FAQ

FAQ

This is arguably one of the most important parts of a deal; making sure that the market can support the facility that you are building. This is not to be taken lightly!  This is difficult, time-consuming, and tedious work. However, in the tedium lies the secrets of the industry! There are many books and podcasts that will tell you that ‘eight square-foot per capita is the “saturation” for demand’.  This means that in an area of 1000 people in a 1- square mile area, if there is any more than 8000 ft.² of rentable storage space, there is no longer any more room for an additional facility or development. we do NOT believe this to be an accurate benchmark.  It might be a useful starting point, but please do not take this to be a rule.  One needs to take into account what demand is in the general area, what the population is doing, what the overall trends are, and what the percentage of renters versus homeowners, presence of any colleges, universities, nursing homes, and also the average gross household income for the area. After looking at the 1 mile demand,We extrapolate this in a 3 mile radius, 5 mile radius, and 10 mile radius. 
 
There are a number of “quick and dirty tools” to quickly gauge this, we believe that the best is radius plus, radius plus does require a subscription and tokens. However, it automatically calculates how much square-foot per capita is already present and list new facilities that have applied for permits or in develop, this data is all publicly available. You can always do this demand yourself, you would have to manually look at the area and do searches on Google, yellow pages (yes it still exists! there are many many facilities that arent on google maps!), and check county and public records for development.
 
We also recommend getting a formal demand study, the Copper group is a very popular company that provides different levels of demand studies, we recommend the mid tier package, but we always take this with a grain of salt, and we have found in practice that he often overestimates the rental rates that you will be able to charge in an area, we believe they are too aggressive, and will make a pro forma look overly optimistic.  Additionally, we believe that he often gives many sites a B+ rating and does include a disclaimer that he only gives 30% of plant developments this rating, but in our experience, we’ve never seen anything besides B+. Of course, you need to do your own research and look into this yourself, we do see the copper studies as a very valuable tool, but like anything, you need to cross reference all of this with your own careful due diligence

There are quite a few web platforms that include your website and the backend business software that allows you to rent people units, take payments, issue, late fees, keep customer information, etc. We have the best experience with easy storage solutions, we have no commercial relationship with them to advertise, but in practice, their back and functionality is extremely well developed and us they do not have the best customer service. However, with a little bit of time and patience we have found that you can get what you need. The cost is also reasonable. This is not to say we have used every single platform. There are at least 25 different platforms out there or more but Easy storage solutions is one of the most tried and true software platforms, and it is our recommendation.

This is can be a daunting, complex topic to understand. The amount of text required to explain all of it would be many many pages, so Jordan has taken the time to read multiple textbooks, learn all of it to a comprehensive level and create a series of videos to help the average person just like us.  This is learning a brand new skill of detailed financial Analysis and underwriting. You will find that this is usually at a college bachelors degree level of detail and complexity, nothing more.  Once you learn a core amount of basic mathematical concepts and vocabulary words, this isn’t as complex as you might think. Please this with a grain of salt, Jordan has spent over a decade in college and medical school learning new concepts and vocabulary words as a profession.  This can be easy for some and difficult for others.  Ben is also a physician and it took Ben 3 times longer to learn!   these topics ‘make sense’ to some people, but not to others.  its all doable! The videos are very easy to watch but you might need to watch them a few times so it makes sense. You really won’t gain a comprehensive understanding of deal structure until you actually do it, play around with numbers and learn Microsoft Excel in detail. We promise that this is understandable by everybody, if you can read this paragraph, and it makes sense you can definitely learn how commercial Self Storage syndications are done! Happy hunting!

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