Investing in Self-Storage

Investing in Self-Storage

You yourself may have rented one of these spaces sometime in the past, or maybe somebody you know who has or uses one now. It could be the case that you were downsizing your home, moving for a temporary job, or you simply needed a place to park your campervan or Motorhome, because your neighbourhood wouldn’t allow it; self-storage units have certainly come in very handy for many Australians. It is not really a surprise that Australians have more stuff nowadays than they know what to do with, which is why the self-storage industry has made massive revenue growth, especially over the past three – five years.

There are many other reasons to consider investing in the self-storage sector, as macro trends are now heading towards an increased demand for storage space in Australia.

Some of These Trends Incorporate:

  • College students who often utilise storage space during summer holidays.
  • The internet home-business community has created a massive demand for inventory space.
  • Businesses having a hard time are downsizing to smaller offices, which makes necessary a demand for storage space.
  • Many new communities have agreements that do not allow for recreational vehicles or even extra cars to be parked on the street or outside of a garage.

Most investors can clearly see the writing on the wall and the growth potential for self-storage, but only a few of that number have the financial resources and management skills necessary to create a reliable cash flow and make profits from it. Even should you be able to find a reasonably priced storage facility that you have not only the time, but also the skills to operate, most do not make any profits for years due to the large upfront investment of cash usually required.

Investing in Self-Storage

Why Should You Invest in Self-Storage?

Self-Storage simply offers investors the favourable circumstance to diversify their investments with relative safety and confidence. The Self-Storage sector has definitely been shown to be one of the most robust real estate segments over the last few decades, and why self-storage stocks are great investments. Here are some of the features which makes self-storage an appealing investment opportunity:

Self-Storage List:

  • Self-storage walls, hallways and components
  • Planning, design and construction
  • Mezzanine floors
  • Self-storage doors
  • Locks
  • Ceiling mesh
  • Security systems
  • Electrical installations
  • Reception and offices
  • Insurance
  • Budget

Self-Storage Investing Without Actually Buying a Facility

Self-storage can provide a great solution for investors looking to profit from the ever expanding self-storage trend in Australia without having to actually own a storage facility themselves.

A REIT, or Real Estate Investment Trust, is a security that trades just like a regular stock, but is invested straightforwardly either in real estate or into mortgages. In exchange for favourable tax treatment, REITs are required to return most of their profits to their shareholders. These profits are then returned to investors in the form of dividends.

A Solid Potential

Most of the many people who want investment exposure to real estate without the hassle of dealing with tenants, tend to choose to invest in REITs. And just like real estate, REITs provide the prospect of both capital appreciation and a steady income. It is for this reason, that REITs are often now considered a viable hedge against inflation.

Should the idea of cashing in on the growth of the self-storage industry spark an interest in you, but should you then lack the desire and/or resources to purchase an actual facility, then REIT investing might be an area you should maybe think about considering. Not only will you obtain a steady income that is directly tied to the self-storage industry, but you will also get a solid potential for capital gains in the many years ahead. The really great part of investing in REITs is that you do not have the hassle or liability of having to operate and manage the real estate yourself.

OK, So Let’s Say You Have Done Some Research

And you are interested in being a part of one of the fastest growing industries in Australia. But, naturally, just like any other start-up you have your own challenges and a set of unanswered questions such as:

Will it work in my location?

How much space will I need?

What about planning permission and building regulations?

How much will it cost to convert a building?

Should I purchase a storage facility or construct one?

How fast will I be writing black figures instead of red?

Should I build everything now or in phases?

How can I market my company, or make sure customers come to me?

 

All of these questions and more can be handled by contacting the right people, the people with the know how to make things go just the way you would like them to.