Buying a fenced lot to solve a fleet parking problem, and letting the surplus spaces cover the mortgage
Sometimes the thing that moves a service business owner's balance sheet isn't the business, it's solving a parking problem badly enough that buying dirt becomes the answer. Take a fleet of eight vehicles overnighting in a rented yard twenty minutes out of the way, $1,350 a month, no security, and a couple of catalytic converters gone in a year. The search for a fenced parcel closer in lands on a 0.4 acre chain-link lot about a mile from the core, asphalt in fair shape, seller an estate wanting a fast close. $210k purchase, $52k down, the rest financed through a small local bank on a 20-year amortization with a 5-year balloon. Financing a bare lot is often harder than financing the property itself, since some lenders won't touch a parcel with no building to appraise. The listing says 24 spaces. A survey turns up a utility easement running diagonally across what would have been four spaces, and the city's minimum drive aisle width for a two-way lot means the seller's implied layout was never legal to begin with. A straight-in layout only fits 19 usable spaces. An angled, one-way layout with the aisle narrowed to the code minimum gets to 26 spaces, with the easement stalls used as short-term visitor spots rather than sold. Renting 16 of 18 available spaces at $135 a month, largely to residents of nearby apartment buildings that supply only one space per unit, brings in $2,160 a month, or roughly $25,920 a year gross. Costs run something like $3,900 taxes, $2,050 insurance, $4,200 snow in a bad first winter, $980 lighting and electric, $900 restripe reserve, plus debt service near $12,500 a year on the note. It nets out slightly positive after eliminating $16,200 a year in yard rent entirely. Worth keeping: paying for the survey before removing the inspection contingency. Worth avoiding: signing every permit month to month in the same week, which lets the entire tenancy turn over at once.
