Morgan

The ones I’m referring to do include the property. Mostly they are mom and pop type establishments and the sellers are retiring. Typically 40-200 unit type places. Generally not big enough for publicly traded companies to care about. Around here, they are a building on the road, sometimes a few buildings, occasionally fenced in. There are almost no climate controlled units here. I suppose the market can’t support it. That being said, in this case the self storage owner does seem to be at the mercy of the landlord. If he’s had the building for 20 years, its likely paid off so he can hold out if necessary. I guess we’d really need to see the books to know the whole situation.

I’ll just add this for general info. I’ve seen self storage properties selling at 7% to 25% cap rates. Lower rates more recently as the market has heated up (until covid 19). I never bought any because they’ve not been attractive enough for me, but I may have some some errors of omissions.

We don’t have all the details about everything but - - - - $250,000 for 400 units is WILDLY, WILDLY cheap. That’s $625 per unit. Way, way below cost to build. The least expensive per unit cost I’ve seen in my local deals (between Columbus OH and Pittsburgh PA) is $2700 unit. Many are in $4000-$5000 range and going up to $9000 per unit (crazy high). If you don’t buy this, let me know where it is and I’ll buy it.

If the federal and state governments make everyone take a financial pause for 2-4 months until this passes, it’s fine (I guess). If evictions are banned and landlords must pay all of their bills then there will be serious problems for everyone eventually. At a minimum tenants won’t pay now and they absolutely won’t pay a lump sum of 2-4 months rent at the end. They won’t have had a job to have saved up the money obviously. They won’t pay and then they’ll abandon their apartment for a new one as soon as they can be evicted. If everyone pauses it’ll be ok. If the landlords (or one part of the chain) have to bear the brunt of it it’ll be a problem. Ironically, NYC still demands to be paid water, sewage and property taxes. What a bunch of dopes.

minten, I think the fear is that the virus will could get out of control and kill huge numbers of people. After all, it is spreading exponentially. I'd rather the government be harsh and do what they can to limit the spread and damage, than say it is like the flu and not do too much. I am seeing headlines everyday of famous people who have died from the corona virus. It is real, and it seems to kill all kinds of people. We're just starting this in the US. We probably have quite a bit more to go unfortunately.

Where are your apartments located primarily? They're in the northern panhandle of West Virginia - about an hour west of Pittsburgh.

I'm not sure what the banks are doing in my area yet, but I wouldn't be surprised if they're stopping everything except for top quality borrowers with lots of cash. I haven't tried to get a loan since all this corona virus stuff started. That being said, I have three cheap fixer-up houses that were listed just before this began. They're all a little bit below what I think they're actually worth, but still basically no interest. My realtor told me there has been a "drastic slow down" in everything real estate. We shall see, but I don't anticipate selling those anytime soon. I've been looking at some other deals and people haven't really started to drop their prices yet. Some have just been too high to begin with, but others don't seem to realize what kind of recession we're going into. The US is due for a slow down or recession. 10 years of growth quite a bit longer than average. My memory says five to seven years is the average. Anyways, I have a few hundred apartments and only five or six tenants have said anything about not paying. We'll see what happens in the next two or three days.

It seemed very alarming that they shut down so many cities so quickly. It’s up to like 30 million people “quarantined” in their cities. China doesn’t mess around, so I wouldn’t be surprised at all if it’s much bigger than the government is saying. You don’t just shut down 30 million people for no reason.

I agree. Keep the politics on the politics board. I don’t have anything muted and read a fair amount on this site everyday, but the culture seems to be changing as more hostility from political discussions spreads to other areas - mostly the result is people posting less in general. This site is very important to me and I really don’t want it to decline because of politics. (This is isn’t a slight against moderators. Sometimes it just leaks out and is hard to control.)

Good lord guys. At least read the book before commenting... that's how book discussions work.

That dude is gonna have a bad day.

The guy who started it sold it a few years ago I think. It was quite good when he was running it. I haven't been following too much since he sold since it changed a bit after the sale.

I'm giving rocket a try too. Looks pretty good so far. Doesn't seem to have a quick way to upload portfolios though. Anyone able to find a way to do it?

Mine finally was changed - what a completely useless update. I guess I'll find a different service to use. What the heck Google? Why?

This site is incredible. Thanks!

Yes I need to pay $8 to listen to someone tell me that it's ok and I should feel good paying a lot of money for a company that doesn't make any money. You see... these are not the droids you're looking for. I believe these are the articles that are printed in the book. They're free here and worth the read even if the website looks silly. https://waitbutwhy.com/2017/03/elon-musk-post-series.html

A few years ago I was looking into buying a mid 80s Porsche 911 SC and they were 10k-20k depending on condition. But now, those cars are 40k-50k. I'm definitely not going to buy one at those prices. They'll almost certainly go down eventually. I can wait...

Thank you for the list!

I basically have no cash, so I usually mortgage as much as possible of the purchase price as long as it's cheap relative to the rents. In my view, cash is key and worth a lot more than the possibility of getting a loan. I'd rather have debt and save my precious cash (if the interest rates are reasonable) for emergencies.

Thanks for sharing the book with us - just ordered it.

Very fun book to read and really shows the constant hustle you have to have to grow a really large company.

I haven't heard of it either. I'd like to see them too!

As others have posted, Trump would likely not be that great for the US, but imposing martial law and stopping our democratic process is highly likely to be far worse over the long term. It would set a seriously bad precedent. Stopping democracy because you don't agree with the views of the other person is taking the wrong path down a bad road in my opinion. We must work our differences out and continue to grow our country in a stabilized manner.

Thanks maxprogram. I read it over the weekend on a camping trip. It did have some good info and was fun, but it was written poorly. Regardless, I'm glad to have read it and learned something.

Thanks Poor Charlie. I also came across this one, "From Cassandra with Love..." by Sam Zell: http://www.cre.org/memberdata/pdfs/zell_cassandra.pdf