Recycling

A dump station is needed for tenants as they return to store their boat/RV.  Recycling bins can be placed around the site along with trash receptacles.  Not only does recycling reduce the amount of trash, but many local recycling plants offer money in exchange for recyclables.  In many areas of the country, old newspapers are commanding $50 per ton, used cardboard is $75 per ton, and high-grade office paper as mush as $2120 per ton.  And aluminum is recyclable by the pound.  With enough recyclables, this can create substantial extra income. 

Sources: Paper Recycling, How to Make Money Recycling

Photovoltaic Systems

Electricity demand on site is very minimal; however, the use of solar panels have become very popular to reduce this demand by converting sunlight into electricity.  For this development, the electricity needed for site lighting, gate access, wash area, and office space is minimal.  And there are many incentives provided by utilities and the government that can significantly reduce solar installation cost.

Example:

Source: Infinite Power

Water Recycling

The wash area on site for the boats and RVs can be constructed to use greywater.  Many car washes are looking to use this system.  Installing such a system will reduce the demand for fresh water resources from city utilities.  

Example:
The Water Rhapsody Poseidon Advantage is a complete greywater reclamation system ideally suited for a carwash.
Waste carwash water is process to remove oils,sand and suspended particles,resulting in clear high quality water that is ready for reuse. As much a 70% of the total wash water is reclaimed,the other 30% is lost to evaporation and spray during the the washing process.
The systems works in 3 stages.

1. Large heavy particles are drawn the the bottom of the carwash sump while emulsified oils are draw out of solution,floating to the top,to be skimmed off.
2. The waste water is sent for primary digesting in anaerobic chamber and then for secondary digestion in an aerobic environment.
3. Once sufficient Bio-Digestion has taken place the waste water undergoes a clarifying process where all suspended solids are taken out of solution. This clear water is then send back to the washing station for reuse.

Vodacom carwash recycling system at Century City,Cape Town

Source: Water Rhapsody

Revised Financial Analysis

Enclosed office space		400	square feet
Enclosed boat storage - 30 spaces at $110.00/mo		10,000	square feet
Covered rv parking (45') - 14 spaces at $120.00/mo		8,190	square feet
Covered rv parking (35') - 18 spaces at $100.00/mo		8,190	square feet
Open rv and boat parking - 31 spaces at $50.00/mo
Potential Gross Income (PGI)		$     99,960.00
Vacancy and Collection Loss % of PGI		10.00%
Vacancy and Collection Loss (VCL)		$       9,996.00
Effective Gross Income (EGI)		$     89,964.00
Total Operating Expenses as % of EGI		25.00%
Total Operating Expenses		$     22,491.00
Net Operating Income (NOI)		$     67,473.00
Minimum DSC Ratio		1.50
Annual Debt Service		$     44,982.00
Before Tax Cash Flow (BTCF)		$     22,491.00
Project Financing Details
Maximum LTV Ratio		70.00%
Loan Term in Months		180
Loan Interest Rate		8.50%
Debt (Loan Amount)		$380,659.03
Equity Required		$   163,139.58
Total Development Costs		$543,798.61
Land Acquisition Costs		$   146,000.00
= Maximum Allowable Construction Costs		$397,798.61
BTCF/EQUITY INVESTED (BTROE)		13.79%
Actual Construction Costs
Enclosed boat storage (includes office and site development costs)*		$18-$25 per sq. ft.
RV covered parking**		~$3 per sq. ft.
Total:		$277,940

Actual construction costs are projected to be much lower than the maximum allowable costs.

*Costs for development of the enclosed boat parking and office would be similar to a self-storage facility, which is $18-$25 per sq.ft., including site development costs. And, a project like this could have gravel drives instead of the traditional concrete paving at self-storage sites, which would lower this cost.
**For the two sizes of RV covered parking being proposed here, the costs are about $3 per sq. ft. for each size needed.

Sources: Trachte Building Systems ; Inside Self-Storage ; G.P.B., Inc.

Site Layout

Conclusion - Project #1

Financially, the before tax return on investment is very good at 13.79%.  The maximum allowable construction costs are at $397,798.61, which I believe to be an overestimate for the necessary type of structures to be built on the site.  The actual construction costs are projected to be $277,940.  If the developer wished to utilize the maximum construction costs allowed, it is assumed they could construct more of the enclosed storage spaces and thereby increase rental income and NOI.  The site chosen is relatively small in comparison to the market competition, and if the developer chose to look at a larger site, they could max out the allowable construction costs by building more covered storage spaces and so increase the NOI.  Or the project could be completed in phases with a larger site. 

There seemed to be quite a few competing businesses in the Mansfield area, but after further research and after speaking with a few of the businesses, there seemed to be a demand for this kind of storage facility, especially considering that many of the existing storage facilities were nearly 100% occupied and remain so for a majority of the year.  And the city does have an ordinance prohibiting the parking of recreational vehicles and boats on residential yards or driveways.  Mansfield also appears to be a growing area with the median income far exceeding the state median income level.  This, along with the city's close proximity to Joe Pool Lake and much-traveled highways/interstates, makes Mansfield a desirable location for an RV and boat storage facility.

In conclusion, an RV and boat storage facility would produce desirable returns at the chosen site. 

Rental Spaces

Kennedy RV & Boat Storage

- This site is similar in configuration to the suggested site, but is 3.4 times the size.
- The unit mix of enclosed boat storage (can also be used for regular self-storage), pull-through covered parking, and open parking seems like the best combination for the suggested site.
- 10'x30' enclosed storage spaces - qty: 8 at $110/mo
- 13'x45' pull-through covered spaces for RVs - qty: 4 at $120/mo
- 13'x35' pull-through covered spaces for RVs - qty: 14 at $100/mo
- 10'x30' open parking for boat or RV - qty: 24 at $50/mo