Self-Storage won't Make You Wealthy Until You Learn This with Jacob Vanderslice
Show notes
Self-storage investing: the truth behind "no tenants, no toilets, no problems"
Welcome back to The Real Estate Investing Club podcast! I'm Gabe Petersen, and today I sit down with Jacob Vanderslice of Van West Partners, a self-storage owner-operator with 42 facilities, roughly 21,000 units and 3.3 million square feet. I have owned six storage facilities myself, and my relationship with this asset class is complicated. Some deals were slam dunks, and others were nightmares. If you want to learn how to invest in self-storage, or whether you should at all, this conversation is for you.
Fix and flips, long-term cash flow and a 20-year journey
Jacob has been a full-time real estate investor for twenty years. He started in 2006 with rentals and fix and flips, completing an estimated eleven to twelve hundred of them, then moved into adaptive reuse retail, commercial real estate, multifamily and mobile home communities. In 2015 he and his team shifted toward self-storage to build long-term cash flow and stop being overly transactional. We discuss why the auction market dried up and why the direct-to-seller flip model stopped penciling out.
Buy and hold vs. sell: return on equity and IRR
One of the toughest questions in real estate investing is when to sell and when to hold. Jacob explains the implied return on equity math that many investors use to decide whether to sell a rental, how opportunity cost plays into that choice, and why IRR can pressure sponsors to exit deals earlier than they would like. We also talk about the risk and unknowns of rolling equity into a new property, and why many wealthy investors simply bought and never sold.
The real pros and cons of self-storage
We get honest about the operational side of storage: break-ins, theft, tenants burrowing between units, damaged gate systems and lawsuits. Jacob also shares what he likes, including resilient demand, thousands of small revenue streams instead of one large tenant, and the ability to adjust rents dynamically as supply and demand shift.
Self-storage headwinds: mobility, interest rates and supply shock
Jacob breaks down two major headwinds hitting the self-storage market right now. First, Americans are moving less because they do not want to give up low mortgage rates. Second, markets like Texas and the Sunbelt were hit by a wave of new storage supply. We also cover how automation and technology help, and why Jacob's team still keeps staff on site for customer service.
How to get started in self-storage
For new investors, Jacob outlines three paths: buy a self-storage stock, invest passively with a sponsor, or buy your own facility. He also shares why he believes AI tools should be part of every investor's daily decision-making process.
Quick questions, deal sourcing and lessons learned
In the quick question round, Jacob recommends In the Kingdom of Ice by Hampton Sides, names Green Bay, Wisconsin as an underrated storage market, and shares how his team sources deals through broker relationships and direct mail. His biggest lessons: always expect more new supply than the data suggests, and always respect the chance that interest rates go higher than you think.
Want to learn more about our guest? Connect here: LinkedIn
