All Forum Posts by: Neil Henderson

This is the monthly commercial real estate investing meet-up for the Wilmington North Carolina area. No speakers, no pitching, just lots of sharing of lessons learned, community, meeting fellow commercial real estate investors, and perhaps some good beer.

Hi Jordan,

We meet on the first Thursday of every month. The next one is next week on August 4th. I look forward to seeing you there.

Neil

This is the monthly commercial real estate investing meet-up for the Wilmington North Carolina area. No speakers, no pitching, just lots of sharing of lessons learned, community, meeting fellow commercial real estate investors, and perhaps some good beer.

This is the monthly commercial real estate investing meet-up for the Wilmington North Carolina area. No speakers, no pitching, just lots of sharing of lessons learned, community, meeting fellow commercial real estate investors, and perhaps some good beer.

I'll echo a lot of what @Brad Hayden is saying:

1. Can you zone it for storage? Is it already zoned for storage? A lot of municipalities have put moratoriums on new storage. Talk to the local zoning board and ask them what their plan for storage is. 

2. Is there a demand for storage in that area? Do your own desktop feasibility study. If you don't know how, you probably should go learn how before going any further. Pay for a 3rd party feasibility study from someone like Bob Copper or Katherine D'Agostino. 

3. Impossible to tell you an ROI but most people I know are looking to double the value of an existing small facility in 12-24 months. Or if they're a bigger operator, they'll be looking to double their investor's money in 5 years or less, which works out to about a 20% annualized return.

4. Often, in regards to ROI, the question should be "What ROI are you looking for?" Now, find out what it would take to generate that ROI and go find a facility or plot of land that would generate that ROI. Work backwards from there.

Hi Eric, I highly doubt a fund is what you want. Most people who transition from the single-asset syndication model to a fund model have been doing them for a while and have a track record. Talk a securities attorney,  we have used Gene Trowbridge and I have also spoken to Dugan Kelly. I can provide their contact information if you are interested.

Love this update @Kurt Granroth thanks for doing it. 

I also love your original plan and that's along the lines of what I'm doing for my LP investments. If I can get an annual cash flow of 6-8% on the deals in which I'm a Limited Partner, that's a pretty great passive return for my living expenses, plus the returns from dispositions or refinance allows it to grow each cycle. 

Please keep us posted about your future deal performances.

 Not to sound like a broken record but "it depends".

I've talked to a LOT of experienced investors who are investing now in multifamily, self-storage, or NNN properties and a lot of them say you don't need to start in single-family rentals. I don't know if I agree with that. I think many of them forget how scary it was to start and underestimate what a heavy lift a commercial property is for an inexperienced investor.

Risk is a muscle just like your quads and biceps. If you walk into a gym tomorrow after not being much of a gym rat and try to bench press twice your body weight right out of the gate, you're probably going to get a face full of barbell and a broken nose. 

For the average real estate investor, I believe the same concept applies. 

The chances you are going successfully go from never investing in an investment property to buying a large commercial deal are not great. Have investors done it? Absolutely! But what were their other resources? Time? Money? Comparable experience? Experienced partners?

If you are lacking in time and experience, you owe it to yourself to find someone with time and experience, and/or get some kind of experience, either through education or partnering. 

Anyone who knows me knows how much I love self-storage. I tried for a LONG time to jump straight from dabbling into real estate investing to buying a storage facility. It wasn't until I exercised my risk muscle by buying a few single-family rentals, and then educated myself on self-storage enough to be of value to an experienced storage partner. 

I'll be there!

So, this is more about one of our passive investors in one of our self-storage syndications who wants to invest with us using a SD-IRA. They had some sticker shock around the fees that other SD-IRA custodians charge and reached out to their primary investment fund managers, Fidelity. Fidelity said "Yeah, we can do a self-directed IRA and the fees are zero!" When I spoke to Fidelity's Alternative Investment back office, they said they could do it, if we submit to annual third party audits. We are fine doing that, but so far, I've not found a single syndication sponsor or syndication attorney who has seen anyone take SD-IRA funds from Fidelity.