Toronto, Canada-based InStorage Real Estate Investment Trust (InStorage REIT) has appointed Judy Kan as senior vice president of investments. Kan's responsibilities will include acquisitions, asset management and debt strategy.

Prior to joining InStorage, Kan was senior vice president of real estate for a major Canadian hotel REIT. She has 20 years of commercial real estate experience in the office, industrial, retail, residential and hotel sectors, including lending, pension fund management and asset management. Kan holds an MBA from the University of Toronto and a bachelor's degree in civil engineering from the University of British Columbia, and she is a qualified member of the Royal Institute of Chartered Surveyors. For more information, visit www.instoragereit.ca.

Although there are numerous ways one can take on a first-time self-storage project, the scope of this article is to guide you through the maze of development challenges.

The Perfect Site

The first step to building your facility is to find several potential locations you consider ideal for a new self-storage site. Each property will have its own pluses and minuses. First, you need to verify with all local municipalities that the property is zoned for self-storage. Even if the municipality says the property is not zoned for storage, the deal is not dead. It may require obtaining a variance from the local committee of adjustment. The process can take as little as a few months to a few years depending on the committee’s schedule. Due to the time and cost associated with this requirement, the site has to be exceptional to warrant going through this process.

Is there potential for another facility being built within a 5-kilometer radius of your proposed site? Verify the demographics of your nearby competition, the population density and commercial marketplace. Each of these items helps determine if the site is viable for storage.

Why even discuss site selection when this article is dealing with construction? If the site location is inappropriate for self-storage success, then building the project is a waste of time and money.

Surveys, Studies and Permits

Once the site choice is narrowed to one or two potentials, evaluate the general condition of the property. Does it have an existing structure that can be converted into self-storage? What do the grounds provide? Do the grounds need significant clearing of brush or debris or is it marshy or paved?

Even if the site is in good condition, well-drained and has no water issues, you should invest in an environmental study and legal survey of the property. The investment of time and money on these two items is well spent. When looking for financing, you will need an environmental study showing there are no contamination issues that need to be resolved. This item alone may be a deal-breaker because lenders consider any project as a risk and will not loan money until the site is environmentally clean.

Determine Your Design

After obtaining a site review that includes all soil reports and a survey, you have chosen the property with the greatest potential. At this stage you should meet with your design team to identify the size of the project, scope of work, a start and finish date and, most important, a budget.

Determine the size of the facility and decide on your amenities. Each design decision, such as if you are offering heated or non-heated storage, will have an affect on the budget.

Once your design team has generated all the drawings, apply for the building permit and other required approvals, such as electrical, site servicing and development. Be prepared that all of these approvals cost money and time even if you are prepared to do it yourself. Do not underestimate the time and effort that will be needed to go through this stage. Being thorough will determine how smooth things will go with the various government agencies.

While your project is going through the approval stages, determine actual cost of the various components and construction trades necessary to take the project to completion. You can obtain quotes yourself or have your design team obtain them.

The Construction Phase

Once you have your building permit and selected your various trades and suppliers, it’s time to move to the construction stage. When construction begins, you must contact each various agency to coordinate inspection and approval stages. Allowing time for inspection and permitting is critical. Moving on without first having necessary inspections and obtaining approvals can delay your project and ultimately cost you time and money.

Before Opening Day

The last stage to confront is the occupancy of the facility. At this stage you will need to make sure you have your occupancy permits from the municipality governing your facility’s location. You should also obtain any final certificates of payments to ensure there are no liens against the property by a trade or supplier. You will want to ensure that all payments have been made so the opening of your building goes smoothly.

This general review of project-development stages should provide an overview to your first self-storage building. There are various subcomponents to deal with within each stage that will require your time and attention. Whether you choose to hire a group to coordinate your project or a turnkey project team, you must make sure you devote enough of your own time to the team so your project results are the most they can be.

David Hornblow is construction manager and administrator for the Ontario-based Canadian Metal Manufacturing Inc. Established in 1999, the company has been primarily focused on the self-storage industry since 2003. For more information, call 888.951.1762; visit www.canadianmetal.ca.

When Simply Self Storage decided to build its new offices and corporate headquarters in Orlando, Fla., the company wanted a look that reflected its services. The storage firm turned to U.S. Door & Building Components to achieve that look. The new corporate headquarters was custom designed with metal self-storage interior and roll-up doors from the door and hallway supplier.

"We had previously installed our self-storage doors and metal interiors into a Los Angeles architectural showroom. That experience gave us the expertise to transform a commercial interior that matched the needs of Simply Self Storage," says Charles Cordes, vice president of U.S. Door. "Office visitors, who are considering an investment in a self-storage facility, can actually test drive our doors and visualize our hallways in their buildings before buying them."

The Design, The Look, The Means

Simply Self Storages new headquarters consists of 3,800 square feet of offices, a reception area and conference room. The interior is in stark contrast to the previous corporate headquarters, which was outfitted in a very traditional Midwestern style. "It was quite a change for our office employees, but everyone seems to be really embracing it," says Jared Farmer, vice president of development.

"No other interior designs were considered," adds D.J. Hobek, director of marketing for the storage company. "We wanted our investors and customers who walked in to know were a self-storage business."

Each private office was designed with a standard entry door and a Royal Blue Model 501 self-storage roll-up door. The Model 501 doors come with a high-performance polypropylene wear strip and are manufactured using hot-dipped galvanized-steel components. This wear strip reduces friction during use, making it quiet and easy to operate, both important characteristics when being opened and closed in an office environment. The wear strip also minimizes paint scratching that can occur during high-cycle operation of a rolling-type door.

The conference room is outfitted with the Model 502 roll-up door that features an electric operator to provide maximum opening convenience and effortless operation. As company meetings are about to start, the roll-up door is raised with a push of a button. The Model 502 has a galvanized steel barrel surrounding a "dead axle" spring assembly. The barrel provides even lifting along the width of the door opening and a protective barrier against field mishandling. The Model 502, along with the other self-storage doors in U.S. Doors product line, is tested to meet 60,000 cycles. The doors are available in sizes up to 12-by-12 and in 22 different colors.

Using a floor plan provided by Jared Farmer, the U.S.Door design department engineered the required metal frames for personnel doors to securely fit into their structural pier and header system. The matching frames create a continuous self-storage look throughout the entire office space.

The hallway system was built around flush, polar-white, 16-gauge structural piers and headers. The structure is considered one of the strongest hallway systems available to the self-storage industry, according to U.S. Door. Chamfered corners, diamond plate aluminum kick plates and corner guards protected the steel components from any damage as objects were moved into the office.

Credit Where Credits Due

"We knew what we wanted. The custom doors and hallway systems vary from 5 feet to 8 feet wide," Farmer says. "You get a much more open office feel, which gives you the sense of working in a larger office compared to those with traditional 3-foot-wide doorways." The aesthetic look and the atmosphere the U.S. Door products create is something he enjoys every work day.

The designs provide a practical benefit as well. With the roll-up doors in an open position, communication is better in the office. Also, on move-in day, other benefits became apparent. "When we were moving furniture in and out, the roll-up doors made it very easy to move in, especially the large desks," Farmer says.

As visitors arrive at Simply Self Storages office, a reception desk similar in height and appearance to a self-storage rental and retail area is to the right of the entrance. A TV monitor behind the receptionist displays appropriate images for visitors seated in the reception area. Instead of the usual office art on the walls, one conference room has a display of a roll-up door, similar to those seen on the exterior of storage facilities. Staff at Simply Self Storage can point to those doors to better illustrate winning tips and strategies first-time developers need for success.

Other elements were installed throughout the interior to reflect the look and feel of a self-storage facility. Even the stained concrete and the unfinished black ceilings provide realistic features often seen in a storage facility. These finishing touches were provided by the other contractors who worked side-by-side with U.S. Doors installation team.

"U.S. Door did an excellent job of coordinating work with the other tradesmen, such as the carpenters and lighting contractors," Hobek says. "The professionalism of U.S. Door from the initial call to the punch list shows in the finished office interior."

Simply Self Storage, a wholly owned subsidiary of OB Cos., is a property management company specializing in existing self-storage operations, ongoing acquisitions and development of new facilities. Many of Simplys projects involve joint ventures with landowners and developers.

U.S. Door has been an international supplier to the self-storage industry for more than 30 years. In addition to supplying roll-up doors, it offers a complete portfolio of related products, including hallway and corridor systems, swing doors, lockers, EZ Access wicket doors, relocatable buildings and mezzanine systems. Products are available with factory-guaranteed installation.

For more information, call 407.859.6770; visit www.usdoor.com.

The Inside Self-Storage Expo in Nashville, Tenn., Oct. 7-10, 2008, will include a seminar on accomplishing successful phone sales in self-storage, intended for facility managers and operators who wish to improve their phone skills and closing rates.

On Oct. 9, Brian Byrd, vice president of sales and marketing for Landvest Corp., will provide a comprehensive overview of the five steps necessary for selling self-storage to customers over the phone. Byrd has been involved in sales since college and has worked in some aspect of real estate and sales management for more than 10 years. He says facility employees often give callers the price of a unit without fully understanding the needs of the customer, properly qualifying the customer, or effectively selling the product.
 
Based in Wichita, Kan., Landvest offers third-party management options, training, consulting and development services to the self-storage and multi-family housing industries.
 
The ISS Nashville Expo, set at the Gaylord Opryland Resort and Convention Center, will feature four days of educational seminars, vendor exhibits and networking opportunities. It is sponsored by Inside Self-Storage magazine, a monthly trade publication for owners, operators, managers, investors and suppliers of the storage industry. For details, visit www.insideselfstorageexpo.com.

Nearly 2 million smuggled cigarettes were seized at a self-storage site in Nottinghamshire, England, by HM Revenue and Customs officers, BBC News reported in April. According to a customs spokesman, £50,000 in cash was also found at the site. Officers seized the contraband along with an Audi car on April 25, 2008.

The estimated lost tax dollars on the illegal cigarettes would have totaled more than £325,000. No arrests have been made, but an investigation is under way. Illicit cigarette sales in the United Kingdom cost the government an estimated £3 billion a year in lost revenue. For more information, visit www.bbcnews.co.uk.

What goes up, must come down, right? Some feel that the real estate turbulence of late was bound to hit at some point, because it had soared to such great heights in the past several years. How far it would drop was anybody’s guess.

While editing a piece on self-storage finance this morning, I did a little research and came across an alarming headline on CNNMoney.com: “Foreclosures spike 112%, with no end in sight." If that’s not enough to make stomachs turn, the lead paragraph should do the trick: “One out of every 194 U.S. households received a foreclosure filing in the first three months of 2008, according to the latest figures released Tuesday by RealtyTrac.”
 
Not too many folks can take comfort in those numbers, but what may cause a sour stomach for some might just render itself as relief for those in the self-storage industry. That was my feeling after I opened an e-mail from fellow editor Amy Campbell, who passed along a link to yet another article. This one, from The New York Times real estate section, told a different story for our specific industry, revealing the silver lining to my blog today:

“The four real estate investment trusts that together own and operate about 12 percent of the facilities nationwide—most of the other properties are mom-and-pop operations—has soared about 31 percent, on average, this year through Thursday, after finishing 2007 with a nearly 25 percent loss.”
 
The reason, the article states, is likely linked to the foreclosure statistics; forcing homeowners to find a suitable, safe environs for their belongings once they’re squeezed from their residences bodes well for self-storage. Other people might just postpone buying a home until the rates are more savory, needing storage space in the interim.
 
According to Michael Knot, senior analyst for Green Street Advisors, self-storage holds great promise for investors and, naturally, for owners/operators as well. “It is recession resistant,” he is quoted as saying in the NYT article.
 
And so it seems, while some have predicted the industry was out for a frenzied rollercoaster ride, others like to look at it in terms of simple playground physics: Self-storage is still looking pretty, sitting on the high side of the economic see-saw.
 
P.S. Thanks for the tip, Amy!

The records-storage market is unlimited in virtually every self-storage market in the world. How can you tap into this potential gold mine?

Self-storage entrepreneurs in most cities refer to their individual markets as areas within a two- to five-mile radius. Records-storage businesses, on the other hand, generally include entire cities, counties and sometimes even beyond. Regardless of which way you look at it, the business of records storage has barely been tapped when viewed from a self-storage point of view.

Today’s self-storage facilities have a mix of individual and business customers. It is fair to say that facilities average about 75 percent individual renters and 25 percent business clients. Of the latter, most represent small businesses that need extra space for records. It is very common to find law firms, accounting firms, clinics, mortgage companies and other such businesses storing records at a self-storage facility in a casual manner.

Small companies in North America represent more than 50 percent of the business volume in employees and revenue. You likely have hundreds of small businesses in your defined market. This size company typically has the most problems with business records, because of management issues. Simply put: They can’t find a file when they need it.

Records Management

What does records management mean for the business professional? Knowing what you have, where it is, how to find it and when to get rid of it. Sound pretty basic?

It always surprises me how simple records management is. So why is it such a big problem in today’s business? I’ll give you four reasons:

1. Records are a big pain in the neck.
2. They aren’t important until you need them.
3. Businesses rarely have a budget for record-management.
4. People don’t know the true cost of record-keeping.

Stop Selling Storage

I know you are a storage business but I am telling you not to sell storage. This may seem counter-productive, but if you sell records management, you will get more storage customers ... and for a very long time. Records stay on the shelf for an average of 16 years. Records contracts are usually considered permanent contacts because of their "evergreen clause" and because the cost of moving them out is greater than keeping them where they are. Plus, businesses have a hard time figuring out what to keep and what to toss. These days, everyone is afraid of making a bad decision so the trend is to store things longer than necessary.

Most commercial-records centers keep records for large clients; probably 50 percent of the records in these large-client accounts are not necessary to keep. But rarely does anyone actually try to do something about it.

Iron Mountain, the only publicly traded company (IRM) in records management, is a highly rated stock and very profitable. Yet, the basis of its business is simply storage, just like you. The difference is Iron Mountain’s storage does not come and go like yours. It stays forever. Iron Mountain boasts of decades of continued storage growth in its annual report on www.ironmountain.com. 

Mimicking Iron Mountain

The formula for successful operation of a commercial-records center is straightforward and right under your nose. You already have a storage business and a larger market than both Iron Mountain and the local commercial-records centers. How can that be?

Commercial-records centers focus on larger businesses because of the volume of records per account. Iron Mountain averages several thousand boxes per account, and the local records centers average about 750 boxes per account. It takes sales efforts to go get them and the biggest accounts are already taken.

Right now there is a feeding frenzy in the industry with records centers trying to snatch accounts from each other. But why fight for business when there is so much still available?

Small businesses account for most of the business in North America and are very difficult for commercial-records centers to attack because of the cost of sales. There are a few that understand the value of the small-business clients, which, in fact, yield as much as three times the yield per box of the big corporate accounts prized by Iron Mountain and the others. You have the secret ingredient: walk-in clients.

Marketing on a local scale can be inexpensive and quite lucrative using a two-pronged approach: self-storage and records-storage at the same time.

Success in records management in self-storage can be measured in quite different terms than that of big companies because you do not have the same overhead and staffing requirements. Additionally, you can do anything the commercial-records center does by forming alliances with other small businesses right in your community.

If you’re looking for more income, look no further than your own self-storage doors. You just need to know how to mine for the gold to enjoy its glitter for a long time to come. 

Cary F. McGovern is the principal of FileMan Records Management, which offers full-service assistance for commercial records-management operations. For help with feasibility determination, operational implementation, marketing support and/or a free 90-minute consultation, call 877.FILEMAN; e-mail [email protected]; visit www.fileman.com.

From a database of nearly 21 million companies reviewed by Entrepreneur magazine and research provider CentrisPoint, Simply Self Storage was distinguished as one of the nation’s “Hot 100, The Fastest Growing Businesses in America” for 2008. The company ranked No. 1 on the list for its rapid sales and job growth, among other select criteria. The Hot 100 ranking appears in the magazine’s May 2008 issue. 
 
Of the millions of companies on the preliminary list, only 0.3 percent made the first cut, and just a fraction of those made it to the Hot 100. Entrepreneur’s 14th consecutive ranking of America’s top fast-growth companies revealed businesses with total combined revenue of $4.6 billion in 2007. The Hot 100 are expected to collectively employ more than 15,000 individuals by 2009, an increase from a total of 517 employees on their first day of business. And of the companies ranked, 91 offer employees health insurance, 73 provide retirement funds, 42 offer tuition reimbursement and 40 offer flextime.
 
“This year’s Hot 100 listing reveals the shining stars continuing to drive the nation’s economy forward,” says Karen Axelton, executive editor of Entrepreneur. “These companies, and the entrepreneurs who built them, are making a major impact on the economy with their revenue and the new jobs they create as a result of their growth. The innovation, persistence and passion they demonstrate in industries across the board are vital to the nation’s success as a whole.”
 
For the complete story and Hot 100 listing, as well as a profile of Simply Self Storage, visit www.entrepreneur.com/hot100.

Based in Orlando, Fla., Simply Self Storage has offices, developments and facilities in 20 states as well as Puerto Rico. The company has more than 15.6 million square feet of storage space in operation. For more information, visit www.simplyss.com.

The use of self-storage is on the rise in Ireland, according to The Irish Independent. The country's storage providers can be roughly divided into two camps: those who provide storage, removal and delivery, and those who specialize in self-storage. Customers say security is one of the things they most like about self-storage facilities, as many provide individual alarms for each unit.

At Elephant Storage in Dublin, units start at €10 per week for 20 boxes. Storing the contents of a one-bedroom apartment can cost up to €200 per month, and can increase to €270 and €300 for two- and three-bedroom living areas respectively. Elephant, like many storage companies, offers a range of boxes and packing kits that can be bought onsite or online. A moving pack that will hold the contents of a one- to two-bedroom home costs €70.