Orlando Storage Project Lands $16M Financing
Futura Co. has taken a $16 million financing package for the construction of the Nona Cove Self Storage facility.
Start Your Application and Unlock the Power of Choice$5.6M offered by a Bank$1.2M offered by a Bank$2M offered by an Agency$1.4M offered by a Credit UnionClick Here to Get Quotes!Futura Co. has taken a $16 million financing package for the construction of a 132,303-square-foot self-storage facility — dubbed Nona Cove Self Storage — in Orlando, Fla. The loan was arranged by Principal Steve Liebert of CCM Commercial Mortgage and originated by James Bracco, managing director of ACRES Capital.
Part of the mixed-use Futura at Nona Cove project, the facility is a four-story building with 98,448 net rentable square feet, 1,046 climate controlled units, and 7,593 square feet of ground-level retail space. Development of the facility is scheduled to complete later this year.
The only storage facility within a 3-mile radius, Nona Self Storage will be located at 14806 Narcoossee Road. The storage facility will add to the 32,000 square feet of planned retail space within the project, which will also include 250 luxury apartments and a wellness community
Metro Market Magic
Orlando, for many reasons, is a widely penetrated self-storage market, with just a little over 8 net square feet of storage space per capita. The area continues to thrive from migration trends to the Sunbelt region, which allows owners the luxury of more aggressive rent asks. According to a recent Yardi Matrix report, the Orlando metro area saw an 11% spike in rent growth for 10x10 standard storage units (without climate control) year-over-year as of January. Orlando also ranks among the top five markets when it comes to development activity, with nearly 13% of its existing inventory in either the “under construction“ or “planning” stage.
Related Questions
What are the benefits of investing in a self-storage project in Orlando?
Investing in a self-storage project in Orlando can be a great way to generate strong cash flow and ROI. Self-storage facilities are relatively easy to manage compared to other types of investment properties, and they are also a recession-resistant asset class. Furthermore, the operational costs of self-storage facilities are generally lower than other types of properties, leading to higher net operating incomes. For more information on net operating incomes, you can check out our Net Operating Income Calculator.
What are the risks associated with financing a self-storage project in Orlando?
The risks associated with financing a self-storage project in Orlando depend on the type of loan you choose. With a conventional loan, you may face difficulty obtaining the loan if you don't have a strong credit history. Additionally, the interest rate may be higher than other loan types. With an SBA loan, you may face difficulty obtaining the loan if you don't have a strong business plan. Additionally, the loan may have a shorter term than a conventional loan.
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What are the most important factors to consider when financing a self-storage project in Orlando?
When financing a self-storage project in Orlando, the most important factors to consider are the market saturation level, the competition within the market radius, and the type of loan you choose.
The saturation level of an area is measured by the gross square feet of storage space available per person. Currently, the average self-storage inventory per capita across the country is around 7 to 8 net square feet. A market with a per-capita inventory above the U.S. average is usually considered oversupplied, whereas anything below is undersupplied.
It's also important to consider the level of competition within your chosen market radius. If there are already a lot of self-storage facilities nearby, it may be harder to attract new tenants than if there were very few options available. It’s also important to consider whether there are any facilities under construction or in the planning stages, as those can affect your property in the future.
When it comes to financing a self-storage investment, there are a number of options to consider. From conventional loans to SBA loans, there's no shortage of ways to get the funding you need. Here are your main options:
- Conventional Loans: These are loans that are not backed by the government and are typically offered by banks and other financial institutions. They usually require a down payment of at least 20%, and the interest rate is typically higher than other loan types.
- SBA Loans: These are loans that are backed by the Small Business Administration and are typically offered by banks and other financial institutions. They usually require a down payment of at least 10%, and the interest rate is typically lower than other loan types.
- Hard Money Loans: These are loans that are typically offered by private lenders and are usually used for short-term financing. They usually require a down payment of at least 25%, and the interest rate is typically higher than other loan types.
What are the best strategies for securing financing for a self-storage project in Orlando?
The best strategies for securing financing for a self-storage project in Orlando will depend on your individual situation. If you have a strong credit history and a good relationship with a bank or credit union, you may be able to secure a conventional loan with a low interest rate and a long term. If you don't have a strong credit history, you may want to consider an SBA loan, which is backed by the Small Business Administration and can be easier to obtain. You may also want to consider other financing options such as private lenders, hard money lenders, or crowdfunding. For more information, you can check out this guide to self-storage investing.
What are the current trends in self-storage financing in Orlando?
According to Inside Self Storage, the current trends in self-storage financing in Orlando are:
- Lenders are offering more flexible terms and conditions.
- Lenders are offering more competitive rates.
- Lenders are offering more creative financing options.
- Lenders are offering more flexible loan structures.
What are the most common mistakes to avoid when financing a self-storage project in Orlando?
When financing a self-storage project in Orlando, it's important to avoid common mistakes such as not having a clear understanding of the loan terms, not having a detailed business plan, and not having enough capital to cover the costs of the project. Additionally, it's important to research the local market and understand the competition in the area. Finally, it's important to have a good relationship with the lender and to be prepared to provide detailed financial information.
For more information on financing a self-storage project in Orlando, you can check out this guide from Commercial Real Estate Loans.