A case study: turning 2.8 raw acres into outdoor storage income

Whether an outdoor storage operation stays easy comes down to the lease and the enforcement. Vehicle storage has a wrinkle unit storage does not. When a tenant stops paying, there is a titled vehicle sitting on the dirt, and getting rid of a titled vehicle is a different legal process from auctioning the contents of a locker. It usually runs through the state's abandoned or unclaimed vehicle statute, and that varies by state, sometimes a lot. Worth tracking how many nonpayers show up in the first several months and whether action had to be taken on any of them.

36k gross on 62k spent is a strong return by most comparisons, well ahead of what typical small multifamily produces on cost basis. Question though, @nicole_adeyemi, is there any labor built into that figure? Mowing is accounted for, but not the owner's own time. How many hours a month does this actually take between calls, gate codes, and someone wanting to swap spaces?

The interesting part of this case is that it is a use conversion on land already owned rather than a purchase. The basis was set in 2016. Someone buying 2.8 acres on a highway at today's asking prices and then spending 62k is looking at a completely different return on the same 36k of revenue. Do you have a sense of what that land would trade for now? Not to sell it, just so people reading can tell whether they are looking at your numbers or a different set entirely.

The grading point is the one I'm writing down. I've been looking at holding patterns for parcels that aren't ready for anything and this is the cheapest one I've seen that isn't just paying taxes and waiting.

Did the conditional use permit attach to the land or to you? I've read that some are personal to the applicant and lapse on transfer, which would matter a lot if you ever sold with the income in place.

This is the version of storage operators ask about most. Nobody lives on site and there's no turnover paint. One worry. The demand here is boats and RVs, which are things people buy when they feel good about money. If the local economy softens, do those come off the lot before or after people cut other spending? Unit storage holds up because people move and divorce regardless of the cycle. A parking space for a boat sits closer to discretionary.

@nicole_adeyemi on screening, do you check anything at all, or is it just a name, a plate, and a card on file? Coming from the rental side I'm used to a whole process and I can't tell if that's overkill for a gravel space.