Need help financing addition to our self storage facility

[Bill Pederson]

Greetings,

1.5 years ago I was able to purchase 2.5 acres of land free and clear by taking a mortgage out on my home. I built a 254 unit state of art self storage facility which we are at 90% full. My average expenses now that we are stabilized are $72,000 per year and my gross rents are $270,000 which give me a NOI of $198,000. Using a cap rate of 8% I would get a value of $2,475,000 which I owe $1,747,000. Using these numbers I should have $728,000 in total equity to use for the expansion across the street from our first phase. On our non climate controlled units we are full and have been full for 6 months. I have a small window of time to acquire land across the street for a good price to add an additional 24,000 sq. ft. of storage. I did talk with my bank and because I took an SBA loan out on our first project I can't refinance my current loan in order to use the equity to start phase 2. My dilemma is that I have sunk every cent that I have into the first phase and do not have cash to buy the land across the street to start building and the seller is not going to wait very much longer before he sells to someone else. I really don't want to bring on a partner being that it would be in competition with our current facility.

My question is does anyone have advice on how I could get financing to set up phase 2. I was thinking of a hard money lender but not sure who to contact. I live in Sioux Falls South Dakota and I am not sure we have hard money lenders in our state.

thanks so much for your time,

Bill Pederson