Case Study: Making $500K+ on a Small Town Self Storage Facility

Most people think you need a big city, big money, or years of experience to land a deal that changes your financial trajectory. Small town self storage keeps proving that isn’t true. Even in a market of only a few thousand residents, you can work a full-time job and still build six-figure wealth if you understand how these properties perform.

This article walks through how one investor in a town of about 3,200 people bought a neglected storage-and-laundromat combo, fixed basic operations, raised rents, added units, and created more than half a million dollars in equity. He didn’t start with much experience or capital - just one rental property and the willingness to pursue an opportunity when it appeared.

More importantly, you’ll learn the principles behind the deal. You’ll see why small markets often deliver the strongest yields, what landmines beginners need to avoid, and the steps that position you to repeat this kind of win even if you don’t have money of your own.

Trying Rental Properties First

Many new investors assume they should start with residential. This investor did the same, buying a single-family rental. It worked fine, but the growth felt slow and the excitement faded.

Everything changed when a small-town storage facility unexpectedly came up for sale. The owner was busy, ready to move on, and willing to be flexible. A quick walk-through turned into a serious conversation, and the buyer soon realized storage operated very differently from a rental house. It offered real estate stability, but also the upside of a small business.

The facility came with a laundromat attached, which wasn’t part of the original plan, but seller financing made the entire deal possible without a traditional down payment. That alone created an opportunity residential investing rarely provides.

Storage scales faster because one property can hold dozens of paying tenants. Once systems are in place, turnover becomes predictable and far easier than managing single-family tenants. Storage also brings in extra income streams like locks, tenant protection, admin fees, and in this case - even laundromat revenue.

For investors willing to tighten up operations, improve the customer experience, and make small upgrades, storage creates momentum quickly. Residential was the starting point, but storage is what unlocked real growth.

The First Storage Facility Purchase

The leap into storage started with a simple text message. A family friend owned one of the two storage facilities in town. He had run it for years but was getting older, traveling often, and no longer wanted to manage every call or repair. The investor asked whether he would ever sell. The owner replied within minutes and agreed to talk.

The deal included twenty thousand square feet of rentable space, a laundromat built into the same structure, and nearly two thousand square feet of laundry equipment. The price was $675,000. There was one big catch. The seller would only agree if the laundromat was included with the storage. It sounded complicated, but they sat down, looked at the financials, and realized it was manageable.

Since the buyer was early in his career, saving a six figure down payment wasn’t realistic. Instead of walking away, he asked the seller to finance the down payment. The seller agreed. That single decision removed the biggest barrier most beginners use as their excuse.

The seller carried 20% at 5% interest, interest only, for five years. This structure immediately made the deal possible, and it also showed how important relationships and creativity are when you invest in small markets.

Revenue, Finances, and the Power of Real Numbers

Before the purchase, the facility produced roughly $50-55k a year from storage and another $4-5k from the laundromat. There were deferred repairs, old doors, weak lighting, inconsistent bookkeeping, and missing tenant information. The facility worked, but it was far from optimized.

After taking over, the buyers separated both businesses into two LLCs. This kept the finances clean and allowed each asset to be evaluated properly. They reviewed occupancy, expenses, rents, missed charges, and inherited habits. One of the biggest surprises came from physically inspecting every unit. Several doors had locks, but the tenants were long gone. Some units had been abandoned for years. Others held the seller’s old equipment.

Cleaning these out opened 10 rentable units immediately. Later, a large 1,500sqft space was vacated and leased to a commercial user for $700/month. These simple changes increased revenue without building anything new.

Turning Mistakes into Money

One of the biggest early lessons came from realizing how many units looked occupied but were generating no income. Instead of ignoring the confusion, the new owners tackled it head on. They posted notices, opened the units after the required waiting period, and brought everything back into the rent roll.

They also cleaned out old “accumulator units” the seller used as storage for leftover items from move outs. That opened even more space for revenue. These issues might feel messy or uncomfortable for beginners, but solving them creates real value. Small markets often have decades of disorganized operations. That is exactly why these deals can be so profitable if handled correctly.

Seeing the Upside in Plain Sight

When the owners combined rent increases, recovered units, the new commercial lease, and the forty additional units, the outcome was massive. The facility’s projected net income now supports a valuation near 1.7 million at a 6 cap. After refinancing, they will likely pay off all existing debt, including the seller’s carryback, and still pocket hundreds of thousands in tax efficient cash.

They also continue to own the asset, which is projected to produce more than $50k a year in cash flow even after a higher interest refinance.

This is the part most beginners overlook. One deal, done correctly, in a tiny rural market, is enough to jump someone several years ahead financially.

Money Isn’t What Holds Most People Back

People often think they need a pile of cash to get into storage investing. This story proves the opposite. The buyer in this deal brought almost no money to closing. The seller financed the down payment. The bank covered the rest. The real lift came from due diligence, smart operations, and a willingness to fix problems the previous owner ignored.

This isn’t unusual in small markets. Many long-time owners have little to no debt, plenty of equity, and a real desire to simplify their lives. They are often open to creative structures, whether that’s seller financing, flexible timelines, or blended terms that make the deal easier for a new buyer. What they want most is someone who will take care of the property and actually follow through.

The real barrier in storage isn’t cash. It’s mindset. Most people talk themselves out of deals because they only focus on what they don’t have. The investors who move forward focus on what they do have, which is knowledge, hustle, and the ability to solve problems.

If you bring a solid plan, show you understand the numbers, and communicate well, money partners and lenders will usually meet you halfway. Deals get funded because the buyer is prepared, not because they start with a fat bank account.

Why You Should Not Quit Your Job Too Early

A lot of advice online pushes people to walk away from their job as soon as they close their first deal. In reality, keeping your job early on is one of the smartest things you can do. Your income helps you qualify for loans, ride out unexpected expenses, and reinvest every dollar your facility earns back into growth instead of using it to cover your bills.

A consistent salary is more powerful than most people realize. It acts like a financial anchor while your storage operation ramps up. Losing it too early slows your ability to grow, makes refinancing harder, and forces you to drain the business instead of compounding your returns.

Keeping your job gives you stability. Your investments give you acceleration. When you let both work together, you build real long-term freedom.

Final Thoughts: What This Means for You

If you take anything from this case study, let it be this: small markets are full of overlooked opportunities. They require good analysis, patience, and clear thinking, but the upside is real. You do not need to start in a big metro. You do not need millions in the bank. You do not need decades of experience.

What you need is the willingness to run the numbers, ask the right questions, and look where others are afraid to look.

One deal can change everything. This one certainly did. And there are hundreds more like it waiting for someone willing to put in the work.

If you want to watch the full story, check out the podcast episode here.