A Self Storage Education
by Mike Parham
In the current economic instability, with tentative steps toward recovery, it is necessary for every business investment to hit on target. There’s very little wiggle room for mistakes, or for correcting mistakes; each possible project must be vigilantly scrutinized. It is the responsibility of all self storage veterans and associations, to educate those seeking to enter or re-invest in the industry, thereby protecting market integrity and the assets of current and future self storage investors.
There will never be a tried and true “formula” that you can apply to the development and construction of any and every self storage venture. The science and the art of self storage are constantly evolving. There are rudimentary questions that never change; however, the answers to those questions do change:
· Who are my customers? Why will they rent from me?
· Where are the competing facilities in my market?
· Is there enough demand in this market?
· What is the occupancy of nearby facilities?
· What are the features and amenities of competing facilities?
· What development steps are necessary for this project?
· What jurisdictional regulations apply?
· What jurisdictional permitting is necessary?
· How do I make the most profit from this piece of land?
· What details need to be considered for this site plan?
· What unit mix will best serve this market?
· Is this project economically feasible?
· How do I structure this business plan? What must be detailed?
· Where do I go from here?
The function of a developer includes, but is not limited to, site selection, facilitation of zoning and entitlements, market and demand analysis, development budgeting, financial forecasting, and the preparation of bank and investor packages. A self storage building is designed like no other building of any kind. The designer, engineer and general contractor of the facility examine issues of space, material efficiency, energy efficiency, the economy of maintenance, tenant accessibility, security...dozens of considerations. These components have been refined for decades and make a structure unique to any other, integrating everything you need to operate a successful business; nothing more and nothing less.
Sometimes people rush to self storage because of its image of simplicity, and relatively speaking, it is a simple business. But it is a business, just like any other. The success of the business and the success of development and construction depend on understanding precisely what is involved. Take advantage of the abundance of self storage educational resources available in industry publications, articles, trade shows, conferences, seminars, webinars, websites, online classes, and from state and area self storage associations. Whether you’re joining the self storage trade for the first time, or expanding your investment in the industry, burrow down to the roots of each venture and analyze the basics.