By Alex Sweet
A new private market investment opportunity is now available to investors looking to diversify their portfolios through an alternative asset class.
The BlueGate Boat & RV Storage offering entails the development of a Class A storage facility in Sanford, Florida, a city approximately 22 miles northeast of Orlando. The facility will feature 326 electricity-equipped units including 220 covered units.
Offering sponsor Madison Capital Group owns the subsidiary, BlueGate Management, which will be operating the property once completed. The group acquired the 11.15-acre land parcel in 2021 at a significant discount, 66% below nearby comparable properties.
BlueGate Management owns a second storage facility less than five miles away that currently holds a waiting list for available units. At the same time, cash flows have improved since the 2021 acquisition due to increasing the covered-unit leasing rates by 83%. The demand experienced by the nearby storage facility along with data such as from ToyStorageNation indicating that the state of Florida ranks #3 in total spent on RV sales and service in the United States at over $306 million per year, leads Madison Capital to project strong market demand that will help de-risk this venture.
Investors in boat and RV storage facilities are considered to inherit less risk compared to standard storage facilities and real estate investments because of the value associated with the boats and RVs, leading to lower delinquency rates combined with a generally more affluent clientele.
Within the immediate vicinity of the site, there are 400 existing homes, 375 homes currently under construction and an additional 377 homes and seven commercial projects in planning. The homesites in the construction and planning phases contain HOA boat and RV parking restrictions, which is expected to boost demand for storage space within the immediate area of the development.
Madison Capital Group was founded in 2009 and is a vertically integrated real estate investment and development firm that specializes in boat and RV storage because of the relatively risk-averse and often high-yield nature associated with the asset class. The group has extensive experience in real estate, including having 134 properties presently under management at a total value exceeding $2.88 billion. The investment offering is currently available to investors for a minimum contribution of $25,000 on the CrowdStreet platform.