Inside Self-Storage

JUN 2019

Inside Self-Storage (ISS) is an information source for industry owners, managers, developers and investors covering news, trends, facility operation, finance, real estate, construction, development, marketing, technology, insurance and legality.

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Teri L. Lanza, Vice President I 've been living in my home since 2003. When my husband and I bought it (before we were married), we were just merging our bachelor and bachelorette pads, excited to have two stories, a garage and a yard. It seemed like a lot of house at the time. After we moved in the paltry contents of our two townhomes, we looked around and thought, "Geez, this place looks empty. We'll never fill all this space!" Lo and behold, some 16 year later, and it's packed to the gills. There isn't a closet, drawer, shelf, cabinet or wall that isn't filled. It's astonishing (and a little sickening) how our possessions have snowballed. And just when we think we can't possibly squeeze in one more thing, someone will give us a gift, or we'll see something we just "can't live without." Then somehow, we find a way to squash it in. A little shifting here, a little adjusting there, and we make it work. Every time we say, "Nothing else. Nothing else comes in unless something goes out! We have to lighten the load." And we do—sometimes—though it can be difficult to let go. I've been thinking about this in relation to the U.S. self-storage markets, which continue to grow ever more saturated, particularly in the large metropolitan areas. Industry experts claim the current development and construction boom must soon decelerate, and yet based on what we've seen and heard in recent months, it shows no signs of slowing. Where are we putting it all? Available parcels and conversion sites aren't unlimited resources … We must hit full capacity at some point, right? How many facilities can the country viably support? Well, if developers are as tenacious in the marketplace as I am in my house, they'll find places to build—even when it appears they can't anymore. As an industry, we have yet to figure how much is enough. Maybe it's never enough; but I think eventually, there will be a tipping point, and in that moment, existence will come down to quality vs. quantity. The older, less appealing sites will give way to the modern, swank builds with all their shiny bits and technological amenities. Their business will be slowly siphoned until only the strongest endure. It'll be a true study in survival of the fittest. In the meantime, those who are developing properties need to know how to do so successfully, in such a way that they can make money without damaging the overall industry. That's the trick, isn't it? How to build and operate a new site that pencils out and can lease up but without adding so much product to an area that all local operators suffer? Add to that, existing operations need to be able to compete and can't always do so on a smile and outstanding service. They may have to do some renovating and expanding (which is starting to sound like a necessity in my own situation, come to think of it). The goal of this issue of ISS Magazine is to teach those of you who are in growth phase how to build s mart. Whether you're developing your first facility or your 10th, or expanding or refurbishing an existing site, you need the right foundation (no pun intended) for your project: land, municipal approvals, strong vendor partners, high-quality materials, and a customer base willing to store with you. So, this is a place to start. Ahead, you're going to learn about site selection, feasibility, the entitlement process, construction methods, timelines and budgets, and more. You'll read about fallacies around the development process and the truths behind them; the common mistakes made by other owners and developers and ways to avoid them; and how to get creative when a parcel or project doesn't have all the ideal characteristics. Is there a perfect formula for self-storage building today? Not one that would work in every market. However, with the right strategies, sufficient research and shrewd decision-making, you should be able to dodge the greatest threats to success. Pay attention to what our experts share. They've seen and done it all, and their experience can save you time, money, headaches and heartbreak. If there's one lesson I've heard repeatedly from those in the know, it's that you shouldn't get emotionally attached to your project. Being too set on a specific location, design, process, etc., could cause you to overlook obvious warning signs. Sometimes, you must make the hard choice between squeezing it in and letting it go. Let the following lessons be your guide, and best of luck in your development endeavors! All the best, THE INSIDE VIEW Squeeze It In, or Let It Go? 4 ISS I June 2019

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