Self-Storage Investing Strategies from the Inside with Tom Dunkel

Nov 15, 2023

What strategies can investors use to profitably acquire and operate self-storage facilities?

 

Angel Williams interviews self-storage investor Tom Dunkel about acquiring, operating, and financing self-storage facilities as an investment strategy. They discuss dealing with sellers attached to their properties, on-site management, customer retention, financing options, and more.

 

With a background in corporate finance and nearly 30 years of real estate and investment experience, Tom Dunkel brings extensive knowledge and expertise to Belrose Storage Group.

 

Growing the company from a start-up to a world-class organization, Tom has specialized in discounted asset opportunities nationwide since 2006. His financial savvy, open communicative manner and integrity have helped alternative investors achieve their wealth-building goals.

 

Tom is the Chief Investment Officer (CIO) of Belrose Storage Group - a seasoned team of real estate investment professionals that specializes in acquiring underperforming self-storage facilities in the Northeast, South, and Midwest U.S. and turning around their performance to achieve high-teens, tax-advantaged returns to its high-net-worth investor partners in a condensed time frame of 2-3 years.

 

 

[00:01:00] - [00:04:29] Overcoming Sellers' Emotional Attachment

• Sellers can get attached to storage facilities they've built up over the years
• Building rapport and finding common ground with sellers is key
• Offering seller financing can help avoid capital gains taxes for sellers

 

[00:04:29] - [00:08:31] Managing Facilities Remotely

• Many facilities use a hybrid model with some on-site and remote management
• Technology like QR codes and mobile apps enable remote rentals and access
• Onsite visits still needed periodically for maintenance issues

 

[00:08:31]- [00:11:47] Maximizing Customer Retention

• Big companies expect churn, smaller ones try to retain customers longer
• Gradual rent increases help keep customers vs sharp hikes
• Longer retention, around 18 months, generates more stable cashflow

 

[00:11:47]- [00:16:24] Dealing with Delinquent Customers

• Storage uses lien laws, not landlord-tenant rules
• Auctions help liquidate contents and get units re-rented quickly
• New buyers must clear out units, allowing rapid re-rental

 

[00:16:24] Financing Facilities as a Business

• Banks are more receptive to financing storage compared to years past
• SBA loans are viable since storage is an operating business
• Rates and terms are still decent despite recent increases

 

 

"Building rapport with sellers and finding common ground is key when they're attached to a property." - Tom Dunkel

 

"Our goal is to gradually raise rates to keep customers longer - maximizing revenue and returns for our investors over time." - Tom Dunkel

 

Connect with Tom:

 

ww.belrosestoragegroup.com

 

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