Carrying costs in Self-Storage development are the ongoing expenses incurred while your self-storage facility becomes a self-sustaining entity. Knowing what carrying costs are and how to budget for them can make a break a self-storage development.
Typical carrying costs are Property Taxes, Insurance, Utilities, Maintenance, Personnel Expense, Interest on Loans, Management Fees, Legal Fees, Opportunity Costs, and any other day to day operating costs in a facility.
Total Carrying Costs can be calculated by adding these monthly costs together and multiplying by the months you expect your facility to come to a profit break-even point or be a “stable facility”.
Understanding, and preparing for carrying costs is crucial for effective financial management in self-storage. Learn more about carrying costs and other hidden expenses in self-storage development by reaching out me at kevin@storageauthority.com.
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