People's wallets are a light these days. Home foreclosures are up. Morale, and business, for a lot of folks, is down. The expendable income isn't flowing the way it used to. And somehow in this time of economic angst, self-storage has emerged as an ogre.
This week, yet another newspaper article joined the extensive and readily growing lexicon of pieces about self-storage auctions. This one, published in the St. Petersburg Times, says abandoned storage units are "just another sign of the times." And reiterated is this debatable premise that our industry is "recession-proof." At least the author was decent (or smart) enough to include our viewpoint, contacting the national association as well as several operators, one of which was Ray Hempstead, owner of Barney's Mini Storage in St. Petersberg.
I liked what Ray had to say about the reality of lien sales: "Ninety-nine percent of the time, we don't even make enough money to cover what they owe. Our business is not selling people's stuff. Our business is renting holes."
The media and general public labor under the presumption that the storage industry thrives on woe and bad fortune. We call like a siren to the downtrodden and those fallen from grace. "Give us what's left of your shredded life. We'll take your money. And when you can't pay, we'll unload your goods to the highest bidder."
This is the way we're most frequently painted in newsprint across America. And when times are bad, that shadowy image grows to demonic heights. If I were to draw a political cartoon of our industry, it would show an eerily large vulture—the words "self-storage" emblazoned across its feathers—circling a wreckage of foreclosed homes, divorcees, widows and bankrupt businesses. Pretty grim stuff.
In truth, self-storage suffers its ups and downs, just like every other business. While we may rent more units to downsizing businesses and people in transition, similarly, we lose those commercial tenants who unload unwanted inventory and customers who store things they don't really need. The St. Petersburg article suggested that we gain rentals as adult children move back in with their parents, but we lose them as tradespeople require less and less space to store materials. The scale still seems to be in balance.
I'd love to hear from some managers out there ... in which direction is your balance tipped? Are occupancies up or down, and what trends are you seeing? Hit the "Leave a Comment" link and leave it on the blog.
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| People perusing the contents of a unit at a self-storage auction. Who are the REAL vultures? (Published in The New York Times, May 11, 2008.) |