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March 12, 2008
Increasing Co-op Value
The board of our small co-op building (15 units) is considering adding basement storage units to the building. In order to move forward, we need buy-in from our shareholders. What is the value of a shareholder having a storage unit beyond just having extra space to store one's belongings? Are there finacial benefits (tax breaks, increased resalve value, etc.?)
Comments
Depending on how you manage it, it can be a small but steady income stream. The co-op should pay to have them built and then rent them to residents/shareholders, first-come, first served. Having them (even if an actual unit is not avialable -- all rented) is a plus for the building as a whole and all the units in terms value. No one should be against this.
Posted by: guest at March 12, 2008 11:13 AM
You can also sell them if the co-op needs funds down the road. Not everyone feels this way- but personally- I've been looking and buildings without storage are a huge minus for me. Whether its a large elevator building or a brownstone co-op- not having basement storage means bikes- wagons- etc. have to be lugged upstairs constantly.
I think its a huge plus- I'm not sure if I've seen a true price difference between apartments- but I'm sure it has an effect on sales in a positive way.
Posted by: panda10 at March 12, 2008 11:32 AM
I think rental income to offset costs of the build-out makes sense. That's how we did it and only people who wanted it were forced to pay for it. For me, $150/yr is well worth it
Posted by: guest at March 12, 2008 12:09 PM
I disagree. The value of basement storage is as a feature of the apartment unit. If buyers are considering two different coop buildings and one building has storage that comes with the unit, and the other does not, they'll choose the storage. Everybody in NYC needs additional storage without exception. If you have more apartments than you have storage, then you'll have wait-lists to get storage and will have to inform buyers yes people can rent storage but someone else is before you on the wait-list. Blah blah. Why mess with that?
Posted by: guest at March 12, 2008 12:50 PM
there isn't that much value and no tax breaks.
Posted by: guest at March 12, 2008 2:56 PM
I'd rather have a storage unit than a parking space. I don't know if the units will increase value per se but they will make apartments more attractive to buyers.
Posted by: guest at March 12, 2008 3:48 PM
On our appraisal, the adjustment for a storage space was $20,000.
Posted by: guest at March 12, 2008 4:00 PM
Wow, that's double what they give you for a fireplace (I think) - who would have thought it? (I guess space is space...)
Posted by: guest at March 12, 2008 5:07 PM
I'd never buy a coop or condo that didn't offer storage. It's not true storage doesn't offer value. It might be hard to appraise it exactly but think about what you'd choose if you were weighing your options as a buyer. Coops have a ton of competition from condos now and condos build storage into the basement knowing people want it. Anything coops can do to stay appealing and competitive the better.
Posted by: guest at March 12, 2008 5:22 PM
We added lockers to our co-op, converting a general storage room into a more user-friendly and more secure area. I
It was funded by one-time fees from the co-op owners, with a letter attaching the "use" of the lockers to each of the participating co-op unit.
We drafted a list of rules including - no subletting of the lockers, no perishables or highly flammable storage. Plus, the co-op reserves the right to take back the space if it needs to without compensation to the locker users, in the future. (Let's say future construction work requires access through the locker room).
"Rental" income instead of one-off "sale" would have been a great benefit of the co-op, but I'm glad I got my lockers for cheap.
A 3' x 5' locker is 15 square feet of real and useful area. What do you think that's worth - $400/ sf? $900/sf?
Posted by: guest at March 12, 2008 6:41 PM
Make sure you build less units than there are apartments, so the perceived value of the unit goes up... there will be competition to get them and you can keep increasing the monthly fees.
Posted by: guest at March 12, 2008 9:39 PM
We are looking to build storage units in our basement and am wondering if you had them done and by who?
Thanks
Posted by: meglmt at August 4, 2008 3:01 PM
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