Value of rented shop space?

I'm helping out a friend who would like to rent out a portion of her barn for storage / workshop space.  Here is her description:

My friend wrote:

I am not good with time or space, but it was big enough to comfortably store a 43' Bluebird Wanderlodge Motorhome. 220 electric and water at the site, hosed-in air attached to an industrial air-compressor. There are two docking lights on either side of the door. Huge window, albeit not the cleanest. Literal fire-engine garage door with garage-door opener. Access to shop bathroom that is OSHA approved with double soap-stone sink. Shop is heated and air-conditioned. Concrete floors, of course you can wrench in there. No smoking, drinking, drugs, non-approved people, no being there outside of Mom hours, no flammable substances to be stored inside the barn, no leaving oils, toxic fluids, grease or dirt on the floors, no hanging nasty pictures, etc on the walls, no damaging anything in the barn (including the barn itself), must have renters insurance, all that kind of thing.

 I've never rented or even investigated shop space.  So, a couple questions for the hive:

1. Do these seem like reasonable conditions?  Not sure what "mom hours" are, but I would assume they don't want you working past maybe 10:00-11:00 at night.
    
2. What do you think this space would be worth monthly?
    
3. Does anybody have decent rental agreement text they would be willing to share?

Any input will be appreciated.  Thanks.

I've rented shop space a few times in the past and that sounds pretty luxurious with a lot of perks. I was lucky to have heat and working 110v.

The conditions are generally reasonable but "no flammable substances", if interpreted at its most literal, would probably limit what you could do there. I also don't get the "mom hours" thing. Finally, typical renters insurance is for residential dwellings and might not cover a setup like this, which could be a hurdle.

Tough to put a price on it without knowing the square footage. Did the RV fit without much room to spare or could you park three of them in there?

Some strange stuff there. 
 

What's an OSHA approved sink?  Why renter's  insurance?  It offers her no protection. 
 

Is this an AG building, or an industrial space?  Or something in-between?

I suspect with her stipulations, it's only worth the value of monthly storage for an RV- a couple hundred dollars a month. 
 

If it's being rented as shop space and is commercially zoned, it's worth a lot more. 

Insurance, Mom hours, Flammable restrictions, no beer, no non-approved people are all going to be difficult requirements for a 'shop'.

Might work as storage though.

In reply to pointofdeparture :

She said "comfortably store" so at a very rough guess I would say the space is probably 20' x 50' at a minimum.  Most likely a bit larger, but probably not 3x the size.  I have not seen the space.

I also think the "no flammable substances" would be for storage of gasoline cans, welding tanks, etc.  I don't think incidental stuff would be an issue.

It's located on the north side of Wilmington, DE.  It's at her house, so it's not in some scary downtown industrial area.  I can get there if anybody really is interested, but mostly I'm just trying to help her value it.

SVreX (Forum Supporter) said:

Some strange stuff there.

What's an OSHA approved sink?  Why renter's  insurance?  It offers her no protection.

Is this an AG building, or an industrial space?  Or something in-between?

I suspect with her stipulations, it's only worth the value of monthly storage for an RV- a couple hundred dollars a month.

If it's being rented as shop space and is commercially zoned, it's worth a lot more. 

I don't believe it is commercially zoned.  I think it's meant to be for private use.  That is another question I can ask.

It is heated and air conditioned.

If it were in the middle of my city, it would be about $3500 a month.  If it were in my home town, it would be worth $300 a year and a dozen farm fresh eggs every week.

On the insurance front, my brother and I went through that when we signed our lease for the shop.  Since we are not a business, we can't get a commercial liability policy.  There doesn't seem to be any such thing as "shop rental insurance" as far as we could find in our conversations with our respective agents.  So that might be a hard one to figure out.

No approved people?  Wtf does that mean?  I need to clear my buddy who's going to come help me out?  That's a deal killer.

No drinking?  Uh.  Yeah, no.

Mom hours?  My lease has a clause about not performing any unusual work overnight.  I don't recall the specifics, but it's geared towards not making a ton of noise, but I have 24 hour access.  For me, that's table stakes.

Flammable items?  No spray paint or brake cleaner to be stored there?  That's a problem.  Requiring a flammables cabinet might be more reasonable.  Do we count the gasoline in the gas tank of the car that's parked inside as a flammable?

Edit: there is a bathroom, missed that.  That raises the value a bit.

Hard to put a value on it, but with those types of restrictions, the price would need to be super low to interest me.  Right now, I'm around $6/sqft/yr and I wouldn't consider that type of place for more than 2.50-3.00, assuming it was close by.  Honestly, that sounds more like a storage opportunity than a workshop opportunity.  Cameras?  Alarm?  Gate and fences?

It sounds like what she has is what was once someone's very nice personal shop on a residential property. 
 

But it's just storage value now with her stipulations. 

The friend wrote: "Literal fire-engine garage door with garage-door opener. "

Is this a former fire-house that the friend is living in?  Seems like this is also attached to her house.  If attached to her house, you might be able to get renters insurance like you were being her occasional room mate.  This should then cover items that you keep in the garage while "living there."  

Mom's hours?  Does she have kids making her mom?  Another way of saying, "during the hours I allow."

Limited access of others seems to imply she wants to know who is at her house.  Also no subletting to others.  The no drinking and no girly pictures could be due to the fact this is still her house and she may have kids.  

Offer maybe 1/3rd of what you think her mortgage might be.  Maybe 25%.  What is her pain point?  What is motivating the desire to add a tenant?  Is she failing to make her house payment?  By how much?  If the place is paid for, what are her annual taxes?  Would covering some or all of the taxes be a sweet deal for her? 

I would specify that any chemicals need to be stored in a cabinet not on an open shelf. And that no gasoline cans can be stored inside. 

As others have mentioned insurance wise is pretty non-existent for a non-business when we seen a location that is not primary ownership. It would be easier or better to say that an insurance policy has to cover whatever vehicles are stored there. 

The hours of access I would want a stipulation on. If it's noise and no impact guns after 9:00 or 10:00 p.m. I would understand that and there's other things that can be worked on or tools and methods to be done to avoid excessive noise after hours. However, total restriction of hours for persons working a 9 to 5 then wanting to wrench makes for a significant restriction on things. Which in turn would limit the potential market and thusly restrict the potential rental income for the space. 

I don't have an issue at all with restricting alcohol consumption on site because it's not about drunken debauchery at a shop, because if that's going on productivity is not going on, It's about a plethora of empty cans needing to go out to be recycled each month. 

It sounds like a storage situation as opposed to a shop situation would likely be preferred by the property owner. Even if they're okay with light maintenance being done such as oil changes and brake jobs as long as everything is cleaned up as soon as the job is done or before the end of the day when the job is done. It sounds like that would be workable with them but the primary aspect would be storage. I don't think it's a situation where anybody's doing an engine swap there. And that's fine. It's the owner's property they can make the rules 100%. And they should be comfortable with whoever is a guest even a paying guest on their property and if a friendly cordial relationship forms with whomever rents the space and they're giving the green light to be around the barn later than originally planned or expected or to do more within the confines of the space, good for them excellent works out all the way around. 

Too often we don't look at the other perspective. If I had a detached garage in my backyard that I wasn't utilizing and I rented it out to someone and an 11:30 at night they showed up the lights went on in the garage and I could see it from my house, I would be like what the hell is going on down there. I wouldn't be angry or upset but I would be suspicious. When the truth be told 2/3 of my wrenching starts after 9:00 p.m. I would literally be being suspicious of someone who's doing the exact same actions that I do. Now taking the consideration somebody that isn't a gear head and doesn't wrench having the same situation on their property. That's where the hours restrictions may seem weird to us or deal breakers but you have to respect the perspective of the other person who's property you would be on. 

I would reach out to people that participated in the Coatesville Grand Prix to see if any of them could utilize new storage options for their vehicles. As long as rodent control isn't an issue at the barn. 

Sure, this is automotive forum so we may tend to think automotive but the real value of this place, and what makes it unique is not so much the floor square footage but rather the height allowance.  After all, she's storing a school bus in there.  This leads me to think of boat storage.  Lets also remember that the term "marine grade" is just code for "cost 3 times what it should."  Those boat guys will spend and they need both a tall door and a tall roof.  

In reply to John Welsh :

Yes the height adds value. It also adds liability for the owner. 
 

To a car guy what does height mean?  It means the possibility of a lift. Or a loft. Or stacked storage. Or tall racks. Every one of these makes it more risky for the owner (potential of falls, injury, property damage, etc). Even changing a light bulb is more liability to the owner. 

And those liabilities are hard to cover in a homeowner's policy.

If I were her, I would not allow a shop at all.  Storage. And your idea of boat storage is a good one. 
 

But that doesn't mean it is worth several thousand a month. 
 

If I am gonna spend several thousand a month, it's gonna HAVE to generate revenue. I'm gonna run some form of business from it. But that won't happen in a residential neighborhood. 

All: thanks very much for your input.  The Cap'n seems to have a handle on the situation.

It's a barn on her property.  Detached from her house, but still in the vicinity.  A couple points in (assumed) answer to the questions / comments above:

• This isn't about a commercial venture.  This is about my friend having a potential resource and needing some extra money.  She'd just like to know what a reasonable quantity of extra money this potential resource is potentially worth.
   
• My friend is in her late 50s and has her elderly mother living with her, or more accurately, she lives with her elderly mother.  The mother has dementia to some degree.  I believe the limited hours are to avoid disturbing the mother.  I imagine that is negotiable as long as work would be quiet.
   
• I also believe that's what's behind the "no strangers" bit.  If you're there with your buddy(ies) working on something, I expect that would be fine.  But the buddy(ies) shouldn't be showing up without you, looking to use the place.
   
• My friend is relatively conservative and is herself a teetotaler.  She would like to keep the place presentable without posters of nekkid people and without beercans / drunks lying around.
   
• I think the idea of flammable incidental supplies being stored in a metal cabinet is fine.  Gas cans are not.
   
• Again, this isn't about setting up a commercial machine shop or repair business.  This is about a place to store your toy(s) / large vehicle and do routine maintenance on them.

So it sounds like we're looking at somewhere around $300-$500 a month, based on roughly 1,000 sq ft?

Thanks again for everyone's input.

In reply to Duke :

Going to a commercial facility with fences, cameras, lights, access control, 24 hour access and no morality clauses, the going rate for indoor RV storage in a 20x50 unit is $500/mo.  If I were to keep my RV there with those restrictions I would expect to pay considerably less than that.  Just to give a frame of reference.

In reply to Duke :

This is exactly the type of space I'd love to have, and I'd be willing to pay somewhere between storage rates and full commercial rates, whatever those are where you live. Around here storage rates are between $100-$200 per month for a regular car bay, and a commercial rate would be at least $1500 (probably more based on size + bathroom). There are a lot of contractors who like to rent these sorts of spaces to store things like landscaping equipment which raises the prices on any potential car repair spaces higher than I am willing to pay.

Going slightly off topic, but personally I am really surprised there aren't more options for DIY auto repair in places where people rent. Click and Clack on CarTalk used to run a garage like that, and RPI has a student auto club with a shared shop, and juiceboxforyou on YouTube is a group of Irish fellows who split a warehouse, but that's the limit of my knowledge. If I could share a shop space with things like a lift and tire machines between 3-6 other people I'd be all over that, but it just doesn't seem like a thing that happens.