Self Storage Facility #2

[Steven May]

Investment Info:

Other buy & hold investment.

Purchase price: $750,000
Cash invested: $63,000

Purchased self storage facility #2. This was the same owner who sold us our first one. 50/50 ownership with a partner. This is down the street from our first one. 99 units on 6 acres with 50,000 sq ft of outdoor RV, trailer, boat, etc parking. This deal also came with 1 acre next door that has a 6,000 sq ft industrial warehouse on it with a NNN lease in place. Purchase at 90% occupancy. We plan to self manage with our ESS software, organize outdoor parking, and increase rents. Expected value after 1 year is $1,300,000

What made you interested in investing in this type of deal?

Great asset class at a great price. Low overhead and economies of scale.

How did you find this deal and how did you negotiate it?

Cold call - same owner as the first one we bought.

How did you finance this deal?

20% down bank loan. 4.1% fixed for 5 years. 25 year amortization.

How did you add value to the deal?

We will be raising rents, organizing outdoor parking, and self managing to decrease expenses by about $30,000/year.

What was the outcome?

Cash cow.

Lessons learned? Challenges?

Always continuing to learn.