Self-Storage Buyer's Pack

The model

Fourteen sheets, with live formulas.

How to use

What to fill in, in what order, and how to read the results.

Inputs

The seller's figures: asking price, rentable area, occupancy, rent collected, street rate, each cost line and an optional rent roll by unit size. Then the county tax rate, closing costs, working capital, your loan program (7(a) or 504) and terms, and prefilled assumptions you can change.

Outputs

Each result beside its published benchmark, with a flag where the facility looks out of line: occupancy, rent, the gap to the street rate, costs, the property tax after the sale, NOI with a management fee, cap rate and price per sq ft, sources and uses of cash, lender cover, the highest loan rate that still passes, any balloon at the end of the loan term, break-even occupancy, your cash return and your equity IRR with a sale after five years, flagged when it rests on the sale.

Projection

Five years forward, with an optional rent roll that re-lets leaving tenants at the street rate, any loan balloon, the sale at the end, a downside case, and lender cover by price paid and revenue.

Lender summary

One printable page for a lender: the deal, sources and uses of cash, lender cover against the SBA minimum, the highest loan rate that still passes, your return, the SBA write-off rate for loans that size, and the flags.

Seller checklist

The papers to ask the seller for, on one printable page, with a column to mark each one received.

Typical example (3 sheets)

A worked example: a facility the median size of Newmark's Class B sales, at National Storage Affiliates' same-store rent, occupancy and costs, with a management fee, priced at the Class B average cap rate and financed with a standard SBA 504, with the source of every figure. At 10% down no bank rate passes the lender test.

Deposit example (3 sheets)

The same facility at the same price on a 7(a) loan, with enough cash down to reach the SBA minimum lender cover.

Sources

Every benchmark in the model, with its publisher, document, year, page and link.

Data

SBA 7(a) and 504 write-off rates for self-storage loans by loan size, term, business type and approval year.

The guide

Eight sections. Every figure names its source.

1. 1

   The numbers in one page

   SBA loan outcomes, occupancy, rent and costs at the four listed storage companies, cap rates and comparable sales.

2. 2

   What the worked examples show

   A typical-size facility at a Class B cap rate, on a 504 with 10% down and on a 7(a) with a bigger deposit: why the first fails the lender test at any bank rate, why higher cap rates do not rescue it, and how much cash the second needs.

3. 3

   Checking the seller's numbers

   Occupancy, rent, the gap to the street rate, each cost line, the management fee, the unit mix, and the papers to ask the seller for.

4. 4

   Property tax after the sale

   Why the tax bill may move to the price you pay, and how the model works out the new bill.

5. 5

   Paying for it: SBA 7(a) or 504

   Minimum equity, term, the special purpose rules, the upfront fee and rate cap, the 504 split and debenture rate, lender cover and break-even occupancy.

6. 6

   Five years, a sale, a downside and a price grid

   The projection, a sale after five years and your equity IRR, a downside case, and lender cover by price paid and revenue.

7. 7

   SBA loan history

   Self-storage write-off rates by loan size, term and business type, against all 7(a) loans, and what the rates leave out.

8. 8

   Sources

   Every source, with its link and the date it was read.