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:
- How do you valuate each storage units? What’s the going cap rate for storage units in a metro area (100k+) in the midwest?
- 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…
Mike
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?
Storage units are 12’ x 26’, there are 50 full units at $65/mo.
Thanks so much for your input Bryan…
depends on location and competition, but that seems low rent. which is also why its at 100% occupancy with a list.
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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.
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Thanks Bryan and Erik, appreciate both of your input!