Uhaul rental income in Mini Storage complex

[CANative]

Is this anything like day use revenue at a hotel property?

 

[BRCJR]

I'd like to see someone tackle the questions that I posed above in the prior post about the problems of using truck rental income. Are you taking out the amortization and repairs/maintenance and vehicle insurance and management and oil/fuel from the truck rental income? Didn't think so.

And the Uhaul company is counting their truck income as revenue on their corporate P&L statement and booking the land as an asset on the same corporate balance sheet. You guys are double counting. Value the real property surplus/excess as real property using land comp comps. And as necessary back-of-the parcel comps (see past debates on the 40-30-20-10 rule). Sorry TAJ is wrong -- actually after being on the blind peer review panel and reading what felt like an infinite number of articles, I've concluded that it's not 100% reliable; they published stuff that I begged to be not published and didn't publish stuff I begged to be published. Heck, I'd like to change some errors in my own article in the journal.

I do not believe those expenses are paid by the dealer. Those are UHaul expenses.

 

[Michigan CG]

I would not include the U-Haul operation. Comparing vending at motel to the U-Haul is apples and oranges.

 

[Ken B]

Excellent thread. It's a nice change.

 

[CANative]

I would not include the U-Haul operation. Comparing vending at motel to the U-Haul is apples and oranges.

How about day use revenue from a hotel?

 

[Ken B]

If CAN is talking about a "no tell" motel, I would think that any income from illicit activities associated with use of the premises would be very risky.

 

[CANative]

I don't know what you mean by "no tell" hotel. I'm talking about hotels that have pools, spas, and services designed for day use. In places like Palm Springs the day use clientele is typically gay.

 

[Ken B]

The nature of your day use question was non-specific. I was referring to a facility that provided rooms on an hourly basis. You are referring to a facility that offers day passes for use of the facility's amenities. Why wouldn't you include day pass income in the valuation of the going concern? Not so unusual an occurrence, especially with a resort operation.

I think one weakness of the thread has been inconsistency with regard to identification of the components of a hotel operation which were being valued. I'm not a hotel valuation expert by any stretch of the imagination, but I would think it rare the valuation of a hotel which did not break out value attributable to real property, FF&E, and BEV.

 

[CANative]

I figured out what you meant right after I posted.

But specifically, I see a parallel on hotels that offer day use passes to the storage facility that also has a Uhaul operation. The complimentary nature of a storage facility and a truck rental operation is almost the same as the complimentary nature of a hotel with a day spa operation. Some say NOT to include the Uhaul income. Why? The complimentary real estate uses can command higher revenues. The self storage doesn't need any significant buildings and the hotel doesn't either.

 

[NachoPerito]

I come here to get answers, but usually things just get more complicated