Self Storage- Making an offer on land

[Henry Clark]

We operate in a 40 mile radius from our house. Anything is fair game within that driving radius. We have been really hammering one town trying to expand there and looking at all potential properties with a realtor there. There are several properties that either are zoned correctly or would need rezoning, but priced out of our range, so hadn't made any offers yet, there. We really "NEED" to buy in this town, but since we operate in a radius we can offset with other market areas. Then this offer in a different town came up.

New listing $1,400,000 for 5 acres.  Middle of city, shovel ready with electric/water/sewer/roads/entrances, etc.  Very little competition within 3 mile radius.  Very little land available for proper zoning or pricing.

Realtor/Owner of property offered to us at $900,000.  His partner is in financial duress.  We have bought through this realtor before.

I selected a Buyers broker to represent me, versus working with the Owner/Realtor to buy his ground.  I will pay a Buyers commission.

Looked at similar pricing with my broker in the area and determined their $900,000 was a fair price, but not a "duress" price.  We weren't really looking in this area, so made "Final Offer" of $800,000 for the property.  

By working within a territory versus a specific town/city, we are able to take ourselves out of "NEEDING" to make a deal.

This in turns allows us to "WALK Away" from an offer, thus we can make a "FINAL OFFER"; knowing the Seller will accept or we are okay walking away.  

This is another reason we like Self Storage.  Whether buying land to develop, buying existing Storage locations, reduce risk of over inventory of storage units in one market, TIME waiting for either land or a location to become available for sale, while we are trying to grow our business.

Start small and MAKE YOUR BIG MISTAKES EARLY. 

Also, be prepared to WALK AWAY from a deal.

[Henry Clark]

@Taylor L.

Don’t know.  Normally we are ready set go.  But this one has roads on two sides with a four lane street road in front.  The front side is better valued with commercial business.  Lot is divided into three lots but can redo to two. 

If we split two acres up front for commercial leaving 3 acres for storage.  3 acres is a little smaller than I would like for this location. Have never done multistory, because I can beat them, but might have to due to the great location in the metro area.   would like to get over 3xx units in this location.  Not sure I can do that on three acres.  Still have to check setbacks. 

On the commercial that’s not my lane.   Probably just hold on to the ground and sell as a shovel ready site. A lot of the bare ground has been getting used for google, Amazon, weekend stay hotels, bass pro, casinos.   Thus as there is less available land the remainder should get more valuable.