Hello BP! My very first post here!
I am an investor, realtor, and property manager for SFH for years, but I've never tapped into the commercial world. I've been looking to buy a small self-storage facility, but there are some myths I've encountered that I just don't know if they are true or false.
1. DON'T FIND A BUYER AGENT
Someone who used to be a CBRE agent and now owns a team doing large-scale commercial investments told me to never find a buyer agent, because the seller agent would not want to entertain your offer. Without a buyer agent, the seller agent gets to be dual and doubles the commission. But as a first-time buyer, there are so many things in the process I am just not familiar with, including how to structure the offer, being able to view listings on Costar, doing due diligence, etc. So is it true that even for beginners, you don't need an agent?
2. UNDER $1M IS TOO SMALL
I talked to a few commercial brokers, and I am under the impression that it's very hard to find anything valuable in self-storage for under $1 million. As I am planning to get an SBA loan, I assume the down payment would mostly need to be somewhere between 15-25%. My comfortable price range would be between $500k-$1M.
I know that under $1M, you probably won't find something new, climate-controlled, or in great condition, but is it true that there's almost nothing worth looking at in this $500k-$1M range?
3. NO GREAT DEAL ONLINE
I keep hearing that "only off-market deals are great deals." I understand why this is the case and truly respect those who spend the time and effort into calling, contacting, and convincing owners or already have strong broker relationships. But as someone trying to get their first deal, I am not hoping to get a great deal but just an okay deal, which means a cap rate around 6-7% with at least neutral cash flow to start off. Is it possible to find something like that online (Costar, Crexi, broker websites, etc.)?
4. LARGE BANK IS BETTER FOR SBA
From what I understand, SBA loans are tight with the actual property. So you can't just get a pre-approval for all properties like in residential real estate, but a pre-approval for the exact property you are going to make an offer on (Is that correct)? And I heard smaller bank usually has more issues in the underwriting process, is that true too?
