Self Storage Acquisition

As an intern at StorageMart, I recognize that one of the company’s primary objectives is to analyze other operating self storage facilities and businesses for the purpose of possible acquisition. This is in addition to maintaining current operations and continuing development projects in progress. The purpose of an acquisition is to find a worthy vehicle for investors’ funds, in this case a storage facility.  When looking at a possible acquisition of a facility, there is much in-depth and scrutinous analysis that must be performed.

It is typically difficult to get all information needed to accurately model an acquisition in a timely manner. This is due to the vast amount of information that must be processed in a short due diligence period as well as the type of ownership, mom and pop sole proprietorships. The key items needed to evaluate a self storage facility—obtained  from the operator—are the unit mix, rent roll, financial statements (and all actual bills and bank deposits), occupancy history, site plan, and environmental report. Competitive analysis must also be done to fully evaluate the business. This involves mapping competing facilities, obtaining their rental rates and other information about the facility, such as security features, retail products, and other amenities. Competitors should be compared to the targeted acquisition, based on all amenities as well as quality of location based traffic counts, street size, visibility, accessibility, neighborhood quality and demographics.

Written by Brice Bernskoetter

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Disclamer: This entry is intended to promote our partner StorageMart and some or all participants received compensation.

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