Self Storage Business Opportunities

[eytonxav]

Just beginning to explore the self storage facility business (eg Shurgard) with a few other partners. Do any of you real estate magnates have any experience in this area, ROI/ income potential, and general guidance on start-up? We all have worked for large corporations in the past and do not have any experience in putting together a small business, but nevertheless the desire is there.

Thx,

Doug

 

[Marshac]

ROI/ income potential

Cash Cow. That's what I have heard.

 

[vic]

I am a partner is several storage businesses. I don't actively participitate in anything although I did do a competitive market analysis for the area before and some legal work. Excellent ROI. I believe it is built at less than $25/sqft and sqft rent is close to residential rates. After the site is fully built out, it is sold after a few years for a fat gain, resulting in capital gains only. These are big sites with on-site managers who live there. The market is very saturated though so you must know where to build and get the land cheap. I see a lot of small operators opening up a couple of units with a phone number on it - that does not work.

Vicky

 

[eytonxav]

Thanks for the info Vicky, and Marshac, I really like your cash cow. Seems that being first to market in this business is a must. Vicky do you have any suggestions/best practices in terms of doing market assessment (eg any demographic tools available to help, metrics for # units/city population, etc) or setting up a business like this from legal perspective? Also, wondering about financing this type of business; is it typically done in a highly leveraged manner or based on big cash infusion from partners?

Thx,

Doug

 

[Martha]

I would look at using an LCC or an S corporation to own the entity.

I know someone who has built two of these kinds of units in a fairly rural area to get the cabin crowd. He had so many inquiries about storing boats and cars that the second unit is one huge open building to store cars, rvs and boats in the winter. He already owned the land so he didn't have to finance anything except the construction cost of the buildings. That cost was pretty low.

I find the whole ministorage thing interesting. People have so much stuff that they have to rent a place to put more stuff.

 

[EricMD]

I am a partner is several storage businesses. I don't actively participitate in anything although I did do a competitive market analysis for the area before and some legal work. Excellent ROI. I believe it is built at less than $25/sqft and sqft rent is close to residential rates. After the site is fully built out, it is sold after a few years for a fat gain, resulting in capital gains only. These are big sites with on-site managers who live there. The market is very saturated though so you must know where to build and get the land cheap. I see a lot of small operators opening up a couple of units with a phone number on it - that does not work.

Vicky

vic, sounds like u got good experience with this business. would u know how about to go find lead or partnership or shares... that i can tried to venture in. thanks for the info

ericmd
compaccess1@yahoo.com