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Updated almost 3 years ago,
Package of 3 Self Storage Facilities
Investment Info:
Other buy & hold investment.
Purchase price: $2,100,000
Cash invested: $350,000
We were super excited to find an opportunity to add more self storage to our portfolio. This opportunity was a gentleman looking to retire and sell off his self storage facilities as a package deal. Two of the properties were located in Northern MN and one in Northern WI. With them being spread out from each other, all of the offers he was getting were just for an individual location.
What made you interested in investing in this type of deal?
We wanted to continue growing our self storage portfolio.
How did you find this deal and how did you negotiate it?
Through agent relationship
How did you finance this deal?
Since we were willing to purchase as a package we were able to get him to come down in price (original list price was $2,250,000), give us seller financing for the whole deal, and put less than 25% down!
What was the outcome?
The seller owned the properties since 2016 and never did any rent increases on existing customers and his market rates were below market. We've already begun to raise rents and plan to refinance and pull our down payment out of the deal within 2 years.
Lessons learned? Challenges?
It was a win win for both because the seller wanted to reduce his tax liability and sell all three locations together and we wanted specific terms with the seller financing. When we initially put our offer in with the seller financing option he rejected the offer. After working with the seller's agent and going over the benefits of seller financing, he was able to work with the seller to come to an agreement with us.