#SolarWebinar

Developing Solar RV and Boat Storage

A Lesson in Earning!

#SolarWebinar

Kelly Pickerel Solar Power World

Moderator

Matt Harrison Director of Business

Developent Baja Construction

Bob Hayworth Founder & Chairman

Baja Construction

Developing Solar RV and Boat Storage – A Lesson in Earning!

Meet your presenters…

 RV  and  Boat  Storage  

A  Case  Study  “ONE  YEAR  LATER”  

Project  Overview  Project  Owner:  Robert  Hayworth  Project  Type:  Solar  RV  and  Boat  Storage  LocaEon:    Oakley,  California    Site  Lot:  8.2  acres  Total  Developed  Square  Footage:  357,560  Zoned:  Light  Industrial    Solar  UElity:  PG&E  FIT:  20  yr.  PPA  ($0.14.4khw)    Rental  Capaci4es  Total  Retable  Square  footage:  179,000  Total  rentable  Spaces:  320      

Project  Ameni4es  Shaded  and  Paved  Parking  for  RVs  and  Boats  serving  the  Greater  San  Francisco  Bay  Area  and  Delta  Waterways.  Security,  Services  and  Shaded  Parking.    

v  24-­‐Hour  Surveillance  and  Security  

v  Shaded  Storage  v  Asphalt  Paving  v  Charging  Outlets  v  Water  and  Dump  StaEon  v  Ice,  Air,  and  Propane  v  Restrooms  and  Shower  v  Wi-­‐Fi  and  Conference  

Rooms    

Project  Performance  Solar  Average  Annual  Solar  ProducEon:  2,627,326  kWh  Average  Annual  Solar  Income:  $380,000.00  (2014)  Solar  Performance:  112.4%    Storage  Occupancy  Capacity  to  date:  52%  Average  Annual  Storage  Income:  $379,766.00  (2014)    Total  Project  Performance    Average  Annual    Income:  $759,766.00      

Cost  Overview  •  Total  Project  Cost  -­‐  $10.7MM  

v Land  Cost  -­‐  $1MM  v Development  Costs  -­‐  $500k  v Land  Improvements  -­‐  $2.9MM  v Canopies  -­‐  $1.3MM  v Steel  Fence  -­‐  $500k  v Solar  -­‐  $4.5MM  

 

Tax  Benefits  

Cost  Breakdown  Including  Tax  Incen4ves,  and  Avoided  Tax  

Total  Project  Cost   $10,700,000.00  

1603  ITC  (Grant)   ($2,100,000.00)  

Project  Cost  afer  ITC   $8,600,000.000  

Loan  Amount   $7,500,000.000  

MACR  (accelerated  dep.)  5  Years   ($3,200,000.00)  

Debt  Service   $32,000.00  /  Month  

Project  revenue  (Solar+  rent)  2014   $63,314.00  /  Month  

Project  revenue  (Solar+  rent)  Projected  at  100%  Capacity  

$83,314.00  /  Month  

IncenEves  ü  1603  ITC  (Grant)  =  $2.1MM    

Accelerated Depreciation ü  MACR= $3.2MM

Target  Demographics  Op4mizing  your  Target  Demographics    ü  Gender  ü  Income  Level  ü  Age  ü  OccupaEon  ü  Marital  Status  

SegmenEng  a  populaEon  into  demographics  allows  companies  to  assess  the  size  of  a  potenEal  market  and  also  to  see  whether  its  products  and  services  are  reaching  that  company's  most  important  consumers.      For  example,  a  company  that  sells  high-­‐end  RVs  would  want  to  know  roughly  how  many  people  are  at  or  nearing  reErement  age,  and  also  what  percentage  of  them  will  be  able  to  afford  the  product.  This  informaEon  will  help  the  company  to  decide  how  much  capital  to  allocate  to  producEon  and  adverEsing.    Read  more:  hnp://www.investopedia.com/terms/d/demographics.asp#ixzz3WAaSlbGV      

Types  of  MarkeEng  and  adverEsing  strategies  used;  v  Visibility  v  TV  v Website  v  Signage  v  Radio  v  Print  v  Social  Media  

MarkeEng  &  AdverEsing  When  it  comes  to  markeEng,  operators  of  boat-­‐  and  RV-­‐storage  faciliEes  face  many  of  the  same  challenges  as  tradiEonal  self-­‐storage  operators—namely  budget  restraints  and  maximizing  new  strategies.  However,  there  is  one  significant  difference:  the  tenant.  While  self-­‐storage  operators  can  market  to  any  person  or  business  in  their  target  area,  the  boat/RV-­‐storage  operator  must  target  a  very  specific  type  of  customer.  That’s  why  careful  markeEng  is  such  a  criEcal  component  of  every  boat/RV-­‐storage  operaEon’s  success.    hnp://www.insideselfstorage.com/arEcles/2011/04/criEcal-­‐components-­‐to-­‐a-­‐boat-­‐rv-­‐storage-­‐markeEng-­‐plan.aspx    

A HAPPY CUSTOMER AND WORD OF MOUTH IS YOUR BEST MARKETING STRATEGY !!!

Facility  OperaEons  At  any  self-­‐storage  facility,  tenants  pay  anenEon  to  customer  service,  superior  security  and  ameniEes.  FaciliEes  that  excel  in  these  arenas  will  anain  a  high  occupancy.  Those  lacking  will  likely  drive  customers  away.  For  faciliEes  that  provide  RV  and  boat  storage,  these  qualiEes  are  parEcularly  crucial  to  anract  and  maintain  tenants.    hnp://www.insideselfstorage.com/arEcles/2013/06/running-­‐a-­‐profitable-­‐boat-­‐rv-­‐storage-­‐operaEon-­‐service-­‐and-­‐ameniEes-­‐drive-­‐success.aspx    

Oakley  Average  monthly  OperaEons  Cost    •  Staff  •  UEliEes  •  Maintenance  •  Security  

$10-­‐12,000.00  /  Month  

Lessons  Learned  Development  ü  Locate  Property  ü  Complete  Market  Analysis  ü  Calculate  ROI  /  Proforma  ü  Contact  Architect  /  Builder  ü  Create  Budget  ü  Secure  Financing  ü  Permitng  ü  ConstrucEon  Scheduling  ü  PPA  

Construc4on  ü  Construction ü  Planning and Zoning ü  Procurement ü  Solar Integration ü  Interconnection ü  Utility Reservation ü  Utility Construction

Operations ü  Staffing ü  Sales ü  Security ü  Customer Service ü  Maintenance

Summary  WanEng  to  know  what  it  costs  to  build  self-­‐storage  faciliEes  is  ofen  the  first  quesEon  a  new  investor  asks.  It  seems  like  a  simple  quesEon,  but  once  you  delve  a  linle  deeper,  you  will  find  that  there  are  a  lot  of  variables  that  make  that  quesEon  hard  to  give  an  easy  answer  to.  LocaEon,  design,  zoning  restricEons,  site  improvements  needed,  etc.,  will  all  impact  the  costs  to  build  your  self-­‐storage  facility.      A  bener  quesEon  might  be,  “How  much  do  I  need  to  invest  and  what  research  do  I  need  to  do  in  order  to  ensure  profitability  in  a  new  self-­‐storage  business?”    As  an  investment  or  as  a  new  business  venture,  RV  and  Boat  Storage  is  a  winner.    Without  overhead  in  inventory,  staffing,  or  a  lot  of  operaEonal  equipment,  RV  and  Boat  Storage  has  a  relaEvely  low  barrier  to  entry.  But  RV  and  Boat  Storage  is  a  business,  and  must  be  evaluated  in  the  same  way  you  would  evaluate  any  other  business.    Adding  a  solar  component  to  your  project,  if  applicable,  and  also  if  you  are  able  to  facilitate  the  appropriate  agreements  with  the  uElity  will  add  a  level  to  the  income  profile  of  your  business  model  that  is  unsurpassable.  Be  aware  that  the  proper      

 planning  of  this  endeavor  is  the  key  to  its  success.  

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