By Martin Mei
Today we will discuss how to select the right markets for a self-storage facility, both for value-add and development strategies.
Meily Investment Group associates know that for industry beginners, investing in a self-storage, RV and boat storage, as well as self-storage hybrid facility outside your local market can be terrifying!
But educating yourself about how to go through selecting markets, could be the best way to get over your fear.
It’s important to note that market conditions can change over time, so it’s significant to regularly evaluate the market to ensure that it remains favorable for self-storage.
The Meily Investment Group focuses on fast-growing, undersupplied markets in the United States, and has a comprehensive procedure for evaluating storage markets. Below are some of the criteria we look at:
A market with a growing population, high-population density, and a high number of households is generally more favorable for self-storage
A market with a strong economy, low unemployment rate, and high household income is generally more appropriate for self-storage
A market with low competition from existing self-storage facilities is generally more suitable for self-storage. This is because less competition means less pressure on rental rates, which can make it more profitable for self-storage facilities to operate.
Determine market size and growth potential:
Assess the size of the market and its growth potential over the next several years, based on trends and projections.
Conduct due diligence:
Once you have identified the investment markets, conduct further due diligence, including market surveys, site visits, and interviews with local business owners and investors to gain a deeper understanding of the market and potential investment opportunities.
Is the market you’re investigating lacking high-class RV and boat storage facilities?
Even if RV and boat storage sites are in existance, predictions within the industry indicating developers should lean into creating Class A sites, raising the bar to meet tenants’ needs, as well as developing a facility that will meet planning and jurisdictional requirements to streamline the permitting process.
Martin Mei works with Meily Investment Group. He enjoys working as a mentor and guiding light for newcomer entrepreneurs. Book a meeting with him to learn more.
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