Self Storage- Deal 2

[Henry Clark]

Start Small and make your big mistakes Early.

Deal breakers- market, finance, zoning, footings, road type, water/sewer availability, Storm sewers, Storm retention ponds. Everything else you can mess up and not get to hammered.

Some of these stories will be ambiguous because they are still "live" items. I am intentionally not telling you all of the details and am obfuscating some of the detail, just telling you the Deal story.

Well this one was me. So I will tell the situation.

Setup:

Found a great location.  8 acres.  4 is usable, the rest is up a 60 degree hill.  About 4,000 vehicle per day traffic count.  Right near the higher income population.  Anchors on both sides (College, Humane society and a shopping outlet) to draw traffic.  Apartment complex and timber on the back side.  Land had been for sale for about 15 years (sucker??).  Price was cut in half, 6 months ago.  I made even a lower offer than list, subject to zoning "use" approval in Planned zoning.  Accepted.  City planning came back and said it was approved subject to me putting in a Water line.  Need for Fire hydrant and a required bathroom.

Right there along the side walk is a fire hydrant.  Why are they saying I need a water line?

The Fire Hydrant is the "Private" hydrant for the apartment above me.  Coming "down" from the apartment. The same owner used to own both properties.  Also the city requires a full water line along the whole road front when you develop.  And you have to own it.

Back to the offer.  Realtor and owner, you didn't know about this?  I really, really, like this land and location.   Re-opened the negotiation (phone call).  I had already offered below list price.  If I backed out the $130,000 extra the city said I would pay for the water line extension, the price would be getting close to zero.  Chalked it up to the cost of learning, and took an extra $20,000 off the price.

Cost of land plus the extra, I was still happy with the cost.  Just a little mentally drained by the thought of, hey there's water right there.

Deal Breakers- make sure your Water/Sewer needs are accounted for.