"It depends" will be most responses.
Interest rates going up makes CAP rate go up as well. Example I was selling mine asking 8.25 CAP producing $280K yr'ly that is $3,400,000. After rates increased the CAP rate changed to something closer to 10 Cap or $2,800,000. So, I won't sell. My units are outside the city, no restrictions in small town USA holding 95 - 100% occupancy for the last 4 years. I was not required to submit blueprints or get approvals for any building. That last building I put in was 50/50 climate control and non - but all spray foamed. 13,200 sq ft and total cost was $33 / sq ft that was Aug 2021. That same bldg June 2023 was quoted at $50.6 / sq ft. Today maybe $5 cheaper. BUT that is in that town, dirt owned, no designs / blueprints required. I charge 25% more than anyone else in town and have people drive 60 miles to come store with me.
I am getting a new quote as we speak for East TX. I am going to build some more now.
Texas law requires all real estate licensees to give
the following information about brokerage services to prospective buyers, tenants, sellers and landlords.
Information About Brokerage Services
Thomas Kent
Parker Properties|Realtor
Cell: 972-672-2120
www.unitedstoragebowietx.com
Original Message:
Sent: 1/25/2024 11:18:00 AM
From: Lisa Christian
Subject: How to value cost when purchase additional units
considering buying more units... some are older but seems to be decent occupancy ... how do you evaluate the sell price other than cash flow ... what is the building cost per square foot new? just trying to make a sound investment ..
------------------------------
Lisa Christian
Hwy 7 West Storage
Center TX
(936) 488-0567
------------------------------