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Timing of Your Self-Storage Rental Agreement Review

Article-Timing of Your Self-Storage Rental Agreement Review

<p>Self-storage operators who haven't updated their rental agreements in the last few years could be opening themselves up to a host of problems. There has been just too much legislation and litigation to ignore the document that permanently establishes the legal relationship between self-storage operators and their customers.</p>

By Jim Chiswell

After being involved in the self-storage industry for the past 28 years, folks are always asking me for industry rules of thumb to follow. How much can I pay for vacant ground? Is the expense ratio always 35 percent of gross revenue? Can I anticipate I will lease up at 7 percent to 8 percent a month? Can I always get a 35 percent to 40 percent premium for my heated and cooled units over my standard unit rates? Etc. Etc.

While you can approach many aspects of our business with intelligent ranges and ratios, I honestly feel every new development project/conversion or acquisition is a snowflake. No two are exactly the same.

Ive found, however, one universal principle when it comes to this question: When will I know its time to review my rental agreement?

If the following appears at the bottom of your rental agreement, you need to get it reviewed quickly!

 

______________________________________________19______

Signature                                                                                             Date

 

If you dont get it, drop me note and Ill explain! There has been just too much legislation and litigation in the past two decades to ignore the document that permanently establishes the legal relationship between you and your customers. Folks, you have so much on the line financially that the minor expense to have a competent attorney review and update your rental agreement is pocket change. Just make sure you select counsel that really understands our industry. Dont pay for any on the job legal training.

If youre fortunate to work in Texas, you just cant go wrong with the Texas Self Storage Associations Standardized Agreements. But most of us dont have the luxury of a tried and true state-wide agreement.

You cant afford to wait 20, 10 or even 5 years between updates. Add it to your to-do list today and get it done.

Jim Chiswell is an industry veteran and owner of Chiswell & Associates LLC. Since 1990, his firm has provided feasibility studies, acquisition due diligence, mentoring and customized manager training for the self-storage industry. He has served for a number of years on the Inside Self-Storage Editorial Advisory Board, is a moderator on the SelfStorageTalk.com interactive online community and is faculty member of the Self-Storage Training Institute. He can be reached at [email protected] or www.selfstorageconsulting.com.