Buying a Storage Facility
Purchasing a Storage Facility
2021 was a year much like 2020, with the rising real estate prices we had a difficult time finding rental properties for sale that make sense for us to buy. We were able to pick up one rental house back in the spring. Shortly after we bought that one we had lunch with a wholesaler friend of ours. He was telling us how he and his brother had just bought a small self-storage facility. After telling us about how he found and structured the deal, he said they really liked the business model and they were trying to find another, possibly larger one, to purchase. We told him we had also looked into investing in the storage business and would be interested if he found any storage facilities that he wasn’t interested in buying, to let us know. Well probably about two weeks later, he called us and said he had found a small storage facility that might be for sale off-market. We told him we were definitely interested. The following week, we met with the sellers, walked the property, and decided to make an offer. After a little back and forth discussion, we agreed on the terms of the sale. The sellers said they wanted their attorney to look over the deal and draw up the contract, of course, we were fine with that.
Then before we had anything signed, things went a little sideways. Someone else, upon hearing that the owners were selling, told the owners they were interested in buying the facility and they would be willing to pay more for it. So the sellers said they weren’t going to honor the deal unless we were willing to match the higher offer. They wanted more money. We told them we would not get into a bidding war, they should take the other offer. This was a little upsetting, but we decided to walk away. We were disappointed, but we are used to walking away from deals if the numbers don’t work.
A couple of months later, our friend, the wholesaler, calls us back and says the deal on the storage facility fell through with the other buyer and the owners would be interested in renegotiating a deal. At this point, we agreed to submit a final offer, take it or leave it. We offered to give them $15k more and pay $100k cash down, but in return, we asked them to carry back a 0% interest 18-month note for the balance. They agreed!
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Chapters:
0:00 - Start
0:29 - Intro
1:01 - 2021 Year in Review
1:27 - Purchasing a Rental House
2:37 - Meeting with Wholesaler
4:33 - Finding the Deal
4:57 - Meeting Sellers and Making Offer
5:28 - Deal Falls Apart
6:37 - Patience Pays Off
6:56 - New Offer Made
7:18 - Taking Over Facility
8:32 - Opportunities for Growth
9:24 - Plans and Progress So Far
11:11 - Quick Tour
14:52 - Outro
