What you need in a Realtor to be Successful in Self-Storage!!

There are 2 things that you need in your Real Estate Agent. You want your agent to put you at the top of their list of buyers to notify when they come across a self-storage property. You need this because you want to be able look at a property first so you can get your offer in first. Second, you want your agent to be a good negotiator because you are not usually going to be making full price offers. You need someone who can show the seller why your offer is good in spite of the lower price.

When you are talking with your agent about finding properties for you, you want them to know that you are a serious buyer. You want them to know that you are going to be buying a lot of inventory as long as they fit your investment model. Let your agent know exactly what you want. Explain that you are interested in existing self-storage, but you are also interested in conversions and properties with 3-4 acres of land that you might be able to build on. Let them know that you want fixer uppers because they have an upside potential.

Make sure you let your Real Estate Agent know that you are not a typical investor that is going to go in and low ball every property that they bring to you. However, you have an investment model that you follow to make sure that this is a property that works for you. You want properties that need work, and you are going to price them accordingly.

Once you are able to show the agent that you are a serious investor and that you are going to be worth them putting you at the top of their buyers list, then you want to talk to them about price range. Most agents want to know what price range you are comfortable with. If this is true, let them know that you and your investors can go as high as necessary as long as the numbers look good. If you are not in that kind of a situation, then talk with a commercial lender first to determine the price range you can work with.

The commercial world of real estate is very different than the residential one. In residential real estate, you have to be able to afford the property all by yourself. In commercial real estate, the building helps pay for itself. You still have to be able to put money down on the property. This may be anywhere from 10%-35% down depending on the loan and that may limit what you can purchase. Chat with a lender that does SBA loans and tell them what you want to buy and what you want to do with the property so that you can get an idea on a price range and down-payment. All commercial lenders are not created equally. If you can’t find a good one, ask your Real Estate Agent for a referral.

A good agent needs to be a great negotiator. Sellers often think that their property is worth significantly more than it actually is. When this happens, a good Real Estate Agent can step in and explain to them that the property cannot be financed for more than it is actually worth. They are a third party who is not emotionally involved in the offer and so they are able to help the seller understand the market in a way that will often allow them to lower their price.

Start interviewing commercial real estate agents. Find agents that you are comfortable with. Find people that are willing to help you through your first deal or help make your 100th deal possible. As always, happy investing.