The Self Storage Playbook: The Strategy of Scaling Up

 

Michael and Paul's Journey with Bigger Garage Capital
Michael and Paul, from Bigger Garage Capital, chatted with Ben Shirey about starting their self storage investment and growing it. They shared their experience and tips they learned.

Michael and Paul first bought houses in Indianapolis to rent out. But, when there were rules during the pandemic about not evicting renters, they looked for a different way to make money (check out our other blog post comparing real estate vs. self storage investments). Paul learned about the profits in self storage from a group he was in. He and Michael decided to work together after meeting at an event. The first self storage they tried to buy didn't work out, but they now have 6 of them and are planning to get more.

They wanted to make their self storage a real business and not just an investment. This meant setting up a call center to answer questions from people who rent storage from them. They had some trouble finding the right managers at first but now use online helpers from the Philippines which is cheaper.

Bigger Garage Capital likes to buy storage places that have room to increase their prices, especially smaller ones run by families. They are very careful when deciding how much money a new storage will make and how much it will cost to run. They also sometimes join with other investors who invest at least $50k. This helps them buy more storage places.

They have ways to make more money from their storage. One way is by raising the rent a little bit every 7-8 months. They also charge new customers based on how full their storage is. The last empty unit of a certain size costs the most. Instead of paying for online ads, they now make sure their business appears on search engines. They are also keeping track of how much it costs to get a new customer.

One big lesson was not to count on making money from expanding a storage place until it's done. Their first time expanding took longer and was more expensive than they thought. They also learned to use services and suppliers that can grow with them. Paul says picking services made for one storage or many storages makes a big difference. For Michael and Paul, running a self storage is a serious business. They use good business practices and data to keep buying and growing their storage places.