Self Storage Loans
The last few years have witnessed many changes in the arena of finance, and self-storage financing has been no exception. In September 1998, the finance world was rocked by the collapse of the CMBS (commercial mortgage backed securities) market. Interest rates were at an all-time low.
The year 2000 brought more changes to the self-storage lending arena. The two primary providers of self-storage loans, Finova Realty Capital and First Security Commercial Mortgage, pulled out of the market.
Self Storage Feasibility Studies and Analysis must prove viability to lenders. Lenders are extremely cautious about construction loan packages. A developer must prove self storage financial feasibility in a business plan showing how positive cash flow is achieved monthly until permanent financing comes on line. Lenders want to know that a project will pay for itself during the critical period through construction to fill-up.
Remember!
A well-constructed loan package contains information that falls into five categories:
- Summation and request
- Property’s physical aspects
- Property’s economic aspects
- Market analysis
- Borrower/manager
A simple way to be sure you have provided enough information is to ask yourself whether you would feel comfortable deciding to buy the property if you were given the same details. Pictures are an extremely potent way to get your lender’s attention and put your loan package in play quickly. Take several photos of the property as well as the surrounding area. An aerial photograph is an added bonus if available.
Self Storage Locations – Demand for self-storage is not always predictable. However consider all the possible potential customers and their options through time in there life, and you will understand that the self storage industry is a needed more than people may think. Self Storage Locations.
