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March 29, 2017
Closed Sales

Prescott Mini Storage Portfolio – Prescott, AZ

The owner of this two property mini storage portfolio contacted with us in the fourth quarter of 2016. He was the original developer of the properties from the mid-80’s and was beginning to consider retirement. For years, his properties had produced consistently high levels of occupancy and cash flow, but there were yet challenges that this portfolio presented. First, the size of the market was not great enough to attract large groups, while at the same time the size and valuation of the portfolio was beyond the means of most local operators. Second, the management records used at the facilities were a tried and true, yet antiquated, paper ledger system. This made delivery of historical records, specifically occupancy and month-by-month analysis, a challenge and gave reason for extra scrutiny by potential buyers and lenders.

This is not a new scenario for us. We were even able to convert the challenge presented by the records system to an advantage. While working diligently with the seller to organize his files and allowing us to construct credible historic records, we were simultaneously marketing a buyer’s ability to create value by bringing the management operations to current practices. As an Argus Network Broker Affiliate, we are building on a prior year of $400 million dollars in self storage sales located in 63 markets around the country. Some of these properties are in urban areas, yet many are in rural markets with similar management practices in place. Over many years, we have compiled an enormous database of self storage buyers and more importantly, a selling checklist to prepare both a property and the seller for an easy, efficient sale process.

In the end, multiple offers were received.  By conveying up to the minute information, scheduling tours in a tight time frame, and fully cooperating with the local real estate brokerage community, a sense of urgency was effectively imparted to all potential buyers. Ultimately, our client received an offer well above the asking price and, through our proactive work to compile the seller’s financial documents into reliable records of the properties performance, the buyer secured non-recourse financing in a timely manner. Both parties were happy with the end results. The seller was happy to retire at a favorable valuation for his assets and the buyer received a value add opportunity that will benefit from modern management practices.