Self Storage Income AJ Osborne

Self storage investing vs. multifamily investing: Which wins in 2024? With the popularity of rental property investing rising over the past few years, competition has remained hot for beginner investments like duplexes, small multifamily properties, and house hacks. But if you’re looking to grow your money the most, is self storage a better pick? Would you rather deal with a few tenants and toilets or hundreds of customers simultaneously?

We’re breaking down each of these investments piece by piece, from the prices to buy each investment property to raising the property value, cash flow, evictions, auctions, competition, appreciation, and more. Both self storage and multifamily real estate have huge benefits for those willing to put in the work, but is the stress of a midnight toilet call from your tenant worth the benefits that residential real estate provides? 

Plus, if you think you don’t have the money to buy a commercial real estate investment, think again. We’ll share examples in this episode of how you can buy a self storage facility for less than a duplex in your area. Don’t believe us? Stick around, and we’ll show you precisely what we mean!

What you’ll learn in today’s show:


Residential real estate vs. self storage investing and which is a better buy in 2024
Property price differences and how it may be even cheaper to buy a self storage facility in your area
More units = more problems? Why it’s easier to have a hundred customers than ten tenants 
Evicting tenants and the considerable benefit self storage has that multifamily can’t beat 
Forced appreciation and how to use self storage to boost your wealth
Multifamily vs self storage competition and which is easier to buy in today’s market 

The self storage industry is changing. From the Great Recession through 2021, those who bought self storage facilities saw massive rent growth, impressive appreciation, and, at times, a seemingly endless supply of renters. As the American population began to move after the lockdowns, self storage only became more attractive, and facilities were filling up left and right with occupancy rates and rents exploding. But now, things have changed.

Over the past two years, self storage operators have been hit hard. Rent drops, vacancy, and increased competition took away the “passive” income part of self storage investing. Thankfully, those who treated their facilities like businesses survived, while the casual investors either bit the dust or sold to stop the bleeding. Time-tested investors Andrew Freeman and Jon Marshalla from KO Storage were able to roll with the punches and survive a tough self storage market.

Today, we’re talking to Andrew and Jon about how they built their portfolio from zero facilities to over two hundred, plus the markets they’re targeting as the “mom-and-pop” investors slowly sell and large operators “consolidate” what’s left of the smaller facilities. Andrew and Jon even share what they’re seeing in 2024 and how they’re pivoting to control the controllable and not only survive but thrive as the storage industry continues to change.

What you’ll learn in today’s show:


Why Andrew and Jon ditched multifamily real estate to build a massive self storage portfolio
The “lost year” in the self storage industry and why so many operators got hit hard in 2022
One CRUCIAL part of your investing strategy that cannot be overlooked
The “acquisition runway” causing mom-and-pop ownership to dwindle 
Why small markets, not big markets, might be even safer to invest in 
Andrew and Jon’s 2024 plan to buy even more as deals become challenging to find 

Previous Episodes with Andrew & Jon

Episode 105 with Jon and Andrew

Episode 142 with Jon and Andrew

Where to find more about our guests! 

Andrew LinkedIn

Jon LinkedIn

Enjoy this podcast? Leave us a great review wherever you listen! 

Ready to buy storage? Have your deals personally evaluated by AJ and our team! 

https://www.selfstorageincome.com/feasibility 

Take advantage of today’s market conditions and invest with us: 

https://cedar.cc/invest 

Make self storage management easier than EVER with our podcast sponsor Tenant Inc. - https://www.tenantinc.com/ 

Today’s guest built a twenty-five facility self storage business in just two years! Even more impressive? He didn’t come from a real estate background, yet he was able to build a serious storage portfolio across multiple states, all by “taking the punches” as they came. If you want to quit your job and start investing full-time, this is an episode you CANNOT miss. You’ll hear how Faraz Hemani left his high-paying Google job to invest in small-market, mom-and-pop self storage facilities. 

The question is, did it pay off?

After making some good income at his tech sales job, Faraz needed somewhere to park his money. Like most people, he thought rental properties were a great option, but as the market began to climb, Faraz realized that he had no control over whether his portfolio’s price went up or down. He sold off his rental properties and found an asset he could control—self storage.

Now, two years later, Faraz has a self storage portfolio of over twenty-five facilities across the southern United States. How did he scale up so quickly? Which markets is he targeting? And how does a complete novice get that many facilities so quickly? If you want to learn how, stick around for this episode as Faraz shares his buy box, favorite markets, and which facilities small investors should target.

What you’ll learn in today’s show:


How to quit your job and build a self storage business (and whether it’s worth it)
Why self storage beats rental properties IF you can master THESE skills
Faraz’s exact buy box and the “mom-and-pop” facilities new investors should look for
Why Faraz DOESN’T buy in the big cities but sees huge success in smaller towns 
Syndicating, raising private capital, and when it’s time to take on investor money
The truth about entrepreneurship and why 99% of people CAN’T handle it 

Faraz’s LinkedIn

Pebble Ridge Capital Group

 Make self storage management easier than EVER with our podcast sponsor Tenant Inc. - https://www.tenantinc.com/

Check out Storelocal! Our national self storage brand. 

https://www.storelocal.com/

Ready to buy storage? Have your deals personally evaluated by AJ and our team! 

https://www.selfstorageincome.com/feasibility 

Take advantage of today’s market conditions and invest with us: 

https://cedar.cc/invest

Wondering how to start a storage business with no money? Surprisingly, most self storage investors start out with no or low-money-down deals. Even the wealthiest of storage investors rarely pay for a property in cash or use their own money to make the down payment. 

Self storage DOESN’T require you to have millions and millions of dollars to get started, and in this episode, we’re showing you exactly how to build your self storage portfolio when starting from ZERO.

There are a few strategies you’ll need to know before you can buy your first zero-dollars-down storage facility. If you’re able to master these, you can easily pick up a storage facility for very little money down or sometimes zero dollars out of pocket. Want to use other people’s money to pay for your deals? AJ and Conner go over the two parts of raising money and how to raise capital once you’ve got a deal in hand.

Do NOT let this tough market go to waste. Now is one of the EASIEST times to get no and low money down self storage investments done! So tune in, and get ready to execute (even if you’ve got NO money!).

What you’ll learn in today’s show:


How to start a storage business with no money or very little money out of pocket
Why now may be one of the BEST times to get seller financing on a storage facility 
The exact strategy AJ used to go from no facilities to hundreds of millions in self storage 
Beginner steps we would take in 2024 to get our first storage facility deal done 
Raising capital for your deals and how to get investors to put up the down payment
Why you should always look for the deal first BEFORE you worry about the money

What we mentioned:

Finding Deals

Buying Deals 

 Make self storage management easier than EVER with our podcast sponsor Tenant Inc. - https://www.tenantinc.com/

Check out Storelocal! Our national self storage brand. 

https://www.storelocal.com/

Ready to buy storage? Have your deals personally evaluated by AJ and our team! 

https://www.selfstorageincome.com/feasibility 

Take advantage of today’s market conditions and invest with us: 

https://cedar.cc/invest

One type of commercial real estate is seeing skyrocketing demand right now: small bay industrial. Haven’t heard of it? You’re not alone. But for investors like Shea Lewis, one of our Inner Circle students at Self Storage Income, this often underrated type of real estate investment gives him great returns, high demand, and rock-bottom vacancy. But what is small bay industrial investing, and why are so many businesses fighting for small bay space right now?

If you invest in self storage, or plan to, this episode may change your mind entirely. In it, Shea goes through what small bay industrial investing is, why it’s experiencing “crazy high demand” in 2024, the deals he’s doing TODAY, and why you should get into the warehousing space BEFORE everyone else learns about it. Plus, most of the headaches of self storage investing almost disappear once you enter into small bay industrial warehousing.

Want to invest in an asset that has locked-in revenue for YEARS? What about one that has almost unlimited demand? Shea will tell you exactly what you need to know to get into the game and his buy box for buying these cash-flowing commercial assets that most investors overlook!

What you’ll learn in today’s show:


Small bay industrial warehouses 101 and why they beat self storage in many ways
The “crazy high demand” for warehouse space as small business growth explodes
Shea’s exact buy box for finding and buying small bay industrial properties 
The markets that have the highest demand for these assets and signs of a phenomenal deal 
Small bay vs. self storage investing and the major headaches it completely avoids 
The one thing you NEED before you start investing in this asset class

Ready to buy storage? Have your deals personally evaluated by AJ and our team! 

https://www.selfstorageincome.com/feasibility 

Take advantage of today’s market conditions and invest with us: 

https://cedar.cc/invest 

Make self storage management easier than EVER with our podcast sponsor Tenant Inc. - https://www.tenantinc.com/ 

Connect with Shea Lewis Here:

https://www.linkedin.com/in/shea-lewis-92379365/ 

shea@zequitygroup.com 

https://www.zequitygroup.com/

 

Videos mentioned in this episode:

Cap Rates in Self Storage

Today, we’re going over how to buy a storage facility, even if you’re a complete beginner with zero experience in self storage investing. From pinpointing your purchase price to closing and finally getting the facility under your management, we’ll walk through the six beginner steps anyone can take to buy a self storage facility in 2024. If you’re ready to buy your first self storage investment, these steps MUST be followed!

Haven’t found a facility to buy? Tune into last week’s episode, where we went over exactly how to find off-market self storage facilities with the most profit potential. Once you’ve found the deal, the fun really starts. In this episode, AJ and Conner share how they come up with offer prices, why they NEVER trust a broker’s “pro forma” number at first glance, and the contracts you need to have ready when you want to get a deal done.

But before you close, there’s still work to do. We’ll discuss due diligence, how to exit a deal when things aren’t what they seem, closing, and what to do as soon as you send over the money so you can hit the ground running on your first facility.

What you’ll learn in today’s show:


How to buy your first self storage facility even if you have zero experience 
Calculating your purchase price and why you CAN’T trust the market 
What brokers will tell you to convince you to buy a facility that ISN’T worth it 
LOIs (letter of intent) and PSAs (purchase and sale agreement) and when to use them
Everything you need to do during your “due diligence” timeline to confirm the deal is worth it
How to ensure a smooth transition when you finally take over your first facility! 

How to Find Off-Market Self Storage Deals in ANY Market

How to Value a Self Storage Facility - Don't Overpay!  

Enjoy this podcast? Leave us a great review wherever you listen! 

Ready to buy storage? Have your deals personally evaluated by AJ and our team! 

https://www.selfstorageincome.com/feasibility 

Take advantage of today’s market conditions and invest with us: 

https://cedar.cc/invest 

Make self storage management easier than EVER with our podcast sponsor Tenant Inc. - https://www.tenantinc.com/