Self Storage Secrets! Dave Lindahl Teaches Investing in Self Storage
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I've got three objectives, and the first objective is to introduce you to profitable self-storage investing. It's a niche market. It's one of the commercial disciplines of real estate investing, and this is kind of the sleeper of all the disciplines, in the sense that it's the less management attentive. It's the easiest to run. And you're going to hear me say "set it and forget it" a lot tonight, because that's basically what you do with storage. You set it – you get it set up, and you can pretty much forget it with the right management in place. So I'm going to introduce you to all those different concepts and what makes a good self-storage investment good. Number two, I want to show you how you can increase your income and decrease your workload. A lot of us are out there buying multi-family properties. A lot of us are buying single-family properties. A lot of us are buying other commercial type of properties. And I'm actually going to show you how you can keep doing what you're doing, what your major discipline is, and increase your income by buying storage, and by doing that, you're actually going to decrease your workload at the same time. And number three, I'm going to show you how you can start creating an autopilot self-storage business.
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Self Storage Secrets! Dave Lindahl Teaches Investing in Self Storage
- 1. Creating Wealth Through CashCreating Wealth Through Cash You’re About To Discover… with Jeffrey A. Lindahl “How Investing In Self Storage Will Pay YOU $10,500 Per Month” Self Storage SECRETS Self Storage SECRETS
- 2. Creating Wealth Through CashCreating Wealth Through Cash Congratulations for Taking Action Today I commend you for taking time out of you busy schedule to be here. I’ll make this worth your while
- 3. Creating Wealth Through CashCreating Wealth Through Cash Let’s Get Started
- 4. Creating Wealth Through CashCreating Wealth Through Cash 4 Steel, Concrete,& Cash Flow
- 5. Creating Wealth Through CashCreating Wealth Through Cash 5
- 6. Creating Wealth Through CashCreating Wealth Through Cash
- 7. Creating Wealth Through CashCreating Wealth Through Cash 7
- 8. Creating Wealth Through CashCreating Wealth Through Cash Doing It In Today’s Market!!! 7,322 Units!!7,322 Units!! Still Works The SameStill Works The Same SystemSystem The Attitude….The Attitude…. Best Selling AuthorBest Selling Author
- 9. Creating Wealth Through CashCreating Wealth Through Cash My First Storage Units
- 10. Creating Wealth Through CashCreating Wealth Through Cash How I stumble upon the Hidden Cash Flow 3 Family Apt Rental plus the 3 Garage Bays rental Sold this property after a 2 year appreciation run Did a 1031 exchange Into a 205 unit complex in an Emerging market During site visit discovered the Secret 60 Self Storage units were also on the site
- 11. Creating Wealth Through CashCreating Wealth Through Cash The Secret is Revealed
- 12. Creating Wealth Through CashCreating Wealth Through Cash Self Storage Investing 60 Self Storage units added on an used irregular shaped- Produced HUGE Cash Flow Very little involvement of the Property Manager-Hardly any additional maintenance involved & Next to none utility costs I needed to add Self Storage Investing to my business model and YOU should too !
- 13. Creating Wealth Through CashCreating Wealth Through Cash More Secrets/ Reasons For Self Storage Investing You can buy self storage facilities in your local market and in emerging markets The Low Operating Costs Insurance Property Taxes Utilities Manage from home or via an internet line 88% of the owners are “Mom and Pop”
- 14. Creating Wealth Through CashCreating Wealth Through Cash Reasons For Self Storage Investing • It’s Very Profitable Niche Market • The Sleeper of Commercial RE Disciplines • Less Management Intensive
- 15. Creating Wealth Through CashCreating Wealth Through Cash Reasons For Self Storage Investing • Increase Your Income and Delegate the Work Load • New Investors Get Started in RE Investing • Seasoned Investors add Self Storage to Your Current Portfolio
- 16. Creating Wealth Through CashCreating Wealth Through Cash Reasons For Self Storage Investing • NOW IS THE TIME to Create a Self Storage Autopilot Business
- 17. Creating Wealth Through CashCreating Wealth Through Cash 17
- 18. Creating Wealth Through CashCreating Wealth Through Cash Self Storage For Sale. Clean 58 Unit Mini Storage Facility. Extra Land for Expansion & Development. Modern Buildings. Fenced & Gated... $249,000 6,900 SF Bldg 9.40% Cap Rate Self-Storage Facility
- 19. Creating Wealth Through CashCreating Wealth Through Cash Any Value Plays ? Future Expansion Bill Boards, Cell Tower, RV and Boat Storage 58 units x $65 x 12 months = $45 K, 28 % Expenses & $1455 per month Passive Monthly Income
- 20. Creating Wealth Through CashCreating Wealth Through Cash 30 drive-up self-storage units; 1500 sq ft garage, rented to automotive detailing business; 1100 sq ft house,... •$199,999 30 units •7,040 SF Bldg •10.95% Cap Rate •Self/Mini-Storage Facility
- 21. Creating Wealth Through CashCreating Wealth Through Cash Owner will Carry-back with 10% down at 7.0% thru 2016, amortized 30yrs. Only $29,000 down gets you this Solid 9.0% CAP property. Experienced manager... •$290,000 66 units •16,512 SF Bldg •9.00% Cap Rate •Self Storage Facility
- 22. Creating Wealth Through CashCreating Wealth Through Cash HIGH SEAS MINI STORAGE 8180 HWY 14, Lyle, WA 98635 FOR SALE BY OWNER 35 UNIT SELF STORAGE WITH ROOM TO GROW AND BUILD HOME VIEW OF WATER AND MOUNTIANS. LOTS OF UPGRADES NEW ROLL UP DOORS,FENCE AND GATE, SECURITY CAMERAS, AND LIGHTS. GREAT CONDISHION. LOTS OF BUILDING NEAR BY HOMES AND A GOLF COURES. MANAGER IN PLACE. IT RUNS IT'S SELF, GOOD INCOME. • PROPERTY IS IN MURDOCK BETWEEN LYLE,WA AND THE DALLES,OR ON HWY 14
- 23. Creating Wealth Through CashCreating Wealth Through Cash • Price $229,000 Gross Income $18,689 • Expenses $4,680
- 24. Creating Wealth Through CashCreating Wealth Through Cash A&B Self Storage4428 WILLIAMS VALLEY ROAD, Clayton, WA 99110 Stable facility with a long history of high occupancy levels • Property offers U-Haul along with Car-Port Buildings dealership with provides for market exposure and added income • Marketing Population (3-5 miles) has steadily increased over the previous years due to the Northwest' s movement to the rural areas • VERY MOTIVATED!!! • .
- 25. Creating Wealth Through CashCreating Wealth Through Cash
- 26. Creating Wealth Through CashCreating Wealth Through Cash 26 “Self-storage companies seem to be the ‘Cinderella segment’ of commercial real estate in a faltering economy.” -Warren Buffett
- 27. Creating Wealth Through CashCreating Wealth Through Cash 27 Self Storage is The Fastest Growing Sector in Real Estate! It’s an Inflation and Recession Proof Business Boston Group. Why Self Storage?
- 28. Creating Wealth Through CashCreating Wealth Through Cash 28 One Objective… Hassle Free CASH FLOW $10,500
- 29. Creating Wealth Through CashCreating Wealth Through Cash 6 Steps To Systematic Hassle-FREE Investing Find The Deals Run The Numbers Make Offers Find The Money Ride The Cash Flow Retirement Strategy
- 30. Creating Wealth Through CashCreating Wealth Through Cash 30 Student Partnership Deal - 872 Units in Pasadena, TX - Purchased for $8.0 Million -No Money Out Pocket - 25% Partnership Interest
- 31. Creating Wealth Through CashCreating Wealth Through Cash 31 “ I can’t think of one single long term trend in our country and our economy that doesn’t benefit Self Storage. It’s the perfect storm--a hurricane of Profits. This is the sweetest spot in the whole American economy, a receptacle for an enormous cascade of money”Ben Stein Leading Economist
- 32. Creating Wealth Through CashCreating Wealth Through Cash Times of Transition – Perfect Storm Economy Baby Boomers Echo Boomers Diversified Portfolio
- 33. Creating Wealth Through CashCreating Wealth Through Cash Economy • There are a lot of people getting foreclosed on. Now, that's a time of transition. What's happening to their goods as they're being foreclosed? They need a place to store 'em. So we're seeing storage facilities filling up very quickly, especially in the high foreclosure areas.
- 34. Creating Wealth Through CashCreating Wealth Through Cash Baby Boomers • The Baby Boomers are getting older. • downsizing on their houses, • collected a lot of things over the years, things that they don't want to part with (heirlooms) • So where are they putting these things? • They were the consumer age, and they consumed and consumed and bought
- 35. Creating Wealth Through CashCreating Wealth Through Cash
- 36. Creating Wealth Through CashCreating Wealth Through Cash Echo Boomers • The babies of the Baby Boomers, now College age • Their putting their extra stuff immediately into storage, because that's what they were trained to do. • Over the next eight to ten years, there are 72 million Echo Boomers coming into the marketplace. So it just means that storage is going to continue to rise.
- 37. Creating Wealth Through CashCreating Wealth Through Cash Diversified Portfolio • You really want to be a transaction engineer. • You want to be able to do any deal that crosses your desk. • And with adding storage to your portfolio, you've added a very powerful cash flow engine to what you have right now. • Or if you don't have anything right now, it's a great place to start
- 38. Creating Wealth Through CashCreating Wealth Through Cash Why Self Storage Makes Cents • The NEED FOR COMMERCIAL USE IS GROWING. at-home entrepreneurs and seek alternative storage other than their home or garage. • 1 in 10 Households Need or Use Self Storage • Hospitals, record filing 70 % • Allows you to Start where Your Comfortable • Huge & Growing Demand, driven by life events: downsizing homes, job transfers, divorce. • Huntsville
- 39. Creating Wealth Through CashCreating Wealth Through Cash • IT’S EASILY MANAGED As a low cost investment, self storage can easily be managed by individuals with little or no experience • The initial investment is much smaller and operating expenses are much lower than other types of real estate investments. • The management task, unlike many other businesses, is not labor intensive.
- 40. Creating Wealth Through CashCreating Wealth Through Cash Make Ready Procedure
- 41. Creating Wealth Through CashCreating Wealth Through Cash SELF STORAGE IS A MONEYMAKER WITHOUT THE HEADACHES • Over 40% of commercial customers rent more than two years. • The average customer visits his unit once a month. • Real estate properties must continually maintain grounds, appliances, plumbing, electrical fixtures, etc., which usually require a maintenance staff. • Self-storage operating costs are a fraction of other real estate properties.
- 42. Creating Wealth Through CashCreating Wealth Through Cash BEST OF ALL • No Jerry Springer Tenants • No Toilets • No Trash • NO PAIN !!
- 43. Creating Wealth Through CashCreating Wealth Through Cash Failure Rate Comparison Compared to other real estate investments, self storage has the ability to absorb economic fluctuations, maintaining value during both good and bad economic times. Failure Rate : Office/Retail 60% Self Storage 8%
- 44. Creating Wealth Through CashCreating Wealth Through Cash Operating Cost Comparison Self Storage $2.75-3.25 All Other R/E $3.50-5.00 Reasons for most businesses going broke is the overhead
- 45. Creating Wealth Through CashCreating Wealth Through Cash Break Even Occupancy Comparison Self Storage 60%-72% All other Real Estate 80%-90%
- 46. Creating Wealth Through CashCreating Wealth Through Cash Create as Much Passive Income as You Need • We're going to get paid three different ways. 1. We're going to get paid through cash flow. The cash flow is the money that we get from our property on a regular basis.
- 47. Creating Wealth Through CashCreating Wealth Through Cash 2. We're going to Get Paid through Appreciation • Always be raising the rents by $10 or $20. • It's called a nuisance increase. • not high enough that they're going to go move their stuff into another facility. • $10 x 350 units = $3500/month
- 48. Creating Wealth Through CashCreating Wealth Through Cash 3. My Favorite Way, is Acquisition Fees • How to pool people's money together. • You've taken the time to discover and educate yourself on how to get these storage deals • And how to get the private money for these storage deals • it's customary in our business, that you get an acquisition fee.
- 49. Creating Wealth Through CashCreating Wealth Through Cash Who’s Renting Now!! Foreclosed Home Owners Apartment Owners College Students Divorce Landscapers - Contractors Home Sellers Boomers Downsizing Home Buyers……..
- 50. Creating Wealth Through CashCreating Wealth Through Cash #1 - Find The Deals Sources Brokers Direct Mail Internet Research “Motivated & Flexible Sellers” “Must Sell” “Seller Finance”
- 51. Creating Wealth Through CashCreating Wealth Through Cash Different Ways that you Can Get the Deal • You can get deals from direct mail, sending out letters and post cards to owners of storage facilities. • You can get deals from Real Estate brokers.
- 52. Creating Wealth Through CashCreating Wealth Through Cash Follow Direct Marketing Rules Envelopes-No windows, multi-colored It has to look like friendly mail (invitation) so that they will open it Blue Ink- Return address- Do not use a PO Box on a business company. You can put your name on a PO Box. Stamps-Use all sorts of funky stamps. Do not use metered mail. Letters w/ headlines - the biggest benefit for doing business with us. PS-the 2nd biggest benefit for doing business with us Delegate-the stuffing process to someone else, such as an ad on Craig’s list will get you a big response. Use proven letters Fax back forms.. 1 % Responce Rate
- 53. Creating Wealth Through CashCreating Wealth Through Cash 1% Response Rate • Out of 1,000 letters, we will be getting 10 responses. • Out of these 10 responses we will get 2- 3 serious sellers, and from these we will get 1 good deal to choose on. • If you get those letters out each month you should be getting a deal a month.
- 54. Creating Wealth Through CashCreating Wealth Through Cash Ready to Use Proven Letters to Owners I’m Interested in Buying Your Property! Read On… Dear Property Owner: I’m interested in purchasing your self storage facility. Are you interested in selling? I currently a member of a group of investors who hold a portfolio of properties similar to yours and are looking to add more. I realize that there are a number of reasons why someone may be interested in selling. Everyone has his or her own reason and my question to you is, are you now ready to sell? If so, I am ready to buy. I can close quickly or delay the closing as long as you like. Please contact me at your earliest convenience so that we can discuss the sale of your building. Call me now at 1-800-999-5555. I look forward to hearing from you. Jeff LindahlP.S. To Get The Best Price For Your Property, Call Me Now At 1--800-999-5555.
- 55. Creating Wealth Through CashCreating Wealth Through Cash How to Work Effectively with RE Brokers • Fear –Just call Them-Just use the Script • Build the Relationship • Where are they – Loopnet.com Follow up, Follow up, Follow up, The average deal is made after the fourth follow up, the average investor only follow ups two times
- 56. Creating Wealth Through CashCreating Wealth Through Cash 56 Steve Hall 167 Unit Facility Little Rock, AR $265,000 Price $600,000 Value (Based on Income) Two minute conversation with the Broker (based on our script)
- 57. Creating Wealth Through CashCreating Wealth Through Cash
- 58. Creating Wealth Through CashCreating Wealth Through Cash Steve Hall
- 59. Creating Wealth Through CashCreating Wealth Through Cash “What Others Say...” “I’m Busy” “I Don’t Have The Money” “It Doesn’t Work In My City” “I’m Afraid” “I Don’t Know What To Do” “I Can’t Find A Deal”
- 60. Creating Wealth Through CashCreating Wealth Through Cash 3 Reasons to be in Real Estate 1.Money Today 2.Money Monthly 3.Money Later If anyone tells you different They don’t Understand Real Estate
- 61. Creating Wealth Through CashCreating Wealth Through Cash #2 - Run The Numbers 1- Replacement Cost 2- Sales Comparison Approach 3- Income Approach 85% Occupancy = a stabilized property.
- 62. Creating Wealth Through CashCreating Wealth Through Cash 62 Cap Rates NOI / Sales Price Cap Rates: A’s 7 – 8 B’s 8 – 10 C’s 9 – 12
- 63. Creating Wealth Through CashCreating Wealth Through Cash 63 Cap Rate Example The purchase price is $1,000,000 Total Annual Income = $180,645 Total Annual Expenses = $68,445 Net Operating Income = $112,000 The Cap Rate = 112K/1MM= .112 = 11.2% Cap Rate Acquisition Fee Income!Acquisition Fee Income!
- 64. Creating Wealth Through CashCreating Wealth Through Cash #3 - Ride The Cash Flow Gross Rent Income Late Charges Admin Fees Bounced Check Fees “The Store Within Your Facility” Ancillary Services Make You $10,000+ Ancillary Services Make You $10,000+
- 65. Creating Wealth Through CashCreating Wealth Through Cash 65 Box Business/Supplies
- 66. Creating Wealth Through CashCreating Wealth Through Cash 66 Expenses made Simple 28% of Income… Taxes – Insurance – R and M – Gen Admin – Management – Marketing – Utilities – Contracted Services – Payroll –
- 67. Creating Wealth Through CashCreating Wealth Through Cash
- 68. Creating Wealth Through CashCreating Wealth Through Cash #4 - Make Offers Letter of Intent… Template for you to use… (page 110) Repair allowance to student at closing using this LOI was $200,000 !!!
- 69. Creating Wealth Through CashCreating Wealth Through Cash #5 – Find The Money Hard Money Owner Financing Self Directed IRA Private Money Partnerships There is $$$$$ in this Room
- 70. Creating Wealth Through CashCreating Wealth Through Cash 70 Conventional Local Banks National Lenders Loan Assumption Mortgage Lenders Stabilized Deals…
- 71. Creating Wealth Through CashCreating Wealth Through Cash The More Deals that You Get Into with The Least Amount of Money Down… The Wealthier you will Become! Formula for Repeatable Success
- 72. Creating Wealth Through CashCreating Wealth Through Cash 72 We Typically Give a 8% Return for Private Money You Also Want to Look For Angel Investors 75% of All Private Money Comes From People You Already Know 75% of All Private Money Comes From People You Already Know
- 73. Creating Wealth Through CashCreating Wealth Through Cash Graciella
- 74. Creating Wealth Through CashCreating Wealth Through Cash #6 - Exit Plan Sell Outright Long Term Cash Flow Real Estate investment Trust Use 1031 And Buy Another One
- 75. Creating Wealth Through CashCreating Wealth Through Cash Advantages of Self- Storage Investing Cash Flow = Freedom! Cash Flow = Power & Power = Freedom
- 76. Creating Wealth Through CashCreating Wealth Through Cash What is Financial Freedom To You?
- 77. Creating Wealth Through CashCreating Wealth Through Cash Cash Coming In Month after Month after Month…
- 78. Creating Wealth Through CashCreating Wealth Through Cash
- 79. Creating Wealth Through CashCreating Wealth Through Cash Sunny Days
- 80. Creating Wealth Through CashCreating Wealth Through Cash Steve Martel
- 81. Creating Wealth Through CashCreating Wealth Through Cash Will You Be the Next Success Story?
- 82. Creating Wealth Through CashCreating Wealth Through Cash Self Storage Investing Riches
- 83. Creating Wealth Through CashCreating Wealth Through Cash Benefits Of Self Storage Investing Riches More Time More Money Cashflow Easy To Use Asset Appreciation Recession Proof Financial Freedom
- 84. Creating Wealth Through CashCreating Wealth Through Cash Table of Contents • Chapter 1: How Investing in Self Storage Will Make You Wealthy pg1 • Chapter 2: Self Storage Property Types pg16 • Chapter 3: How to Find Good Deals Using Direct Mail pg 23 • Chapter 4: Secrets to Finding Good Deals pg36
- 85. Creating Wealth Through CashCreating Wealth Through Cash • Chapter 5: How to Work Effectively With Real Estate Brokers pg 40 • Chapter 6: How to Determine the Value pg 48 • Chapter 7: Deal Analysis Income Component pg53 • Chapter 8: Deal Analysis Expense Component pg 59 • Chapter 9: Deal Analysis Underwriting pg 65
- 86. Creating Wealth Through CashCreating Wealth Through Cash Chapter 10: How To Determine Where And When To Buy pg 90 • Chapter 11: Team Building pg 99 • Chapter 12: Creating and Presenting Offers pg 106 • Chapter 13: Due Diligences pg160 • Chapter 14: Planning the Site Visit pg 174 • Chapter 15: Financing pg 189
- 87. Creating Wealth Through CashCreating Wealth Through Cash Chapter 16: Creating a Loan Package and Business Plan pg 205 • Chapter 17: Entity Selection & Structuring pg 219 • Chapter18: Property Managers pg 232 • Chapter 19: Setting Your Business Office pg 239 • Chapter 20: Marketing for Tenants pg 261 • Chapter 21: Powerful Tax Strategies for Real Estate Investors pg 265 • Chapter 22: Exit Strategies, Goals & Time Management 284
- 88. Creating Wealth Through CashCreating Wealth Through Cash Self Storage Investing Training Manual You’ll discover… Storage property Types Finding Great Deals Working with Brokers How to Determine the Value Deal Analysis Income & Expense Determining Where & When To Buy Creating and presenting offers... Real World Value $1495Real World Value $1495
- 89. Creating Wealth Through CashCreating Wealth Through Cash Self Storage Investing Audios You’ll uncover… The Current & Future Demand For Self Storage Secrets To Finding Properties thru Classified Ads “Cruising For BIG Profits” And much, much more… Real World Value $499Real World Value $499
- 90. Creating Wealth Through CashCreating Wealth Through Cash Self Storage Investing DVDs Real World Value $899Real World Value $899 This Video Training will reveal… How To Find Deals And What To Look For How To Find Great Deals Using Proven Marketing Financing Secrets To Get Any Deal Done And more…
- 91. Creating Wealth Through CashCreating Wealth Through Cash Lindahl’s “Deal Or No Deal” Calculator Fast & Easy “Deal Screener” Saves You Time Know “Deal Or No Deal” In Minutes Real World Value $247Real World Value $247
- 92. Creating Wealth Through CashCreating Wealth Through Cash Quick Start Training CD Fast Track Your Way To Success Positions You To Get Your First Deal Done…QUICK Where To Focus First And More… Real World Value $349Real World Value $349
- 93. Creating Wealth Through CashCreating Wealth Through Cash Self Storage Profit Analyzer Know If You Have A Deal How To Make A Good Deal Better Creates Reports For Lenders & Private Investors Real World Value $1195Real World Value $1195
- 94. Creating Wealth Through CashCreating Wealth Through Cash Marketing & Legal Library Including… Jeff’s Proven “Fax Back Form” Campaign Forms, Contracts & All The Paperwork Confidence Scripts Done For You Marketing Letters Real World Value $999Real World Value $999
- 95. Creating Wealth Through CashCreating Wealth Through Cash Self Storage Investing Riches System Self Storage Investing Training Manual Self Storage Investing Audios Self Storage Investing DVDs Lindahl’s “Deal Or No Deal” Calculator Quick Start Training CD Self Storage Profit Analyzer Marketing & Legal Library $1495 $499 $899 $247 $349 $1195 $999 Total Value $5,683 Total Value $5,683
- 96. Creating Wealth Through CashCreating Wealth Through Cash Real World Value $8,486 Your Risk FREE Investment Today $995$995
- 97. Creating Wealth Through CashCreating Wealth Through Cash Self Storage Boot Camp Seattle Bonus (Only Today!) 3 Days of Intensive Training Facility Classification and How to make it Easy Our Millionaire Marketing Plans Case Studies with Real Life Applications High Tech Property Management Systems Lien and Auction Process
- 98. Creating Wealth Through CashCreating Wealth Through Cash Do a Deal in 90 Days Get It FREE !!!
Editor's Notes
- Good evening, everybody. Jeff Lindahl here, and we've got a very exciting webinar to go through. We're going to be talking about self-storage and self-storage secrets, and we're going to talk about how to invest in self-storage. And I want to, number one, congratulate you for being on the call and thank you for being on the call because I know you lead a very busy life, and it can be difficult to continue your education. But money is in education, so I commend you for being on the call, and I'm going to make this call worth your while right up to the very last moment because I got a ton of information to share with you on self-storage. So for this particular call, I've got three objectives, and the first objective is to introduce you to profitable self-storage investing. It's a niche market. It's one of the commercial disciplines of real estate investing, and this is kind of the sleeper of all the disciplines, in the sense that it's the less management attentive. It's the easiest to run. And you're going to hear me say "set it and forget it" a lot tonight, because that's basically what you do with storage. You set it – you get it set up, and you can pretty much forget it with the right management in place. So I'm going to introduce you to all those different concepts and what makes a good self-storage investment good. Number two, I want to show you how you can increase your income and decrease your workload. A lot of us are out there buying multi-family properties. A lot of us are buying single-family properties. A lot of us are buying other commercial type of properties. And I'm actually going to show you how you can keep doing what you're doing, what your major discipline is, and increase your income by buying storage, and by doing that, you're actually going to decrease your workload at the same time. And number three, I'm going to show you how you can start creating an autopilot self-storage business. So with those three objectives in mind, let's get started.
- I am going to show you the opportunities that exist in this business Self storage can meet a variety of investment goals. For me, self storage offers the ability to quickly produce high investment returns, with minimal risk, and allows me to choose my level of involvement. By effectively investing in self storage an investor can:* Produce returns that exceed 20%* Quickly establish cash flow* Significantly increase investment value* Manage investment risk* Control investment involvement
- What are your dreams , is being able to relax on your favorite beach
- So imagine this. You've got steady cash flow coming in through storage facilities. What are you going to do with that cash flow? Where are you going to take your family? What kind of vacations are you going to take them on? What are you going to better provide for them? When are you going to quit your job? That's what the cash flow does for this. Or is it time on the beach, developing the next CEO of your real estate investment company ?
- Dave has put together a great portolfillo But do you know who the man behind there scenes was ?
- objective
- Self storage comes in all shapes and sizes if the #’s work we love them all I will show you how to analyze these. Investors love self storage for many reasons. One of the more important reasons is the reduced management role. Self storage requires less management than residential rentals. All management is required to do is rent units and collect the rent. In the event rent is unpaid simple procedures are followed. Mainly, the unit is overlocked. This blocks access to the renter's property. You do not have to evict a tenant. If the renter fails to pay their rent you simply sell their contents to pay their back rent. An owner may even have an auctioneer handle the sale of storage units contents. Many times the auctioneer will collect much more money from the proceeds of sale than the owner would. Only their stuff resides on the property. Managers do not have to paint, replace carpet, unstop toilets or worry about collecting the rent or having to evict a tenant. No one is on the property at night. You can sleep knowing you will not have to let provide a tenant with a new key or anything else.
- Warren Buffett. Started buying 6-7 yrs ago good enough for him???? In the United States alone there are 59,657 self-storage facilities*, proving storage is here to stay. With a market value of $220 billion, the self storage industry has proven its value as a solid investment opportunity with high financial performance*. Today, over 21,000 self-storage owners* have made a robust living owning and renting self-storage facilities. Whether a newer facility or an older facility from the 1960s, self storage remains a highly competitive industry that continues to grow through the ages. Self Storage is not affected by the national Economy. When the economy starts to go down storage rates tend to rise. When the economy is good storage rates will stay stable or tend to rise. When people are getting foreclosed on they tend to move their stuff into storage as well
- READ SHEET In the United States alone there are 59,657 self-storage facilities*, proving storage is here to stay. It has become a fixture of our commerce, from rural America to booming metropolitan hubs. With a market value of $220 billion, the self storage industry has proven its value as a solid investment opportunity with high financial performance*. Today, over 21,000 self-storage owners* have made a robust living owning and renting self-storage facilities. Whether a newer facility from the third generation or an older facility from the 1960s, self storage remains a highly competitive industry that continues to grow through the ages. Self Storage is not affected by the national Economy. When the economy starts to go down storage rates tend to rise. When the economy is good storage rates will stay stable or tend to rise. When people are getting foreclosed on they tend to move their stuff into storage as well
- My One Objective is to show you the way to HASSLE FREE CASH FLOW Who would be happy adding $10,500 dollars of passive income to Your existing monthly income?
- What I’m about to teach you are 6 steps to add a zero to your check and to learn how to have success in the high end market. How many of you want me to show you these 6 steps? Great – get out a pen and write these down.
- Here is a facility that we purchased. The Sellers needed to sell quickly to close on another property. It was 75 % occupied. At 90% it would be worth 10 Million, which we projected out to take 2 years which made our private investors happy. 2 months ago a Hurricane hit. Luckily no damage to it, unlucky for others. We went to 88 % occupied in one month. Is that sweet? Yeah 2 months ago a Hurricane hit. Luckily no damage to it, unlucky for others. We went to 88 % occupied in one month. Is that sweet? Yeah These were the deals that Dave and were looking to take down. That is why we created the self storage system. I am partnered on this deal and for those of you who are ready to reach the ultimate plateau in investing I have been authorized to give a property package to you. Showing how we structure a deal and all its projections and benefits. Phase 4 purchase 75% occ Hurricane / Us on hill others flooded we are at 88% in 6mths stabilized.
- READ SLIDE ONLY
- Well, in times of transition, it creates a perfect storm. When I mean transition, we're talking about the economy. We're talking about Baby Boomers. And we're talking about Echo Boomers. So look what's happening in the economy right now. There are a lot of people getting foreclosed on. Now, that's a time of transition. What's happening to their goods as they're being foreclosed? They need a place to store 'em. So we're seeing storage facilities filling up very quickly, especially in the high foreclosure areas. One of the best cities right now for storage is Detroit, Michigan, which has the highest foreclosure rate as well. And then we have Baby Boomers. The Baby Boomers are getting older. They're downsizing on their houses, and as they downsize, they've collected a lot of things over the years, things that they don't want to part with, things that they're going to give to other family members as heirlooms after they go. So where are they putting these things? They're putting them in storage. And they're putting – and they have been putting them in storage for years. Because, let's face it, the Baby Boomers are the consumers. They were the consumer age, and they consumed and consumed and bought and bought and bought. And because of that, their children have seen them putting their stuff in storage, their overstock into storage on a regular basis. So now, as their children, the Echo Boomers – the babies of the Baby Boomers are called the Echo Boomers – come into the marketplace, as they go to college, as they buy their first homes, their putting their extra stuff immediately into storage, because that's what they were trained to do. And now, over the next eight to ten years, there are 72 million Echo Boomers coming into the marketplace. So it just means that storage is going to continue to rise. I’ll briefly talked about a diversified portfolio. But you really do want to be a transaction engineer. You want to be able to do any deal that crosses your desk. And with adding storage to your portfolio, you've added a very powerful cash flow engine to what you have right now. Or if you don't have anything right now, it's a great place to start, and we'll get into reasons why in a few minutes.
- Self storage offers a HIGHER RETURN ON INVESTMENT with a comparably lower failure rate than many other real estate ventures or new businesses. Self storage allows you to START SMALL AND GROW OVER TIME. Self storage demand is driven by life events: downsizing homes, job transfers, divorce. Additionally many businesses opt to outsource storage needs. The time is now to buy a self storage facility and BUILD A SOLID BUSINESS. The NEED FOR COMMERCIAL USE IS GROWING. More people are also becoming at-home entrepreneurs and seek alternative storage other than their home or garage. 1 in 10 Households Need or Use Self Storage IT’S EASILY MANAGED As a low cost investment, self storage can easily be managed by individuals with little or no experience. The initial investment is much smaller and operating expenses are much lower than other types of real estate investments. The management task, unlike many other businesses, is not labor intensive. SELF STORAGE IS A MONEYMAKER WITHOUT THE HEADACHES. Over 40% of commercial customers rent more than two years. The average customer visits his unit once a month. Real estate properties must continually maintain grounds, appliances, plumbing, electrical fixtures, etc., which usually require a maintenance staff. Self-storage operating costs are a fraction of other real estate properties. BREAK-EVEN OCCUPANCY RATES When you own a rental property, you must rent a certain amount of space to be profitable. In self storage, the break-even point is considerably lower than other real estate ventures. Create as Much Passive income as You Need, No Jerry Springer Tenants, No Toilets, No Trash, NO PAIN So how do we get paid with self-storage? Well, we're going to get paid three different ways. We're going to get paid through cash flow. The cash flow is the money that we get from our property on a regular basis. . We're going to get paid through appreciation. Appreciation is the money that we're going to get from raising our rents. So always be raising the rents by $10 or $20. It's called a nuisance increase. And the reason it's called a nuisance increase is because it's a nuisance that they get it, but it's not high enough that they're going to go move their stuff into another facility.And then, number three, and my favorite way, is what's called acquisition fees. And when we talk about how to get money to do these deals by taking no money out of your pocket, we're gonna talk about how to pool people's money together. And because you've taken the time to discover and educate yourself on how to get these storage deals, and you've also taken the time to discover how to get the private money for these storage deals – the people that will give you the money – then it's customary in our business, and your business as well because we're in the same business, that you get an acquisition fee. And an acquisition fee is anywhere between one to five percent of the closing of the purchase price paid at the closing by the investors. And that's a beautiful thing because not only do you get in with no money out of your pocket, but they actually pay you at the closing. And they're happy to because the investors are focused on their returns and as long as you're giving them a certain return, you will be able to get the acquisition fees. So that's a good thing.
- Do you want to be part of the 60% club or the 8%????
- Reasons for most businesses going broke is the overhead as you can see the cost is dramatically different with S/S want a greater chance at success?????? Yes
- So who's renting from us now? Who's renting the space in our storage facilities? Well, I mentioned foreclosed homeowners, but also apartment dwellers. One of the best places to own a storage facility is right next to a large apartment complex or right in the middle of what we like to call apartment row, where there's a lot of apartments right in a row in any particular city. Also, college students that are going off to college, and all of a sudden they find themselves in a very small dorm room, and they know they're going to be there may be their first year but not their second, well, they move a lot of stuff into storage while they're there, in anticipation of moving out.Unfortunately, 50 percent of Americans get divorced. And I know there's some Canadians on the line as well. But 50 percent. So when there's a divorce, typically the person that moves out moves into an apartment, and their stuff is moved into storage. Also, landscapers, contractors, anybody in the trades are always looking for storage facilities. Home sellers. Home sellers that have too much, as their selling their house, they'll go into storage facilities. Boomers downsizing and homebuyers going into new housing that may be not the right size for all of their stuff.But also, another great place to own storage facilities – and you want to write this down – are outside 55 and older communities. There's communities now where you have to be 55 years or older to live there. Also, new developments are a great place for storage too because you have people moving into the new development, and storage facilities do well there also.
- Now, there are different ways that you can get the deal. You can get deals from direct mail, sending out letters and post cards to owners of storage facilities. You can get deals from Real Estate brokers. You can get 'em from classified ads. They'll be for sale in the commercial real estate section. You can put your own classified ad in there that says, "I buy self-storage," and that will be very - you'll get some good responses from that. So with direct mail, we've got three rules. The three rules of direct mail are: you're only looking to get a one percent response from your letter. Now, a one percent response, that means that you send out 1,000 letters, you're going to get 10 to 12 to respond to you. And of the 10 to 12 that respond to you, 2 or – will be serious sellers. And of the two or three that are serious sellers, you may get one deal a month. But hey, one deal a month – some months you might get no deals and some months two or three. But one deal a month – that can start putting some serious cash flow in your pocket very quickly. Storage facilities aren't the type of properties that we're going to flip. We'll flip single families. We'll flip multi-families. We'll flip large commercial properties and small ones. Storage facilities we like to hold, and we like to hold them for cash flow. So of the 1 percent response, we have 12 facilities that we put into our cash flow bank and before you know it, you're sitting in that hammock by that beach.Lists are really important. What you want to do is you want to buy an owners of storage facilities list, and you can get it from the different list brokers. You can't really get one of these lists from the assessor's office like you can many other lists, but you can buy them, and it will typically cost you anywhere from $0.28 to $0.35 a name. You may go to a title company to get a list. They may segregate them for you. And if you're really smart, you'll go to your title company, and this is what a lot of my students are doing because I told them to – is don't go to the marketing department and ask them if you can buy their list. Go to the department where you would actually use them for services – you know, if you called up and said, "Hey, I need a title service." Go to that department, and say, "Hey, look, I'm going to use you for my title searches rundowns and to run titles. Could you give me the list of all the people that owned storage facilities in the area?" And you hit the right person at the right time, and they'll give you the list for free. So that's good information. And then number three, the headline is the most important part of your letter, whether it be a postcard, or whether it be a letter itself. The sole purpose of the headline is to get them to read the body of the letter. And remember, everybody sorts their mail over the trash. So in doing that, the whole idea is to get on the countertop, get on the A pile. And we do that by being interesting.So let's take a look at the letter. They're tested. They're proven. And because – I don't know if you realize this, but you are actually in the marketing business. You are. No matter what business anybody's in, they're in the marketing business. Real estate happens to be your product, but you're in the marketing business. So I'm constantly studying marketing, and I'm constantly studying real estate investing. So this particular letter says, "I'm interested in buying your property. Read on. Dear Property Owner, I'm interested in purchasing your self-storage facility. Are you interested in selling? I'm currently a member of a group of investors..." – now, if you don't own any storage right now, this is the line that you want to use. If you do own some storage, you want to say, "I currently own x amount of units here." So this says, "I'm currently a member of a group of investors who hold a portfolio of properties similar to yours and are looking to add more." Now, if you're a member of a real estate investment group, you are a member of a group of investors, so that's how you can legitimize that line. "I realize that there are a number of reasons why someone may be interested in selling. Everyone has his or her own reason, and my question to you is: are you ready to sell? And if so, I am ready to buy. I can close quickly or delay the closing and take as long as you'd like. Please contact me at your earliest convenience so we can discuss the sale of your building. Call me now." That call me now is a call to action, and you need at least two call to actions in your letters. That's very important. So you know you need a headline. You know you need two call to actions. And then, the second most important part of your letter is actually the P.S. because what's gonna happen is they're gonna open your letter. They're gonna look at the headline, and they're gonna think, "What is this?" And they're gonna look down to see who sent it. They're gonna look down and see your name. They're not gonna know your name, but it's statistically proven that they're gonna go from your name over to the P.S., and they're gonna read that P.S. So your P.S. should be the second biggest benefit that they'll get for reading the letter, and it should have a call to action in there. So it says, "To get the best price for your property," because that's the biggest benefit, "call me now at..." And the marketing advice that I just gave you works not only with storage, but it also works with any other type of letters that you're sending out for any of your other type of real estate business as well. These ones just happen to specifically work for storage facilities. So this particular letter – when you're marketing, there's this phrase called "message to market." This message to the storage market – you always are trying to create a good message to market. This message to the storage market creates an eight percent response on this one letter. So what you need to do is use the letter over and over and over again. It's a good thing.Let's talk about Real Estate brokers. We give you a script that you can use so you'll know exactly what to say to them and when to say that. And on that script, what you do is you tell them who you are. You tell them what you do. You tell them what you're looking for. And the most important part of this is to find commonality. And when I say commonality, you want to find something that you have in common with this person. You know you have real estate in common with them, but find something outside of real estate. Find something – maybe you like to fish. Maybe you both like to bake. Maybe you like fast cars. Whatever it is, probe a little, probe a little, probe a little until you find something, because this is a business relationship, and that's really important to know.This is a business relationship, and relationships are built with people that you have something in common with. And people won't do business with you unless they like you and trust you. And they start to like you when you're like them. That's where the commonality comes in. And this commonality is going to give you the opportunity to call your broker once every ten days – that's really important. Write that down. It's going to give you the opportunity to call that broker once every ten days and feed them some information that may be outside of real estate, but it's something that they're interested in getting, and now, every time you call, you're in an invited guest instead of a pest. And you're also building up chips, chips in what's called the law of reciprocity. Because let's face it, when somebody gives us something, we want to give them something in return, and if you're constantly giving, you're eventually going to get a listing from the broker. And once you do that first deal and perform on that first deal, you are off and running. Because the hurdle is getting over the first one. But when trained properly, you'll get over the first one quickly.
- So how are we going to get these deals? Just like anything else in life. It’s a relationship business. So you want to create relationships with brokers. We will talk about brokers in a minute. We are going to talk about Direct Mail. So we are going to get a list of the storage owners. One way is to go to the yellow pages and pull the name of the facilities in the area, or you can go to the Self Storage Association, become a member and you can get a list of all the owners in the state that are interested in. Then we are going to mail them by using the direct marketing rules. The envelope will be no windows It has to look like friendly mail so that they will open it. We are looking for a 1% response. If the envelope is multi colored it’s better. If it looks like an invitation that’s great! Use blue ink on the return address. Do not use a PO Box on a business company. You can put your name on a PO Box. Use all sorts of funky stamps. Do not use metered mail. We are going to have our letters. Which explains what we do. They will have headlines on them and PS’s. The headline gives the biggest benefit for doing business with us. Then the owner will look down at the PS when they realize that they do not know us, and the PS will give the 2nd biggest benefit for doing business with us. Inside the envelope with the letter and a fax back form if they want to do business with us. We are going to delegate the stuffing process to someone else, such as an ad on Craig’s list will get you a big response. We are going to do it consistently. Because we know that we will be getting a 1% response. So out of 1,000 letters, we will be getting 10 responses. Out of these 10 responses we will get 2-3 serious sellers, and from these we will get 1 good deal to choose on. If you get those letters out each month you should be getting a deal a month.
- So dealing with brokers. There maybe some fear with that. Just follow the script. Do not leave them a message. Find out from the gate keeper the best time to call or leave a message, tell them that you have a deal for them. Good chance they will call you back. If they do, the deal is I want to make you money (commissions), this is what I am looking for. This is the type of storage that I buy. Lets partner up, you go find them for me. I will buy them and then resell them through you. We will all make money. Does that sound good? Yeah! Typically there will be one or two brokers in that market that are main players. Find them and work the relationship. Do what you say your going doing. Make doing business with you easy. Do not be a pain. When you call them glue them good information that they can use in some other aspect of their life. So when you are calling them your an invited guest not a pest. Make sure that you are calling them on a regular basis. Follow up, Follow up, Follow up. And you will get deals. The average deal is made after the fourth follow up, the average investor only follow ups two times. Do you see how much opportunity is out there if you follow up? Yes,yes. You can find brokers on loopnet & selfstorage.com/Argus.
- So, hey, this is Steve Hall. Biggest Fear “I didn’t know how to talk to them” first purchase was 167 units. Purchase price was $265,000. The value of the property when he bought was $600,000. He's going to be able to refinance it and pull cash out. Now, why was there so much value in the property? Because he found a motivated seller by networking with his real estate broker, and that's what we're looking for as well. We're looking to deal with motivated sellers.
- As a matter of fact – oh, this was his acquisition fee. Look at your screen. Here's a check that he got for $51,504 at the closing on May 20th of this year. So imagine this. You do your – you follow the system step-by-step. You do your first storage deal. And you take no money out of your pocket. And at the closing they give you a check for $51,504. At the closing table. And then the very next month you get cash flow. What a country. This is why I love acquisition fees on properties. So that was his first deal. Not bad for a first deal. $51,000 in your pocket and $300,000, which he's refinancing right now. He's going to pull out another $300,000. Folks, this is done all the time in this particular business, and that doesn't include the steady increase of the cash flow
- READ SLIDE What I’m seeing today is that investors don’t know how to find deals, find money, they don’t know how to find buyers and they have no systems in place.
- There are 3 ways to determine value for a self storage facility. We have replacement cost, sales comparison approach and the income approach. The replacement cost would be cost to replace, it’s the highest of the values, it’s usually the one that we are not going with. You always want to be buying below replacement value. The sale comparison approach compares like kind properties together and that’s good too. With self storage, it’s an income producing property. We are going to be using a capitalization rate. But on the sales comparison approach, it’s something that is look thru for the appraisal, but for us as the investor it’s not something that we are going to key on. We are going to key on the income approach. We are going to determine value by looking at cap rates, but we are going to buy cash on cash return.
- Okay let’s look at some of the things that we do with the Income Approach. The first thing is that we never buy based on Proforma numbers. We buy based on todays or the actual numbers. If we buy on Proforma numbers and the numbers do not come in as expected the next year then we are in BIG trouble. Are you getting it? We do not buy on Proforma, we are going to buy based on the Capitalization Rate. What is the Capitalization Rate? It’s the Rate of Return that you expect to get on your investment. It’s the unleveraged return. (No financing involved) The cap rates for A properties is 7-8, B properties 8-10 and C properties 9 -12. Part of our market research is determining the Cap rate that the sellers are selling and the Buyers are buying at. If we can resell at a lower Cap rate than we are buying at then we can make a lot of money we decide to sell. Are you getting it? Okay let’s look at some of the things that we do with the Income Approach. The first thing is that we never but based on Proforma numbers. We buy based on todays or the actual numbers. If we buy on Proforma numbers and the numbers do not come in as expected the next year then we are in BIG trouble. Are you getting it? We do not buy on Proforma, we are going to buy based on the Capitalization Rate. What is the Capitalization Rate? It’s the Rate of Return that you expect to get on your investment. It’s the unleveraged return. (No financing involved) The cap rates for A properties is 7-8, B properties 8-10 and C properties 9 -12. Part of our market research is determining the Cap rate that the sellers are selling and the Buyers are buying at. If we can resell at a lower Cap rate than we are buying at then we can make a lot of money we decide to sell. Are you getting it?
- All right, let's talk about how to analyze these deals. With storage facilities, it's much like other commercial properties. So if you're familiar with the analysis of other commercial properties, you're a step ahead. If you're not, there's a very simple formula. What you do is you take the yearly income from a property. You subtract the yearly expenses, not including the mortgage. That mortgage will be used for another type of calculation at another time. And that's going to equal net operating income. The Cap Rate is calculated by taking the Net Operating income and diviving it by the Purchase Price.So let's put some numbers on here. Here's a 25-unit storage facility, and on this particular one, the yearly income, was $180,645. The expenses for the year – these are annual numbers – was $68,445. And that equals $112,000 which is the Net Operating Income.. You take that $112,000. You divide it by the purchase price, $1,000,000, and your Cap Rate = 11.2% for this particular facility. Is that easy?And I know that some of you know that the ten I'm using here is for the ten cap rate, or the capitalization rate, and that's what I've just been – I just created – I've just shown you how to do – use a ten cap to determine value on a property. So what is a capitalization rate, if you're not familiar with the term? you'll often here it called the cap rate. Well, the cap rate is the return that you expect to get on your investment. It's as simple as that – the return that you expect to get on your investment.A ten cap is typically a good deal. You'll have investors out there that will say, "I'm not going to buy anything for less than ten cap," because when cap rates go down, buildings are more expensive. When cap rates go up, they're cheaper. So a ten cap is a very conservative cap. You get a property that cash flows at a ten cap, and you pretty much have a good deal. The 11.2 % is great, That is why we are thing Aquistion Fee Income !So let me ask you a question. Was that easy? Of course it was. We're actually going to give you some software where alls you do is simply plug in those numbers and it's going to give you your cap rate, your cash-on-cash return, your debt coverage ratio. It's going to give you your cash flow, 5, 10, 15 years down the road. And it also is going to give you a sensitivity analysis as well. So a lot of good - lot of easy things. Press a couple of buttons on the software, and it will tell you whether or not you should go forward with that deal. More importantly, it will tell you when to stay out of deals.
- We discussed earlier that we get paid three different ways in self We're going to get paid through cash flow. The cash flow is the money that we get from our property on a regular basis. We're going to get paid through appreciation. Appreciation is the money that we're going to get from raising our rents. And then, number three, and my favorite way, is what's called acquisition fees. Our cash flow with include the tenant’s rents, “Late charges”, Admin Fees and Bounced Check Fees. We will also get paid by creating “The Store Within Your Facility” “Ancillary Services Increase your NOI by 20 %. NEXT SLIDE
- If you do it right, you're going to have a bunch of different ancillary services, a bunch of different cash flows coming in. Now, here are some of the cash flows that you want to do. Truck rentals. You can get Rider. You can get any one of those truck rentals to actually – you can be a go-to center for them. You don't have to buy their trucks. You just lease their trucks for them, and you make a commission off of each truck that gets leased. Easy way to make money. Because, hey, people need trucks to go to your facility, don't they? So they rent a truck, they pick up their stuff and they bring it back. And they unload, and then the trucks already there. It’s a good thing. Propane fill up is big. You want to have propane filling station. Not only because you'll make money, number one, but number two, when people come to your facility for the propane, and they look and they say, "Oh, yeah, I might have some stuff that I want to put in there." So it'll actually help you increase your occupancy. Then there are the boxes. Now, that's a given. Everybody's gonna need boxes, so always have boxes on your site and all the different stuff that goes with boxes, like tape and those peanut things that go in there that stop things from breaking, and the bubble wrap, all that stuff. And you charge for it all and you make money from it. eBay centers are big. eBay centers are, you know – there's so many people making a ton of money on eBay right now. But eBay centers here at these particular facilities are moneymakers as well because you provide all the different things that the eBay people need for packing up their goods and sending it out and a computer terminal so they can be in there, and they can be doing their business. It's like an office away from home where most people realize that they can't have an office in their home because they don't get anything done. Business centers themselves – fax machines, copier machines, all the different things that somebody might need to do by or get something done or send something somewhere. Or just to get onto the internet for a little while. You can make money on those as well. Mailboxes. Did you know that you could have mailboxes at your facility? That you can actually put an application to the post office and have a mailbox center at your facility. Think about that. With the mailboxes, you'll also have FedEx or UPS. So this will be the go-to place for people to send packages or get their mail. Well, if they're coming to your facility on a regular basis, eventually they're going to think, "Hmm, I could use one of those spaces." Or if they're in a conversation where somebody says they need to store something, they'll say, "Hey," your facility is the place to do it. So this increases foot traffic, which will increase your occupancy. Wine storage is big nowadays. Have special air-conditioned units, very small ones, for wine prices and get premium prices. Document storage for businesses is really big as well. You know, most businesses have to keep their documents for seven to ten years. So that's the hidden cash flow in your storage facilities. So not only do you get your rent, but you get all of these extra bonuses if you go out and use them, if you're savvy enough to use them. And in the system, we show you exactly how to step these up and how to profit from the immediately upon buying your facility.
- The Rules of Thumb for expenses are based on the Effective Gross Income. These rules apply for a stabilized facility with the occupancy in the 90% range. The Expense to Income ratio will be 30 – 35% depending on the market. The Total Expense per Rentable Square Foot should be a value in the 3.2 to 3.7 range. Use the Rules of Thumb when you are analyzing your DEAL. When you input your numbers into the Self Storage Profit Ananlyzer you will see if the expenses numbers are high or low. It’s a great tool designed to make sure that YOU ARE GETTING IT. Taxes = 9 % but Look at the Assessment Value, Verify the taxes, (80% Purchase Price) x (Mill rate) = Taxes Get Mill rate from the assessors office Insurance = 2 % (this could be higher, depending on if property is closer to coast, the claim history, if in flood zone, etc) A few ways to get cost down: Umbrella policy – when you own a lot of property OR Management Company – if using a management company that manages many properties, you can piggyback on their rate. Repairs & Maintenance (R&M) = 1 % If higher than this - usually from deferred maintenance. Includes Contractors and material General Administration = 1.5 % Misc. things that you need to keep the leasing office running, Accounting Services, Bank Fees, Permits, Office Supplies, Postal Delivery, Telephone, Answering Service, Pagers,ect Management Fees Typically 6% of Total Income If you know you are going to be using a particular property manager and you know their fees, use that figure. Marketing/Advertising = 3.5 % If the property is located on a main road or in a tight market they will come in around 2.5 % Utilities = 2% Take historical from last year, annualize this year’s, compare & then take the higher of the two. Electricity, Gas, Oil, Water, Sewage Contract Services = 4% This could be Landscapers, Pest Services, Trash Services, and Security etc. Payroll = 3 % It is reflective of the area. This is where your lenders become very useful Manager, Leasing agent, Maintenance, Bonuses, Payroll Taxes, Workman’s Comp The Rules of Thumb for expenses are based on the Effective Gross Income. These rules apply for a stabilized facility with the occupancy in the 90% range. The Expense to Income ratio will be 30 – 35% depending on the market. The Total Expense per Rentable Square Foot should be a value in the 3.2 to 3.7 range. Use the Rules of Thumb when you are analyzing your DEAL. When you input your numbers into the Self Storage Profit Ananlyzer you will see if the expenses numbers are high or low. It’s a great tool designed to make sure that YOU ARE GETTING IT. Taxes = 9 % but Look at the Assessment Value, Verify the taxes, (80% Purchase Price) x (Mill rate) = Taxes Get Mill rate from the assessors office Insurance = 2 % (this could be higher, depending on if property is closer to coast, the claim history, if in flood zone, etc) A few ways to get cost down: Umbrella policy – when you own a lot of property OR Management Company – if using a management company that manages many properties, you can piggyback on their rate. Repairs & Maintenance (R&M) = 1 % If higher than this - usually from deferred maintenance. Includes Contractors and material General Administration = 1.5 % Misc. things that you need to keep the leasing office running, Accounting Services, Bank Fees, Permits, Office Supplies, Postal Delivery, Telephone, Answering Service, Pagers Management Fees Typically 6% of Total Income If you know you are going to be using a particular property manager and you know their fees, use that figure. Marketing/Advertising = 3.5 % If the property is located on a main road or in a tight market they will come in around 2.5 % Utilities = 2% Take historical from last year, annualize this year’s, compare & then take the higher of the two. Electricity, Gas, Oil, Water, Sewage Contract Services = 4% This could be Landscapers, Pest Services, Trash Services, and Security etc. Payroll = 3 % It is reflective of the area. This is where your lenders become very useful Manager, Leasing agent, Maintenance, Bonuses, Payroll Taxes, Workman’s Comp
- Let’s talk about presenting the Offer. You have received a property package from the owner or the Real Estate Broker. It contains the financial information so that you can analyze the deal and determine your Strike price and you are going to offer 10% below it.. It is now time to create the offer. This is called the LOI, Letter of Intent. It contains the purchase price, your down payment, repair allowance, closing dates, and the contingency for the financial and physical due diligence period. Usually the LOI will go back and forth until the deal is in agreement with both parties.
- The More Deals That you can Get Into with the least amount of Money down…The Wealthier that you will become.
- Financing Okay, how are we going to get the money? Local Banks will sometimes have great terms because self storage is seen as a very stable investment. The National Lenders will lend on self storage. Mortgage brokers are the easiest to deal with and they will find you the best lending terms. Our latest deal our mortgage broker gave us four lenders with different parameters. So we chose the best fit for us. Loan assumptions are done the same way as with other commercial real estate. The commercial brokers will get us the lenders to give us the 80% and we like to get the 20% from other investors and not from our hip pocket. Using private money allows us to get more deals. We split the deals with our private investors Private investors with Self Directed Ira’s are one of the best sources to get funding for your deals. The other source is Angel Investors. You can find angel investors everywhere. Financing Okay, how are we going to get the money? Local Banks will sometimes have great terms because self storage is seen as a very stable investment. The National Lenders will lend on self storage. The Conduit lenders are coming back and they are very aggressive. Mortgage brokers are the easiest to deal with and they will find you the best lending terms. Our latest deal our mortgage broker gave us four lenders with different parameters. So we chose the best fit for us. Loan assumptions are done the same way as with other commercial real estate. The commercial brokers will get us the lenders to give us the 80% and we like to get the 20% from other investors and not from our hip pocket. Using private money allows us to get more deals. We split the deals with our private investors Private investors with Self Directed Ira’s are one of the best sources to get funding for your deals. The other source is Angel Investors. You can find angel investors everywhere.
- Cash coming in month after month
- How many transactions would it take to get rid of all of your credit card debt? How many transactions would you need to do to cover all of your monthly expenses for the year? Two or three. Can you see how powerful this is. Can you see how quickly your going to have extra money to do those things in life that you deserve to do, like travel, spend more time with the family, buying a new home, new car…. Can you see that Self Storage can do it for you ? Yes or No ? Yes How many would train with us if it were free!! Well that sure woke you up. It is free, it pays for itself and it pays you over and over again. NOW would be a good time to register.
- This is my team My wife Joan, and my 3 kids , 2 teens
- Good or Great ? What was the Creative Purchase Strategy ? Seller was not willing to do Creativer Financing. Steve got them to do a Lease Option. Occupancy is at 63% and it cash flows !! Bring the occupancy up and refi or Cash Out This stuff is happening today
- This is what you get when you get started with our system. I talked a little bit about it. Let me give you the details.
- Read it, stop at Asset Appreciation increases what ? Your Wealth I see your getting it. Recession Proof Financial Freedom
- Read Everything that you need to do the Business is in the manual The Real World Value of the manual is easily $1495 {Grab the Course} Is there $1500 worth of information in this manual to do the business ? More Than that But we put a Real World Vale of $1495 on it A ton of knowledge in there and that is the key Now some people are readers so it is good to have a manual tha is several hundred pages, get in there roll up your sleeves and go to work
- Many people though do not learn the best from reading. They love to what ? Listen so we have an audio library. The thing that I love about the audio library is what ? You get to listen to it over, and over and over again. How many of you have mps players or IPODs ? You Can rip those CDs and put them on your MP3 player or IPOD and play them over and over and over again. HOW MANY OF YOU ARE COMMUTING BACK AND FORTH TO WORK ? That should be added to your mobile library and you should be listening to good stuff that will teach you more than more It’s Dave, himself, doing all of the teaching. Real World Value $499
- Now some people like to watch TV ? Right ? Well you got Dave on the DVD Training program. Your basically watching Profit TV. Watching Dave Teach and Train. Dave will make sure that you get it. So you get the audio , the visual and again it is exactly what to do and how to do in the business. Real World Value $899
- Read slide We use this to plug in many deals. You plug in 10, 15 , 20 deals. Now out these pick 4 or 5 deals that you really want to pursue. Are you with me ? Based upon some of the really basic numbers. Take those numbers and plug them into the “Deal or No Deal” software. I’ll show you how to do it. Real World Value $547
- The Quick Start Training CD. This is important because remember how many of you came here in a vehicle that has a CD player ? I want you to listen to this CD as you leave here today. This is your Fast Track to Success. It positions you to get your first deal done..Quick And most importantly where to focus First The Real World Value $349
- Now the Self Storage Profit Analyzer After you do the Deal or No Deal Calulation and figure which deals that you want to pursue. Know what you can you offer to the seller, your investors and how much you can put in your pocket at closing. Very, very important, this creates the professional reports that you need to use for your lender and private money lenders. You do not have design it, figure it out, it is all there for you. These are the reports that they are looking for so they can determine if it is a deal for them on the financial side. Total value on that $1195. If any of you have invested in commercial or business software, you know the value in that.
- The Marketing and Legal Library- This is really simple. The forms, contracts, and paperwork that you need to do the business as well as my “private fax back campaign” form and a whole lot more! The easy way to determine if this is something that you can make use of.. Who has ever hired a Real Estate Attorney? All you guys in the back row- How much did you pay? 200-300 , if we put a real work value of that $999, that is 5 hours at $200 with an attorney. So realize the benefit and value there. You don’t have to wonder what to use- it’s all there for you!
- 1:39:04 Ok, so we have talked about a lot. Everything that I have talked about and some is included in the system. And it is literally a system… and this system grows as you grow. There is so much in there. It is literally what you need to get started, what you are going to need and have as you go forward. And what I talked about earlier, I’m going to go back and tie it all in. Everything we talked about- all the different times (?) of investing, all the little keys, if all that did was bring you one deal, would it all be worth it? Yes or no? Would it be worth $8,486? Yes or No? Yes! Well, what I did was to make it affordable to everyone.
- This complete offer is only good for today. If ALL this system did was get your first million $ deal, would it be worth the investment? If ALL this system did was get you one deal per month would it be worth the investment? If ALL this system did was show you how to be financially free like me, would it be worth it? How many of you want that NOW? But for tonight, and tonight's call only, we're going to drop it down to $995, and here's the thing. I'm going to make a deal with you. Invest in the system tonight. Go out and do a storage deal within the first 90 days. You don't need is resell it. All you need to do is just buy it and start tasting that cash flow, and I will give you your $995 back. Now, I'm not going to do this for everybody. I'm going to do it for the first 25. And let's see, there are 523 people on the call right now. So you want to take action. So we'll do it for the first 25. And why are we doing it? Because I want a testimonial from you. Since putting this system out. We're getting great results, but we want a whole lot of testimonials so we can show the world exactly how effective this system is. So if you'll send us the testimonial, we'll send you the $995 back. Not only that, this is a good kick in the butt for you, so it gives you a kick in the butt to get it done, and it's a challenge, and a lot of people thrive off the challenge as well. You can go to jeffsstorage.com or you can call the office at 781-878-7114, and we've got a couple staff members in the office. And when you call, it'll be busy because I'm in my back office and I can already hear the phones ringing. But call back because – the lines will eventually open up. Or just go right to web, jeffsstorage.com. Oh, I see that Dennis Campbell from Dallas,Texas, congratulations. Karen Small from Chicago, congratulations. Lucy Merrill from Wurster, Mass, congratulations. My backyard.
- Call the office, 781-878-7114. You may not be able to get through. I can see they're crazy in the other room. That's okay. That's a good thing. That means that you're smart. You're taking action, and you're going to be successful. Or go to the website, www.jeffsstorage.com, www.jeffsstorage.com. If you called the office and it was busy, you just go over to the website, jeffsstorage.com. If you're in a car and you're on your cell phone and you're listening to this whole thing and keeps being busy when you're calling in, just keep calling. You'll get in. Eventually a line will open up.So that's it for me. I hope I've given you – I know I've given you some really good information on storage facilities. I know that if you take the information, even some of the information that I've given during this webinar, but especially the information in the system, you'll be able to go out, and you'll be able to start doing this. It's a very little understood or little known class. It's overlooked by most investors. But the smart investors are in storage. They set it and they forget it. They increase to a portfolio or they diversify their portfolio to all different asset classes. And that's what a good commercial portfolio is, commercial and residential.So that's it for me. One last time, go to www.jeffsstorage.com and then go over to – or call the office 781-878-7114. Get all the bonuses. But only if you're one of the first 25, and they're telling me that 19 of them are gone. Hey, they may just pick up the phone and tell you a number or get your name because if you're on this call, you're one of my students and you're on my list. Because we have not offered this to anyone else. I'm only offering this to my student base right now. So you're one of the first. So I want to say goodnight everybody. Talk to you soon, and happy investing. Take care. ``