Want to invest in Self-Storage but nothing is available in your area?

Because self-storage is so desirable, as discussed in a recent blog, many sellers are not willing to part with their facilities. However, this does not mean that you cannot get into self-storage. There are plenty of properties that are sitting vacant that have the potential of being turned into a self-storage facility. There are plenty of properties that you may not have considered for example, that old bowling alley or that empty ice skating rink. How about that big box retail store that has been empty for the past few years? You might even want to get creative, there are old industrial buildings that can be changed into storage. I like to find out the history of these “Junkers” as I like to call them. You are looking for a big building that can hold a lot of self-storage units.

You do not need a ton of parking, find out what the minimum parking your city will allow you to have. You know that you are never going to have all your tenants there at the same time, but the city may still require a lot of parking. If they require a lot of parking stalls, then get creative on where you place your parking stalls. Depending on the type of building you are converting will depend on where you are placing your parking. Remember that you can put entrances on all sides of the building so you can put parking everywhere if you need to, to be compliant with city ordinances.

If you have a lot of parking left over, this tends to be true when you are dealing with big box stores, find out if you can convert that into storage for RV Parking or Boat parking. You may want to rent out U-hauls as part of your business model, this extra space allows you a place to put those vehicles. You can cross utilize every inch of the space that you purchase.

Start by checking with planning and zoning to make sure that the current zoning will allow you to convert the property into self-storage. Usually the zoning is already zoned so that you can, you just want to cross your T’s and dot your I’s. If it is not zoned for self-storage, find out if you can get a variance from the city that will allow you to turn the building into self-storage.

One of the great things about conversions is how quickly you can get them up and running. When you start with new construction, you have months of working with the city putting together plans, getting approvals for new construction, etc. When you start with a building that is already built, the process is much faster. This allows you to get from the planning stage to the opening stage in a shorter window of time.

Another aspect of conversions is that you can change the class of an existing storage unit. For example, if you change out the lighting, the security, and the doors, you may be able to convert a facility from a Class C property to a Class B property.

So how do you find a new property to convert? Simply do an internet search for properties that have a low cost per square foot. You know what ugly buildings look like. The next step is to determine, is this property something that would work as a conversion? Our series of blog posts will take you from finding that cheap real estate to knowing if you can convert it into a Self-Storage Facility.

The next thing that you want to look at when you are considering a conversion is location! Location, Location, Location is still true in the self-storage world. If you are looking at a building that has 3-4 properties between you and the majority of the residential population, you are out located. You need to be in an area that is easy for people to see on their regular commute and that is not very far from where the residential population is. For more on how to determine if your location is good, check out our next blog on conversions. As always, Happy Investing.