$68,294 before taxes. Self Storage located in Hesperia, CAChallenge
The Otaka family owned Main Street Self Storage located in Hesperia, CA. They decided to sell the property as more storage competitors entered the market and they saw a significant drop in their occupancy and income. Their cash flow dropped from $11,000 per month to just $2,000 per month as a result of the increase in new storage competitors in the city of Hesperia.
After analyzing the mobile home parks we decided to list the properties separately given their locations and unique attributes. The mobile home park in Ontario was a senior community.
- Total Equity in Main Street Self Storage: $1,070,000
- Price of the IHOP Investment:$2,640,000
- Cash Flow Before Exchange:Main Street Self Storage-$24,000 before taxes
- Cash Flow After Exchange:IHOP$68,294 before taxes $44,294 net additional cash flow
Not only did they increase their yearly cash flow by 185%, but they also get to keep more due to depreciation on their new investment. The Otaka family now have less management responsibilities as there is only 1 tenant to manage as opposed to 485. In addition, this NNN lease investment provides a consistent & stable income stream that will not fluctuate with market conditions.