All Forum Posts by: Henry Clark

What town or state are you wanting to focus on?

Ok. We need info to help out.  

Give us info. 

@Mark Wille

Thanks for the vote of confidence on my other post.

Loopnet Commercial Sacramento.

Address 7210 Greenhaven drive, $350k, office/live in, 4 offices.  Do a Hack.

Forget whether this fits your bill or not.  Approach it with a thought to buy.  Go through the process.  Basically sharpen your pencil and your skill sets, for the deal you finally go through with.

Don't know how you plan to finance coming from $20k.  This has an existing revenue stream. Also you have BP group to pose the thought to.

Good luck.

On these long projects, every once in a while you want to stop and think why you are doing them.  Pay for your house or Son's college.  A bigger "Number". Pure joy.

Or knowing we got our 10,000 Teak trees planted down in Belize, and life is good.  Can't wait to go down around Covid, and walk through the Teak plantation and seeing the trees growing.

Been doing paperwork to finalize the subdividing of the 8 acres:

1.  City Economic development review- completed

2.  County GIS review- finalize Thursday.

3.  County Assessor signoff.

4.  County recorders office- copy of plat, certified resolution, then record the subdivision.

Although this property is in the City, for whatever reason, need both City and County review/approval.

At this point the local Banker will work with the SBA, to get them to release the front 4 acres so I can do the Contractor buildings.  Again, SBA won't loan on properties where someone else is running a business, which this will be 100% contractor rentals.  Should not be an issue as noted in the post above.  SBA portion of Self Storage, has roughly $400k value extra per appraisal than the 10% $160k equity required for the loan.  But we will see, government and bank project.  

Forgot pictures on last post.

Check the following:

a.  See if the utilities are directly in front of your property.  Water, Sewer, electric.  I paid $130,000 for water because the fire hydrant I saw was a private hydrant  and I couldn't use.  Had to run water a quarter mile away.

b.  Look around the area and see if new locations are putting in Storm ponds.  Took 1/3 acre out.

c.  Look and see if they have storm drains  $110,000 for mine on 4 acres.

d.  We are doing a 4 acre contractor building site.  Electric rough estimate is $300,000 to get to panels.  And then wire.  This does not include the hookup cost at the front of the property, just the buildings.

e.  Insulation.  $???,???  Spray foam, roof, side walls, etc.

f.  Just the driveway for our Self Storage, 7 inch concrete, 25 foot wide by 1700 ft, $450,000.  Use this and convert to a sq ft cost for your estimates.

g.  Slab will be about the same.  A lot more for frost free footings and rebar.

h.  Just plumbing for bathrooms and walling off will be $10,000 minimum per unit.

i.  Security fence?  Would be $40,000 with roll gate, if automated.

j.  Exterior lighting?

k.  Gutters?

l.  Landscaping- see what the development group will require and what you will want, even if engineering fabric with rocks on top. $15,000

m.  Engineering costs.  Either you will buy a pre-engineered building and still need the site engineered for permitting; or you will pay for both building and site engineering.  $50,000

n.  Floor drains; no, middle, front outside.

o.  Go halfsies on HVAC, they leave if they move out.

 p.  Same on office space, as O above. 

Keep going with your project, but make a spreadsheet and lay out each of these items.  Make sure you get hard numbers for the big numbers and softer numbers for the small ones.  Key thing is chop this project up and really nail down the big dollars.

If first time out, you might pay an extra 10% for a General contractor.

 Start small and Make Your Big Mistakes Early.

Putting myself back in your shoes and lifestyle at 19.

a.  How is your housing costs?  Try an RV court.  Look for an RV to purchase and also check with the owners for Rent free, if you assist on a year round basis, that fits your schedule.  Sweat equity.

b.  If its close and the parking is big enough.  Sell your car and drive the RV to work or get a motorcycle.  Austin is a lot drier and better weather than up north.

c.  When your ready, sell the RV and then move up to house hacking.  Unless you already have enough for the downpayment for a house.

d. Before your do any of the above, call my brother, he's in LaVernia.  Your in Texas, the greatest place for Sheriff sales, and off list property sales.  Take advantage of this opportunity.  Buy a house for $10,000 taxes owed, straight up, no waiting, no lien exposure and fix it up.  Sale and move to the next tax sale house.  If it is land and no house, buy an RV, clean the property up and/or subdivide and sale.

Most importantly go swimming at Barton Springs or Hippy Hollow and enjoy being there.  Drive down to Port Aransas for Spring break and enjoy yourself.  Sleep on the beach.  Go flounder gigging at night.  Get someone to teach you how to do beer butt chicken barbecue.  Go on your life time search for the greatest tamale.  It has to have lard and not vegetable oil. Drive out into the countryside and stop at a large rancher's house.  Offer to come out and help on some weekends, so you can hunt deer and hogs on his property.  Most importantly take time in the spring to enjoy the bluebonnets along the highway.

You mentioned transitioning. I would look in Oregon, near you. If you have plenty of equity built up and are wanting to transition, I would do a 1031 exchange out of SFR into Storage. Otherwise your only leveraging the bank collateral % of the value, say 70% versus 100%. Pick your worst SFR or the one you don't expect to appreciate further and do 1031.

Look on Loopnet self storage as an example.  There are 3 storage locations for sale, they are all priced high, but hey you negotiate.  Personally I would look at the Vale Oregon location and vet it.  a.  Extra land, b.  Largest and 99% occupied, then you control rent rates in town., c.  Buy the other locations out., d.  Increase rent rates

Don't talk with SBA.  You will go through a bank that handles SBA loans.  Pick a bank that is mid size.  You would like your loan officer to grow with your business.  If you pick a large National bank, that person will be gone in 2 years.

Good luck.