Sell your storage facility
Stabilized or still in lease-up, run on a platform or on a spreadsheet, with a new competitor down the road. Send it.
Storage Facility at a glance
- Typical deal size
- $1.5M – $20M
- Lease structure
- Month-to-month — an operating business, not a net lease
- Typical term
- Month-to-month
- Escalations
- Existing customer rate increases, typically 8–12% annually
Overview
What storage facilities are really worth
Our read
Self-storage is the asset class most often misunderstood as real estate when it is really an operating business that happens to own real estate. There is no lease to underwrite, no tenant credit to check, and no rollover schedule. What there is instead is a customer base that turns over continuously, a street rate that resets weekly, and a revenue management function that either exists or does not.
That distinction is why trailing financials mislead so often here. A facility running at 90% physical occupancy with rates that have not moved in five years is not a stabilized asset — it is an underpriced one, and the gap between in-place rate and street rate is the whole investment thesis.
The risk that does not show up in the financials is supply. Storage demand is drawn from about three miles, which means a single new facility inside that radius competes immediately and completely. Underwriting a storage facility properly means underwriting the planning department, not just the rent roll.
Valuation
How we underwrite it
The method
We underwrite storage on economic occupancy rather than physical, because the two diverge more here than in any other asset class. A unit occupied by a delinquent customer three months into non-payment is not occupied in any sense that matters.
From there the model is rate-driven. We compare in-place rates to current street rates by unit type, apply a realistic existing-customer increase schedule, and account for the churn that a genuine rate program produces. Owners who have never pushed rates typically see a higher offer than their trailing financials would support, because the upside is real and quantifiable.
Supply gets its own line. We pull the permit pipeline within three miles and haircut lease-up assumptions accordingly. This is the adjustment most conventional buyers skip and then discover eighteen months later.
Deferred capital — doors, roofs, access control, and paving — is priced up front rather than used as a retrade lever later. If the gate system is failing, we would rather account for it in the first number than in the third.
What moves the number
- 01Physical versus economic occupancy — a facility can be 92% full and still underperform if the rates are ten years stale
- 02Street rate versus in-place rate, which tells you how much rate-increase runway is left
- 03Existing customer rate increase discipline, which is the single largest lever on NOI in this asset class
- 04Unit mix against actual demand — an oversupply of 10x30 units in an apartment submarket is dead space
- 05Climate-controlled share, which drives both rate premium and construction cost
- 06Supply within a three-mile radius, including anything permitted but not yet built
Capital markets today
- 10-yr Treasury
- 5.24%
- 4.12% a year ago
- SOFR
- 3.87%
- 4.2% a year ago
- 30-yr mortgage
- 7.28%
- 6.3% a year ago
- CRE loan delinquency
- 1.53%
- 1.57% a year ago
- CRE prices, YoY
- 6.58%
- -2.7% a year ago
Sources: FRED DGS10, 2026-10-01 · FRED SOFR, 2026-10-01 · FRED MORTGAGE30US, 2026-10-01 · FRED DRCRELEXFACBS, 2026-04-01 · FRED COMREPUSQ159N, 2026-01-01
Diligence
What a buyer actually looks at in a storage facility
- Check 01
Rent roll with delinquency and auction history
Self-storage revenue quality depends on collection discipline. High delinquency masquerading as occupancy is the most common overstatement in this asset class.
- Check 02
Existing customer rate increase history
A facility that has never pushed rates has enormous embedded upside. One that pushed too hard may have bought occupancy problems it has not shown yet.
- Check 03
Three-mile supply pipeline, including permits
Storage is hyper-local and supply-sensitive. A permitted facility half a mile away can reset the entire submarket before you finish lease-up.
- Check 04
Roof, doors, and gate or access system condition
Doors and roofs are the capital items, and a failing access control system is both a capital cost and a security liability.
- Check 05
Zoning and any expansion land
Entitled expansion land is real value that rarely shows up in a broker's pricing, and re-entitling storage is difficult in most jurisdictions.
- Check 06
Management agreement and platform
Whether revenue management is manual or run on a real platform determines how much of the rate upside is achievable and how quickly.
Backfill risk
What happens if the tenant leaves
The tenant-goes-dark scenario
Self-storage does not have a backfill problem in the way single-tenant assets do, because there is no single tenant to lose. What it has instead is a supply problem, and that is the risk that actually matters.
Demand is drawn from roughly a three-mile radius, so a new facility inside that radius competes directly and immediately. The market absorbs new supply eventually, but lease-up on the incumbent slows and street rates compress while it happens. Underwriting a facility means underwriting the permit pipeline around it, not just its current occupancy.
The offsetting characteristic is that customers are remarkably rate-insensitive once they are in. Moving a unit costs a Saturday and a truck, which is why disciplined rate increases on existing customers stick at percentages that would be unthinkable in any other asset class. A facility that has never exercised that discipline is usually worth more than its trailing financials suggest.
Why this matters to you
Every buyer prices the tenant-goes-dark scenario, whether or not they say so out loud. It is the largest hidden input into the cap rate you get offered.
Understanding it before you go to market is the difference between negotiating and being negotiated with.
Who sells to us
Situations we see most often
- Owner-operator reaching retirement with no succession plan
- Lease-up stalled after a new competitor opened nearby
- Refinance coming due on a facility that has not raised rates in years
- Owner running it manually and unwilling to invest in a management platform
- Expansion land entitled but the owner does not want to build
Buy box
What we buy
- 01Stabilized and in lease-up, $1.5M to $20M
- 02Manual operations fine — we bring the platform
- 03Facilities facing new nearby supply
- 04Expansion land entitled or unentitled
Process
How selling to Dizposition works
Day 0
01Send us the property
Address, asset type, and the lease if there is one. That is enough for us to start.
- 02
We underwrite it
Our underwriting runs the income against current market pricing and the cost of capital. No lowball anchor.
10 minutes
03You get a firm offer
In 10 minutes, with the math shown. You will know exactly how we got there.
As fast as 30 days
04Close on your timeline
As fast as 30 days, or as slow as you need. We are the principal, so the date is yours.
FAQ
Selling a storage facility
My facility is only 70% occupied. Is it still sellable?
Yes. Lease-up is an underwriting question, not a disqualifier. We look at how long it has been at 70%, what changed, and whether the cause is new supply, rate positioning, or the absence of a real marketing operation. A facility stuck at 70% because nobody is running revenue management is a very different asset from one that lost customers to a better competitor.
I have never raised rates on existing customers. Does that hurt me?
It usually helps. Untapped rate-increase runway is embedded value, and it is one of the first things we model. You will not capture it in a trailing-twelve-month statement, which is exactly why facilities like yours are often mispriced by conventional buyers.
A competitor just opened two miles away. Should I wait to sell?
Waiting rarely helps. The lease-up drag from new supply typically shows up over the following twelve to eighteen months, so selling into the decline is usually worse than selling now. Send us the facility and we will tell you honestly how we see the supply impact.
I run it myself with a spreadsheet. Is that a problem?
Not for us. Manual operation generally means the rate upside is still on the table. We are buying the real estate and the customer base, not your software.
How long does it take to sell a commercial property to Dizposition?
You get a firm written offer within 10 minutes of sending us the property. If you accept, you can close in as little as 30 days — most of that is title work and your own timeline. There is no listing period, no marketing, and no waiting on a buyer's financing contingency.
Can I sell my property as-is?
Yes. We are the buyer, so there is no lender requiring repairs and no inspection contingency to renegotiate against you. Deferred maintenance, a failing roof, an aging tank system — we price it into the offer rather than asking you to fix it first.
Can I sell with a tenant in place?
Yes, and in most cases a tenant makes the property more valuable to us, not less. We will ask for the lease, a rent roll, and any estoppel certificates. You do not need to deliver the property vacant.
What if my lease is short-term or about to expire?
Short remaining term is one of the main reasons owners come to us. A conventional buyer needs lease term to get financing, which is why short-dated assets sit on the market. We underwrite the real estate and the backfill prospects rather than the remaining term alone.
What if the property is vacant?
We buy vacant assets. Pricing shifts from an income approach to what the building and land are worth to the next user, which is a different calculation — but it is one we do routinely rather than one that disqualifies the property.
Do I need a broker to sell to you?
No. We buy directly, and there is no commission because there is nothing to market. If you already have a broker, we will pay them. Selling without one saves the commission, but you should understand you are also giving up price discovery — a broker's job is to find out whether someone will pay more than we will.
What documents do I need to get an offer?
The address and the lease are enough to start. To finalize, we will want the rent roll, the last two years of operating statements, the title commitment, any existing survey, and any environmental reports you already have. You do not need an appraisal or a broker package.
How do you determine your offer?
We underwrite in-place income against what the space would re-lease for, adjust for capital needs and any environmental tail, and apply a cap rate supported by comparable transactions. We show you the inputs. If you disagree with an assumption, we would rather argue about the assumption than about the number.
What are typical seller closing costs?
Title and escrow fees, any transfer or recording tax owed in your state, prorated property taxes, and payoff of any existing debt. Because we are the buyer, there is no commission and no marketing cost. Transfer tax varies significantly by state and is often the largest single line.
Will I owe capital gains tax when I sell?
Usually yes, on the gain above your adjusted basis, and depreciation recapture is taxed separately from appreciation. State treatment varies. This is a question for your CPA before you sign, not after — the structure of the sale can change the answer.
Can I do a 1031 exchange?
Yes. A 1031 exchange lets you defer federal capital gains by reinvesting in like-kind property, subject to a 45-day identification window and a 180-day closing window from the date you sell. You must have a qualified intermediary in place before closing — it cannot be arranged afterward. Most states conform to federal treatment, but a few do not.
Can I sell if I am behind on payments or facing foreclosure?
Yes, and speed is the reason to move early rather than late. We can close on a defined date, which is what a lender or a receiver generally needs to see. Send us the payoff figure and any notices you have received.
Can I sell a property I inherited or that is in probate?
Yes. Probate sales take longer because the court timeline governs, not ours, and multiple heirs need to agree on the price before anything can close. We are used to working around both. Inherited property also generally receives a stepped-up basis, which can change the tax math substantially.
What if there is environmental contamination?
Send it anyway. Environmental history is one of the most common reasons a conventional sale falls apart, and it is one of the reasons owners call us. We price the remediation and the residual liability into the offer rather than walking away at the Phase II.
Is there any cost or obligation to get an offer?
None. There is no fee, no listing agreement, and no obligation to accept. If our number does not work for you, you keep the underwriting we showed you and we part ways.
Markets
Top markets we buy storage facilities in
Where the inventory is
18,564 U.S. establishments · Lessors of miniwarehouses and self-storage units
- 01Sell a storage facility in Texas2,304
- 02Sell a storage facility in California2,247
- 03Sell a storage facility in Florida1,581
- 04Sell a storage facility in Georgia705
- 05Sell a storage facility in New York702
- 06Sell a storage facility in North Carolina645
- 07Sell a storage facility in Illinois572
- 08Sell a storage facility in Washington535
- 09Sell a storage facility in Arizona530
- 10Sell a storage facility in Virginia511
Sources: U.S. Census Bureau, County Business Patterns, NAICS 531130, 2023
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10-minute offer
Ready to sell your storage facility?
Send us the property and the lease. You'll have a firm offer, with the math shown, in 10 minutes.


