Paul joined the coaching program with StorageNerds about a year ago, and now in this episode, he shares his humble beginnings and how he bought two facilities in his first year. Before going into storage space, he has residential properties owned with his partner, where they are receiving a steady cash flow. From there, he built momentum into raising money and building his portfolio with the help of capital partners with which he was able to build personal relationships. Listen as Paul shares more inside information from his deals!
—
Watch the episode here
Listen to the podcast here
Case Study: Paul’s Strategy For Building His Real Estate Portfolio After Joining StorageNerds
We’ve got a special guest. Paul has been in the coaching program for a while and I’m excited to hear all about the deals that he’s been doing. He’ll tell his story about how he got started in self-storage investing and what he’s doing. Before we get started on that, I want to remind you of a quick couple of things that are coming up. The doors to StorageNerds are opening up on May 1st, 2022.
If you have been thinking about getting into a coaching program and you’re one of these people that’s like, “I’m going to buy me some storage facilities,” I highly consider that you get on the waitlist for StorageNerds and set up an appointment with me. All that is on the waitlist get notified first. I’m only taking calls for 6 days in 2 weeks on Tuesday, Wednesday and Thursday. I do calls all day long. You can ask me questions about the coaching program. I could tell you how it works and things like that.
Another thing is that we’re going to be offering, as of May 1st, 2022, StorageNerds Acquisitions. You get to hire my acquisitions team to look for facilities for you. I’m excited about that. You can go and get your VAs if you want to. Paul does this and he’s going to tell you how. If you don’t want to hire VAs and manage them, you can always use our team to do that. We’re offering that to only Storage Nerds lifetime members.
If you’re interested in that, please make sure that you set up an appointment with me through the waitlist. We can chat about that as well too. I’m only going to take a handful of people because this is our first time doing this. I have the whole acquisitions team set up. We’ve got 4 and hiring 2 more people. I’m excited about that. We’ll keep hiring people and managing them to get out there. Build lists, call owners and talk to owners is what they do. You don’t have to do that work. They’ll do all the deal analysis. To submit deals to you is what we’ll do.
Another thing is if you’re an REI USA student or an REI USA member, this is in conjunction with REI USA. I own REI USA. For all the members of REI USA, I invited them to come to this webinar anytime that they want. They can come and listen to me. REI USA is an online platform for people to learn how to invest in any type of real estate, not just storage but Airbnbs, land, notes, flipping, wholesaling and all kinds of stuff.
We teach people how to invest in all different types of real estate transactions, so please check out REI USA. We are going to be doing another May 7th, 2022 virtual summit. It’s called Raising Capital. All the coaches and teachers from REI USA are going to get on and talk about how they’re raising money. I’ll talk about how I raise money and somebody like Mike McKenzie, who does land, is going to talk about how he raises money to buy land.
Yukiko is here as well too. She’s a teacher for REI USA. She’s going to talk about how she raises money for the apartment buildings that she buys, which are small multi-family apartments. If you are interested in learning how to raise money, I highly recommend that you sign up for REI USA and come to the virtual summit. Our StorageNerds Bootcamp is coming up in May 2022 as well too. If you’re interested in the two-day bootcamp, you can join the StorageNerds program.
Thank you very much for hanging out with us. I want to introduce Paul. He joined the coaching program in 2021. He is the male version of me. He’s a hustler, gets out there and takes action. He’s like, “I’m going to buy some storage facilities.” I like him. I teach people, find, fund and run them. Paul, tell me if I’m wrong but I feel like you are the funding person. Do you do a lot of the fundraising?
I have a partner that I’ve brought on. I have always started and raised a lot of money for a lot of my residential deals myself. When I partnered up with my partner, we had complementary skillsets. It turns out that we both are able to raise money, which is a nice skill to have. What I’ve found is from a bank perspective, underwriting and stuff like that, my partner enjoys and prefers that.
From a running perspective, the operations, collecting the cash and doing some of the marketing, with that process, my wife and I are more skilled. My wife runs an Airbnb property management company. We’re more focused on the operation side. It’s great to have a partner that has complementary skillsets to mine. Both of us can do both things. It’s just what he and I prefer to do.
That’s what we’re going to do in this episode. We’re going to talk about each of the deals and how you found and funded them. For the ones that you own, you can get into the running part as well too. Whichever one you want to start with, your first one maybe. Tell them how you found your first deal.
The first deal that I found was I found it myself. I joined StorageNerds in November of 2020. We got our first deal under contract in February 2021 when it fell through and found this deal. The way I found it, as exactly as Stacy teaches, is essentially driving for storage through Google Maps. I found the facility. We skipped tracing the owner because he held it in the trust using the skip tracing company that Stacy recommended. The first phone number on the skip trace was him and he answered.
I pitched him the idea of buying a self-storage facility. He and I went back and forth on the purchase price. It wasn’t the price where we wanted to be but it was still within range. We agreed on the price and ended up financing it. My partner and I own quite a bit of residential property in Indiana, Indianapolis and Terre Haute.
My partner had a bank contact that he had done some financing with. We approached him and got these unbelievable terms from a commercial lender. It was 4.25% fixed for 5 years, it adjusts and then another 5 years. After ten years, we have to refinance our balloon. We got interested only in the first twelve months, which was nice because we are doing a build-out of the facility. I might bring up some of the pictures and stuff of the facility.
We haven’t unfortunately broken ground. We’ve hit some zoning headwinds. In the meantime, we raised some capital. We’ve got quite a few equity partners that we brought to the deal and they brought in their money. We used that as a down payment and raised a little bit for CapEx. There was some damage to the storage building. We got all that straightened out. It was about 50% occupied.
We didn’t have any leases. It was a rough shape. It does have a 3,000 square-foot of commercial office space that was rented out. Part of the deal of purchasing it was that the lease would be renewed. We ended up renewing that lease and it pays almost $3,000 a month. The property cashflowed without the storage at all, which is nice.
How did you find your partner or some capital partners?
It’s great to have a partner that has complementary skill sets.
I work with a company called Replace Your Mortgage. I’m not going to pitch their services here but it’s several people that are very like-minded individuals. They’re looking for ways to leverage the equity in their home to build wealth. A lot of them didn’t want to be landlords. They were looking to borrow at 3% or 4% and lend out at 10% or higher. A lot of my private lenders have come from those sources. I’ve been at that for years. One source referred me to another. Before long, raising money starts to build momentum.
My wife is a real estate agent and works with investors in the Metro Detroit area. She manages investors’ Airbnbs. Some of those investors are always looking for ways to get a return on their capital. She’s turned me on to several private lenders. I had a call with another $50,000 commitment for a facility that we’re under contract on in Indianapolis. You start to build momentum. We raised from that community of partners that we had and were able to bring them in on that deal for the one in LaPorte, Indiana.
Are you syndicating for this deal you’re looking at? How are you handling the deal?
I am syndicating. That’s exactly the best way to put it. You got to be careful about that because I don’t publicly raise money and make commitments for returns and stuff like that. You can get in some trouble with the SEC. All these capital partners have relationships with me. I’ve worked with some of them for multiple years. I consider them family friends. It’s an organic way of working with existing clients and it comes up where you’re looking for ways to get a better return on their investment.
Stacy has started her fund. It’s something that my partner and I have talked about because my partner is out raising a lot of money. He’s had a lot of success. If we can get a good solid deal flow going, we’re very serious about starting our fund and going down that same path that Stacy has gone on. This is interesting. I’m pretty sure that this guy is posting stuff to our Google page but self-storage is my first facility.
Bigger garages are the branding for all our facilities. We’ve claimed our Google My Business. This is a 3-000 square foot office space. It pays us about $3,000 a month. With the interest-only payment, the property cashflows without the storage. The storage building is about 32 units. We closed in November of 2021. All 32 units are full and all the tenants are paying.
One of the things that attracted us to this deal, other than the almost guaranteed income from the commercial space, is it has a lot of land. We have plans approved at the state level but gotten some pushback from our neighbors and the municipality about building additional storage out here. There have been some concerns about rain, runoff and drainage. Believe it or not, one of the neighbors was concerned about building a building right here along the road that would block the view of the intersection. We do think we’re going to get two more buildings on this land. Once that’s built out and stabilized, then we’ll have 74 units in total.
We have our Bigger Garage Self-Storage website, which Stacy probably recognized. Another thing that I got from the StorageNerds program was her marketing person. He’s been amazing. He put together this website. It does somewhat integrate with storage. If you go to Rent a Storage Unit, you can see that Carleton is the one we bought and La Porte. You can say, “I want to rent a storage unit in La Porte.” A new tab is taking you to the storage rental center. It’s got our little logo. We’re all filled up. There’s no availability in La Porte.
Both facilities and eventually, all our facilities will be on this website. It’s got a map. There’s a lot of thought that’s gone into marketing of how this website is designed and even down smiling faces have a better likelihood of them clicking on the button and signing up versus not. We’re super excited. This has only been live for maybe a week because we moved away from a stock website that storage provides you. You ended up saving up quite a bit of money because this website is one fee for all our facilities, whereas storage charges you per website. Stacy, you’ve already moved over. Yours probably look very similar.
We have eleven facilities. Think about how much that would cost if we used that.
That’s my first facility. We financed it with a local community bank, a commercial lender, somebody that we connected with. We’re using storage. We’ve had a great experience with storage. The occupancy isn’t correct because I’ve probably gotten ahead of myself. I’ve already added the 74 units. We do have some people that are past due but we’ve got 25 tenants. We’re all full up.
Some of the features that we like about this are insurance. This is something that we’re working on. We’re going to go through and get everybody onto insurance, whether it’s private insurance that they provide or facility insurance that provides us some residual income. This integrates with storage. We can go through and get residual income from that.
Another residual income that we get is we rent locks out to our tenants. Through storage, you can set them up where we buy DaVinci Locks for $10. We rent them out for $2.50. You think about your breakeven on that. The locks that we buy are for free. We overlock our tenants with the locks that they bought for us. That’s the way we’re going to manage our new Carleton facility and the one there in Indianapolis that we went under contract on. That’s all I’ve got for find, fund and run it for LaPorte.
“What was the name of that source? What source is that? How do we use locks that others have keys to?” That’s one thing. None of the locks that we use have keys. They are combination locks that can be reset. Our lease has instructions for how the tenant can set the combination to their combination. Before we return their security deposit, they have to set the combination back to all zeros. We have not yet had any people forget their combination but we do have a $50 lock cut fee that dissuades them from forgetting it.
For the bank and mortgage question, it was a small community bank in Indiana. Unless you’re in Indiana, it won’t make sense for me to tell you this. It’s the Community First Bank of Indiana. There are some larger lenders out there. Stacy, the rule of thumb is anything above $500,000, you can work with some of the larger nationwide lenders.
To be honest with you, we enjoy working with local commercial banks like this facility that we’re under contract in Indianapolis to purchase. We’re working with the same lender that we closed on the facility in Michigan. They’ve been great to work with. That facility is going to be $1.1 million. They’ll do a 75% loan-to-value.
We found Carleton through a wholesaler. If you’re familiar with a wholesaler, they find the deals from motivated sellers and assign contracts out to buyers. We pay an assignment fee. Believe it or not, we paid a $100,000 assignment fee on this deal. The numbers worked well for us. It would have been great if we could have found it before these guys did, which is what our goal is. If the numbers work, everybody makes money. We were initially passed up on this deal. The wholesaler was going to try to get a cash deal done but the cash deal backed out when he found out how much work it was going to be on this facility. We got a second chance on that.
Stacy, I saw this was posted in the StorageNerds group after we went on under contract because Steven was out talking on Facebook again. Funded, this was a commercial bank, Alliance Bank, another small local bank in Indiana. These are some of our terms. It was a 75% loan-to-value. Unfortunately, we fought to get an interest-only for twelve months but they wouldn’t do it. We were very lucky because a lot of times facilities like that, lenders won’t touch it if you can’t get some documentation from the owners. The seller ran it as a cash business and never reported any of the income. There were no tax returns to be had on this deal. This bank financed it without tax returns. We were very lucky.
Hire out the things that you’re not good at or things you don’t want to do.
Why did you use this lender instead of the other one that you had?
This lender was willing to finance in Michigan, whereas the other lender that did the Indiana deal is Indiana only. Believe it or not, we were surprised that this lender is based in Indiana. My partner and I had done some deals with this bank in Indiana and we were surprised that they were willing to do this in Michigan. They sent one of their people up to meet me because I live in Metro Detroit. She and I met out at the facility. I walked her through the facility.
They asked a lot of questions and did a lot of underwriting. It ends up being a great deal, 4.5% fixed for ten years with a 25-year amortization. Principal and interest payments are the only downside. We’ll probably be out of pocket a little bit in the first few months as we stabilize but it’s about 50% occupied, so we’ve made some pretty good progress in a very short period. This is the remaining of it that we raised.
We’ve raised $295,000 from partners. I had four partners. This deal is so sweet that my partner and I put some money into this deal. We each put $15,000 in, so each of us owns 33.75% of the deal. You add the 1.5% onto our equity for the cash that we put into it. It’s going to be a very good deal. Our partners are going to have a very handsome return on the deal once it’s all stabilized. We’re using storage for this.
We’re using the same marketing company that I mentioned for LaPorte. It’s on the same website. We’ve got Google My Business using Google Ads to attract new tenants. We’re less than a month. We closed on it and have been able to collect about 70% of rents from existing owners. The facility is about 50% occupied out of about 129 units with 10 parking spots. The business plan is that we’re going to raise rents all up to the market.
The owner was very reluctant to raise rents. We’ve even found that if you paid 3 months in advance, you’ve got the 4th month free. A lot of these people were paying far below market rents. We’ve already gotten rid of that policy. We’re probably giving them a few months so that we can get all the vacant units rented out according to market rent.
Once everything’s rented to market, we’ll go through and across the board raise everybody to the market. We’ve probably had a few people threaten to leave if we raise the rent but that’s why we like to fill it up according to the market, so we know what the market will be. Once we get up as we did at LaPorte, we’ll be 100% full and then bring everybody up to full market rent.
What are you doing to market and find tenants?
We’re using Guy’s marketing, his search engine optimization, Google My Business marketing and Google Ads. I’ve been reluctant to use SpareFoot, which was what we used at LaPorte. We did fill up that facility pretty quickly using SpareFoot. As you are aware, it was very expensive. We had a lot of good luck towards the end at LaPorte using Google Ads, instead of SpareFoot even before we had our new website up and running.
We’ve cranked up the Google Ads because it’s about 25% of the price of SpareFoot. I don’t mind paying $500 a month in marketing through Google Ads because for a couple of units rented up, that’s what SpareFoot will cost. I’ll be able to fill them up a lot faster with Google based on how much I’m spending on marketing. That’s what we’re using.
Guy will do marketing on a lot of other platforms like Bing, Yelp and other search engines. He also helps post on Facebook, where we keep our social media refreshed with new posts around the holidays and such that help you bubble up on the search rankings. Our strategy is we’re going to dump a huge amount of capital into marketing to get Guy filled up as fast as possible.
When you were getting into storage investing, were you thinking like, “I’m going to have to learn how to do search engine optimization, all the Google Ads and stuff?” Is this something that you’re thinking about or is this something that’s like, “I’ve got to do this?”
I don’t mind it. I’m a small business mentality. I’m not going to do a lot of the heavy lifting myself. My wife and I were out at this facility with the kids sweeping out units and stuff. It’s good to try it once, get boots on the ground and get your feeling on what’s going on. I try to hire out the things that I’m not good at or I don’t want to do. That’s why it was a no-brainer for us to hire Guy for his marketing expertise. It’s well worth the money. I wrote a $2,500 check to SpareFoot to fill up LaPorte. It will take me five months to pay that to Guy. It makes a lot of sense to find somebody good at that. They’re able to do that heavy lifting but it’s a business.
I don’t know how much you want me to hawk different solutions here but there’s a company that we’re working with called Late2Lien. Our strategy is that we’re going to try to build a portfolio where we can not necessarily be close to our homes like Michigan, Indiana and Ohio. I’ve got some family in Missouri. Between Missouri and Indiana is Illinois. There are quite a few states that we probably own a property in.
I don’t want to have to worry about knowing the lien laws in all these different states. Late2Lien integrates with storage. Once the tenants reach a certain point, you hand it off to them and they’ll take it out through the lean process and up to the point where they’re ready for auction. They’ll connect their system to the auction system.
It’s another example. It’s $15 per unit, which in our mind is a no-brainer because we charged a $20 late fee. We’re not going to send every unit through Late2Lien if we think that we can get them back on track. It’s not worth our time learning all of that or trying to hire somebody when it’s $15 per unit. Making sure that we’re following all of the different state laws with facilities in different states makes sense.
We do all that in-house but most likely, we’ll be getting somebody else to do it. That’s a lot of work with the auction process.
Make sure that you’re compliant with local and state law so you won’t get yourself in trouble.
There are far more wholesalers for residential properties than there are for self-storage.
Here’s another question. “I’m familiar with the wholesalers and I use them for buying single-family homes. However, none of them have brought new storage deals. Do you have a suggestion on finding deals besides wholesalers?”
Join Stacy’s group. She teaches you nuts and bolts and soup to nuts on how to find your deals. With my first deal, that’s exactly how I found it. I took the script that she gave us, all of the tools and information. I went and found it myself. It’s tough work. Maybe this is a good segue. I formed a new company called AMP Self Storage. We’re going to be a wholesale company. The original idea behind the AMP Storage was we needed enough deal flow to keep up with our acquisition and capital. We’re into a position where we have far more capital than we have deals.
I don’t want to be out finding deals. That’s not something that I want to sit and do every day. We formed a company and brought in some partners that would find deals. We compensate them handsomely, a $100,000 assignment on a self-storage deal. All you have to do is assign one deal and the rest of your sourcing of deals for the rest of the year can be paid for. That was the whole idea behind Amp Self-Storage. We brought on our virtual assistant and marketing.
We’re using a lot of the strategies that Stacy has taught, like Google Maps, LandGlide and IDI Skip Tracing. There are a lot of tools out there to find your deals and get in front of owners. I came from the residential world. I’ve never bought a single residential property that didn’t come from a wholesaler. I’m very familiar with that environment. There are far more wholesalers for residential property than there are for self-storage.
There are not a lot of wholesalers that are self-storage. The concept of wholesaling in the storage world is very new. Is this something that you partnered with Allen?
Another benefit of being part of Stacy’s group is Allen came into one of our Tuesday webinars and said, “This is what I’m doing.” He’s a marketer. He already had a virtual assistant and instituted some of the processes with the virtual assistant, training them on how to use the tools. Instead of building it ourselves, we partnered with him. We gave him a little bit of equity in the company. We’ll do the part he doesn’t want to do. He can find the deals. We’ll underwrite them and both profit from it.
What he wants to do is find deals.
I have no problem partnering with people that have complementary skills. I know how to do it. I did it. I found my first deal and did exactly the way AMP Self Storage does it regularly but I don’t want to sit and do that every day. I’m running self-storage facilities and doing some underwriting. We found somebody that that’s what they want to do and what gets them out of the bed every morning. I’m hoping that AMP Self-Storage will be able to grow to be an active player in the self-storage wholesale world. Who knows we’ve made it to the top if we wholesale deal with Stacy?
For your third deal, is that the one you have in your contract? Did you find that yourself or did you get that from a wholesaler?
It’s one of the things that my partner does. I’ve never put much stock in it because, frankly, it’s frustrating to deal with brokers. I don’t give brokers enough respect. My partner is a hustler like me and a networking person. There’s never a dead contact in his network. We had a broker bring this deal to us. It was off-market. I’d never been posted on the internet or anything. He brought it to my partner and said, “This guy is motivated. Before we post it live on the internet, we’d like to give you a shot at it. I’ve got two other buyers but they’re not super excited about the offers. What would you guys offer on it?” We did the underwriting, made sure that we had the money available in our network and put it under contract. It’s going to be a great deal.
How big is that one? Tell us a little bit about that.
The warehouse alone is pretty large, which is 10,000 square feet. It has a tenant who is paying $3,000 a month but the market says that it should be able to rent for almost $5,000 to $6,000 a month. They’re vacating in May of 2022. We’re going to probably spend a couple of months trying to get that warehouse rented out but then it’s got 74 units of self-storage on the property and about 80% occupied. There’s not a lot of stabilization there to be done but they’re way below market rents.
There’s very little CapEx at all that’s needed. The warehouse is in great shape. The storage is relatively new and in great shape. What they call a tired landlord wanted to dump the property. We gave him what he wanted and thought the numbers worked well for our buy box and got an under contract. It’s $1.1 million for 74 units, and about 10,000 square feet of warehouse space.
When do you close on that?
I wired my earnest money. The closing is tentatively scheduled for the 3rd of June 2022. That’s one thing that’s different with storage and you warned me about it. These commercial deals take a long time. Usually, a 60-day close is pretty standard. I’ve even seen 90. My partner and I are both very excited about it because we’re back home in Indianapolis. In both of our networks, we’ve got a team on the ground in Indianapolis that can support that facility. We’re excited about that deal.
You’re out raising money for it as well.
We’ve got more capital than we know what to do with. We’re to the point where we’re trying to figure out what’s the expiration date on some of this funding. If they don’t put it in one of our deals, they’re going to go put it in another deal. We’re trying to figure that out and get them subscribed to the deal. We’re more focused on AMP Self-Storage and finding more deals. We ended up through AMP. We got in contact with an owner in Terre Haute, Indiana. He was working with a wholesaler that was blowing him off. We’re hoping to get that one under contract.
Through AMP, we found a self-storage facility in Elkhart, Indiana. Believe it or not, the lady refused to negotiate a price over the phone. She said, “I’m interested in selling my facility but I want to know you’re serious. I want you to come to visit me.” We’re going to drive down through Elkhart, stop and see her. I’m going to have an LOI in my hand. I’ve already floated to her on the phone a price of what we think we can buy it for. She didn’t say no or hang up on me. I’m going to bring my kids. We’re going to try to charm her and see if we can get a deal done there as well.
There’s still not enough storage out there, so that’s a great asset class to be part of.
My daughter is a little chatterbox, so she’ll be in there and the lady will forget about selling self-storage. She’ll be ready to go. We’re very excited about that. We do anticipate that we’re going to be able to get one of those deals or another one here under contract. Our goal is probably to do another 3 or 4 deals to try to get 10 deals done in 2022.
For the wholesaling company that you’re setting up, what areas are you all looking for?
We’ve got lists for Michigan, Ohio, Indiana and Missouri. We’re also driving for storage in Illinois so in the Midwestern area for those states. We’ve had the most luck, maybe because that’s where the VA started in Indiana. We’ve had a few leads in Michigan that we couldn’t come to an agreement on the terms but we’ll be hitting Ohio and Missouri pretty hard here because we feel like we’ve rung out Indiana.
Although my partner was sending me a message, we’ve got a source of free leads through a library. I’m not sure where he got these about 3,000 self-storage facilities in Indiana through somehow getting them up through a library. We’re going to feed that into our AMP Self-Storage machine, get the VA call on those and see if we can get any of those under contract.
This is something that I see more and more in the StorageNerds too as well. Once you learn how to find facilities, you can find them for yourself and easily find them for other people as well too. This is what we’ve been doing. Aseem is in the group as well too. He has hired virtual assistants. He is out on the West Coast looking for facilities as well. There are pieces to you like setting up a company where you could wholesale self-storage. This is another thing that you could learn in StorageNerds because you’re going to learn the whole process and be able to utilize that to help other people as well.
One of the things that storage does has this great map. You have to build this map yourself but you can drag the unit mix over. There are 300 and 200 buildings and less than 100 buildings. In the property, there is space down the middle for a fourth building. The owner gave us the plans that were approved back in the ‘90s to build the fourth building down the middle. One of the things that we might consider doing in the future is building another building down the middle.
We’ve got some 5x10s and 10x10s, 4 20x20s, a few more 10x20s and a huge number of 5x15s and 10x15s. These are what our rates are, 16 5x10s and 40 5x15s. We have this one unit which is a 5×15 but somebody built a shelf in the back. We’re charging an extra $5 for the 5×10 that has a shelf in it. I don’t know if that’ll fly or not but we thought, “We’ll try it.” We’ve got 12 10x10s and 15 10x15s. We have 2 different 10x15s. What the owner realized is that the 10×15 sells a lot better than the 5×15.
What the owner did is they took the wall down between the 5x15s and make it a 10×15. What we’ve heard from some of our tenants as we’ve been out there working is they don’t like having that dual door. They want one big door, which is what it is. We might end up having to lower the price on these because they’re dual units. If the marketing works and we’re able to fill this up fast, we may convert these back to 5x15s. If you look at revenue per square foot, the smaller units give you more money per square foot. I’d love to be able to convert all these back to 5x15s and rent them out for more per door.
That’s the way they’re configured. You can see these little signs that they’re vacant. Some of these are delinquent. We’ve got quite a few that need trash-outs. The doors need to be fixed. There’s quite a bit of CapEx that needs to go into the facility. I’ve got 8 10x20s and 9 10x20s for parking. We’re still trying to work through the parking situation. We’ve got two different parking spots that are pretty large. We have 4 20x20s that are two-car garage door types. A lot of them have like 2 boats, 2 cars or something like that.
That gives you the unit mix. These are the standard rates. I wish I could show you how much some of them are going for. It’s quite surprising how far below the market they are. We’re about 38%. We’ve been able to make it through most of the tenants. We only have a handful of people left that are behind. Out of 53 tenants, maybe 20 or 30 tenants are left to go.
We’re making good progress. It’s a process. The hardest part of the entire deal is stabilizing the facility. Once the LaPorte facility is stabilized, we hardly ever get calls. It’s full. Many of the tenants are on autopay. We might have 1 or 2 that we’ve got to chase down because they’re late but other than that, it’s very turnkey. Once you have the processes and the marketing in place and the place is filled up and full, it’s very easy to run.
Thank you so much, Paul. Give everybody a synopsis of your year in StorageNerd so people can have an idea of what happened that you’ve been there?
I joined in November 2020. I was one of the last people that joined when Stacy was still taking the calls directly. Stacy called me directly and we had a great conversation. In 2020, like many residential real estate investors, I got a little spooked because of the eviction moratorium. I was looking to diversify into storage. It’s in high demand. There’s still not enough storage out there, so that’s a great asset class to be part of. Instead of teaching myself what I needed to know to be successful in storage, I decided that I wanted to buy the education. It’s been a great experience with Stacy.
The first deal that I got under contract was from a wholesaler. It ended up falling through. We may have had one other deal that fell through. Stacy, you’d brought us a Flint deal that we couldn’t get done. It can be frustrating. Stacy knows that if you’re trying to find deals on your own, you’re going to call potentially hundreds of owners. A very small percentage of them are even going to be open to selling. Even out of that small percentage of the ones that are open to selling, it’s maybe 1 or 2 that you’re going to be able to get a deal done but it is a numbers game.
The more people you call, the more driving for storage you do, the more calls you make and the more owners you talk to, the more likely you’re going to get a deal done. We didn’t quit. I’ve leveraged everything that I’ve learned from Stacy. This website came from her marketing contacts. We’re working with the storable contact that she gave us. We worked directly with Jennifer. I’ve been able to collaborate with some of the other students to start new businesses. It’s been a super valuable experience of being in that group. I went down to Georgia and we had a chance to go driving for storage together.
My partner lives in New York. My partner and I and our wives were able to go driving for storage with Stacy in Pennsylvania and New Jersey. Meeting the other students that were on the trip and collaborating with them has been a great experience. I would encourage anybody that all of this you can learn on your own but it takes a lot of time. If you want to get this done fast and move quickly, it’s worth the money to learn this from somebody that has been very successful doing it.
You have such a great community too. You have so many people in the community doing deals together, partnering and wholesaling. Thank you so much, Paul, for hanging out with us and going over your deals. Congratulations on your next deal. There are many more to come because it gets addicting.
It does. I can’t wait to get another one under contract.
Thank you for hanging out, everybody. I will see you in the next episode.
