Self Storage Biz?

Recently have been given an opportunity to acquire an old family owned piece of property extremely cheap, it is on a busy stretch of road, I am looking for types of passive income to get into and self storage units have been on my mind the last 4 or 5 years, there are several locally owned units scattered around my town of about 10,000 people im trying to figure out how I learn if there is a demand for more units the average monthly rent is around $25-35 depending on size, I estimate that I could build a 40 unit structure for about $30k counting some light dozer work and concrete flooring and charge a minimum of $25 per unit per month or I could start smaller and build a 20 unit space at half the price half the income, what are your thoughts, also none of the bug name chain storage have a site within 100 miles of here

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Find a way to improve upon the competition, such as adding security cameras, giving out free high quality locks, or giving out a free monthly blowjob (good upsale opportunity).

(Glory hole in unit #3 self storage facility, LLC) kind of a working company name

I gurantee youd outsale the competition

Call and ask each existing storage company in town how many units they have free. You may need to pretend to be a business looking to store stuff to get them to tell you how many are open.

insurance is something you should factor in as well, you could be storing millions of dollars worth of things So dont go cheap on the building.


i would look into coin laundry if youre planning on building. acquire mainly big machines (30lbs+) for comforters and blankets. even in a small town the return can be pretty good and its low maintenance.

literally heard it was an amazing business, from a dude in a rich neighborhood who flew off in a helicopter. invest. 100%. don't look back.

>town of about 10,000 people
This sounds kinda small to me. Is there much demand for storage? Most small towns have cheap land, and so people don't have much need for a lot of extra storage.

On the other hand, are the competition all really small-scale? Maybe there's potential to blow them all out of the water with a larger operation and a heavy marketing campaign.

What would your debt situation look like if you didn't get enough customers to hit black for several months to a year?

And finally, there really isn't much that's truly passive income. There'll always be work to do, even if you get a manager in to run the joint. Be prepared to put in the hard yards to get it running at least.
>at least.

my town of 21k has at least 6 or 7 self storage places, not including the outdoor only camper and boat storage.

BEfore you do this. Read annual reports from self storage REITs (Public Storage, CubeSmart for example) to see what kind of shit they have to deal with, what the rent per square foot is, maintence cost etc.

Let's assume this:
$25 x 40u = $1000/month (assuming permanent 100% capacity always and no defaulters)
It would gross $12k a year BEFORE taxes, expenses, your massive stapler budget, etc etc.

Bump up the price or you won't make any money for years upon years.

I have never heard of anyone who uses these things. If it's an actually busy stretch of road, why not put some kind of rest stop there, or housing, or something?

I know people who use the RV ones to park their camper 40-50 weeks a year because they don't have room on their own property.

RVs seem like shitty purchases if you don't have the driveway for it, IMO.

Seems like a niche market compared to, say, operating a trailer park or campground.

I know, but every storage company in town that has the room for RV lot space are fucking packed with them.

I really don't get it.

Well I really have no idea what I'm talking about, but a town of 10k with "several" places sounded like a lot. I think the key thing is to do the proper research before jumping in.

> posting on Veeky Forums is not proper research
> but we can suggest some of the right questions to ask.

>starting a business
>passive income

When will this fucking meme die?

OP here my tag may be different now but maybe not

I like the ideal of coin op Laundromat, there are 2 in my town one is pretty dilapidated the other is decent but older equipment I don't see many customers at either these days though, plus It would cost so much more to build I don't know about it right now
demand is cause mostly by locals being so poor and drug abuse and shit, they get evicted and don't have anywhere to move their shit to right away and they end up sleeping on someone's couch for 2 years while trying to their life back on track, also divorcées would be prospective customers ect ect

Competition im going to guesstimate that the 4 bigger storage sites have 80 units or less on them, and a couple smaller ones have maybe 40 each so about 400-500 units total

debt situation im thinking the loan payment would be somewhere around $250-300 per month for this venture

when I say passive income what I truly mean is, something that's going to make me money when im older with relatively little effort im 31 now and fully expect to work at anything I delve into right now just trying to plan for my golden years
if im not competitive on the price than ill be sitting empty 25 is for smaller units anyway id say mine would be $35

Also just throwing out there that the property is only going to cost me about 6k its about 3.5-4 acres im thinking

Bump?

This...It'd take forever to make youroney back and when you do it's hardly shit.

But my reasoning is that lets say $30 X 40 units is $1200 per month, and it cost $35,000 to get going i could repay that after insurance and taxes in 3.5 years at full capacity and 4.5-5 years at 75% capacity, and im only 31 years old and not intending to use this as sole source of income just as a partial retirement income, also i live in a area where the average household income is around $18,000 so id be ok with the profits from this once it was rolling... or am i completely wrong here, if so what's the best thing to do with the property to make it work for me because im defiantly going to buy it

>also none of the bug name chain storage have a site within 100 miles of here

go see what the nearest one charges for the same size space and up it by 50-100%

why the fuck are you trying to do people favors with near-free storage?

My company rents a couple units. We have them filled with boxes of paperwork. We have to maintain records for a certain number of years depending on the type of document.

But anyway, when I've seen other units open, most appear to be rented by locals that live in the nearby trailer park and have their units filled to the roof with all sorts of junk and furniture. Just like you'd see on Storage Wars. And a couple homeless people rent units too.

How is it zoned? What's going to happen to property taxes after you build?

What about if it isn't fully rented? What about the procedure for evictions? Generally you can't just throw their shit out (depends on the locality).

I would have to similar pricing of the local competition of not I would be empty
it isn't zoned and has had commercial business on it before and around it, the other companies here double lock in the case of non payment and then after notification to the tenant the sell the shit inside to recoup lost rent sometimes one locker could fetch a couple hundred dollars sometimes you may have to give someone the shit just to get it hauled away, property taxes im not sure... they will increase no doubt but not sure by how much

>why the fuck are you trying to do people favors with near-free storage?
Because if he can put the competition out of business quickly enough then he wins and can set his own prices.

>Sort of. If he raises prices too high, people will get back into business or others will see an opportunity to.

>And a couple homeless people rent units too
To live in?

/frugal/

>Those are a really good investment but I would expand further in real estate.

How do you or anyone else recommend I move forward in real estate, the plan was to purchase this property for $6k which I already have hen in turn use the property as collateral to acquire the funds necessary to build the units on, use income from the units to repay the loan.... I suppose I could still use the property as collateral to acquire financing for some other type of viable venture BUT WHAT?

> im trying to figure out how I learn if there is a demand

Easy. Call some storage places and ask how many units they have empty. If they're filling up, the area needs more.

>a minimum of $25 per unit per month

Too cheap. I've never seen a unit go for less than $35. Most are $40-60, and garages large enough to park a car can go for $200-300.

Be sure to check the prices in your area. Undercutting an existing market by more than a few dollars is stupid, because you don't need to.

Start a trailer park.

Nice idea user

Costs for Single Story Self Storage Construction typically ranges between $25-$40 per square foot – not including land or site improvement costs.

Car wash could be a good alternative. Just a cheap cinderblock shell with simple plumbing. Bonus points for metal money that you can bury in the back yard without the IRS knowing.

$25-$25 is the average price of units locally if I tried to charge anything above that I would just have a big empty building

we are flushed with car washes 4 within a town that's city limits are only about 6 miles long

Storage areas are usually buikt in places where people think the real estate will be worth more in the future- they are set up to break even or lose a little in the thought the location will be worth more later.

T. Guy who worked for an investor group

Interesting but in this rural poor town everyone knows things aren't going to get better soon and are building the units simply to rent to people wanting to store some shit

>mostly by locals being so poor and drug abuse and shit, they get evicted and don't have anywhere to move their shit to right away

huh

so how about self storage with plumbing, (a shitter and a sink)

sell 40 sqft "microstudios" for 75-150 bucks/month to vagrants

add some community showers for flavour.

with an on-site laundromat, and a space you lease to vending machine companies and burrito vans, you can gauge your customers even more.

make it a multi tiered establishment (depending on the clientele) surrounded by fences, each being identical, only differing in price. the highest priced area should always have empty lots, and you adjust the prices for the lower ones so they are always filled.

the selling point for the more expensive units will be a higher class of neighbor and showermate.

+ free wifi, and prepaid electricity.

This would never be approved by zoning boards, local government. Great idea but not possible in the US.

Closet equalivant would be a mobile home/ RV park. People can and do live indefinitely in them. RV parks are better because of the client el are usually retirees and not poor people.

You could do both. Self-storage and RV park and stick it out in the countryside and open a little convenience store to sell groceries and beer to the tenants.

You'd be like a petty medieval lord with a whole village of peasants to extract wealth from.

what if you call it a "toilet rental"

you just rent out wheelchair accessible private toilets. what people do with or in them ain't your business. ("some people just need to shit in peace™")

to keep the cover in tact maybe adding a small RV area might not be such a bad idea. also covers the showers and the rest.

I think it can be done with the right phrasing in most places. you just need a master artisan lawyer.

but yeah, adding some RV space

>you just need a master artisan lawyer.

or some leverage with the mayor.

Buy it and rent it to a commercial business or franchise like McDonald's or petco

poor area nothing is coming here we don't even have a wal-mart, and if someone wanted to build they could buy property fairly reasonable

It's difficult to advertise something that must be described by some kind of legal fiction. Even if the local board could be convinced to pretend the legal fiction, law enforcement and other types would not.

Anyways, my personal opinion is that I would'nt want to rent to the types that would be interested in leasing 'microstudios' in a rural area near a economically dying town. Because meth. It would work pretty well in some hipster shithole like Seattle or California, you'd just have drop-out trust fund kids and shit, but again, local zoning and municipality boards would be even more keen on cock-blocking you.

It's possible though, for sure. I'm not sure I would want to be the slum lord of a shanty town made up of storage units with plumbing. It might be uninsurable and your liability risk would be high. Again, this is a great idea, but I'm pessimistic on if it would be possible or profitable in the long run.

I'm a real estate investor.

Self storage units are a bad idea, lots of low revenue tenants mean lots of work, hassle and little profit,

>I estimate that I could build a 40 unit structure for about $30k counting some light dozer work and concrete flooring

Lol no.

Yeah also some real estate experience here.

I'd guess a quality 40 unit structure would be $100k to $200k. And that's not including getting the land ready with grading, sewer, etc..

Forgetting what you have to pay for an engineer to design your building and an engineer to do a soil investigation

Do you know how much a single fully loaded truck of concrete costs?

Like $8000

I'd only build in a place that looks like it has future potential-I install fire sprinklers and the first couple I worked at got totally demolished in the last 2 years and became Chipotles and strip malls.

That was my estimate as well. Typical Storage units are about 10 x 15 ft, plus deadspace 40 units would mean a total of 7,000 sqft.

For commercial buildings I usually calculate with at least $100 per sqft but let's be very generous and assume $30 for a simple concrete shed, that's already $210,000 and you haven't even factored in paving and road access.


Simplest demonstration of this is garage doors, with installation they cost about $1,000 and you'll need 40 of those.

Thanks for contributing but you must live in an area where building materials are much more expensive, keep in mind that all the interior lumber would be non pressure treated saw mill lumber,

Other than labour, construction costs are pretty much the same everywhere, thing is you cannot base your estimate just on the raw materials.

The garage doors are a good example. Maybe on whole sale you can bring the price down to $700 per unit but that's still almost the entire budget you gave.

>keep in mind that all the interior lumber would be non pressure treated saw mill lumber

Untreated lumber is a bad idea, shit will rot in no time. If you want to be cheap at least do a metal sheet construction on a concrete frame like pic related.

Here's some more info for you:

>Having a contractor build a standard garage typically runs about $35-$45 a square foot. A small, single-car garage is about 240 square feet, or $8,400-$10,800; for a two-car structure it's around 380 square feet, or $13,300-$17,100.

Source: home.costhelper.com/build-garage.html

Sure building continuous units will be a bit cheaper but that does kinda confirm my generous estimate of $30 per square foot. And that still doesn't contain paving, road access or drainage.

It's going to be inside not exposed to the elements how could it rot?

If this was a proper house, sure, but you're trying to build a super cheap storage unit. You provide practically no insulation against humidity and temperature.

Steel struts and sheet metal are cheap as well and much more reliable.

ok...I have a barn on my property that is made from rough saw mill lumber it's been there since 1931....still standing strong it has no insulation no protection against humidity and temperature, but I will make a note of what you said about steel construction and defiantly check into that as well

Yeah it used to be more common but it's totally a thing. I think it's only not more common because these places tend to be very out of the way, which makes them prohibitively far away from the work you'd need to rent your little unit.

>I have a barn on my property that is made from rough saw mill lumber
I can guarantee you that it's sealed and treated ten times over with oils and varnishes and paints.

...ok

>passive income
For real, the abandonment and credit control issues alone would keep you busy enough.

Not to mention shit like keeping security up to snuff from break-ins, the list goes on.

See if there is a way u can get down payment. Run newsoaoer add for a no money down sign up fee for wtf ever sixmze u running. Go to bank with businsess plan. Say u can build it fast and u can. And these peoole wont leave u alone. There is a need. Get loan, call builder, start taking money day 1 of completion.

Its been around for thousands of years. Hopefully never.

Multiple use for that size of land. Storage sheds. Offer camper lot with hookups and storage shed special with lot rent. Places for non lived in campers. Pit a cuckshed our 2 near the hookups for camoers to rent out, have a little shack on site with coin op laundry and vending machines. Etc. If u keeo if leveraged and borrow against it every 6 months or 1 year to improve it you will make more money. Sadly property tax goes up but shouldnt be bad. Good luck in your endevors user. Post up here if you break ground. I love shit like this.

In my research businesses like this are a large part of the rentals. Bonus, as a resl estate endevore it is about as cheao as it gets to get started. Also competition can be feirce. Always tell everyone in town it doesnt even oay for itself some months even if you are fucking full

Larger lock and a note if 30 days late. Have 30 days to oay or they forfiet they shit and still owe rent. They cut the lock it is b&e because they voided contract. So its not their locker. Your shit. My facility u just broke in. Abide by laws to publicly auction the unit and re rent. Far as i know you cant legally keeo any stuff.

U want good lighting. And probably a good fence and gate and micro office building. Cameras. Etc. Loans generaly need 20% down for real estate but it can vary.

Maybe throw a modular home on it? Block foundation and have a nice rental?

Bonus points for duplexes?

Holy fuck really? Damn thats high...

Guess my cuckshed is going on railroad ties.


Fuck

Theres some guys in town that just threw up a 3 stall unit. Surely they are not making much buy if u arent in a rush and can stay full you can always expand a few at a time. Just a few foot soace and build another until they aren't full. Then start looking at wtf else u can or shoukd do?

Depending on climate un climate controled structures draw moisture. The concrete sweats. Etc. Always treated. Always.

Insurance be cheaper. Fire dont melt galvanized beams. Much...