Tag Archives: #InPursuitOfHigherYield

Closely-Guarded Secrets To Becoming Carefree Investor

Issue 89 – Why Those Who Discovered The Secret Are So Happy

Introduction...The meeting was held at ElFenix in Dallas, Texas on March 15, 2016. This was spring break week and attendance was unusually low.  However, the meeting was quite lively and those in attendance were very engaged and excited to be there.  The meeting had a warmth and supportive atmosphere not common to many business luncheons.  Many of those in attendance were owners & investors of this asset class.

I have never been around a group of owners & investors who were so:

  1. Carefree
  2. Stress free
  3. Disconnected from current market conditions concerns
  4. Happy
  5. Joyful
  6. Supportive of one another

Why have you not heard of this before?  Several reasons:

  • Generally, this is not an asset class promoted by Wall Street
  • Insurance salesman do not sell this product
  • This is not a product promoted by most brokers – in fact, very few understand this class
  • Few people even notice this product type when they drive by it or ask if they should have this their portfolio

Here is a true story.  I contacted a broker with a major brokerage firm that I’ve done business with previously.  He said, “Bill, we just don’t sell that product here.”  Later, I discovered that his company had a national group active in this area and one of the top Texas brokers was in his office right under his nose.

So, it is apparent that this is a closely-guarded secret.  In fact, in the state of Texas, there are only a handful of brokers who sell it.

One of these brokers told me, “Bill, I discovered this asset class 17 years ago.  Once I understood it, this is all I wanted to sell.”  I heard those words by several people, “once I discovered this asset class this is all I want to invest in or purchase.”

There are many reasons these owners & investors mentioned above are so carefree.  One reason is that it does well in both good times and bad economic times.  Also, the loan default rate is low single digits.

Click Here to watch the above video The Closely-Guarded Secret To Becoming A Care Free Investor.

Conclusion…You owe to yourself to find out what these happy, carefree owners & investors have discovered.  To discover what they know and “Get Little Known Secrets For Steady Income” FREE go to billmoist.com

Investors…Consider The Uncomplicated Self-Storage

 Issue 85 – Uncomplicated Self-Storage

Introduction...The uncomplicated world of self-storage recently became the most desirable way to invest in commercial real estate.

Two examples...

  1. One Fort Worth owner had is property 95% leased when a buyer came along and asked if he’d sell.  The owner estimated his property value to be $4,000,000.  When the offer arrived at $5,500,000 the owner said, “SOLD!”
  2. Another owner had accumulated 20 smaller properties in Texas and New Mexico. He was very happy with the management and the cash flow.  Until a California investor wanted to jump into the market and offered $25,000,000.  Again, this owner “SOLD!”

Why so much interest in self-storage…In the past apartments were considered the most desired way to invest in real estate.  However, there are many good reasons to branch out.

Self-storage has proven to be recession proof.  During boom times we buy more stuff to store.  During contraction when we are downsizing, we tend to store our extra stuff rather than sell it.

In a recent issue of the Self-Storage Insider, we reported…The Commercial Mortgage Backed Securities (CMBS) self-storage loans funded over the past 10 years have the lowest default rate of all property types at less than 1 percent.

In conclusion…Do you have self-storage in your portfolio?  If not, let us give you more insider information by contacting us at bill@billmoist.net.

Why We Love Self-Storage More Then McDonald’s

 Issue 79 – Storage is better than Big-Macs

Introduction…Turns out the only thing Americans may love more than Big Macs is hoarding.

There are more self-storage facilities in America than there are McDonald’s restaurants, according to a recent report from the commercial real estate publication REJournals. The U.S. has more than 4 times the number of self-storage facilities than McDonald’s. There are 58,000 self-storage facilities in America compared to only 14,146 McDonald’s restaurants at the end of 2016.

Finding a place for extra scrapbooks, holiday decorations, office records, boats and RVs isn’t exactly cheap either. The average American household is using about 18 square feet of storage at an average rental rate of $1.42 per square foot per month.

The industry makes more than $24 billion in revenue annually. Plus, state and property taxes get to scoop up about $3.25 billion.

Here are 4 reasons Why We Love Self-Storage More Than McDonald’s:

  1. We are a hyper-consumer nation consuming more than $14 billion in goods and services, much of which ends up in storage

  2. The psychology of self-storage is we have month to month leases with no end date so the renter thinks he will move out next month that never comes

  3. We are a nation on the move with 12% of the population moving each year

  4. When the economy is improving, we buy more stuff – when the economy is downsizing we store more stuff

Conclusion: So why are we building more storage facilities?  The population and the economy are growing.  But, more importantly, the trade area for storage is only 3-mile circle.  Take 18 square foot per household in an area and you can see the demand is great and growing.  And we have more room to grow as only 10% of the American households have discovered the joy of self-storage.

For more self-storage investor news, subscribe above.

Shipping Container Self-Storage

 Issue 71 – Shippping Container New Self-Storage

IntductionYou have probably heard that sea going shipping containers are being used to build houses.  And now apartments.  And now self-storage.

Beautiful shipping containers…The above architects’ rendering is to be a new 1,017 unit CubeSmart Self-Storage in Pearland, Texas.  The property will be 95,565 rental square feet on three stories.  It will also included 24-hour surveillance, electronic access control, climate control, and as customer service office.

Why shipping containers?…One estimate says the U.S. has over 30 million unused shipping containers sitting on the ground waiting for a second life.

The compelling benefits to the developer and owner are:

  • Construction costs reduced by up to 50%
  • Construction time reduced by six months
  • Occupancy to positive cash flow reduced by 45%
  • Sea going shipping containers are almost indestructible
  • You don’t have to worry about hail damage in Texas

From the investor/owner’s point of view…we get positive cash flow faster at a 50% reduced cost.  ROI can be greatly enhanced.

What you can do to participate in this better building model

If you own or have access to a tract of land that generally meets the following criteria, let’s talk now:

  1. 5,000 cars per day passing site
  2. $50,000 median household income
  3. Rental rates in the area around $1 psf
  4. Suitable zoning
  5. Viability from road or highway

In summary…Let’s build some highly profitable and beautiful container self-storage properties.  Send your inquiry to bill@billmoist.net.

Announcing Increased Cash Flow For Storage Investors

 Issue 67 – Increased Storage Cash Flow

Introduction…This is an exciting time to be a self-storage owner or investor.  We have multiple ways to decreasing operating costs and increasing positive user experience.

Here are current items that improve cash flow for owners or investors:

  • Online payment processing
  • Online unit availability and lease execution
  • Smartphone online leasing
  • Gate access with smartphone
  • Unmanned properties with Advanced Kiosk
  • Enhanced data track-ability and analytics
  • Paperless operations reduce management expenses and provide improved search ability
  • Improved customer experience by providing information access as they want it with websites, software, gate access, payment processing, and facility marketing.

In summary…Much of the above technology improvements to customer experience are so affordable.  The labor saving and speed to lease or collect payments greatly exceeds its cost.  This is an exciting time to be owners and investors in self storage properties.  To request more information, email bill@billmoist.net

Where Can You Store Your Boat & RV?

Issue 64 – Boat & RV Storage..Where?

Introduction…In the United States 11,870,000 recreational boating vessels need storage.  Add to that number 8.900,000 recreation vehicles need storage. That totals 20,770,000 recreational items that need to be stored for the off-season.

RV And Boat Sales Growing Self-Storage Demand…RV The research, conducted by Dr. Richard Curtin, RV industry analyst and director of consumer surveys at the University of Michigan, reveals the number of RV-owning households has grown to a new peak of 8.9 million households, up from 7.9 million in 2005. According to the report, 8.5% of U.S. households now own RVs, up from 8.0% in 2005.  Annual U.S. recreational boat sales have averaged 550,000 per year since 1990.

So, where do the 20,770,000  households store their recreational vehicles and boats?  Most of the larger motorhomes, larger travel trailers, and boats can’t be stored in city residential areas.

The self-storage industry has recognized and met this demand.  Many properties have built larger storage units to accommodate the largest motor-coach.

What’s next..Currently, we are finalizing the purchase of a 60,000 square foot boat storage facility.  It seems adding recreational vehicles storage to our partners’ portfolios would be a logical path to take.

Free Stuff Makes Self-Storage More Profitable

Self-Storage Insider Issue No. 63

Introduction…Who doesn’t love free resources that will make your self-storage operation purr like a kitten and kick out gobs of cash? —that is, a no-brainer!

Here is a list of free marketing resources of which self-storage can take advantage:

  • Free Facebook marketing posting company advertisement to groups where people may need storage.  Examples include… Garage sales listings, antique sales listing, flea market listings, and dealers of household items
  • Email marketing to current and prospective tenants with Mail Chimp which is free
  • Ask for referrals from existing customer…one property had a drawing each month with a prize for those who made referrals
  • Sponsor a charity event one property held garage sales with those who participating making a charitable donation and promoted through local chamber of commerce and actually picked up additional tenants
  • Optimize website for local search improvement with long-tail keywords
  • insert promotions in monthly billing statements at little cost
  • Monthly print newsletter this one is not free, but can worth the investment
  • Add phone number and website on property sign or side of building

In conclusion...The best marketing strategy uses multiple strategies.  My experience after reviewing dozens of self-storage properties is most use one maybe two marketing approaches. One large property that had 500 vacancies was using only one strategy.  I love my competition.  It is soon easy to out produce them.

 

 

Record Breaking Self-Storage Sale…In Menomonee & Waukesha???

Introduction…Unless you are from the upper Midwest you’ve probably never heard of Menomonee (pop. 35,974) or Waukesha (pop. 71,489.)

Click here to watch the video “Record Breaking Sale…”

But, some well-funded self-storage buyer did.  He paid $17,100,000 for The Vault of Menomonee Falls and The Vault of Waukesha.  This is the highest amount ever paid for a self-storage portfolio in the Greater Milwaukee area as announced by Marcus & Millichap.

This sale…This sale works out to be gigantic $16,553 per unit or $164 per square foot for the existing rentable space. The Menomonee property has another 317 units to be completed in mid-2018 which was factored in the purchase price and is yet to be leased.

In contrast, DFW has a population of 7,300,000 and is expected to add another 125,000 people in the next year.

So, DFW’s one year population growth is expected to exceed the total population of Menomonee and Waukesha.

The high price to purchase existing self-storage properties in Menomonee and Waukesha gives contrast to what we’ve been able to secure in the DFW area.  We’re buying 98% leased self-storage in Dallas for $36 per square foot.

Conclusion…Does our property seem like a bargain purchase to you?

 

How A Dull & Boring Segment May Be The Best Way To Invest In Real Estate

Introduction…As commercial property go, self-storage has none of the sex appeal of a gleaming office building or a ritzy shopping mall. There are more than 50,000 self-storage facilities in the U.S. — nondescript warehouses filled with cubicles where Americans keep the belongings that don’t fit into their homes.

But even though self-storage is about as unassuming an industry as you can get, it turns out to be a pretty solid investment — often better than other kinds of real estate.

Why is self-storage so popular with investors?

  • Recession-resistant
  • Lowest default rate among commercial real estate
  • Low operating expenses
  • Easy tenant lock-out for non-payment
  • Make ready is a broom
  • Trade area is 3 miles so easy to analyze and monitor
  • My favorite – no toilets

Self-storage properties can be bought in all sizes and prices.

On the low end,  it is a classic mom-and-pop operation, owing to the low level of upkeep and capital spending required.

On the high end, one 724 unit, 70,000 square foot class A self-storage property recently sold for and estimated $18 million.

A local investor could find a smaller property to purchase, invest in a larger private offering, or even a Real Estate Investment Trust (REIT) if one likes public offerings.

Click here to watch “How A Dull & Boring Segment May Be The Best Way to Invest in Real Estate.”

In summary…Very successful investors have watched Forbes 400, B. Wayne Hughes, build his $2.4 billion fortune on self-storage.  Mr. Hughes founded Public Storage in 1972 which is now the largest self-storage REIT with 2,200 locations in U.S. and Europe, totaling 142 million square feet of rentable space.

Why Baby Boomers Love Self-Storage…Revisited

 Boomers Driving Self-Storage Demand

Introduction…One major force driving the demand for more self-storage are the boomers.  The boomers are those born between 1946 and 1964 whose age range between 51 and 69 in 2015.  Almost nine months after World War II ended, the cry of the baby was heard across the land.  More babies were born in 1946 than ever before in the U.S.: 3.4 million.  This was the beginning of the baby boom.

There were 76.4 million “baby boomers” in the United States and they made up 40% pf the nations population.

As the boomers grew older, every segment of the economy was impacted from the selling of baby products, building schools, building automobiles and houses.

Bulidng Self-Storage for Boomers…Now we are building self-storage because the boomers were the most prosperous generation we had ever seen  and represent $2 trillion in spending power.  Is it any wonder they have more stuff than any previous generation.

Now that they are getting to the age where they are beginning to start downsizing, they still have more stuff to store.  So, rather than getting rid of those things they worked to obtain, many are choosing to store it.

In Summary...Nearly 1 in 10 American household uses one of the 50, 000 self-storage facilities.  And now the boomers are increasing demand for self-storage like we’ve never seen before.  Is it any wonder that experts predict it will be 2022 before the industry meets the demand for self-storage?

Click here to “Get 9 Little Known Secrets For Steady Real Estate Income.”