Listen to this episode as Whitney Sewell discusses converting distressed buildings into storage units with Scott Krone. What Scott does is converts distressed buildings into self-storage units, primarily in rural areas throughout the Midwest. In this episode, we discover that this niche is both environmentally friendly and profitable too.
By utilizing existing buildings, these projects decrease much of the waste that is synonymous with construction. There are also financial incentives for being involved in projects that lower the carbon footprints of buildings and increase their energy efficiency. Scott talks about how he ensures that his self-storage units will succeed by going into areas with heavy demand and very little supply. We also learn why self-storage is as close to a failsafe investment as is possible, some of the creative financing he uses to fund these projects, and much more.
Key Points From This Episode:
- An introduction to Scott and the work that his two firms are currently involved in.
- Why Scott works in the Midwest: it’s underserved and there are development incentives.
- Criteria Scott looks for in buildings: size, competition, and more.
- A ‘look green’ concept that underpins Scott’s self-storage conversion projects.
- How long a deal on these types of buildings usually takes to close.
- PACE Funding: the federal program that looks to reduce a building’s carbon footprints.
- What motivated Scott to pursue his niche.
- How the market is not the biggest hurdle in self-storage.
- The two biggest self-storage mistakes: not knowing your competition or your market.
- Creative ways of increasing investor returns: historic tax credit, opportunity zones, and PACE.
- The markets Scott is looking at buying in and how he locates properties.
- Challenges in Scott’s journey with real estate: getting people to believe in him.
- How Scott has used the Enneagram to improve his business recently.
- Why Scott understands investors well: he does the design, development, and the build.
Listen to the full interview and read the complete show notes here!