Storage Unit Valuation?


#1

I’m looking at a park with over 50 self storage units ($65/mo), that’s currently and always has been full with a waiting list (supposedly). Two questions for those of you who own parks with storage units:

  1. How do you valuate each storage units? What’s the going cap rate for storage units in a metro area (100k+) in the midwest?
  2. Is $65 market, below-above?

Thanks in advance for all you guys-gals who always make the time to help out with newbies like me… :slight_smile:

Mike


#2

Its very similar to MHPs, Different classes A, B, C.
Something small like this would probably be a 10 cap. Expenses run around 35-40%

rents depend on size, do you know what they are?


#3

Storage units are 12’ x 26’, there are 50 full units at $65/mo.

Thanks so much for your input Bryan…


#4

depends on location and competition, but that seems low rent. which is also why its at 100% occupancy with a list.


#5

I would suggest survey some of the stand alone self storage properties. Most storage I’ve seen in a park are slightly below those not in a park (security concerns). Depending on the market the cap rate may be at or below that of the MHP. If it’s a metro a 10 cap is too high.


#6

Thanks Bryan and Erik, appreciate both of your input! :slight_smile: