Self-storage managing from afar!

[Dawn Young]

Hi! While looking for investments, we have found a small mini-storage (self-storage) facility for sale, but it is over 2 hours away. It is not large, and there is no fence.

I hear a lot of talk about managing from a distance, and just having minimal "boots on the ground".  But how exactly does this work? 

Online contracts? 

How do you hire someone far away?  How much are they typically paid?  I'd rather not run a payroll! Can they be paid in a way to avoid that, like maybe commision? (I've owned a business for years, but don't have employees, so this is new to me.) 

 We are close enough, we can go down there if we need to, but definately don't want to drive there for each new renter/vacancy!  

Also, would love any info about your experiences with SBA loans, (I've discussed them with the loan officer, but not known anyone that has gotten one.)

Thanks a million, guys and gals!

[Michael Wagner]

I own 3 facilities on opposite ends of the country and use a 3 pronged remote management structure that seems to work really well.  The three components are an online portal that customers can use to rent, pay for storage etc., a industry specific cal center and "boots on the ground" (an individual who is local to the property who can perform the needed onsite tasks). You can avoid payroll by ensuring your structure your agreement with them such that they are a 1099 sub contractor NOT an employee (bes ure to get smart and play by all the rules!).  Your really only looking at a couple hours per week.  $15-20 per hour is standard which might be a bit high given the ease of the tasks but you need to take into account the fact that they are driving out and disrupting their life for what is often a 10=30 min task. With this strategy, I spend about 5-10 hours per week "managing" this portfolio and it handily pays our families bills. 

I've also used SBA 7A loans on multiple occasions. They, like any product, have pros and cons. Cons are high LTV (if that;s your aim) and relatively good terms. Upfront costs are a bit expensive but many can be rolled into loan). They do come with a pre-payment penalty. Also can be a bureaucratic mess to get approval but this can be mitigated by working with a bank who is VERY experienced in doing these loans. You DO NOT want to be the person who the bank uses to "learn" how to do an SBA.

Feel free to message me if you have other questions.