Ladies and gentlemen, today I have an expert in an area of real estate investing that I’ve been looking forward to interviewing for a long time. This is an area I myself am incredibly interested in and had a hard time finding a qualified expert to talk with. But I found him, and his name is Hunter Thompson, a leader in the self-storage investing market with his firm Cashflow Connections.
Cashflow Connections is an investing firm based out of LA that focuses primarily on self-storage facilities and mobile home parks. These are reasonably recession-resistant assets and the opportunities are abundant. The reason these are great assets during recessions is that these are used more often during times of change: downsizing, kids moving home unexpectedly, etc. Self-storage facilities have a high occupancy rate and low vacancy, and the rental rates are continuing to rise as people continue to over-consume.
Storage facilities also offer opportunities for increasing the value without spending any capital. For example, Hunter partners with U-Haul to provide moving trucks for his tenants to rent when they need to move in or out of their unit. Depending on how large the facility is, that can be 15 to 50 trucks parked and ready to use. That can add thousands of dollars a month in cashflow and hundreds of thousands in added value to the property.
These facilities have exploded in number since the mid-90's, rising from 15,000 to about 53,000 in the United States today. That's the equivalent of the number of Starbucks, McDonald's, and Subway restaurants COMBINED. When you do your due diligence, you can find markets that are underserved and demand is high. A true gem from Hunter is to look at military bases and universities for great tenants, but don't depend on any one industry to supply all of your tenants.
Make sure you head over to Hunter’s fantastic website, CashFlowConnections.com, and find out more of what he and his team are doing in the marketplace.
Hunter has his own podcast, the Cashflow Connections Real Estate Podcast. Listen at CashFlowConnections.com/Podcast.
You can also email Hunter directly with your questions on storage facilities at HunterThompson@CashFlowConnections.com
Don’t forget to visit us at CashFlowGuys.com to see what we're up to and join our Facebook group at CashFlowGuys.com/Group.