Many of our investors are individuals with 1031 tax-deferred exchange requirements, and as long term investors, are appreciation and cash flow oriented. We, at American Self Storage, have delivered quality results over more than 28 years.
Strong management skills and fundamental knowledge of the Self Storage business can also be put to work for you! Please understand that past performance is no guarantee of future results. If you would like more information please call Dennis Peterson, President, and CPM at (805) 963-5945.
Here is a small part of our history:
Dennis A. Peterson Biography:
Dennis Peterson is the President and Chief Operating Officer of The Laurel Company and Managing Member of American Self Storage. After graduating from the University of California Los Angeles in 1963, he served as a combat command officer in Viet Nam with the U.S. Marine Corps.
Thereafter he was a stockbroker with Morgan Stanley/Dean Witter and later worked in the field of finance as Regional Vice President of a major investment counseling firm. He started his real estate career in 1971 with a leading Santa Barbara real estate company, and in a short time was responsible for the training of all sales personnel. He was subsequently appointed to lead and operate the investment department of that company.
With this experience and background, in 1973 Mr. Peterson established his real estate firm, D.A. Peterson Enterprise Inc. At that time he began to construct and syndicate apartments. He has built and/or syndicated over $50,000,000 in real estate and raised almost $20,000,000 in equity capital. Presently, D.A. Peterson Enterprise Inc. manages on the central coast over 500,000 square feet of commercial/industrial real estate and 400 residential units. Additionally, the Self Storage portfolio exceeds over 500,000 sq. ft. of rentable space. The current value of D.A. Peterson Enterprise Inc.’s management portfolio is more than $100,000,000.00.
Pursuing his active interest in property management, in 1983 Mr. Peterson became a Certified Property Manager. In 1989 he was chosen Property Manager of the year for the California Central Coast chapter of the Institute of Real Estate Management (IREM). He has been instrumental in raising the level of awareness and professionalism in property management through his work in the establishment of the local chapter of IREM and is a past president of this organization.
Mr. Peterson is a licensed Real Estate Broker in California and is a member of the Self Storage Association and the California and Nevada Self Storage Associations. Attorneys in state and federal courts have called upon Mr. Peterson to serve as an expert witness in multiple receiverships and bankruptcies. In 2007 American Self Storage was named by the Self Storage Association as one of the “Top 100” largest operators in the United States.
Past Self Storage Performance:
Over the past 28 years and 27 buy and sell transactions the average rate of return on all properties, performing and non-performing is 14.3%. This includes valuations of properties still in the portfolio.
Notes on Self Storage
Over the past 28 years with 27 purchase/sales investment performance has been excellent. Double-digit yields were common along with good monthly cash flow, all tax-sheltered. The past five years (2008-2012) have been challenging but we are still heavily involved. In the last three years, annual tax-sheltered yields of, paid monthly, of 8% have been common and are expected to continue. We have a conservative approach with moderate leverage. We usually make down payments of 40% with long term fixed-rate financing. We’d like to help you supplement your monthly income. For a detailed list of all storage investments please contact Mr. Peterson at (805) 963-5945 or Peterson@dapentinc.com.
PAST SELF STORAGE PERFORMANCE:
Paso Robles, CA. – Purchased the facility for $875,000. The first remodel added an office, manager’s apartment, and re-configured one-third of the area into more marketable spaces. The second edition in 1989 added 10,000 sq. ft. During this time dividends were paid to partners at an 8% rate from 1987 until the sale, or over 10 years. The project was sold in 1997 for $1,350,000. The new owner retained our firm to manage the project for five years. Investors received an annual return of 21%.
29 Palms, CA. – This 18,250 sq ft property was purchased in 1993 for $350,000. Revenues increased over 5% per year and a dividend of 8% was paid from acquisition until sale. In 1998 we added 10,000 sq. ft. of storage space. Initial invested capital was $170,000, the property was sold for $2,150,000 in November 2007 which represented a 20% annual rate of return for investors.
Bakersfield, CA. – Purchased the 68,000 sq. ft. facility for $1,150,000. Aggressive management Was installed. Gross income went from $16,000/mo to $30,000. The property was sold in November 2002 for $1,850,000. The invested capital was $375,000. Paid an annualized 8% return monthly. Investors took out (through a tax-deferred exchange) over $800,000 in addition to an 8% rate of return. The investor combined rate of return per year over the holding period was 22%.
2002 – Bought out by Partner
Los Banos, CA. – Purchased an almost new 66,000 sq. ft. facility in August 2002 for $3,400,000. We had it 66% occupied in nine months. Space is available for 40,000 additional sq. ft. It was put on the market for $4,500,000 in 2005.
Casa Grande, AZ. – Through a 1031 tax-deferred exchange from Bakersfield, purchased a 70,000 sq. ft. facility in Casa Grande, AZ for $2,859,000. The cash flow was 8%. Average gross rents went from $35,000/mo to $40,000 with $1,000,000 initial investment. Property sold in November 2006 for $4,250,000. The annual combined rate of investor return was 26.1%.
Apache Junction, AZ (East Mesa) – Purchased badly managed facility in June 2004. At the close of escrow, the facility was 47% occupied. A new aggressive management team was installed. Over six months a complete rehabilitation was undertaken for $400,000. A new office was installed along with state of the art electronics. Gross income went from $16,000/mo to over $35,000/in one year. Occupancy was 87.8%. The facility was chosen by the Arizona Mini Storage Association as one of two featured facilities for their annual conference in 2005. There are 591 units with 75, 240 sq. ft. Purchased for $1,900,000 & sold Dec 2006 for $4,100,000. The annual combined rate of investor return was over 70%. The down payment was $850,000. Priority return was 9%.
Mesa, AZ. – A companion purchased along with the above facility which consisted of 43,300 sq. ft. with 402 units. At the purchase close of escrow, March 2004, the occupancy rate was 75% and 15 months later was 91.3%. The purchase price was $1,500,000 and it was sold for $2,400,000 in December 2006. The down payment was $450,000. The annual investor combined rate of return was over 70%. Priority return was 9%.
Fontana, CA – This 41,000 sq. ft. facility purchased for $3,050,000 with $2,000,000 down. Ten years fixed-rate loan at 6.26%. Good cash flow. Rent collections were up for 2008. 2009 & 2010 were down an average of 5%. Client owned; Sold 2012
Current Operations (to December 2012)
Travis AFB (Fairfield, CA.)- Purchased 30,000 sq. ft. facility for $1,450,000. At purchase gross income about $16,000/mo. Included in the price was almost two acres of vacant land. After an office remodel and addition of a Manager’s home, rents were increased 37% to over $22,000/mo. In 1999 the facility was refinanced for $1,650,000 after an appraisal of $2,300,000 and an additional 16,000 sq. ft. in two buildings were added. After a few months of increased rental sales, rents were averaging $40,000/mo. In November of 2001, the project was refinanced for $1,850,000 (appraised at $2.8M, copies available) with the balance used to upgrade security, roofing, and paint the older portions of the project. A balance of $150,000 was to be used to add more units. In 2005 we added 5,760 sq. ft. in portable storage of 76 extra units. Total finished buildings were 56,500 sq. ft. Refinanced in 2012 and added 19,500 sq. ft. in two new buildings totaling 76,000 sq. ft. The original investment was $425,000 and the facility pays an annualized 10% return paid monthly. The current value is about $72 per sq. ft. This will give a value of about $5.5M with an equity of $3.4M.
Santa Maria, CA. – In October, under our direction, a client purchased a 57,200 sq. ft. facility for $3,700,000 with $2M down. 19 Parking spaces were replaced with containers that doubled the rent per square foot for that size. The property is in substantial positive cash flow. For 2008 rents were up over 8%; even for 2009 & 2010. In 2011 revenue was up 11%. Cash flow 7% annuals paid monthly. The client owned long-term hold; consistently over 90% full. Rents up again in 2012.
Marysville, CA. – Purchased a run-down facility in May 2006, gross income was $17,500. For 2007 average per month rents were $22,500 with occupancy at 83%. This despite a new 60,000 sq. ft. project two miles away. Currently, the property is 70% full. The purchase price was $2,150,000 with a down payment of $900,000. Rental income in 2008 was down 2.5% over the same period during 2007. 2009-2010 revenue was even. 2011 was up 7%. 2012 down 1.7%.
Redding, CA. This property was acquired in a 1031 exchange from Mesa, AZ. Long term plan called for a two-phase expansion of almost 30,000 sq. ft. for a total of 70,000 sq. ft. Property acquired at a cost of $2,400,000 with initial down payment $1,000,000. Rents were up almost 5% average per year since 2008. 2012 up 10.5%.
Stockton, CA. This property was also a 1031 exchange from East Mesa, AZ. for a 7 ½ acre project on Highway 4, the gateway to the San Joaquin Delta. There are 53,500 sq. ft. of storage and 80,000 sq. ft. of RV parking. At the close of escrow, the property was 50% full. The partnership paid $4,000,000 for the project which was appraised for $5,600,000 six months earlier. RV parking was covered and RV rents were raised. Down payment was $2,000,000. Currently, the project is about 80% occupied. Rent collection for 2008 was up over 10%. For 2009 up 12.5%, 2010 up 7%, 2011 up 9%, 2012 up over 9%. Free cash flow $150k/yr.
Red Bluff, CA. This property was purchased for $1,350,000 with 33,840 sq. ft. of the building or less than $40/sq. ft. which its estimated replacement value. Our plans to add over 15,000 sq. ft. are on hold due to the current economy. In 2008 rents were up 11%. For 2009 & 2010 down an average of 6.2%. 2011 and 2012 were are even. 2 years after purchase FEMA put us into a flood zone. We are 78% occupied. Currently up for sale.
North Highlands, CA. (Sacramento) Purchased for $2,550,000 with $1,000,000 down. The worse project we have ever seen and subsequently one of the most attractive opportunities for capital appreciation. Sellers paid $3,100,000 in 2003. The property was plagued by the bad layout and extreme foundation water leaks. The project was 50% occupied at the close of escrow. We installed new foundations and radically altered the unit layout. Intense site work was also performed and the current occupancy is 85%. 2008 rents were up by almost 2%. For 2009 rents were up 6.3% & 2010 up by over 16%. 2011 up 16%, 2012 up 13%.
Oroville, CA. This property closed escrow in March 2008 for $2,880,000 with a loan of $2,050,000 at 4.25% for three years. This re-model entailed more tenant disruption but as of December 2009, we are stabilized at 74% occupied units. For 2010 we are stable and 77% occupied. 2011 rents up almost 4%, 2012 we are 81% full. Revenue growth has been modest.
Sparks, NV Property purchased August 2011 for $1,900,000 with $900,000 down. Our purchase price was $29/sq. ft. which was 50% less than new construction. Currently, rents are rising and occupancy is 95%. Yield is over 10% paid monthly.
Visalia, CA. This property was acquired in June 2012 for $2,700,000 or $40/sq. ft. At the close of escrow, investors receive an 8% annual yield paid monthly. Nine-month revenue since June 2012 is up almost 7%.
Hemet, CA. Purchased 12-31-12 for $3,600,000 with $900,000 down and $150,000 for improvements. The property was 70% occupied. The $2.7M 1st Trust Deed is fixed @ 5% interest only for three years. 30 days after the close of escrow occupancy was 75% and an 8% annual dividend paid monthly commenced.
Phoenix, AZ. Purchased a 125,000 sq. ft. facility for $2,775,100 all cash. $22/sq. ft. a record low price. It is a state of the art facility and our objective is to reach 85% occupancy and sell. We believe the price will be over $8M. Priority return is 6%.
Over the past five years, many have fallen by the wayside. All of our facilities have recovered and new buying opportunities are showing themselves almost daily.
Many of our investors are individuals with 1031 tax-deferred exchange requirements. All our investors are long term capital gains oriented. We at American Self Storage Wealth Management have delivered market-beating results for over 28 years. Strong management skills and fundamental knowledge of the business can be put to work for you!
Please understand that past performance is no guarantee of future results. If you’d like more information, please call Dennis Peterson at (805) 963-5945.
Dennis A. Peterson
D.A. Peterson Ent. Inc.
American Self Storage