Aiming for a Sale

Preparing your facility for market involves making the property appeal to the broadest range of buyers for an expeditious and profitable sale.

Until the recent real estate slowdown, self-storage owners and investors in many parts of the country saw property values rising dramatically. A combination of record-low interest rates and rapid price appreciation turned many into serial buyers or sellers.

But don’t forget, the self-storage investment market, like any economic market, is cyclical. Periods of robust activity are followed by periods of sluggishness.

Now that the real estate market has softened in many areas, it’s time to seriously reassess the curb appeal, interior appearance and integrity of your facility if you’re considering a sale. Self-storage investors are shopping properties with a longer term in mind. They’re also cautious to avoid “catching a falling knife.”

The first thing is to get inside the mind of potential buyers, who’ll be trying to envision themselves owning and operating the property. They can’t do that if they’re distracted with inferior construction, obvious deferred maintenance, damaged or faded paint, and accounting hardware and software that fails to work.

Curb or street appeal is the most important factor drawing buyers to view your facility. Buyers often do a drive-by prior to a formal onsite inspection, and if they like what they see, they’ll request a viewing. If the exterior of the facility looks dreary and in need of maintenance and repairs, buyers assume the interior will tell the same story. Is that the message you want them to hear?

First impressions really count. In fact, at least 80 percent of a buyer’s decision is made from the drive-by. In a minute they’ll decide if your site is worth a visit. Shoppers are critical and tend to focus on all the things that could give them an excuse to present a lower offer. Their first choice will be a facility that needs little to no work.