If you are the owner of a self storage facility, you are one of the many who helped to break some industry records! With so much competition popping up, passive management is no longer an option! If you want to survive the boom in the industry, you are going to have to dig your heels in and start taking your business seriously! If you are ready to do this and to improve on your brand, check out these following operator and owner tips to make the best out of your investment:
1. Commit to improving economic occupancy.
The best way to measure the recurring revenue that your property is bringing in and to maximize your profit is through economic occupancy. This shows the difference between your current income and what income you could be bringing in. This is even more telling of the success of your business than just by looking at your occupancy numbers! If your physical capacity is at 95% that may sound good. But if you are giving out discounts like Oprah around Christmas and not regularly raising your rents, your economic occupancy may actually only be at 70% Ouch!
The economic occupancy of your facility ideally would be less than 10% of your physical occupancy in order to be maximizing profits.
2. Know your competition.
It doesn’t matter what stage of the game you are in, you need to know your competition! Research valuation and acquisition trends and learn from other operators! What were their wins? Where were their losses? Create a competitive advantage for your business. Don’t be scared to be a secret shopper. Go visit other establishments and see how you can set yourself apart from them.
3. Get the support of professionals.
If you are a seasoned real estate investor, don’t be scared to investigate the storage industry. If you don’t know much about it, talk to someone who is fluent in it. Trust me when I say that it is a who different kind of dragon to slay than typical real estate management. You are going to want experts by your side(*wink wink* me).
Building relationships with industry professionals and storage brokers is necessary in today’s hot market. Having someone who is experienced will help you find the perfect opportunities, reglardless of if you are looking for something turnkey or to build from the ground up. Having these tips in mind can certainly set you up for success against competing companies.