Scott Ramser was the guest for session 22 of the National Self Storage Investment Club's weekly webinar, which is aimed at self-storage investors. The subject was how to underwrite and value RV and boat storage.
Ramser started with how RDC got here. The firm built industrial buildings in downtown Los Angeles until 1993, then stepped in to help run an outdoor RV and boat facility in Lake Forest, California. RDC installed access gates, computerized the operation and bought it. What drew him was the rent roll. Dozens of tenants moving in and out each month replaced the single-tenant vacancy risk of an industrial building.
Most of the hour was spent on valuation. Ramser argued that stabilized RV and boat income should be valued the way self-storage income is. "You know, income's income," he said (31:34). He went through the expense lines, which he said track self-storage closely, and explained why RDC won't buy at negative leverage. He also said an RV and boat site draws from a far wider area than self-storage: roughly a 30-mile radius, against the three to seven miles typical for self-storage (49:28).
On strategy he was direct. "I much prefer the value-add scenario than the ground-up development scenario," he said (46:43). He put about three-quarters of RDC's deals in the existing-asset column and pointed to how hard it has become to entitle new outdoor storage.
Questions from the audience covered site design, paving, conditional use permits and rate management.