Over the years, eager investors have gravitated toward multi-housing projects to beef up their portfolios based on the premise that these popular real estate investments bring great returns. Some have come to realize that there’s an even better option: self-storage. And those who are truly enlightened are now recognizing that RV and boat storage may be the best investment of all.
Meily Investment Group has pinpointed several reasons why the storage industry is a far superior commodity when compared to multi-housing investments. Read on to determine the best investment for yourself. Chances are you may be swayed over to the storage industry after reading this convincing argument.
Lack of Tenant Issues
Unlike multi-family properties, self-storage facilities do not have strict tenancy laws, rent cap or tenants living on the property. This means storage site owners don’t need to worry as much about damages to the property, nor do they have to pay for carpet replacement, painting over dingy walls or needing to buy expensive appliances when tenants vacate. Rarely do storage owners have to deal with difficult tenants either. As for RV and boat storage facilities, operators are finding people are joyous when they come to the facility because they’re about to embark on a fun adventure in their RV camper or boat.
Commercial Evaluation
Storage facilities are evaluated based on net operating income divided by the cap rate, just like multi-family properties. However, due to the lack of tenancy laws and rent caps, torage investors have more control over their net operating income and valuation.
Multiple Streams of Revenue
In addition to rental income, storage facilities can generate revenue from multiple sources: mandatory tenant insurance, moving supplies for sale, UPS and/or Uhaul franchises, lockers and more. Class A RV and boat storage operators have recognized there are many more amenities they can offer to increase revenues. The more these facilities gravitate to a luxury storage experience, the more money they can make, in addition to maintaining a steady clientele by keeping them grateful for the added services.
Recreational vehicle storage facilities often incorporate any or all these added amenities: Wash and dumping station; complimentary coffee, water and ice; insurance policies to protect vehicles from damage on the site; business services, wireless and conference room for tenants to conduct business at the site; packaging, shipping and mailbox services; and even valet services that ensure a tenant’s rec vehicle is ready to go when they arrive.
Tax incentives
High-income earners can use bonus depreciation benefits against their taxable income to reduce their tax burden.
Investing in storage facilities can provide a stable and profitable investment opportunity, with less stress as compared to managing multi-housing properties.
Moreover, savvy investors are learning the returns are much higher, with less work involved. It’s a win-win situation that continues to attract more developers, owners, operators and investors. The best part about RV and boat storage is there is plenty of room in most markets to open a facility because demand for this specialty is huge. There are few, if any, markets that have reached saturation, so the field is wide open for more players!
Meily Investment Group is a team of seasoned professionals who are dedicated to assisting investors in the process of buying, selling and transforming self-storage assets. The company uses expertise and knowledge to increase the value of the properties and provide a range of services to make the investment process as seamless as possible for clients. Meily experts understand that investing in self-storage properties can be a major decision, so they are committed to delivering a high level of service to help clients achieve their investment goals.
