Resources
Investor Glossary
Plain-English definitions of the metrics, loan terms, and legal concepts self-storage investors meet when they underwrite a deal.
Aug 26, 2022 · 6 min read
Feasibility Study
Here’s how to conduct a self-storage feasibility study before investing in a facility.
Aug 26, 2022 · 5 min read
Yield Maintenance
Learn about yield maintenance and how it is utilized as a prepayment penalty in commercial real estate finance.
Aug 26, 2022 · 4 min read
Operating Expenditures
Operating expenditures (OpEx) are any ongoing costs incurred in the everyday operation and maintenance of the commercial property.
Aug 26, 2022 · 5 min read
Ingress and Egress Rights
Ingress and egress rights are the defined legal right to enter and exit a property.
Aug 26, 2022 · 6 min read
Self-Storage Lease Agreements
Self-storage rental contracts should include a few key elements. Here’s a list of what these are.
Aug 26, 2022 · 4 min read
Holding Companies
A holding company protects an investor’s assets by placing everything related to the ownership of a commercial real estate asset under its name instead of the...
Aug 26, 2022 · 5 min read
Loan to Cost
The loan-to-cost ratio, or LTC, represents the amount of debt in relation to a project’s total cost.
Aug 26, 2022 · 4 min read
Key Metrics in Self-Storage
When considering a self-storage investment, there are many factors to take into consideration. Three key metrics and measures in self-storage investing stand...
Aug 26, 2022 · 4 min read
Return On Investment
Return on investment (ROI) is a financial metric that measures the approximate profitability of an investment.
Aug 26, 2022 · 5 min read
Internal Rate of Return
What is the Internal Rate of Return? Internal rate of return, more commonly referred to as IRR, is a measurement representative of the annual rate of growth...
Aug 26, 2022 · 6 min read
Prepayment Penalties
Prepayment penalties are fees that lenders typically collect from borrowers who pay loans off early.
Aug 26, 2022 · 4 min read
Loan to Value
An LTV represents the amount of debt in relation to the value of the collateral tied to a deal.
Aug 26, 2022 · 5 min read
Net Operating Income
NOI, short for Net Operating Income, is a metric that represents the profitability of a commercial property.
Aug 26, 2022 · 6 min read
Net Present Value
Calculating NPV helps determine the value of all future cash flows for the life of an investment discounted to the present day.
Aug 26, 2022 · 6 min read
Step-Down Prepayment Penalty
Step-down, or graduated, prepayment is a straightforward declining payment schedule that is calculated based on the remaining balance at prepayment in...
Aug 26, 2022 · 4 min read
Loan Assumability
When buying a property encumbered by a loan, you may be able to assume the existing financing instead of taking a new mortgage for the acquisition.
Aug 26, 2022 · 8 min read
Joint Ventures
When multiple companies or individuals are involved in owning a property, they are structured as joint ventures, often referred to as JVs, where each party has a...
Aug 26, 2022 · 7 min read
Gross Potential Rent
Gross potential rent, or GPR, is a metric that reflects the amount of rental income a commercial property generates at 100% occupancy.
Aug 26, 2022 · 6 min read
Defeasance
In commercial real estate, defeasance is the replacement of the collateral of a loan with securities whose value provides the lender with an equivalent return.
Aug 26, 2022 · 4 min read
Debt Yield
metric in commercial property finance that measures the profitability of an investment.
Aug 26, 2022 · 6 min read
Generations of Self-Storage Facilities
The self-storage sector has three unique generations of facilities based on a property’s age, and knowing an asset’s generation is useful in an investment decision.
Aug 26, 2022 · 4 min read
Easements
An easement is a legal agreement with the owner of real estate that permits access under specified circumstances.
Aug 26, 2022 · 5 min read
Gross Leasable Area
Gross leasable area (GLA) is the space in a commercial property that is designed for the exclusive use of a tenant.
Aug 26, 2022 · 5 min read
Balloon Payments & Balloon Loans
What Are Balloon Payments? Many amortized loans, like many of the ones used to acquire commercial real estate properties, are originated with short-term...
Aug 26, 2022 · 7 min read
Debt Service Coverage Ratio
Debt Service Coverage Ratio, or DSCR, is a measurement of an entity’s cash flow vs. its debt obligations.
Aug 26, 2022 · 4 min read
Capital Expenditures
Capital expenditures are large investments made to acquire, rehabilitate, or maintain a property to extend its economic life.
Aug 26, 2022 · 6 min read
Cash-on-Cash Return
A cash-on-cash return calculation, also known as a cash yield, is a relatively easy way for an investor to determine how profitable an investment could...
Aug 26, 2022 · 7 min read
Diversification
Diversification involves holding a mixed variety of investments within a single portfolio.
Aug 26, 2022 · 6 min read
Equity Multiple
The equity multiple is a simple financial metric used to compare the income an investment has generated compared to the amount of capital input into it during a...
Aug 26, 2022 · 5 min read
Capitalization Rate
A cap rate is a commercial financing measure representative of the expected net gain or loss of profit on an investment over a specified time period, usually one...
Aug 26, 2022 · 7 min read
Effective Gross Income
Effective gross income, or EGI, is a forecast of an asset’s income. It isn’t strictly limited to rental payments, any revenue generated from a property should be...
Aug 26, 2022 · 5 min read
Absorption
Absorption is a metric that describes the amount of space that has been leased in a market or submarket over a specified period
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