On this episode of The Self-Storage Podcast, our host Scott Meyers is talking with Pat Wilson about passive income opportunities. With a full-time career in a global energy company, Pat Wilson was looking for easier ways to invest in real estate. As a devoted husband and father, he needed something that could generate consistent cash flow without taking too much of his precious time. And he found it in self-storage investing.
Is Self-Storage Investing a Passive Income Strategy?
As with all types of real estate investments, here you have two options: be a passive investor (a silent partner) or an active one (in this case, the owner of a self-storage facility). Syndication in the storage industry (pooling money with other investors) allows you to invest passively and avoid the hassle that comes with active real estate investment. You don’t have to deal with tenants, manage properties, etc. As a passive investor, you just put in the initial sum and gather profits generated by the facilities.
Is Owning Self-Storage Facilities Profitable?
Active investing is not only time-consuming but also takes a lot of your energy, too. You do a ton of heavy lifting, even if you get professional help from brokers and managers. On top of this, sometimes it’s not as profitable as one might think!
On the other hand, self-storage investing is highly profitable for passive real estate investors, even during economic downturns! This business is booming during recessions, and your passive income streams are consistent.
Self-storage also allows portfolio diversification. Rather than sinking your money, time, and energy in a single project, you’re able to look at a much broader landscape of real estate asset classes and reduce your investment risks so you could generate higher profits.
How Much Money Do Self-Storage Businesses Make?
Naturally, this depends on the facilities and the type of project you invest in. The typical profit margin for owners of these businesses is around 11%. As an individual looking to passively invest in a particular self-storage business, your returns vary on the project you choose to invest in. That’s why you need to carefully research the promoter of the project, local storage market, ROI projections, and, of course, the entire project itself.
To figure out if a certain project is the real deal that will generate high-income, find people with credibility and a lot of real estate experience. Remember, your goal when entering the self-storage industry is to be a passive investor, so you want to work with professionals capable of running these investments on your behalf.
Referrals are great options to get started. When you get help from a person that already achieved success with lucrative self-storage deals, you’re more likely to succeed in the business, too. “Trust but verify” should be your motto! Conducting due diligence is a must when it comes to catching an amazing investment opportunity and avoiding investment mistakes.
Can I Run a Business From a Self-Storage Unit?
You can do anything from a self-storage unit – even run a business. Certain units have electrical outlets, so working in them is entirely possible. This just means that storage space is always going to have a demand on the market.
What does this mean for investors? For starters, demand for storage units secures your passive income stream. No matter the state of the economy, people always need a place to store their inventory, clothes, vehicles, and office supplies. This is why self-storage properties are often called recession-proof commercial real estate assets.
So, are you ready to passively invest in self-storage units? Then, here’s someone that can help! Our community of investors under Scott Meyers’s guidance is always discussing innovative and lucrative investment strategies. Our advice on this podcast alone has helped a ton of people catch amazing investments and increase their ROI.
This is a place to share knowledge and skills from the industry’s leading professionals that will help you launch and grow your self-storage business, so make sure to tune into the next episode. If you want a personalized approach and tailored investment plan, we’re ready to help you, too. Get in touch with Scott Meyers and invest in self-storage in a matter of days.