Call Us Now:
How To Sell a Self Storage Facility Business in New York For Cash Today
Free Offer Form
Selling a self storage property is easier then ever in todays market. If its mis-managed facility, has no website, no fence, customers are behind on rent, etc...we will buy it or teach you how to sell it with this guide!
Selling your self-storage facility is a complex task. After all, you'll need to assess things like neighborhood safety, property accessibility, and cash flow to come up with the right price.
You'll also need to get your financial records in order.
You could hire an experienced broker to help you land a sale, or you could sell the facility for quick cash, which saves on broker fees.
Regardless of what you choose, keep reading to learn the process of marketing and selling a self-storage facility to the right buyers.
The Process of Selling a Self-Storage Facility in New York
First, we'll give a quick overview of what to expect when you sell your storage facility. Understanding the process can help you craft a good exit strategy and attract prospective buyers.
After all, this process doesn't do well with shortcuts.
Preparing Your Self-Storage Facility for Sale in New York
Before you list your self-storage facility for sale, there are several fixes you may want to do.
Confirm Your Intent to Sell
The first thing you'll need to do is ask yourself if you really want to sell the storage space. After all, rather than being a purely economic decision, it's also a personal decision.
Thoughts like "I'll sell this if I get an above-market price" are signs that you're still quite attached to the property and don't want to sell it yet.
Of course, landing a deal above market price is possible, but this kind of sale is exceptionally rare — especially for the self-storage industry, which has a relatively small market for prospective buyers compared to other real estate properties.
Selling your self-storage property without the serious intent to do so can actually hurt the property and your ability to sell it effectively.
Hire a Real Estate Agent
If you're sure you want to sell it, hire a real estate agent to keep you on track and help with the sale. However, ensure that the agent specializes in selling self-storage properties.
You can consider raising your rental rates to increase income in the short term, which will then make it more appealing to potential buyers.
However, don't go too overboard. A buyer's broker might analyze 12-36 months' worth of financial records. So, if a before-the-sale increase in rental rates isn't justified, it can hurt the sale of your property.
You might want to get the full market potential rate of every rental unit. However, it's more important to show your facility's potential to produce good income.
This is something you can discuss with prospective buyers when trying to market and sell your property to them.
Sell To An Investor
Selling to an investor will by far the easiest way to sell.
Get the Necessary Documents in Order
You should also organize your paperwork. Update all necessary local and state government approvals, certificates, and licenses.
That's because when prospective buyers acquire financing, they typically also need to confirm the status of those approvals and permits for their prospective lenders.
Enhance Your Security
See if your security needs to be improved as well. Both rental unit customers and prospective buyers alike will want to be assured that stored items are well-kept within the storage space.
Here are some marks of good security.
- Security gate with a security code
- Security cameras
- Sturdy unit doors with good locks
- Adequate exterior and interior access lighting
FAST CASH OR SELLER FINANCE
No waiting for your home to sell while you pay the house mortgage, taxes, & home insurance (on top of agent commission). Sell fast as-is!
Easiest Way To Sell in New York
Before you list your self-storage facility for sale, there are several fixes you may want to do.
FILL OUT FORM
Fill out our form and we'll get started on your free offer! No obligations.
RECEIVE CASH OFFER
We'll research your property and call you with our fair offer in cash!
YOU GET PAID!
Money in your bank account at closing. As quick as 7 days!
If a simple home sale that closes on your schedule sounds like what you need, come check us out. You can request a free quote for your house by filling out our form below!
Free Offer Form
Or you can give us a call to learn how we buy houses! (123) 456-7890
Selling AS IS in New York - Fast & Easy!
Selling as-is doesn't mean a low price for your home. As house buyers, we provide the conveniences of an as-is sale while still offering a fair price for your real estate. Plus, there's no commission to pay to real estate agents or closing fees! Our goal is to make selling your home simple, fast, and easy!
NO REPAIRS
Selling your house as is means we take care of all the hassles!
NO AGENTS
Skip paying for agent commission. We make home sales simple!
NO FEES
Not only do we have NO agent or iBuyer fees, we cover closing costs!
FAST CLOSING
Sell your home in 7 days or on your timeline! We buy homes fast.
NO OBLIGATIONS
Take it or leave it. Our free cash offers come with no obligations.
HASSLE FREE
No agents. No inspection. No delays. We buy real estate as-is for cash!
Hiring a Storage Broker IN New York: Pros and Cons
Self-storage brokers can help you call the right shots when selling your self-storage facility.
However, make sure to get your financial records from the past 3 years in good order before hiring a broker.
It's also a good idea to work with a real estate broker with good experience in self-storage facilities — otherwise, creating an exit strategy and selling your business will be harder than it should be.
The above advice applies whether you're a single owner or part of a facility management company, like a REIT.
Yes, you'll need to pay these professionals a fee, but they give you a reality check regarding the self-storage industry.
Remember to hire a real estate broker who actually specializes in self-storage properties rather than someone who mostly deals with homes or multifamily properties.
Below are more pros to hiring these professionals:
- Right pricing for your property
- Presenting the property well on different avenues of exposure
- Negotiating price and terms of the sale
- Overall preparation of your facility for sale
SELL FOR CASH IN New York: Pros and Cons
There are actually two options for letting go of self-storage facilities yourself: selling for cash and cash-out refinancing.
Selling for cash is generally regarded as better between the two, since cash-out refinancing is more complicated, requiring you to work with commercial mortgage-backed securities lenders.
Here are some of the pros of selling your self-storage business for cash:
- Self-storage values are generally high, so selling the facility in the current market is a great option
- You generally get maximum funds, providing a strong internal rate of return and multiple on your investment from when you first bought/built the facility
- You can save on broker fees
Meanwhile, here are some drawbacks to consider:
- Federal and state taxes can eat up part of the money you got from selling the property
- Cash buyers might deduct improvements and repairs from your price
READY TO KNOW YOUR OFFER?
Get Cash For My Home!
Free Offer Form
How to Sell a Self-Storage Facility IN New York: Step-by-Step Guide
From creating an exit strategy to looking for commercial real estate sites to post your property on — there are many things to consider when you sell your storage property.
Below is a quick step-by-step guide that can help you close a deal.
Evaluating the Curb Appeal
Evaluating and improving how your facility looks is an important step in the selling process.
That's because the look of your self-storage facility can easily affect how much an interested buyer is willing to pay. As such, you should understand the impression your facility leaves on a buyer when they look at it.
Some things you can consider doing are:
- Put a fresh coat of paint on the doors of storage units
- Make upgrades to the landscaping and signage
- Put lighting at entryways and along the road frontage
- Remove trash, junk cars, and other things that shouldn't be in the parking lot and exterior walkways
- Repair any damaged or outdated items
- Power wash driveways and sidewalks
- Improve the security system
Cosmetic fixes may be able to lift the sales price since buyers tend to prefer properties that are clean and well-maintained.
However, you should still ask your self-storage broker about what capital improvements you should prioritize. After all, not all changes will move the sale price up and might be just a waste of money.
For instance, it might be better to focus on improving the security system and repairing damages to the facility rather than planting new flowers and shrubs or repainting the whole property.
Setting the Right Price
You'll have to decide how much the property is worth on the market. After all, market demand is what will ultimately determine the right price of your facility, not you.
That means you can decide whether you want to sell for the market price or not, but you can't change the market. So, selling too high won't make it an attractive option.
However, selling too low can make prospective buyers wonder if the property is worth buying. Underselling also means you'll lose money.
You can pay for an appraisal, but your real estate broker can help you set the right price for market competitiveness.
Several things can also affect the right sales price, such as:
- Property accessibility
- Unit sizes
- Neighborhood safety
- Average size of storage units
- Having security features
Be aggressive but realistic in evaluating your facility. Do this from the perspective of possible buyers.
Objectively weigh the pros and cons, but also be aware of how well the facility aligns with the current market. You can adjust the pricing according to your or your broker's research.
The more well-maintained your property looks and the more competitive its prospects, the better the price you can sell it for.
Marketing Your Facility
Having a professional property presentation can help in promoting your facility effectively, since it'll be easy to give details about your facility to potential buyers.
This presentation should contain pertinent data about your facility. Include the following.
- Pictures of the property
- Site layout
- Demographics of the market area
- Loan information
- Unit mix
Ensure that your financial records are detailed and accurate. Look for cash flow patterns and be ready to answer if potential buyers question why the cash flow has been rising and falling.
Understand how your facility stands against competitors.
There's a big difference between having a facility in a market where there are small independent operators and a facility in an area serviced by big REITs and larger players.
Marketing Your Facility
As such, all the information you provide can let prospective buyers analyze market competitiveness and gauge future potential income. You can also further discuss acquisition trends in your area.
Once you have that down, you can focus on giving the property maximum exposure so as many qualified buyers as possible know that your storage facility is for sale.
Use different avenues of exposure, such as:
- Direct mail
- Magazine advertising
- Convention presentations
- Network affiliations
- Social media platforms
Of course, choose commercial real estate platforms, too, so your property gets exposed to more qualified buyers. Optimize your listings so it reaches as many people as possible.
A good broker will agree that generating exposure is worth spending money on.
However, you shouldn't worry about spending too much if your real estate broker helps craft an efficient marketing strategy. They probably even have a vast network of potential buyers in the self-storage industry they can tap.
Don't jump on the first offer, either. Instead, cast a wide net, which can drive up competition for your facility. Doing so can give you attractive bids that can raise the price.
However, don't play this hand too much or too long, or your prospective buyers might lose interest and move on to another property that can close the deal faster.
A good broker can help cast a good wide net through a
targeted marketing campaign that will reach qualified buyers.
Understanding the Value of Your Self-Storage Facility IN New York
Self-storage facilities will be valued differently depending on various factors. These will also help you determine the right market price for your business.
Factors Influencing the Value
When talking about value, a real estate agent will likely look at economic factors. Below are some of the economic factors that affect the value of self-storage facilities.
- Net operating income (NOI) - This tells you the current value of your self-storage business but can also predict its future value.
- Occupancy - Shows the state of your income compared to your total potential over a certain time, so it can also show consistency or growth.
- Physical occupancy - Percentage of occupied units out of the total number of units available.
- Economic occupancy - Percentage of units rented at full price.
- Capitalization rates (cap rates) - Measure the buyer's yield when buying the property.
- Current cap rate - Based on the past 3 to 12 months.
- Pro forma cap rate - Based on predicted market values.
- Market cap rate - Based on recent sales, economic outlook, and supply and demand.
- Market level - Primary markets have high traffic volumes, wealthier clients, and greater potential. Buyers can consider even low cap rates if you're on a primary market compared to if you had high cap rates on secondary or tertiary markets since they prefer more consistent growth.
- Location and demographics - If your property is in a high-traffic, highly visible area, your property may be more valuable.
Income Capitalization Method: A Detailed Overview
The income capitalization method (also called the income approach) is a kind of real estate appraisal method that estimates a property's value based on the income it generates.
When using this method, factors like the amount of income generated are considered to determine how much a property can sell under the market conditions.
However, the condition of the property should also be considered. After all, potential repairs and upgrades will cut through future profits.
So Many Satisfied Home Sellers IN New York!
We've been helping homeowners sell their homes as is since 2012. We're known for our faster and simpler selling process compared to working with real estate agents. But, you don't just have to take our word for it... Check out each review from our sellers!
Johnson M.
HAPPY CLIENT
"I was pleasantly surprised by how easy it was to sell my house to Commercial Cash Buyerz. They delivered on their promise of a fast and fair cash offer. The team was reliable and professional throughout the transaction."
Sarah A.
HAPPY CLIENT
"Choosing Commercial Cash Buyerz to sell my property was the best decision I made. Their cash offer was attractive, and I didn't have to deal with realtor commissions. I'm extremely satisfied with the outcome."
Profitability of Owning a Self-Storage Facility IN New York
The potential profitability of a self-storage facility is quite good. After all, most people tend to have a lot of possessions without having anywhere to store them, so demand is fairly consistent over time.
Downsizing and relocating to a new house are typical reasons for people to consider looking for self-storage units.
The changing seasons are also a big factor. After all, some people might want a storage unit for their Christmas decorations or home gym equipment while they're not in use.
Overall, the increasing population, expanding economy, and rise in household income and size are big driving forces for the boom of the self-storage market.
These factors ensure storage facilities have the strong potential to remain profitable over time.
Return on Investment: What to Expect
Return on investment (ROI) is a performance metric that evaluates an investment's efficiency or profitability.
To calculate the ROI, subtract the cost of investment from the current value of investment, then divide the answer by the cost of investment.
The self-storage market has been recession-resistant. In fact, it's projected to have a CAGR of 134.79% between 2020 and 2025.
This is thanks to steady demand, with the average cost of self-storage units of all sizes being $87.89 per month.
How Profitability Affects the Selling Price
Your facility's potential profitability plays a big part in how much your property is worth.
For instance, NOI is determined by subtracting your operating expenses from your total income. Current cap rates are based on your income and expenses from the most recent months.
Occupancy shows any consistency or growth based on your income and total potential.
The
better the profitability of your self-storage business, the more attractive it is to potential buyers since they'll be inheriting that income when they buy it.
Frequently Asked Questions
Regardless of whether you enlist the help of a broker or not, trying to sell a self-storage facility is hard work.
If you have more questions regarding the process, we've answered some of them below to help you close a deal.
How Do You Value a Storage Business?
A self-storage broker has several ways to assess your self-storage business — income capitalization, sales comparison, and cost method.
But of those three, the income capitalization method is the best option for a self-storage property that's currently renting out units to tenants.
Your broker can make suggestions to further increase your property's value by evaluating storage unit prices and improving your curb appeal.
What Is the Profitability of Owning a Self-Storage Facility?
A self-storage facility can make anywhere from $350,000 to $800,000 a year.
However, this depends on factors like the size and location of your commercial property.
As such, if you want to improve your facility's profitability, do your research regarding high-demand locations and competitive pricing.
You can also provide clients with extra services that make you stand out from your competitors — such as selling additional supplies like boxes and tape and offering truck moving services.
What Factors Influence the Value of a Self-Storage Facility?
The value of your self-storage property is made up of performance and market factors. These factors include:
- NOI
- Physical and economic occupancy
- Cap rates
- Market level
- Location and demographics
These factors provide an estimate of how much your property is worth at a certain point in time.
Ultimately, you'll only really know your property's true market value when you solicit bids from a pool of qualified buyers.
An experienced self-storage broker can help you navigate the real estate market. They'll also help you improve your property's value if needed.
How Can I Improve the Curb Appeal of My Self-Storage Facility?
There are many ways to improve your curb appeal. We've included some examples below.
- Clean or paint exterior walls
- Repair broken features
- Replace old or faded signage
- Install new lighting fixtures
- Power wash the drive aisles and sidewalks
A self-storage broker can suggest which fixes can best improve how much your property is worth.
What Role Does a Storage Broker Play in Selling a Self-Storage Facility?
Self-storage brokers can make all the difference in the selling process of your self-storage property since they help you be more objective when selling your business.
That's because you may not realize how attached you still are to the self-storage facility, so a for-sale-by-owner (FSBO) deal might negatively affect your choices.
For instance, you might think too highly of your property and give it a high sales price despite the rapid increase in cash flow being caused by low rental rates.
Potential buyers might take this to mean that you're not making the most of your facility's potential to produce good income.
As such, a good broker will help you know how much the real estate market is willing to pay for your property. They'll also help you improve it to increase how much it's worth.
An experienced self-storage broker should be good at optimizing pricing and helping you understand how to best position your property for sale.
They should also be able to impart in-depth real estate and self-storage industry knowledge during the selling process.
They can also ensure you get your other requirements in order — like local and state government approvals. After all, buyers will need to confirm their statuses for their prospective lenders when they acquire financing.
Trying to sell your storage facility entails a process that doesn't work with shortcuts. So, if you want to start selling your self-storage property, a real estate broker who specializes in self-storage facilities can be a great help.
To start the selling process, contact our team to request an evaluation of your business.
SELL FOR CASH IN New York: Pros and Cons
There are actually two options for letting go of self-storage facilities yourself: selling for cash and cash-out refinancing.
Selling for cash is generally regarded as better between the two, since cash-out refinancing is more complicated, requiring you to work with commercial mortgage-backed securities lenders.
Here are some of the pros of selling your self-storage business for cash:
- Self-storage values are generally high, so selling the facility in the current market is a great option
- You generally get maximum funds, providing a strong internal rate of return and multiple on your investment from when you first bought/built the facility
- You can save on broker fees
Meanwhile, here are some drawbacks to consider:
- Federal and state taxes can eat up part of the money you got from selling the property
- Cash buyers might deduct improvements and repairs from your price
READY TO KNOW YOUR OFFER?
Sell Your Home As-Is Today!
Free Offer Form
Terms & Conditions - Privacy Policy - Sitemap