Pulling the Trigger on Self Storage Development

[Michael Derespinis]

Greetings Self-Storage Enthusiasts,

So I've been silently stalking BP for self-storage guidance for a few months and it's time to break the silence. I'm most assuredly a "newbie"; new to self-storage, new to commercial real estate and new to construction. I started aggressively researching self-storage investments after reading about the investment potential and growth of the industry - seems like a GREAT investment if done RIGHT. I stumbled across a parcel of land that seemed to have potential, and I performed the requisite preliminary market demand and economic feasibility analysis. Preliminary analysis was positive so I actually pulled the trigger to lock up the land. It was tremendously difficult to break the "analysis paralysis" and hope I have the will to see this through. I signed the purchase contract and the 90-day due diligence countdown has started. I will get the professional feasibility analysis started immediately followed up by the civil engineering work. I'm interviewing construction managers and potential lenders. There's not much the lenders can do based on my preliminary estimated numbers so until I have the formal pro-forma data from the feasibility analysis, that will have to go on the back burner. At this point, I'm not even sure what size facility to build. My demand analysis showed there was plenty of demand so I believe the size of the facility will be dependent on how much capital I can raise. I don't want to bring on investors but if the formal feasibility analysis shows I should build a 50,000+ SF facility, then I will need to solicit investors. Anyway, I will have lots of questions later to run by the experience here on BP but for now, I was wondering if anyone can briefly explain how a typical investor relationship would be structured (how do I entice an investor & what do I offer) and what trait do I need to consult to capture that structure; attorney, accountant, etc.?

I'm definitely pushing my own comfort level with this venture. I own a few beachfront vacation rental condos but an investment of this nature is way out of my wheelhouse. I'm totally reliant on the expertise available on the internet; Scott Meyers, Mark Helm, SSA, ISS, etc. Of course I'll need to build a top-notch team. If anyone else has been down this road (newbie venturing into a self-storage development project), I'd welcome any insight or recommendations!!!

Thanks,

Mike D