Self Storage Investment

Discussion in 'Commercial Property' started by blw101, 4th Mar, 2015.

  1. blw101

    blw101 Member

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    Hey all, long time lurker member looking for anyone with experience in self storage ownership?

    Feels a lot like fragmented industrial property, but there's been a bit of consolidation in the last 5-10yrs with a couple of big LL's but it looks to be mostly small private ownership.

    Thinking is future demand will come over the next 10 years as boomers sell their big house and downsize but dont want to ditch all their stuff?

    No real idea on potential returns and/or operational difficulties so be interested to hear any thoughts or insights.

    Cheers,
    blw101
     
  2. handyandy

    handyandy Member

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  3. bumblegoodie

    bumblegoodie Call me BG

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    I used to work for a firm that does that.

    The owner owns the land so even when they are making min. profit it doesnt hurt them!!!!!!
     
  4. blw101

    blw101 Member

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    Unless they have levered up to buy the property?!

    Thanks for the responses all.

    BLW
     
  5. ije

    ije Member

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    Hi blw101- I've been watching ( bought none, and it helps me none by spruking it here!) the stock NSR - National Storage. Basically one of the companies that is buying up the smaller ones.

    http://www.asx.com.au/asx/research/company.do#!/NSR

    I figured these companies own land ( which is increasing in value ), trends to apartment living leads to greater demand (need somewhere for your old trophies and nannas wall unit), and improvements in self service and computer applications to manage sign ups, leases etc.

    Stock is heading north, though some report the occupancy rate are stagnating within the complexes owned.

    It may be worth using their asx reports for research into the industry as a whole if you are looking more into it.
     
    Last edited: 5th Apr, 2015
  6. datto

    datto Member

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    I used Nat Stor ( they sponsora. AFL team). Nice new premises, good lift etc butI Itransferred to a competitor and saved about 20%
     
  7. fernfurn

    fernfurn Member

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    Know people who own and operate one, they make a good living out of it. It would depend on picking the right area. We looked at it, but buying the amount of land close enough to where it would be needed for theright price was the sticking point
     
  8. blw101

    blw101 Member

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    Interesting points.

    Sounds like location is key (when isn't it), I cant see the operation or maintenance being particularly onerous.

    Had a look a NSR, interestingly the direct property cap rates (yields) are high single digits, albeit on $5m+ properties. With decent leverage the cash flow could be quite attractive.

    Any brokers with experience lending against these?