All Forum Posts by: Henry Clark

@Christie Duffy

We do self storage.  Our objective is to get units cleaned out, that are being auctioned.  If we make $10, we are happy, even when there is a motorcycle, diamond ring, Drone or whatever in there.  Doing Ebay is not our game.  We want it cleaned so we can "FLIP" it.

If you just want cleaned out, recommend you do the following.  Contact your local Self Storage locations.  Tell them your situation, and ask for their top Auction people.  

a.  Get some orange or lime green masking tape and put it on everything you want left.  Take photos.  If you don't want something broke, protect it.

b.  If your in a hurry, contact 3 or 4 of the Auction people and assign them different rooms with different access doors. Back door, garage door, front door that is closest to their rooms.  

c.  Place some dumpsters in place.

d.  Tell them everything has to come out of their rooms, good and bad at the same time.  Bad goes in the dumpster.  If they start to cherry pick, kick them out.  They can only access the building from xx am to xx pm.

e.  Don't sell to them.  Give it free.  Reduce your exposure.

f.  Give them two days to remove everything.

Over the last two weeks I was asked what is a good customer in terms of length of stay. My response was all customers are good, because most of them don't know how long they will stay. Even when they tell me they only need a unit for one month, I will rent to them. Even if it is the last unit we have available.

Our oldest location was flooded about 2 years ago and we lost all of those tenants, so their dates are not reflected. The below data covers only one of our three reporting areas, but are the oldest locations. This also includes about 60 parking rentals. The Terms below represent that period and prior, to the next Term. So 90 days is 90 days or less; down to 60 days. Then it converts to Months.

Always tell people it takes 3 customers to cycle through, to get one "good" customer who will stick. So especially for a New location, want the customers to come and go, till we get customers who stay longer.


Below is a Cacao Pod, from which Chocolate comes from. Until you crack it open, you don't know what's in it. Just like a new customer, until they start renting you don't know how long they will stay. So every customer is a good customer to us.

You eat the white film around the seeds, which is really sweet. Then you can dry the beans, for Chocolate.

@Timothy Roberts

All of your requests/questions are valid, but I recommend you regroup and develop a road map.

Objective- financial freedom, Wife quit her job (Why?), 

Time frame- sounds like soon.

Tools- house hacking (can only do one house at a time, not scalable, although good tactic); looks like your next investment would be SFH?;

Road Map: timeframe, Cashflow/profit per house SFH, collateralization needed, Cash flow needed for financial freedom.

Lay the above out.  Something needs to give (timeframe, objective, collateralization or investment tool).

SBA will always be lower than conventional since it is guaranteed by the government.  I would ask them more specific questions.

If you are able to get 3.25% with a conventional, that is better, since you can use your investment to collateralize future investments.  SBA is restricted to only certain types of investments.  Your local bank is probably on a 20 year amort, but with a 5 year renewal?  3.25% is a great rate for conventional, especially if this is your first Self Storage experience.

Did you look at SBA 504 or 7?  You could do one for both construction and to refinance to better terms.

10% down, 20 year amort, 2.99% interest rate. 

We have both self financed, seller financed, collateralized with prior storage or other assets, SBA, or Conventional 5 year revolving.

Great, you have Sales background.  Lets use those skills.

Target: Baby boomer SFH/MFH investors in Hartford CT, who have a lot of units. "Who don't know they want to sell."

Product:  Just like in Medical sales, you want a High, Medium and low product mix.  Develop that mix.  Don't just say you want to buy their units.  a.  Talk with your Parents, Grandparents and older people, Kids with real old parents.  Ask them what solutions they are looking for or have taken, to handle the older persons home., b.  Develop a offering that an aged investor would want.  Example:  Offer them seller financing, with 5-6% interest.  Come up with about 7 offerings.

Search:  a.  Get 10 addresses of properties of the types, neighborhoods and potential price ranges you would like., b. Google Hartford CT GIS map or Treasurer map.,  c.  Pull up their report.  Our system will list all other PID's under their name., d.  Look for one of the properties where the person has many PID's owned by them.  Check those out, to see if most of them fit your "Buy" metrics., e.  Go offer them your "Product Offering".  Don't try to buy from them.  Offer them Solutions.  Example, I don't know them, but I know they don't like paying Sales commission.  The Buy will come later.

Sales Software:  What type of sales software are you using?  You want to use the same approach you are using for Medical sales on your "Buy" targets.  Birthday card.  Happy New Years letter.  Way to go letters.  Stop by on the porch and have tea times.  Etc.  Get to know them.  Don't do a hard sale.  Play the numbers, someone will sale.  You don't have to buy all of their units at once.

OLD folks:  If the folks are really old or maybe "susceptible", I would recommend asking if it is okay to talk with their kids.  No matter where they live.  Send the Adult kids your brochure with offerings.  The adult kids will do your selling for you.

"NO":  I love a great "NO".  Anyone who gives me a solid "NO", I thank them.  By now you have learned this.  Its a numbers game.  Keep working your Sales database.  Take every learning moment your manager has given you for Medical sales and turn it towards your Real Estate data list.

Seasonal:  Next winter go around after each snow and develop a database of all houses that fit your "buy" parameters,  that haven't cleaned their snow up after 3 days.  Add those to your Sales database.  Understand why, their snow wasn't cleaned up.  That will help you determine which Product offering to sale them on.  Knock on their door and ask if they need help with the snow, if they fit your profile.

Financing:  Get it in order. You have to be able to act fast.

Basically do what you already know how to do, just with a new product.

Step 1:  Write your goal, time frame, risk assessment, funding source and available collateral.  

Step 2:  Develop a road map.  Point A (current) to Point B (goal); timeframe.  Even though you don't know the deals, lay them out with targeted returns.  Be able to visualize it. As you get more experience keep redoing this task, to make it sharper.

Step 3:  "Financially free" and "not have to deploy anymore".  Explain what these two mean to you.  For example, "Financially free" to me, means I have hit my "number" and don't have to work anymore.  That would never happen for me, since other than gambling, I could never achieve it in a two year time frame.  Explain.  "Not have to deploy anymore", if your in the military, you have some great R/E investment potential with your BOA.  If not military, you have great potential doing a House Hack with example a 3 bedroom 3 bath, and you live in the small one, since your gone.

Step 4: Give more detail.  The BP community will give you better options.  Are you living in Utah or NYC?  Single or Married with 5 kids.  Etc.

Thanks, I needed the break from landscaping, work my mind for a while.

@Payman A.

1. Above. 

a.  Inflation/CPI adjustments is easy to maintain, you just raise the prices.  Its that simple., Also buy in a low ratio Storage unit availability to population demand area.;

 b.  Devaluation is part of "a" just raising the prices.  Your looking for a location that is charging below market or has not raised prices in several years and is at least 85% full.;  

c.  Falling demand or population, is only a minor concern.  You can evaluate that at selection time. Should not change during your investment horizon, unless you picked a one trick pony town.  Your greatest change in competition is if someone builds beyond demand or in your area.  Evaluate that in several ways.  A.  Units versus population demand. (If town can take 2,000 units and there are only 1,300.)  , B.  Location of storage units (If most units are on the South side of town and most people are on the North, safe), available zoned ground at reasonable prices and size (2 acres or more), C.  Don't play in the "A" market.  Do C and D in towns less than 30,000 people.

2.  Above.

a.  Call up Sparefoot or Webselfstorage or other software groups.  Ask to discuss their call center programs and reservation taking systems.  I actually don't recommend this, especially for a new investor.  You don't get the first hand pulse of the operation and changes that need to be made.  Once you have learned, then maybe.

b.  See our website youtube on SelfService.

c.  Talk with a local realtor to handle, calls, maintenance resetting units, security, payment management.

3.  Above

a.  Pick some states.  Google Loopnet self storage for sale.  Look at these deals.  Then look for the National brokers who are handling these deals.

b.  Call the national brokers and tell them the type, size, $, location, etc of the property you are looking for.  More importantly tell them you want to do a 1031 and have a timeframe of xx months.

c.  Get your financing lined up.  Out of state will be harder, since you don't have a relationship.  Talk with the brokers above.  Decide what type of 1031 you want to do.  Decide which of the following you have the most control over.  Buying a For Sale storage location.  Selling your properties.  Use this to determine which type of 1031 you want to do.  Ask the 1031 executor you plan to use for their advice.  

Crash course on Self Storage:

a.  Reach out to the folks on this forum and google for training camps for Self storage.

b.  Go visit a location near you and discuss with them.

c.  Go analyze a location for sale near you.

d.  Read my post on: Self storage- checklist 101; Self storage- will they come or market analysis.

e.  Binge read all of my posts starting with "Self Storage".

You will get information overload doing all 5 of the above.  But as you do them, you will start to absorb more of the info.  Recommend you do B thru E first, then go to A, camp.  You will be at a higher level of learning then, and absorb more.

NOT ME.  I would reach out to some of the Training courses and ask if they provide consulting services.  Even at $10,000 or $20,000 you will be both at ease more and make better buying decisions.  This does not give you a pass on doing A thru E above.

You should be owning a self storage location in the next 45 days.  Good luck and hope you get the results you want.

I can give you a crash course in SS.  But there are three questions:

1.  What is the "right SS option"?

2.  Why are you selling the one asset class for another?

3.  Other than avoiding taxes with the 1031.  What are your objectives both financial and otherwise?  More passive, move out of California, diversify geographically more, etc.

Another option. Lower purchase price.  Offer them a 5 year management fee for $xx,xxx per month guaranteed.  See if there is any tax advantage to them. 

If this is a commercial versus mfh then break out parking, landscaping, hvac, etc for early writeoff.