105: An Asset Class for Uncertain Times: Self-Storage Investing with Scott Meyers

PILF 105 | Self Storage


Self-storage has been one of the best performing real estate asset classes over the past two decades, especially in uncertain economic times. Join Jim Pfeifer as he talks to real estate investor turned self-storage investor, Scott Meyers. Self-storage is a simple and predictable asset class and Americans love to store their stuff – in good times and in bad times. You can add value and raise rents much more quickly than in multifamily and other assets. Tune in to learn how the storage business works, how to vet sponsors, analyze deals and become a successful passive investor in self-storage!

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An Asset Class for Uncertain Times: Self-Storage Investing with Scott Meyers

I’m very excited to have Scott Meyers with us. He’s been a real estate investor since 1993, and he’s been a self-storage investor since 2005. His companies actively acquire and develop self-storage facilities nationwide. He has approximately $160 million in assets under management, 2.5 million square feet, and over 15,000 doors across 43 projects. He is a self-storage guy. Scott, welcome to the show.

Jim, it’s good to be here. Thanks for having me.

It’s a pleasure. The first question I always ask is if you could give us your journey, how did you get into real estate and how and why did you get into self-storage after that?

1993 is when I bought my first property and believe it or not, I’m dating myself, and the fact that some folks here may remember Carleton Sheets and his home study course. It was sold on cable television. I bought that home study course and learned how to find and implement the BRRRR method before it became the BRRRR method, which is you find a home, single-family house, rehab it, rent it out, refinance it, and then move on to the next.

We did that multiple times and then multi-family. We found ourselves with about 78 homes and about 425 apartments. We recognized that we didn’t have the freedom and the passive income that Mr. Carleton Sheets had talked about. My wife and I decided that we love real estate for the same reasons why everybody here on this show does. It’s that it appreciates if you do it right and you can force that appreciation as well by improving the properties. We can depreciate them for tax purposes. We can leverage and borrow money to buy more real estate.

When our tenants pay our properties off, they paid our basis down and all we have to do is manage it in the meantime. When I say, “All we have to do,” that is the challenging part between the A to a Z. We decided that there had to be a better way. We began looking around the landscape and everybody loves rental real estate if it weren’t for tenants and toilets but then that leaves parking lots and self-storage.

There’s not a lot of value that can be created in parking lots. We began looking into the asset class with self-storage and liked what we saw. There are many reasons from a management standpoint, from a collections standpoint, and an ease of operations standpoint. It’s a very simple predictable business model. If people don’t pay you, you lock them out and you sell their stuff to recoup your losses.

PILF 105 | Self Storage
Self Storage: There are many reasons to go into self-storage. From a management, collections, and ease of operations standpoint, it’s just a simple and predictable business model.

When we turn the units, there’s a metal box on a concrete slab. We don’t have all the maintenance and we don’t have the lengthy, inexpensive turns of painting and carpet replacement or cleaning the appliances and everything else that goes on in the meantime. At that point, that’s when we begin to divest all of our tenants and toilet-type real estate and then got into nothing but self-storage.

That was in 2005 and we began to ramp that up. I used to also be the president of the central Indiana Real Estate Investors Association here in Indianapolis and we began to teach people how to get into the business of self-storage. It’s by holding these little workshops on Saturdays and that caught fire and some of the national agents for the speaker’s bureaus and the real estate speaker agencies began calling me and asking me to go out and speak around the country on this topic and teaching people, thus the education side of our business was born as well.

We were not only investing but we were teaching people about the business. If you want to grow at any scale in commercial real estate, you need to learn how to raise private equity. We became very good at doing that and that is what has fueled our growth and brought us to the place where we are right now with the stats that you mentioned. We still teach people about the business, although I’m stepping away from that. I don’t do that as much. We have lieutenants in place on the teaching side, but I do run our mastermind, which is a group of A-players that are investing in the asset class. My role is head of and chief visionary if you will, for our financial services arm, which is raising private equity to go out to and grow the business.

If you want to grow at any scale in commercial real estate, you need to learn how to raise private equity.

That’s a great story and I always like to dig in a little bit to understand more about the shift. I understand wanting to get away from tenants, toilets, termites, and all that. I did the same thing but then go to self-storage, how did you find self-storage? Now looking back it’s easy to say, “I wanted to get away from the stuff I didn’t like and self-storage was there.” Now, it’s more well-known. How did you know then that this was a place to get into? It’s because that was quite a few years ago.

It is and at the time, that’s how our education business was more that when I began to look around the landscape, there wasn’t anybody teaching. There wasn’t an organization like ours teaching people how to get into it. We could certainly learn by reading books and doing home study courses and seminars on multifamily and mobile home parks and different asset classes, but there wasn’t any on storage. As I begin to look around, I recognize that it was unpopular at the time.

This is back in 2004 and 2005 when I was looking into it. It was the stepchild of the commercial real estate asset class. It’s these simple garages and there weren’t anywhere near as many as there are now. At that time, it was dominated by mom-and-pop. Ninety percent of the self-storage facilities around the country were owned by mom-and-pop owners. Investors like myself were out buying these small apartment buildings and houses.

Whereas when you look at multifamily, assisted living, and mobile home parks, they were predominantly owned by the REITs or hedge funds. I recognize that this was a great opportunity for me to go out in a large opportunity to buy these mom-and-pop commercial pieces of real estate where it was a little more difficult to do so in multifamily. It was more competitive.

We have seen how wealth is created in real estate and the commercial side when you roll these up. When you own a number of apartment buildings in communities in one location and you sell off to a larger player, if that is, and the multiples are higher and the profits are greater. I saw that in self-storage. Even though there’s a fewer of them compared to some other asset classes, the opportunity to be able to buy these from the mom and pops and roll them up into my own organization. Centrally manage them and achieve that economies of scale, then in a few years when I decided to sell, there would certainly be a greater opportunity at that point to be able to roll up my portfolio and sell it to a larger player.

It still seems like there is a lot of mom-and-pop that are in this space or do you feel like that’s been reduced significantly? Is there still a runway to find these older people who are looking to get out of it and you can buy a property from them, upgrade it and do some of the things they didn’t have to or need to do?

They have gained ground, meaning the REITs and the larger players. At the time when I got into the business, about 10% was owned by the REITs and now it’s about 20% or maybe approaching 21%. The larger players have gained ground but you could also say there is a lot of opportunity because it is the opposite. The ratio is the opposite.

When you look at the multifamily and the other asset classes, it’s about 90-10 with 90% owned by the REITs and only 10% owned by mom-and-pop and individual owners. The opportunity is still there and it still is. I don’t want to say the Wild West and wide open because it is becoming a popular asset class, as you mentioned. I think that’s partly due to our organization or education organization and making people aware that this is an asset class that is desirable.

You have a mastermind teaching education. Are these targeted toward people that want to be syndicators, operators, or owners of the asset? Are these targeted toward passive investors who are going to be investing in somebody?

A little bit of both. When we started, it was more along the lines of holding these workshops for people that wanted to get into the business that wanted to explore this asset class. We focused on the folks that were coming out of either single-family or maybe multifamily and taking it from 0 to 55 miles an hour in self-storage. Transferring the skillset from one commercial asset class to another by way of the underwriting and the operations.

Along the way, the next step was people wanted to grow and scale. That’s where our mastermind came in place. Those are folks that meet certain criteria and in other words, they are in the business and they are growing and scaling. They have access to capital and lenders or maybe not. We begin to put people into our mastermind or we begin to attract people into our mastermind that did have private equity.

Also, they represented some family offices that were looking to come alongside investors like ourselves that were growing in scaling and doing some one-off syndications or some portfolios or being a part of a fund. By nature, it grew in tandem and we begin to attract more passive investors because our marketing was geared towards growing our business by way of creating these private placements as well as our fund. Our marketing efforts from a joint standpoint are what have allowed us to grow on both ends.

I want to get into the actual asset class, self-storage. You mentioned a couple of things in the opening. You are getting away from having to evict people, instead, you are evicting stuff. Why is self-storage such a good place to invest? I want to look at this from the operator standpoint but also from the passive investor because as a passive investor, I don’t deal with termites, tenants, and toilets anyway. That’s your job. Why do I care? Why is it better for me to invest in self-storage than multifamily if it is or is it only about diversification? There are2 or 3 questions wrapped up in there for you.

I get it and I would answer that almost the same for the reasons that a passive investor is interested in self-storage and investing along with us are the same reasons why we liken it to an owner-operator and an active investor. First of all, it’s a very simple predictable business model. It doesn’t mean that it’s an easy business. No business is, or if you think it is, then you are probably not minding your business very well.

In terms of development and in terms of market saturation, we have got some numbers. Some baselines that are pretty easy to calculate and we can determine with a fair amount of accuracy when we go into a market. We are either looking to buy an existing facility and expand it or raise the rates. We have got a pretty good handle on the market and we know a 7-square-foot per capita roughly is equilibrium and any less than that, you are able to raise rates. Also, any more than that, you need to dig in a little bit further. It goes the same for development.

From an operations standpoint, if people don’t pay after 60 or 90 days in some states, we have the ability to sell their stuff off and recoup our losses. Whereas, that’s a misnomer in the apartment world. You have some baselines in terms of percentages, but if somebody leaves, they owe you a lot of money and they trash your apartment. That could vary from unit to unit and you don’t know if you’re ever going to get that back, whether they have a job or not, or what small claims court looks like in that market. That’s a moving target.

PILF 105 | Self Storage
Self Storage: In storage, if people don’t pay you back after 60 or 90 days, in some states, you can sell their things to recoup your losses. Whereas in the apartment world, that’s a misnomer.

In storage, we know that we are going to get a percentage of that back because we don’t have to go to the courts. It’s not up to them. It’s a lien law and we have the ability to auction this stuff off. We get our money back. We get it back quickly and we know roughly what that’s going to look like. We also know what our repairs are going to be because it’s a metal box on a concrete slab. We blow it out and we wipe down the door. That’s it. There are no ups and downs. There are no fluctuations. From an owner’s standpoint, we can budget better. We can hit our marks. That’s also good for our passive investors when we know so we can budget exactly where we are going to be when we head into a project.

With storage, you know what your repairs are going to be because it’s just a metal box on a concrete slab.

With more accuracy, there are no guarantees from that standpoint but probably the bigger piece is that when we head into a recession, self-storage does much better. It’s needs-based. When there’s trauma and there’s transition in the marketplace when people are moving, whether it’s good times or inflationary periods when the housing market is strong.

With self-storage, people are staging their homes, putting things in storage and they are moving, which necessitates a need for storage, but also during a recession, conversely individuals are downsizing and they are putting their stuff in storage. When they move back home or move in with each other, they are putting inventory back into storage because it’s cheap warehousing space until things turn back around again.

We did better during a recession as an industry than we do during the boom times. I would never say a business is recession-proof or inflation-proof, but self-storage has proven over and over again to be very recession-resistant and inflation resistant. It has the lowest loan default rates and the lowest loan loss rates. From that standpoint, it’s very attractive to us as owners and obviously to our passive investors.

This will be the third recession that we are heading into and the statistics speak for themselves. From our standpoint, we don’t have to work too hard to twist somebody’s arm or persuade them that storage is the asset class that they should be investing in, especially when we head into a recession because the industry speaks for itself.

Self-storage is usually thought of as recession-resistant as you explained. It also does well in up markets, but there’s been some discussion in the Left Field investors that are in Infielder Forums about self-storage and is it going to be the same this time? When I look at it, every time there’s a new apartment complex going up in my town, there’s a self-storage facility that is brand new and built right next to it.

Sometimes when there’s an apartment building built across the street from another one, they put up another self-storage facility. I’m sure it’s somewhat market-dependent, but is it going to be the same if there is a recession coming, which most people think? Is self-storage still going to be the asset class to be in or is it overbuilt and is that market-dependent?

I would say that it’s extremely market-dependent. As a self-storage developer, I include myself as well as in the industry, we don’t do this for fun. We don’t do it for kicks and there’s no longer a spray and pray or build it and they will come mentality. What you are seeing and I imagine most folks out there are seeing are the multi-story Class A self-storage facilities that we are in the $8 million, $9 million, $10 million, or $20 million range.

The lenders are savvy. They are not going to hand over $10 million to $20 million if we haven’t done a market or a feasibility study by an independent consultant. We have shown and proven that this is a market that has a demand for self-storage. The market is self-correcting or self-policing. We are no longer taking any of these risks and the appraisers aren’t going to give an as-is in a 2(b) if they don’t see those same market stats.

When we do our feasibility studies, we do them in-house first. We have been doing this for so long, but in order to pay to play, we have to have a feasibility study done by a consultant to give to the lenders. Also, when we raise private equity, that’s what we use to send over to our private equity partners that says, “This is not only Scott saying, ‘This is going to work. It is done by a consultant who is looking into the market and digging into it.’”

All that to say, there’s an opportunity perhaps if somebody has a lot of cash and they want to take a chance and go build somewhere and they haven’t done any type of market study. My guess is that’s a pretty haphazard approach and if folks have that much cash, probably they are smart enough to know that they need to do their homework and they have got a lender behind it. Also, some consultants with some studies to show that it’s proven.

You have been in self-storage for many years. Can you talk about some of the things that have changed and that you have learned over that long because there aren’t a whole lot of operators, certainly not in self-storage and even other asset classes that have been doing it for so long and that’s a huge advantage? Can you talk about some of the learnings that you have had?

Initially, it was only the underwriting and understanding of this asset class, and then through years of operation, seeing some of the market swings by way of now heading into our third recession. We know what to expect, but also, seasonality on a year-in-year-out basis. We know that in the springtime, it leases up, and in the fall when people go back to college and they take some things back out of storage, it’s a little slow. People don’t come out and rent. We know how to predict and manage that as well.

In terms of the business itself, it is not sexy. These are metal boxes on concrete slabs. It doesn’t change much. The biggest changes that we have seen in the industry in terms of improvements to navigate them all have been good ones and that is technology. It has allowed us to be able to utilize kiosks to rent up our facilities and not necessarily manage them. We don’t have to have somebody sitting behind the desk or two people twiddling their thumbs all day when they can rent a unit on their phone and receive the code to be able to get into the facility and to their unit.

Self-storage isn’t sexy. It’s just metal boxes on a concrete slab.

The security systems that we have to allow us to be able to monitor the entire site so we don’t have to have people on site all the time. Those are some of the major changes that we have seen. In the macro sense, it has become the Cinderella of commercial real estate. It is no longer the stepchild, but it is the darling. It has outperformed all the other asset classes, bar none, for the past several years.

I’m very unbiased when I say that. If there’s a better asset class out there, I will invest in it but I’m happy that we are in this one because it has outperformed all the others. As we head into the recession, again somewhat know what to expect. As you mentioned, all of these are different, but it has been a very predictable asset class. There haven’t been a whole lot of changes or anything that I can say has been a huge change in the industry itself other than it’s becoming popular.

Yes, there is a race for folks to be able to consolidate and get into this asset class. We are seeing players in the competition coming in that we have never seen before. We have to have our A-game out when it comes to acquisitions as well as development but those are also our end buyers when we develop these facilities or when we consolidate and sell off. We are happy that competition is coming in because it is driving up the values on the exit side.

What do you do when the market’s changing? How are you preparing for that? What is your team doing to make sure that if the recession comes, you are prepared for that in this market?

We have been preparing since 2009. I was in real estate. The recession that I went through first was in ’99 and 2000. That’s when I was in houses and apartments. That’s when the Community Reinvestment Act was put in place to send the economy back a fire again. That administration felt it was a good idea that anybody who could fog a mirror should be able to buy a home and they did. All of our tenants left and I realized at this point that this may not be the best business model moving forward.

That was another reason I began looking into storage. In 2008, we paid for the Community Reinvestment Act and by way of the next recession. At that time, I was in storage and all I could see was a huge land grab by my friendly competitors that had been in the industry a lot longer and had deeper pockets in terms of cash or private equity and good lending relationships.

They bought when these other owners didn’t create enough value. When they refinanced, they couldn’t hold onto their facilities because the LTVs had changed or their capital stack. The cost of capital had changed. Not to the fault of the facilities, but of owners that weren’t prepared. We saw that and we bought some of those up. However, we recognized that when the next recession comes around, we need to have better lending relationships and more private equity because that will happen all over again. We will see that.

The business will be strained. The capital stack is strained when people need to refinance. Partnerships will be strained for other reasons and things that happen outside of the self-storage facility or the business that these partnerships are in and people are going to need to sell. We have been preparing by way of making sure that we have cash available by way of our private equity partnerships and lenders that know, like, and trust us because we have done a lot of business with them. Our preparation has all been to participate in what will be the biggest land grab in my lifetime or in my career in self-storage.

We are starting to see that happen and as you said, as we get deeper into the recession or once it finally hits, that’s when we will begin to see a few more of these opportunities that will come into play where there are either facilities or owners that are distressed that we will be able to step into and hopefully, make a deal with.

Can you talk a little bit about what would cause an owner to be distressed? We are talking about self-storage being the best asset class to be in hard times. Hard times are coming. I would think that everything would be great. They are looking forward to it because self-storage performs so well. Is the self-storage overperformance relative to other asset classes in recession or is it because some of the self-storage owners have gotten themselves into trouble with debt and things like that?

It’s the latter. I’m not talking out on both sides of my mouth. For all these reasons, people sell real estate, and many times when they have to sell, it isn’t always the fault of the facility or the asset class that they have chosen because the asset class is going to do well and it continues to do well during a recession. However, is this owner diversified across other asset classes that aren’t performing well?

PILF 105 | Self Storage
Self Storage: Many times when people sell real estate, it’s not because of the facility of the asset class they’ve chosen. There are a number of reasons why people sell and that all gets amplified during a recession.

If we head into another pandemic situation and they have assisted living or if they are affected by short-term rentals, whatever that looks like, death, divorce, and bankruptcy come with a recession. If these owners have facilities but get wrapped up in bankruptcy, the facility could be top of the market and rents and 100% occupied but it gets wrapped up in foreclosure in bankruptcy and it will come back out to the market again.

Somebody has to make up for a small business that they own that is tanking and they need to sell their storage facility to get a windfall and grab some cash or any of those other reasons. People also during a recession are moving around. They are trading assets. They are selling because they don’t get the depreciation any longer. Maybe they are fearful. They are in the front end of a recession and they are scared so they don’t want to ride it out. They are going to sell now and be done with it. Maybe, they are nearing retirement. Capital gains taxes. There are a number of reasons why people sell real estate and that all gets amplified during a recession.

At Left Field Investors, we are passive investors. We are always looking for top-quality sponsors. How do you vet a self-storage sponsor? If you were going to invest in somebody else’s deal, what are some of the questions that we need to be asking specifically to self-storage sponsors?

You and I have been to a number of events together and I have been to yours. The same resounding message comes out over and over again and that’s they want to invest with somebody who has integrity. The challenge with that is how do you vet that out? You don’t determine that until you get down the road with someone or until you get married, per se. You need to do your homework.

As a passive investor, the basics. The things that you teach, first of all, is it their first rodeo? Have they been in the business for a while? I would say as we tell our passive investors as well and we are teaching, “Has this person been through or this company been through a recession?” To me right now, that is probably the one, if not the number one thing that they should be looking at because there are a whole lot of folks out there that have done well. They have made a lot of money and they have got some solid returns. They have exited and made some good returns for their investors or maybe they have raised a lot of money and they haven’t exited yet.

Anybody can do that when money is free, cheap, and flowing as it has been since 2009 but the question is, how successful were those owners, operators, and syndicators when they have had this big wind in their backs? I will be the first to admit as well, 50% to 75% of the success in the real estate market has been as a result of the market. We are not all rock stars, but how well have people performed through the last recession or the recession before?

We are fortunate enough that we have a good story to tell that the industry average in self-storage has returned 16.8% over the past years. In the past few years that we have been syndicating and doing this business, our returns are above 34%. We are doubling the market and we have been through two recessions. I’m not tooting my own horn, but I guess I will and that is you need to look at folks that have been through a recession to see if have they navigated through that before.

If they haven’t, they may not be able to see a little further down the road, or as one of the gentlemen mentioned at the last event you and I were at, he said, “I don’t think I’d ever follow a leader who doesn’t walk with a limp.” In other words, I will continue to repeat that. You can’t learn from somebody and I don’t know that I invest with somebody who hasn’t been through a war. Who hasn’t been through battle and come out to the other side successfully with victories?

Don’t invest in somebody who hasn’t been through a battle and came out the other side successfully.

That and track record are important. To be able to vet that, get referrals from other folks. Take a look at where they are investing and why are they looking at a particular geographic reason or are they spraying and praying and following deals? What does their team look like? Is their team savvy and does their team have experience? All those are ample reasons.

Also, to be able to interview them and I think many times, an integrity piece will come out. If you can get on with the lead sponsor or the folks that are in charge or a handful of them. You can get on a Zoom meeting and you can fire these questions away at them, you will be able to tell how they answer. If there are lots of ums and ahs and they can’t answer, they may not be the person that you feel comfortable going into battle with because we will be going into battle as we head into this recession and your retirement dollars are at stake.

Who do they follow in terms of economists and what are they seeing coming down the pike? Ask them some pointed questions. Their underwriting model, how have they adjusted, and are they adjusting their underwriting model and their exit cap rates based upon the upcoming recession? If they plan to exit in 4 or 5 years, what are the cap rates and how are they calculating that? Those are the questions you need to be asking because somebody who hasn’t been through a cycle like this may not be able to answer them in the proper way.

That’s the sponsor. We also then got to analyze the deal or a fund or however, you are looking at it. As passive investors, we have already vetted the sponsor as you talked about. We get comfortable with them. The next step is how do we analyze the deal. Can you share with us 2 or 3 of whatever you think are the most important deal-specific metrics that a passive investor should look at without having to re-underwrite the whole deal? Top line, “Here’s a few things to look for.”

The same thing an active investor would be looking at is digging into their feasibility study and looking at their supply index. Is it high compared to the rest of the market? Where are rental rates and where are they trending? Being able to vet and see what is the occupancy of the competing facilities in the market. Are rates going up? Are they using store track? Are they using Yardi Matrix? What are the metrics and the baselines that they are using? Also, third-party reports to determine how strong is the market.

PILF 105 | Self Storage
Self Storage: When analyzing a self-storage deal, you need to be looking at the deal’s feasibility study. You need to look that the supply index and whether it is high compared to the rest of the market.

If it’s new construction, who is their GC and is it a reputable GC? This is going to be a solid exit when the bigger players come along because they use a reputable GC that knows and understands storage that is going to get top dollar for it. Did they use their local guy that has never built a storage facility before? What is the pedigree of all those folks that are involved? Furthermore, it is part of the deal as well in the underwriting and taking a look at their exit cap rate and what is the valuation they are putting on that. How are they going to manage it? Who’s going to manage it?

I find that the more vertically integrated, the better. We have in-house property management and that’s because we know that nobody cares 1% as much about our facility and its performance of it as we do. Third-party property management companies are great. We use them. We have used them. We continue to use them. We have three that we use on a regular basis or geographically, we may have to pull somebody else in but only with an incentive-based compensation package would we use a third-party management company.

If a syndicator or promoter response is not vertically integrated and they are not controlling the management, which means they are not controlling the expenses of managing it, then they are at the behest of a management company whose only goal is to maximize fees. It’s not necessarily the performance. Does that sponsor, if they are using third-party management companies, is it a one-off customized compensation package with this property management company that is driven by performance? Not only a 6% fee, which ends up being a 12% fee when all is said and done. It throws your underwriting and everything off for the passive investors. I can go deeper, but those are probably the main things in terms of how is it managed and who’s driving the NOI.

The next question is, we vetted the sponsor and analyze the deal, what are the markets that you are in? Are some markets better than others or is it like in multi-family? Everyone’s in the Southeast, Southwest, or specific markets that are good where everyone’s going. I assume that some of that is the same for self-storage.

It is 100%, as you mentioned. You are seeing apartments, multifamily, and storage going up across the street or storage is in first and multi comes after that. We always want to be in the path of the pipelines and where things are going. The water pipelines and utilities and the path of progress are almost always the best markets and the places to be able to go to. That being said, we also have the ability, and because we have been doing this for a while and we have inroads with not only developers but also with our brokers to be able to find these infill locations to be able to develop or find these warehouses or other industrial buildings that we can convert into self-storage.

Places with a path of progress are always the best markets to go to.

Whereas in the past, the city has not been amenable to this or there’s a building that goes vacant and the apartment folks and the condo folks looked at it and it doesn’t work, but it works all day for storage. If we can get in there and the supply index is only 2 or 3 square-foot per capita where the median is seven or the equilibrium is seven. We have the ability to step into some of those markets as well. We can do that anywhere in the country. It doesn’t matter if the market is growing. It means that there’s tremendous rank growth and pent-up demand. It’s a multi-tiered approach, but by and large, we are in the Southeast and we are in the markets in which people are moving to and that are growing.

Can you tell us a little bit about StorageMissions.com?

I would say that we almost exist to do missions. When my wife and I started in real estate, the goal was always for two things. 1) We had to honor God and be able to give back. 2) It was to build the lifestyle business, or truly we could be on the mission field and we would be able to raise our kids and take them out of school or homeschool and take them around the country to experience life in the world. That’s what we have been able to do.

Over the years, it has evolved. What we do now is primarily through our house-building efforts. Back in 2013, we began tithing on our corporate profits. Taking 10% of our corporate profits and all our businesses. Put them into a pool and then we go and build houses in the Dominican Republic in the beginning and now primarily in Ensenada, Mexico.

What we do is we pay for the house and we pay for all of the fees associated with it and all the travel, food, and lodging for anybody who wants to come on a mission trip with us. It’s a four-day family-friendly mission trip and a very safe area in Ensenada, Mexico. It is a cruise ship port. If you blink, close your eyes, and open them again, you see Starbucks, McDonald’s, and palm trees and you would think you were in the US. It’s very safe. It’s introducing people to the mission field. It’s twofold. We give these folks a house, the folks that are interviewed with our partners, YWAM, Youth With A Mission, and the Homes of Hope Organization. These folks are very deserving and in need of a home. We are ending generational poverty one house and one family at a time.

Also, our missionary partners, the folks that come alongside us are moved in some way. You can’t be moved in some way. Some of them are doing the same things. They are small business owners. They are real estate investors. There are many of our partners, our vendors, and our passive investors that are coming along with us. They go back and either they are changed enough to do something different in their home or their community. Some of them are now doing the same things that we are doing and they are building alongside us. They are paying for a house and for people to come and to be able to pay it forward but also multiply.

The ripple effect is taking place now. As we have been doing this since 2013, we built 26 houses and we now take two trips a year in the spring when school gets out and then once the weekend before Thanksgiving. We are building three and now approaching four houses per trip. We take groups of twenty people along with us able to do that. We see no end in sight. We are getting larger. The goal at some point is for my wife and me to flip the script and it will be the 80-20 where we spend 80% of our time on the mission field and growing that and 20% in real estate versus the 20-80 where we are right now.

That’s StorageMissions.com. If people want to get more information, is that the place to go?

That is the place to go. Jim, we need to get you out there sometime. We would be happy to take you and your family on a trip. It’s all paid for. Just get yourself to San Diego and we take care of the rest.

I love the idea of investing in real estate and then doing good. I’m always looking for those opportunities. That sounds amazing. The last question I usually ask is, “What’s another great podcast that you listen to?”

I have been listening forever to Tim Ferris’ podcast because he makes me think outside of the box, a little bit about his guests. The syndication show is one of the better ones in terms of our craft and what we do. Those are two of the most popular. I have been listening to a little more of the market podcast. What’s going on in Dubai and the BBC for more world finance to be able to look a little further down the road with what’s happening with capital markets and what we expect as we head into the recession.

If the readers want to get in touch with you, what’s the best way they can do that?

Go to SelfStorageInvesting.com. It is our all-encompassing self-storage website. Everything for the active or passive investor. It explains what we do as well as our mission efforts. Scott Meyers self-storage, if you Google that, you will find me on all the socials. Feel free to connect with me anywhere there, but I spend more of my time on LinkedIn.

Thank you so much. This has been informative and we appreciate you being on the show.

Thanks so much. It’s my pleasure. It’s good to see you again.

There is a lot of good information in that one. To have someone that’s been in this asset class for so long is super interesting and you get lots of great information from that. When he started in self-storage, it wasn’t popular as it is now. It wasn’t one of the hottest asset classes. I always find it interesting how people can find something like that. You are a multifamily guy or a single-family home person, and all of a sudden you are somehow, “I don’t like tenants. What do I do?” You find self-storage and it worked out fantastic for him.

At the time, it was dominated by mom-and-pop. My question was, is that still the case because it’s all being institutionalized? I was really surprised that he said it went from 10% institutional ownership to only 20%. Now, that’s doubled in several years, but it’s still only 20%. There’s so much opportunity there because a lot of times you have these mom-and-pops who have owned it for 30 years. They don’t want to do any of the updates or upgrades because they have paid down their debt and now they’re cashflowing so what do they care if they have no employees, electronics, or all the other stuff that you can improve the asset on?

There is still a lot of room to run by finding these mom-and-pops and to keep going. One other thing he liked about self-storage which makes sense to me is it is a simple and predictable business model. You can buy a unit or buy a self-storage facility and you can instantly raise all the rents if you want to because everyone’s on a month-to-month. The turnaround is quicker. You can add value more quicker. If there’s any open space, you can build more stuff on it. It’s an easier and more predictable business model. Also, recession-resistant.

Scott said in the last two recessions, it’s done better than everything else. It’s not only better relative to other asset classes, but it also performs better in downtimes because people are moving. There’s a lot of displacement going on. Americans love their stuff. When things get displaced or can’t get rid of your stuff, you go rent a unit for $30 and throw all your junk in there. That works and that’s the one thing that he said to focus on when you are talking to operators is to find someone that’s been through a recession.

There probably aren’t that many out there and if they haven’t been through a recession, then you got to do your due diligence. Start asking questions about how they’re going to handle things and what have they learned. Have they looked back at how things went in those recessions if they weren’t investors or owners at that time?

Try to figure out, “Have you done any preparations? Have you done any research and learned about how to get through a recession?” Those are some of the important things. It was interesting talking to Scott. He knows his stuff about self-storage. There’s no doubt about that. We will keep an eye on him as we move forward. That’s it for this time. We will see you next time in the left field.


Important Links


About Scott Meyers

PILF 105 | Self StorageScott Meyers has been a Real Estate Investor since 1993 and a Self-Storage investor since 2005. He currently owns and manages 40+ facilities with over 14,000 units and over 2,400,000 square feet nationwide. He began his real estate career by purchasing, rehabbing, and selling a portfolio of over 75 single family homes in Indianapolis valued at over $6,000,000. He then quickly progressed into the commercial arena by purchasing, rehabbing, and selling over 400 Apartment units in 4 separate developments valued at over $7,000,000.

Scott is a member of the Self Storage Association. He is also a 2007 graduate of the Owner/Investor Executive Course taught through the National Self Storage Association. He was recognized by The Indianapolis Business Journal for its annual 40 under 40 list of up-and-coming Indiana business owners in 2007.

Scott also founded a Self-Storage Education and coaching business in 2007 to educate investors and entrepreneurs on how to buy and develop Self Storage Facilities. He holds several seminars and provides advanced mentoring programs. Scott started and runs The Storage Mastermind, a group of 40-50 industry-leading storage professionals that meet quarterly.

In addition to running his education business, he is also an active syndicator of Self Storage investments. As a syndicator, he matches Self Storage projects with private equity investors. To date, he has syndicated over $50 million worth of projects.

Prior to his storage career, Scott was a past President of the Central Indiana Real Estate Investors Association (CIREIA) where he doubled the group’s membership over 2 years from roughly 300 members to approximately 600 and won 2 awards of excellence in successive years from The National Real Estate Investors Association. Scott was also the co-founder of the Indiana Real Estate Investors Association (IREIA) in 2005 and served as the annual conference chairperson for 2005 and 2006, the largest of its kind in the state.

In April of 2006, Scott was invited to serve on the Indianapolis Economic Development Advisory board which acts as an advocate for economic development programs and projects in Indianapolis and the surrounding communities. Scott also spent several years as an instructor of the Landlord 101 course through the University of Indianapolis in partnership with The Central Indiana Real Estate Investors Association.

Scott was a 5-year member of the Indiana Chapter of the Young Entrepreneur organization, (YEO) an international organization for entrepreneur’s whose business produce over $1 million per year in sales and were formed and are wholly owned by their founders. Scott has held an Indiana real estate license since 1998 and has brokered hundreds of deals worth over $12 million dollars. Scott is also a Crown Financial Ministries and Dave Ramsey instructor and Budget Counselor, and he directs the financial ministries at the church he and his family attend.

Currently, Scott lives in Fishers, Indiana with his wife and their 3 beautiful children. They spent 2-3 weeks per year on the mission field where they fund and then build houses with their family, friends, co-workers and students and gift each to a needy family. They have built 14 houses since 2013 and average 4-5 per year. Scott graduated from the University of Michigan with a marketing degree and worked for 8 years in the telecommunications field with Lucent Technologies and Ameritech before starting his own real estate companies.



Our sponsor, Tribevest provides the easiest way to form, fund, and manage your Investor Tribe with people you know, like, and trust. Tribevest is the Investor Tribe management platform of choice for Jim Pfeifer and the Left Field Investors’ Community.

Tribevest is a strategic partner and sponsor of Passive Investing from Left Field.

Chris Franckhauser

Vice President of Strategy & Growth, Advisory Partner

Chris Franckhauser, Vice President of Strategy & Growth, Advisory Partner for Left Field Investors, has been involved in real estate since 2008. He started with one single-family fix and flip, and he was hooked. He then scaled, completing five more over a brief period. While he enjoyed the journey and the financial tailwinds that came with each completed project, being an active investor with a W2 at the time, became too much to manage with a young and growing family. Seeing this was not easily scalable or sustainable long term, he searched for alternative ideas on where to invest. He explored other passive income streams but kept coming back to his two passions; real estate and time with his family. He discovered syndications after reconnecting with a former colleague and LFI Founder. He joined Left Field Investors in 2023 and has quickly immersed himself into the community and as a key member of our team.  

Chris earned a B.S. from The Ohio State University. After years in healthcare technology and medical devices, from startups to Fortune 15 companies, Chris shifted his efforts to consulting and owning a small apparel business when he is not working with LFI (Left Field Investors) or on his personal passive investments. A few years ago, Chris and his family left the cold life in Ohio for lake life in the Carolinas. Chris lives in Tega Cay, South Carolina with his wife and two kids. In his free time, he enjoys exploring all the things the Carolinas offer, from the beaches to the mountains and everywhere in between, volunteering at the school, coaching his kids’ sports teams and cheering on the Buckeyes from afar.  

Chris knows investing is a team sport. Being a strategic thinker and analytical by nature, the ability to collaborate with like-minded individuals in the Left Field Community and other communities is invaluable.  

Jim Pfeifer

President, Chief Executive Officer, Founder

Jim Pfeifer is one of the founders of Left Field Investors and the host of the Passive Investing from Left Field podcast. Left Field Investors is a group dedicated to educating and assisting like-minded investors negotiate the nuances of the passive investing landscape and world of syndications. Jim is a former financial advisor who became frustrated with the one-path-fits-all approach of the standard financial services industry. Jim now concentrates on investing in real assets that produce cash flow and is committed to sharing his knowledge with others who are interested in learning a different way to grow wealth.

Jim not only advises and helps people get started in passive real estate syndications, he also invests alongside them in small groups to allow for diversification among multiple investments and syndication sponsors. Jim believes the most important factor in a successful syndication is finding a sponsor that he knows, likes and trusts.

He has invested in over 100 passive syndications including apartments, mobile homes, self-storage, private lending and notes, ATM’s, commercial and industrial triple net leases, assisted living facilities and international coffee farms and cacao producers. Jim is constantly looking for new investment ideas that match his philosophy of real assets producing cash flow as well as looking for new sponsors with whom he can build quality, long-term relationships. Jim earned a degree in Finance & Marketing from the University of Oregon and a Master’s in Business Education from The Ohio State University. He has worked as a reinsurance underwriter, high school finance teacher, financial advisor and now works exclusively as a full-time passive investor. Jim lives in Dublin, Ohio with his wife, three kids and two dogs. In his free time, he loves to ski, play Ultimate frisbee and cheer on the Buckeyes.

Jim earned a degree in Finance & Marketing from the University of Oregon and a Master’s in Business Education from The Ohio State University. He has worked as a reinsurance underwriter, high school finance teacher, financial advisor and now works exclusively as a full-time passive investor. Jim lives in Dublin, Ohio with his wife, three kids and two dogs. In his free time, he loves to ski, play Ultimate frisbee and cheer on the Buckeyes.

Chad Ackerman

Chief Operating Officer, Founder

Chad is the Founder & Chief Operating Officer of Left Field Investors and the host of the LFI Spotlight podcast. Chad was in banking most of his career with a focus on data analytics, but in March of 2023 he left his W2 to become LFI’s second full time employee.

Chad always had a passion for real estate, so his analytics skills translated well into the deal analyzer side of the business. Through his training, education and networking Chad was able to align his passive investing to compliment his involvement with LFI while allowing him to grow his wealth and take steps towards financial freedom. He has appreciated the help he’s received from others along his journey which is why he is excited to host the LFI Spotlight podcast and share the experience of other investors and industry experts to assist those that are looking for education for their own journey.

Chad has a Bachelor’s Degree in Business with a Minor in Real Estate from the University of Cincinnati. He is working to educate his two teenagers in the passive investing world. In his spare time he likes to golf, kayak, and check out the local brewery scene.

Ryan Steig

Chief Financial Officer, Founder

Ryan Stieg started down the path of passive investing like many of us did, after he picked up a little purple book called Rich Dad, Poor Dad. The problem was that he did that in college and didn’t take action to start investing passively until many years later when that itch to invest passively crept back up.

Ryan became an accidental landlord after moving from Phoenix back to Montana in 2007, a rental he kept until 2016 when he started investing more intentionally. Since 2016, Ryan has focused (or should we say lack thereof) on all different kinds of investing, always returning to real estate and business as his mainstay. Ryan has a small portfolio of one-to-three-unit rentals across four different markets in the US. He has also invested in over fifty real estate syndication investments individually or with an investment group or tribe. Working to diversify in multiple asset classes, Ryan invests in multi-family, note funds, NNN industrial, retail, office, self-storage, online businesses, start-ups, and several other asset classes that further cement his self-diagnosis of “shiny object syndrome”.

However, with all of those reaches over the years, Ryan still believes in the long-term success and tenets of passive, cash-flow-focused investing with proven syndicators and shared knowledge in investing.

When he’s not working with LFI or on his personal passive investments, he recently opened a new Club Pilates franchise studio after an insurance career. Outside of that, he can be found with his wife watching whatever sport one of their two boys is involved in during that particular season.

Steve Suh

Chief Content Officer, Founder

Steve Suh, one of the founders of Left Field Investors and its Chief Content Officer, has been involved with real estate and alternative assets since 2005. Like many, he saw his net worth plummet during the two major stock market crashes in the early 2000s. Since then, he vowed to find other ways to invest his money. Reading Rich Dad, Poor Dad gave Steve the impetus to learn about real estate investing. He first became a landlord after purchasing his office condo. He then invested passively as a limited partner in oil and gas drilling syndications but quickly learned the importance of scrutinizing sponsors when he stopped getting returns after only a few months. Steve came back to real estate by buying a few small residential rentals. Seeing that this was not easily scalable, he searched for alternative ideas. After listening to hundreds of podcasts and attending numerous real estate investing meetings, he determined that passively investing in real estate syndications was the best avenue to get great, risk-adjusted returns. He has invested in dozens of syndications involving apartment buildings, self-storage facilities, resort properties, ATMs, Bitcoin mining funds, car washes, a coffee farm, and even a Broadway show.

When Steve is not vetting commercial real estate syndications in the evenings, he is stomping out eye diseases and improving vision during the day as an ophthalmologist. He enjoys playing in his tennis and pickleball leagues and rooting for his Buckeyes and Steelers football teams. In the past several years, he took up running and has completed three full marathons, including the New York City Marathon. He is always on a quest to find great pizza, BBQ brisket, and bourbon. He enjoys traveling with his wife and their three adult kids. They usually go on a medical mission trip once a year to southern Mexico to provide eye surgeries and glasses to the residents. Steve has enjoyed being a part of Left Field Investors to help others learn about the merits of passive, real asset investments.

Sean Donnelly

Chief Culture Officer, Founder

Sean holds a W2 job in the finance sector and began his real estate investing journey shortly after earning his MBA. Unfortunately, it could not have begun at a worse time … anyone remember 2007 … but even the recession provided worthy lessons. Sean stayed in the game continuing to find his place, progressing from flipping to owning single and multi-family rentals to now funding opportunities through syndications. While Sean is still heavily invested in the equities market and holds a small portfolio of rentals, he strongly believes passive investing is the best way to offset the cyclical nature of traditional investment vehicles as well as avoid the headaches of direct property ownership. Through consistent cash flow, long term yield and available tax benefits, the diversification offered with passive investing brings a welcomed balance to an otherwise turbulent investing scheme. What Sean likes most about the syndication space is that the investment opportunities are not “one size fits all” and the community of investors genuinely want to help.

He earned a B.S. in Finance from Iowa State University in 1995 and a MBA from Otterbein University in 2007. Sean has lived in eight states but has called Ohio home for the last 20+.  When not attending his children’s various school/sporting events, Sean can be found running, golfing, shooting or fly-fishing.

Patrick Wills

Chief Information Officer, Advisory Partner

An active real estate investor since 2017, Patrick Wills’ investing journey began like many others – after reading the “purple book” by Robert Kiyosaki. Patrick started with single family rentals, and while they performed well, he quickly realized their inability to scale efficiently while remaining passive. He discovered syndications via podcasts and local meetups and never looked back. He joined Left Field Investors in 2022 as a member and has quickly become an integral part of the team as Vice President of Technology.

An I.T. Systems Engineer by trade, he experienced the limitations of traditional Wall Street investing firsthand in his career and knew there had to be a better way to truly have financial freedom.

Unfortunately, that better way is inaccessible to those who need it most. His mission is to make alternative investments accessible to everyone who seeks to take control of their financial future and to pursue their passions in life.

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