All Forum Posts by: Kris Bennett

@Dmitriy Fomichenko thanks!

Investment Info:

Other commercial investment investment in Gastonia.

Purchase price: $1,875,000
Cash invested: $400,000

94 existing units, 50+ parking spaces for boats and RVs. We're building an additional 22,000 sf., bi-level building which will add 150+ units to the facility.

What made you interested in investing in this type of deal?

The location around new homes, few competitors, high rents, and high occupancy.

How did you find this deal and how did you negotiate it?

A referral from a friend on LinkedIn! We had 60 days for DD and 2 extensions that we ended up using to finalize the financing.

How did you finance this deal?

Bank financing.

How did you add value to the deal?

We're increasing rents, implementing tenant insurance, and building an additional 150+ units.

What was the outcome?

Closed the deal and working on the development now through 2021.

Lessons learned? Challenges?

Make sure your lender is communicating with you regularly. Our lender went radio silent for 2-3 weeks prior to closing! Not good.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

No, I'm a licensed agent so we didn't need one. Our team did a great job getting this closed.

Thanks. I called the owner directly 2 years ago and met with him. At the time he wasn’t ready to sell, just considering his options, so I stayed in touch. This year he decided it’s time to sell, so I made and offer and he accepted.

Hey Kishore, sorry about your job situation. Job loss can be hard to overcome. Great job putting yourself out there to see what doors open up. We don't have any openings at this time, but you never know what happens down the road. Keep it up! 

Awesome! @Zach Quick is the man! 
@Zach Quick

We're under contract right now with a mom-and-pop owner. Here are the issues we've had:
- Records kept on paper, not in management software or spreadsheet. This makes it harder to transfer information to proper management software when we get close to closing.
- Owner doesn't do anything by email, only phone, regular mail, or in-person. I have to coordinate meetings to discuss documents, get signatures, etc.
- Owner is near 80 years old which makes explaining simple matters more difficult.
- Owner didn't understand he would have to pay excise tax (transfer tax) on the sale of his property. He wants us to pay for his sales costs. We won't.
- Owner didn't disclose a few matters of title. Wants us to pay to solve his problem. We won't.

On the pro side, the rents are low for the market, there is land to expand, and there is a new 200 home community wrapping up sales about 1.5 miles away. I hope that helps. 

Typcially, self storage property management fees are 5% of effective gross income. If the facility is small, that percentage could be higher, and vice versa. It's all negotiable. Keep in mind, if the facility is large (40,000 sqft. or more), it's common to see a PM fee and payroll expense in the Income Statement. In other words, the owner would pay the PM fee + the payroll for the onsite manager. If the facility is small, the fee and payroll could be combined or negotiated some other way. I hope that helps!

@Chris Stroup I'm in Charlotte, but I've been to Fayetteville many times. Happy to connect on this platform, and I wish you the best! 

@Albertinny Colin I'm working on an owner financed self-storage deal right now. With the covid-19 situation, it's taking a lot longer than I'd like, but it's all good!

Hey Evan, welcome and great job finding that deal in CLT! When the world resumes normal operations, I'd be glad to meet up the next time you're in Charlotte.