Does anyone have any excel models they are willing to share or any resources for modeling acquisitions of mobile home parks, self storage facilities, or leased farmland?
I'm sure none of these are particularly complex and would be relatively easy to build or adapt from another model, but I wan't to make sure there aren't any nuances I am missing specific to these niche property types.
I've done self storage, nothing really nuanced there.
Self storage is about as straightforward as you get. Pick a vacancy and a rent. Sometimes there are marketing rents/concessions but if it's stabilized there's no variability.
Leased farmland the biggest thing to focus on is the farmer's credit. I can't imagine it's at all easy or predictable to find a tenant to step in if the guy blows out. Then look at what the property's residual value could be if it could be rezoned from ag.
I literally don't know anything about trailer parks but I would just treat like a multi deal.
With farmland I have to imagine selling the land or even reducing the rent to work with the farmer is the most viable option if a farmer defaults? I think almost all investment farm acquisitions are SLBs and I imagine finding another farmer to lease the land it difficult, lengthy, and very geographically variable.
After thinking about it further I think trailers would be identical to multi, just with any income from renting actual trailers (as opposed to lots) being categorized as "other income", as it isn't RE.
Still would love to get my hands on an actual model (especially farmland) if anyone has one.
Bad information on storage here. It is quite nuanced, not necessarily in terms of modeling but definitely in terms of underwriting.
Discounts/promotions do not go away and are substantial. We're talking like 5% stabilized here on top of vacancy. If you do not have these you are probably running a shitty no-name mom and pop facility with awful margins (hint: below 70%).
Bad debt needs to be underwritten. This always affects storage facilities though this is not necessarily true for all multifamily deals.
What about fee income? Tenant insurance? There are a lot of adjustments to be made above EGI.
Utilities need to be underwritten based on what % of the facility is climate controlled. It's a substantial difference and one of the largest operating expenses.
Management fees from the REITs are not 3%. Usually 5-6%. The operator is one of the most important qualitative factors of a storage deal.
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