How to value a new self-storage facility

[Vlad Kolbas]

Looking for some direction in how to value a brand new 120 unit  self-storage facility that is currently 30% occupied (over last 5 months). Feasibility study has been done and there is need for more storage in the area.

Are there any general guidelines when establishing a value in this scenario?

We own three other facilities that have been very successful but they were almost 100% occupied when we bought them so it was easy for us to put value on them.

Any help is appreciated!

[Hai Loc]

Almost no way the asking price will be based on NOI as it is 30% occupied. It will definitely based on current replacement cost and a few other factors. No real concrete answer but one suggestion would be like this. You need to compare a similar “new” built facility in the general area. This may be difficult to find in immediate area but you can go a little further out as long as it’s in the state. Figure out price per sqft. Once that is establish you need to figure out the difference of land value. Just need to compare as much apples to apples and make adjustments with everything else.
This is the best you can do without having to hire an appraiser. You won’t get exact figures but a ballpark at least.

Good luck