Tag Archives: self storage news

Self Storage Investing in the News

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Here at Self Storage Investing, we’ve been helping newcomers advance and get their start in the business through our mentoring program. And after years of service, I’m happy to announce that others are taking notice. This past week, our efforts were featured in Extra Space Storage’s blog, as well as IBT PR Center’s website, highlighting the outline of our plan.

In her blog, Holly Robinson of Extra Space Storage, expresses the importance of a program to help buyers obtain finances and show them the ropes of the self storage business. She states how most businesses don’t come with a how-to manual, but that’s exactly what we’re doing: teaching investors what to expect. But we don’t stop there.

During the program, students learn the ins and outs of self storage through several mediums including software, seminars, eBooks, and one-on-one mentoring. Then we help them sign up for specialized loans or meet with private lenders to make their business a reality. In fact, last year alone we were able to help four students obtain storage facilities, across the country, worth a cumulative $6.9 million.

To find out more about our mentoring program, comment or click the academy tab above.

Business Awards Bring Recognition, Free Advertising

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With all of the advertising options that are available today, the costs can add up quickly. There are radio ads to purchase, commercial slots, internet space – the options quickly make a dent in the profits. But, what if there were another way? What if there were a way to get the word out about your services without having to pay for it? While nothing can actually replace conducting your own advertising, there are methods that can help along the process. One such free example is winning an award.

While, of course this path requires for your company to be chosen by others, it also makes it that much more honorable once it’s been earned. Not only will winning an award bring clout to your business, proving to potential customers that you’re the real deal, it will also get your name out into the public. Award winners can also be featured in local publications, reaching an even broader audience.
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Economy 0, Self Storage Business 1

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It’s nothing shocking to hear yet another blog/article/news piece about the failing economy. Every day the media is announcing one more way the US economy is hitting the ground. From banks, to small business, to Fortune 500, it seems that everyone has taken a hard hit from the Great Recession. However, it seems that, with all of this negative financial news does come an up side, there is one industry that is thriving more than ever: the self storage business. (I knew I got into this business for a reason.) And for those still standing on the outside of those storage garage doors, it’s not too late for you either.

How is the Self Storage Business Thriving in This Economy?

If you’re wondering how the self storage market is thriving when financial companies can’t even make it, you’re not alone. People from all across the country are analyzing the self storage business and looking to duplicate its success. Their results? There are several for the current success rate. Here’s the top three contributors I’ve researched:

  1. Banks aren’t approving many loans. Rather than purchasing land, building, and then renting, owners are buying up current properties. Bankrupt furniture businesses, grocery stores that have closed – no matter the building, almost any property can be built with plans for a storage units in mind. (And many for prices much lower than their worth.)
  2. People are downsizing. With the looming thought of an increasing mortgage payment, or just the realization that a home is too large, many are packing up and moving their excess belongings into a self storage unit.
  3. Bang for your buck. Buying a property outright can be expensive. But renting for a few months is much more cost-friendly and allows renters the flexibility to use a unit for as little or as long as they need.

But, as many have found, why the self storage business is thriving isn’t so much as important as the why-haven’t-I-been-doing-this-for-years. Newcomers from all over the employment map are beginning to purchase storage units and renting them out. Former businessmen/women, former salespersons, and even those just looking for some extra side money have bought units and started turning a profit almost immediately. And just because you haven’t gotten in the game yet doesn’t mean it’s too late. To find out more on how to get into the self storage business, contact us or check back here for weekly tips.

Many Green Innovations Are Already Established Tactics In The Self Storage Industry

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Ecological consciousness, or simply “going green,” depending on how much you like catchphrases, has been gaining popularity in almost every industry and market in the last decade. Businesses are looking for ways to reduce their ecological impact.

Self storage businesses are particularly keen on shrinking carbon footprints and keeping electrical use down for a simple reason: it’s pretty easy, and we’ve already been doing it for a while.

In the world of self storage, we’re expected to do a few common sense things for our customers. We need to keep their property protected from environmental factors and theft and provide easy, convenient access for renters. Ecological consciousness isn’t at odds with either of these concepts.

Many of the simple “green home improvement” tips that you’ve heard everyone from Oprah to Steve Jobs discussing over the past few years are already widely recognized in the self storage community. CFL bulbs are a standard, as is quality insulation and eco-smart HVAC.

Of course, any change to storage facilities costs money. Going green can be costly, particularly when an HVAC system needs an overhaul, so many storage companies aren’t going to play a game of follow the leader. There needs to be an established benefit to going green, whether that involves a chance at new customers or better utility bills.

Fortunately, green storage facilities get a lot of good press and can claim their eco-friendly status on websites and in advertisements, which brings in new customers. Lower utility bills are a no brainer, as they’re one of our biggest costs. If you’re looking for an industry that’s moving toward a positive ecological impact, the self storage industry is certainly a great example.

Changes in Investment and Their Impact on the Self-Storage Industry

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Self-storage has gone through great changes in the public’s consciousness. Investors and lenders from Wall Street to insurance companies are beginning to have greater confidence in self-storage real estate ventures. This has led to lending being done on terms similar to that of more traditional real estate classes like the office and industrial sectors. These changes in perception, in addition to low-interest rates, have created a perfect storm of opportunity for sellers and buyers to make the most of these properties.

Not too long ago it looked as though the real estate market crash would cause owners to suffer losses on their properties and even have to face defaults as property values continued to fall and the number of lenders willing to be part of such ventures quickly dwindled. However, with an increase in confidence, the number of lenders for self-storage enterprises grew. That, compounded with low-interests over the past few months, has given property owners the ability to sell their properties at historically high prices. Owners also have the ability to refinance at much better rates ensuring that they are able to keep more of the money they make rather than handing it off to lenders.

Low-leverage refinancing options are leading to non-recourse loans that are almost identical to what they were at the market’s peak. Higher-leverage deals are also making their way into the industry, though at high interest rates. These factors have caused property values to bounce back faster than could be expected. Of course, not all businesses are run the same way and cannot expect to see the same growth. Self-storage businesses that were started at the height of the industry with little foresight and impractical expectations will find themselves struggling and will only make their way through it with hard work.

With the new ability to find and receive financing at low rates, self-storage facilities are seeing pricing, as it relates to income, change. Low rate financing means increased returns on every dollar because less of the income needs to be tied up. The estimate is that over the last 12 months, value has gone up by around 15% without any gain on the cost of operating.

For as well as the self-storage industry is doing, it would be improper to think that everyone involved is doing equally well and facing no or few problems. Larger operators can take better advantage of changes in the industry than their smaller counterparts.

With greater value in the eyes of the public, self-storage has become much more competitive. Operators are beginning to see that in order to stay in business and make their businesses profitable, they need to make adjustments in the way they operate. This means taking advantage of sophisticated operations and economies of scale. Big operators are able take business from the smaller businesses for a variety of reasons from marketing to pricing, and if small operators hope to stay solvent in the same markets as their larger counterparts, they will need to make changes to how they operate.

This is contrasted between how large and small operators work and the ways these changes in the industry can impact them. Big operators are able to more easily fold these changes into their operation, while smaller operators are being forced into difficult positions.