Buying a single self-storage unit and renting it back

How it works

Step by step

1. 1Map every self-storage facility within a 45-minute drive. Filter out the branded chains (Public Storage, Extra Space, CubeSmart) — you want family operators of 50-300 units.
2. 2Visit 5-8 facilities in person. Talk to the owner, not the desk clerk. Ask about occupancy, waitlists, and how they're planning for retirement.
3. 3Ask directly whether they've considered selling individual units as a fractional-investment structure. Most haven't; a polite conversation plants the idea.
4. 4If interest exists, hire a real-estate attorney familiar with tenants-in-common (TIC) or condo-storage structures. Budget $2-4k for the legal work.
5. 5Negotiate a 10-year property-management contract with the owner: they handle tenant turnover, collections, maintenance and insurance for 20-25% of gross rent.
6. 6Underwrite the unit carefully: purchase price, monthly rent, management fee, insurance, taxes, and a 10% vacancy buffer. Target an 8-10% cash-on-cash yield.
7. 7Wire funds only through the attorney's escrow account. Register the deed or ownership certificate before releasing any money.
8. 8Set up a separate bank account and a monthly reconciliation reminder to verify rent hits after the management fee.
9. 9Meet the operator once a year in person. Small facilities change hands frequently — you want first right of refusal if they sell the whole facility.

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