Alternate income on extra building space.
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  1. #1
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    Default Alternate income on extra building space.

    So we are looking at another building. Probably not because we 'need' it right now, but because we could use a little space and the location is right. Problem is it is WAY bigger than we need. But if we can find a way to optimize, that would help.

    I am pretty resistant to an outright lease for space as this opens my doors to all sorts of people. However, do what we must. I really hoped to rent out as storage, but no way to gage the interest until we own it.

    I really had ideas to get into other sectors of business, having nothing to do with mfg. Something that needs an extra 20-30k sf. Logistical assist, docking, distributing, etc.

    Any thoughts or ideas?

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    Quote Originally Posted by huleo View Post
    So we are looking at another building. Probably not because we 'need' it right now, but because we could use a little space and the location is right. Problem is it is WAY bigger than we need. But if we can find a way to optimize, that would help.

    I am pretty resistant to an outright lease for space as this opens my doors to all sorts of people. However, do what we must. I really hoped to rent out as storage, but no way to gage the interest until we own it.

    I really had ideas to get into other sectors of business, having nothing to do with mfg. Something that needs an extra 20-30k sf. Logistical assist, docking, distributing, etc.

    Any thoughts or ideas?
    Self Service mini storage and RV, boat and car/truck storage. This guy is doing it in old department stores at shopping malls. Why a Rochester man is buying up empty space in dying malls, including Great Northern - syracuse.com

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  4. #3
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    If you deal with "unknown" people letting out space, make sure your insurance covers you for all the risks. Be especially aware of any laws in your state that could effect you if anyone is doing something illegal in your premises (drug labs, whatever), as you don't want to risk forfeiture of your property...

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    Quote Originally Posted by huleo View Post
    I am pretty resistant to an outright lease for space as this opens my doors to all sorts of people. However, do what we must. I really hoped to rent out as storage, but no way to gage the interest until we own it.
    Post craigslist/facebook marketplace ads for warehouse storage rental in your area. Gives you a quick idea how much interest there might be...nobody replies vs 10 responses in two days.

    I used to just rent out some of my yard space to another guy (completely fenced off from the rest of our yard), and I know I wouldn't want that situation again. Wasn't much wrong with the renter I just didn't like the liability or distraction of that arrangement.

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    Procure:
    1. Liquor license
    2. Qty (1) "Brass Pole".

  7. #6
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    If you are located near big industrial parks:

    3pl (3rd Party Logistics) Short term or long term warehousing.
    What you'll need:
    Pallet racking
    forklift
    Insurance
    A salesperson.

    Essentially it is an overflow warehouse... Imagine a manufacturer can't complete their widgets because they are waiting on parts from China... But the rest of the parts of the widgets are taking up their small warehouse volume... 3pl warehouses can take their waiting stock and store it until they need it again...
    A lot safer than letting random strangers in.. can be a decent revenue stream.
    Just takes the effort to get established abong the local warehouse scene.

  8. #7
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    By investing in the building you're investing in an appreciating asset (at least it would be an appreciating asset in the Pacific NW).

    As to "all sorts of people". I've had residential rentals as a side business for 35 years. Over that time I'd guess we've had maybe 100+ tenants. Only two were kind of marginal. I don't know much about commercial rentals although my friends in that line tell me it's better/easier than residential.

    As the saying goes the three most important things about residential rentals are location, location and location. That probably applies to commercial rentals too, so as you say your location is good.

    Check out prospective tenants as much as you can, credit, time in business, etc, etc. I would be very cautious of business startups since statistically most will fail.


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