A basic, modern CCTV system has several main components: video cameras, a digital video recorder (DVR), display monitors, and cables to connect them all together. Quality equipment is important, but you can streamline costs by selecting an alternative type of cabling.

Traditionally, a CCTV system connects via coaxial cable. With this approach, every camera requires a dedicated cable connection to the central monitoring console. Although coax is known to be reliable, another technology is giving it a run for its money: UTP, or unshielded twisted-pair cabling. UTP uses a baluna device that converts an unbalanced video signal into a balanced oneto adapt the video signal from the coaxial cable so it can support it. Together, UTP and baluns provide a dependable, cost-efficient video path.

Advantages

What are the advantages of UTP? The first is the material cost savings. UTP costs about 40 percent less per foot than coax cable. On top of that, it can support up to four camera signals, while coax can handle only one. This creates a windfall of savings if your system contains several cameras near each other, as you can use just one cable to send the video signals back to the monitoring equipment.

Versatility is another factor that translates into cost savings. UTP is generally easier to install and connect than coax. In addition, it is less bulky and lighter to transport, and requires less valuable conduit space in the building. CCTV installers are starting to use UTP to eliminate the need to supply 110-volt power at the camera or run separate cables for each. Within limits, a single cable can do it all.

Thinking ahead, if a new self-storage facility is going to be prewired with UTP for voice and data anyway, it makes business sense to add a few more cables to support CCTV. This avoids the need to install new cables for video, plus the UTP can be reused for other services later, if necessary.

Finally, twisted-pair cabling lowers the cost-per-camera connection, so its affordable to offer more camera positions. For example, for a premium, you can offer additional camera views to a tenant who would like additional surveillance around the perimeter of his unit. If youve already installed UTP, accommodating his request will not only be possible, it will be cost-efficient.

How Much Savings?

To get an idea how much you can save with UTP, lets look at a sample facility with 16 cameras. Assume the cameras are clustered in groups of four, positioned about 500 feet from the DVR. If coax is used, the cable would cost $2,160 at a median price of 27 cents per foot. If UTP is installed, the price is $300, plus the expense of 16 baluns at $20 each. The total price tag weighs in at $620, a savings of $1,540 in cable alone.

Any self-storage facility investing in a CCTV security system should consider the advantages of twisted-pair cabling. Consult with your local security and surveillance providers before purchasing your system, or you may lose the opportunity to save time, convenience and money by thinking ahead with UTP.

Jeffrey Herman is product manager at MuxLab, a Montreal-based designer and manufacturer of CCTV and audio-video connectivity solutions for copper twisted-pair cabling. For more information, call 514.734.4320; e-mail [email protected]; visit www.muxlab.com.

Chateau Products Inc. is a family-owned business dedicated exclusively to the self-storage industry. ISS conversed with the companys vice president of operations, Tony Borysenko, who shared insight to Chateaus business philosophy, the companys international drive, and the quality products and services it is committed to provide.

Tell us a bit about Chateaus roots. Where did the business begin?

Chateau was founded in 1991 by Bill, Pauline and Peter Martin. Its a family business with a vision of great products, great pricing and the very best in customer serviceand it all started in the garage of the Martin home in Southwest Florida. The idea for Chateau came shortly after the sale of the familys successful specialty-hardware business, which they owned and operated for more than 20 years. Looking for new opportunities, they purchased a self-storage facility as an investment. They quickly identified the growth potential of the industry and a niche that complimented their business background: security hardware.

Chateau began by selling just a handful of padlocks and replacement door latches exclusively to self-storage. Almost 15 years later, the company still focuses exclusively on this industry, having become a one-stop shop for virtually anything you need to maintain and operate a storage facility. Chateau is headquartered in Bradenton, Fla., and continues to be solely owned by Bill and Pauline.

What regions does the company serve?

Chateau is a global company, serving self-storage facilities all over the world. Our corporate office and Eastern distribution center is in Bradenton, with Western distribution covered by our Sparks, Nev., facility, and Canada served by our facility in Orangeville, Ontario. We have evolved from using controlled tooling interests for the production of our security hardware to operating our own manufacturing facility in the free-trade zone of Southern China. Our factory produces 90 percent of all the locks we offer and 100 percent of our latches and latch components. We employ 35 people here in the states and more than 400 in our factory in Asia.

What are Chateaus primary products?

Since 1991, Chateau has offered the self-storage industry high-quality padlocks, latches and latch systems, with value pricing and the highest regard for customer service. We design and manufacture our security hardware to meet the ever-growing demands of the industry.

There are few applications in which you have more padlocks concentrated in a single location than self-storage, and a storage facility is a tough place for a padlock. Its constantly exposed to the elements, must perform after months of sitting idle, is at constant risk of being attacked, and must be keyed differently than the hundreds or thousands of other locks on doors just down the row. At Chateau, we place a high priority on key changes that maintain the integrity of uniquely keyed locksyou dont want the key to your neighbors lock to open yours.

National lock brands sold by major retailers and some industry distributors can be great, but theyre not necessarily right for storage applications. There are cost savings that can be achieved with less focus on key changes, and the name brands often take advantage of those efficiencies. Thats fine when two locks are sold off the same retail hook in a Home SuperStore, since what are the chances those locks will be used only feet away from each other? Its more likely one will be used to secure someones outdoor freezer, and the other will end up on the other side of town, keeping a spare tire secured under a pickup truck. But when two locks are sold at a storage facility, you can count on them being used near each other, and you want them to be different.

In addition to security hardware, Chateau offers a full and complete line of retail, moving and packing supplies, retail displays, maintenance items, tools and specialty itemsall exclusive to the self-storage industry. We are fortunate in that our diverse line gives us the opportunity to work with storage owners and managers on a variety of challenges, allowing us to constantly learn and improve on how we operate and what we offer. Beyond our products, we provide solutions: We work with new operators on choosing security and retail layouts for sites in development or under construction; we can help stop break-ins at a existing site, or show you how to convert your current office into a retail-profit center.

What is your company philosophy?

This is simple: quality, value and the highest regard for customer service. You have to offer products that perform, are priced right, and reach your customers in a manner that exceeds their expectations. You also have to specialize. If you do one thing, do it well; and in our case, its self-storage. Our goal has beenand continues to bemaking Chateau the brand for the industry.

What trends are you seeing in the storage industry?

Self-storage is becoming more sophisticated and mainstream. Facilities must appeal to the consumer in more ways than ever before, and its rare to find a newly constructed site that offers just storage and nothing else. Operators are adding products and services of all types to add more appeal to their businesses. Storage locations are no longer off the beaten trailtheyre next door to major retailers and high-traffic locales, competing for consumer attention.

As the market becomes more sophisticated, so should industry vendors. Chateau embraces these changing times and strives to raise the bar on all its products and services. We are constantly improving our locks and latch systems, offering more features and finishes to suit every application. We continue to improve on the packaging and presentation of all our products to make them more retail-friendly.

Its important that items are functional, attractive and priced right. When competing with the big boys, its important for a storage business to be competitive with the items it sells. Several years ago, a major convenience-store chain was losing market share due to high prices on staple items like bread, milk and eggs. It charged too much and generated a negative perception of its business. On the other hand, when you offer good value to a consumer, its never forgotten. Small things connect in a big way.

What makes you most proud of Chateau?

Our commitment to customer service. We do business the old-fashioned way. The customer is always right. In todays business world, many companies talk about customer service, but dont always give it. I also like the fact that though were a big company, were small in ways

What is your company philosophy? This is simple: quality, value and the highest regard for customer service. You have to offer products that perform, are priced right, and reach your customers in a manner that exceeds their expectations. You also have to specialize. If you do one thing, do it well; and in our case, its self-storage. Our goal has beenand continues to bemaking Chateau the brand for the industry. What trends are you seeing in the storage industry?

Self-storage is becoming more sophisticated and mainstream. Facilities must appeal to the consumer in more ways than ever before, and its rare to find a newly constructed site that offers just storage and nothing else. Operators are adding products and services of all types to add more appeal to their businesses. Storage locations are no longer off the beaten trailtheyre next door to major retailers and high-traffic locales, competing for consumer attention.

As the market becomes more sophisticated, so should industry vendors. Chateau embraces these changing times and strives to raise the bar on all its products and services. We are constantly improving our locks and latch systems, offering more features and finishes to suit every application. We continue to improve on the packaging and presentation of all our products to make them more retail-friendly.

Its important that items are functional, attractive and priced right. When competing with the big boys, its important for a storage business to be competitive with the items it sells. Several years ago, a major convenience-store chain was losing market share due to high prices on staple items like bread, milk and eggs. It charged too much and generated a negative perception of its business. On the other hand, when you offer good value to a consumer, its never forgotten. Small things connect in a big way. What makes you most proud of Chateau?

Our commitment to customer service. We do business the old-fashioned way. The customer is always right. In todays business world, many companies talk about customer service, but dont always give it. I also like the fact that though were a big company, were small in ways that count. We can make decisions quickly without the bureaucracy that can affect customer service.

Some facilities are well-sold on its advantages. In addition to the pressure of increasingly competitive markets, a desire for an added level of security has encouraged some operators to explore master-key options. Over time, more will become open to the possibilities. Think back to a few years ago, when many in the storage industry were skeptical about using tubular-lock systems because of potential problems with overlocks. They were hesitant to use the locks at first, but today these systems are ever more common.

How it Works

In a true master-keyed system, one master key has the ability to unlock all of the locks at a site. This should not be confused with a flat unrestricted key. While there are some similarities, they are completely different, especially when it comes to the way their mechanisms work. The rotating disc locks employed by the master-keyed system are virtually pick proof, while the locks in a flat-key system feature springs and pins that make them vulnerable.

In addition, the master key of a master-keyed system is restricted and cannot be copied by a locksmith. Quality systems are hand-assembled, not mass produced. Each lock is registered and coded by the manufacturer for added protection.

Motivations Behind the Master Key

Self-storage security has changed drastically over the years. Some advancement has been the result of better technology. In other cases, it came in response to increased competition and the need to provide more and better options than the facility up the street. Even the permitting process in some areas has forced our hand. For example, some cities require the fire department to have 24-hour access to a storage facility and its units in case there is a fire. This can only be accomplished with a master-keyed system.

Issues of homeland security have also shed more positive light on master-key use. As storage facilities are built in more densely populated areas, the activities that occur behind their doors are of greater concern to local officials and residents. The anxiety is not unfounded. For example, consider the Oklahoma City bombing executed by Timothy McVeigh and the 9/11 attack on the World Trade Center. Both incidents were tied to a van and its explosive contents, which were storedyou guessed itat a self-storage facility. Recently, law-enforcement officers found a half-ton of ammonia-nitrate fertilizer in a London storage unit.

Could these incidents have been avoided with use of a master-keyed system? Its difficult to say. Obviously, the staff of those facilities would have to be vigilant enough to notice suspicious behavior on behalf of tenants and questionable goods coming to and from the site. There would have to be sufficient evidence to support use of the master key. Simply having a master-keyed system in place does not guarantee greater securityit has to be used intelligently.

The Right Way

Though master-keying offers many security advantages, there is a right and wrong way to use it. Owners of apartment complexes keep keys to their tenants units without legal difficultybut they follow the necessary guidelines. The same must hold true in self-storage for the system to work.

If you choose to employ a master-keyed system, you will need to include specific provisions regarding its use in your lease agreement. These clauses should be straightforward so tenants understand their right to privacy and your right to enter a unit under strictly defined circumstances. Some simple language added to your contract will keep you out of hot water, but consult your legal counsel to make sure the text is sound. No judgments have ever been awarded in a court of law that found the owner of a master-keyed facility liable for exercising his rights.

The expectations for site securityfrom tenants, local communities and the federal governmentare higher than ever before. And this is not likely to change. Savvy storage operators also recognize that security doesnt just protect valuables; it serves as an excellent marketing tool.

With that in mind, consider a master-keyed system. When used correctly, it will protect you in extraordinary events such as fire and suspected acts of terrorism. Plus, it will help you deter criminals from renting with you every dayjust by mentioning it in your sales presentation. Use a master-keyed system to improve your reputation for security and increase your bottom line.

Morgan Lambert is a regional sales director for Lock America Inc. (d/b/a L.A.I. Group), which manufactures a complete line of security locks and custom-designed security hardware for self-storage and other industries. The L.A.I. team is committed to taking knowledge gained from other security industries and applying it to the self-storage market. For more information, call 800.422.2866; visit www.laigroup.com.

Richard and Jill live in a nice ranch-style home that tops a low hill in southern Ohio. He commutes 12 miles to administrative duties in the regional hospital. Jill plays mom to two youngsters. But thats not all. When her phone rings during the day, she answers: Valley View Self Storage has great prices, great service, and great views of the valley. How may we help you? Valley View provides a service to the community, even though it has no full-time onsite manager. Jill runs the 181-unit facility from her home a mile away.

Likewise, Glenn, a commercial real estate developer in one of the Midwests larger cities, operates his holdings from a central downtown office. Sometimes referred to as a hub-and-spoke arrangement, Glenns five remote sites pose a different set of operational requirements than a traditional manned store with a full-time staff.

As industry consolidation opens the door, national and regional operators take the opportunity to bring multiple facilities throughout a widespread area into their folds. As a means of saving time and money, executives dream of having systems that will allow totally unmanned facilities, with expanded automation connecting them to a home office.

Whether a facility is a mom and pop operation, a local real estate venture or part of a national chain, its owners will seek out ways to minimize overhead and maximize profits as they run the business day to day. Of the estimated 45,000 self-storage facilities dotting the face of the United States, many follow a business model that does not include a full-time manager. Built to take advantage of the high demand for storage, these facilities are known as remote sites.

The Quandry

Jill and Glenn meet at a self-storage tradeshow. While browsing security equipment at the booth of one vendor, they discover their operations have something in common: remote management. It makes for some insightful conversation.

You know, the requirements for running the facility are the same whether you have a full-time staff or not. You still have to make it easy for people to do business with you, says Jill.

Glenn agrees, Weve all got the same issues. Keeping tenants happy takes customer service. They want a clean place to store, and they want to feel that what theyre storing is going to be protected. Depending on the size of the store, theres a way to do all of that and still not have a full-time staff.

Security is a business tool with two purposes. Obviously, protection of property is one. The other is to keep your facility competitive within your market. Better security may be the very item that makes the difference to prospects. For example, if your store has a fence and automatic gate, it will naturally be more secure, attracting customers concerned about safety.

Tight security results from a good plan: You need to combine management systems and equipment that match the needs of your location and operation. Though facility types vary, security fundamentals remain the same.

When it comes to security, we start with the basics, says Glenn. Since we use a central office, its easy to standardize procedures. As well as we can, we make sure our tenants are who they say they are. We require photo IDs and background information, and we even keep a photo and fingerprint of each customer. We also give each tenant a disc lock with a security sticker. We know its the most secure lock they can use, so its part of the rental package. When we do our onsite inspections, we can quickly see if someone has tampered with any units.

Jills in a different boat. Though her facility is doing quite well, having stabilized at about 88 percent occupancy in two years, security is still a sore spot. We just had our third break-in in two years, she says. We cant abide that, so Ive got to find some new options.

A Solution

A sales representative overhears Jills quandary and offers some assistance. We can provide all the same electronic security tools for a remote site that we can for a manned facility, so long as we have electrical power, he says.

The big difference is how information flows between the two locations and how its handled. In a manned office, all pieces of equipment are within easy reach of each other via wiring. The only thing that changes in a remote setup is the method for moving the data stream. A local-area network (LAN), wide-area network (WAN), or even a wireless connection can easily be set up to transfer the information that helps security systems work seamlessly.

Those systems include access control, individual unit alarms and video surveillance. Access control includes the automated functioning of gates and doors; assigned codes ensure that only tenants whose leases are valid and accounts are paid have access to the property. Individual unit alarms still rank at the top of the list of features that appeal to customers. Many feel more secure about using storage when they know their space is armed. Likewise, many facility owners feel their business is more secure when they use video surveillance on the property. With todays digital video recorders, even smaller facilities can afford to enjoy heightened security.

With a fence and a good automatic gate, youll cure better than 80 percent of any theft problem you would ever have at a facility, says the sales rep. If you want proof-positive security, an individual unit alarm will do the trick. The alarm system can be hard-wired or wireless. Both options have proved to be valuable, especially in a remote location. Any unauthorized entry will cause an alarm condition to startle an intruder and summon you or the authorities. So long as they are installed properly, these systems work very reliably for years.

Jill is impressed, but this doesnt entirely solve her dilemma. Im more concerned about seeing whos at my facility at any given time. How can I use cameras to see them from the house?

The rep is unphased. If you have a high-speed connection, you can run all your access control, alarm notification and security cameras right over the Internet, he says. Just like the major self-storage companies that view their facility cameras from all over the country, you can see whats happening at your site in real time right on your computer screen.

As the sales rep mentioned, the difference between security at a manned and unmanned site is related to the flow of data. In the case of short distances, such as two facilities across the street from one another, transmissions can be made via a wireless modem. Otherwise, the simple data for the access-control and alarm systems can travel on a standard telephone circuit, while larger transmissions such as video from security cameras will require a high-speed Internet connection.

More Options Than Ever

With connection devices readily availableand the technology always improvingremote site operation has become viable and affordable. Many owners are taking a close look at the new kiosk-type equipment. Whether for standalone use at an unmanned site or as a robotic support manager at a staffed facility, these self-serve stations can connect to a home office or call center to handle all the tasks required for rentals. They can even maintain the paperwork for customer relationships.

Along with automation, built-in and add-on security features give you all the systems you need to keep up with the competition, says Glenn, who has been listening to the sales reps pitch. We have been able to use a combination of security systems at our remote sites and operate them very efficiently. Of course, we still have someone doing the daily property and lock checks, but the investment in the technology has really paid off by keeping our overhead down.

Another owner whos been listening in says, We really dont have a remote site, but we might as well. We have a manager, but my wife and I like to travel, so weve added the necessary connections to keep up with whats going on at home. A couple of weeks ago, we were watching our site over the Internet on a pocket PC while sitting on a beach in Maui. Its a great way to take care of business!

If you are one of many adding to the buzz with questions about unmanned storage stores, your answer about security is, Yes! Properly planned features will help protect your property and add appeal for prospectseven more so because you operate without a manager in sight.

Steve Cooper is part of the marketing team at Digitech International Inc., which produces comprehensive security solutions for the self-storage industry. The companys product line includes gates, access control, video surveillance, individual unit alarms, management site control and onsite marketing tools. For more information, call 800.523.9504; e-mail [email protected]; visit www.digitech-intl.com.

The intelligence community bases its warnings on the domestic-terrorism cases of Ramzi Yousef (Word Trade Center bombing, 2003) and Timothy McVeigh (Oklahoma City bombing, 1995). Both criminals used truck bombs to carry out their actions, and both stored their materials (large quantities of ammonium nitrate and fuel oil) in self-storage units.

But whatever the implications of government documents, the reality is self-storage personnel are not law-enforcement officers. Facility owners and operators will (and should) remain primarily focused on running their businesses in an efficient and profitable manner. To everyones benefit, however, they should consider basic and proper risk management and smart security.

The idea is the more security elements you employaccess systems, CCTV, alarm points, etc.the smarter your security and greater your level of protection. To properly support employee awareness, you must choose the right technology to secure your self-storage environment.

The Importance of Vigilance

Since the root of vigilance is observation, a key element in smart security for self-storage is a CCTV system based on DVR (digital video recorder) technology, as opposed to a time-lapse videotape solution. By using a DVR system to monitor your facility, you have two ways of preventing domestic terrorism: surveillance and the procurement of evidence.

Install cameras in key locations around your facility, including the front gate, loading docks, building entrances, and above the front desk and point-of-sale system. Your monitoring equipment should be in plain view in your front office, not only to give comfort to tenants but to deter any criminal activity. A DVR can be easily integrated with security features such individual unit alarms and access control to ensure important images are captured and stored.

But cameras will not be sufficient if your staff doesnt know the red flags. To understand what to watch for, employees will need a list of suspicious items and behaviors. Consider posting a list in your office. You can create one from the aforementioned government advisories. The Self Storage Association has made some notices available for download via its website, www.selfstorage.org.

No matter how vigilant employees are, it can be extremely difficult to determine the intentions of customers by simply observing them. Its more likely a red flag will be raised when a tenant makes a blunder that reveals criminal plans. For example, Yousef had chemicals delivered to his storage unit directly from the manufacturer. This sort of activity is not only suspicious, it is easily recordable via surveillance cameras.

This is where the DVR is most useful. To conduct a solid investigation, law-enforcement officials will need accurate evidence, such as video footage. A DVR produces highly detailed images, making key information, such as the identities of individuals and license plates, easy to see. In addition, a DVR can pinpoint events from specific time periods, eliminating the need to sift through hours of tape. It offers great flexibility, extended record times, future expansion ability, and a greater capacity for data storage and reproduction.

In this age of heightened security concerns, superior technology combined with increased employee caution will enable the self-storage industry to play a key role in the war on terrorist activity.

Van Carlisle is president and CEO of FKI Security Group, a security and loss-prevention company, where he has worked since 1975. Mr. Carlisle studied criminal justice at the University of Louisville and served six years in the Air National Guard Security Police Force. For more information, call 800.457.2424; e-mail [email protected]; visit www.fkisecuritygroup.com.

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Homeland Security: Red Flags

The following is excerpted from the Potential Terrorist Use of Self-Storage Facilities Notice released by the Federal Bureau of Investigation on August 6, 2004.

Owners, operators, and employees should be aware of any suspicious activity by self-storage customers, including:

• Insistence on paying in cash, sometimes weeks or months in advance.
• Seeming overly concerned about privacy.
• Visiting the storage facility late at night or at unusual times.
• Exhibiting suspicious behavior when approached by employees.
• Having unusual fumes, liquids, residues or odors emanating from their storage units.
• Displaying burns or symptoms of chemical exposure and providing vague or irrational explanations for the injuries.
• Discarding chemical containers in facility dumpsters.

Storage of the following items may also be cause for concern:

• Quantities of fuel
• Agricultural or industrial chemicals
• Agricultural equipment, such as commercial sprayers
• Explosives, blasting caps or fuses
• Weapons or ammunition
• Flight manuals or other similar materials
• Laboratory materials (e.g., flasks, sealed containers, incinerators, incubators, cell cultures, agricultural sprayers, improvised showers and eye baths)
• Protective clothing (e.g., surgical masks, gas masks, rubber gloves, self-contained breathing apparatuses)
• Textbooks and journals discussing biology, chemistry, explosives and poisons
• Pesticides
• Large delivery vehicles, vans, cargo containers, trailers or related equipment

Self-storage personnel are encouraged to contact their local FBI office regarding any concerns about possible terrorist activities or behaviors. Contact information for field offices can be found by calling the local police department or visiting www.fbi.gov.

This month, I gathered real estate experts to discuss the state of self-storage in the North-Central United States. Lets hear what they have to say about their respective cities and regions. Our panel includes: Bruce Bahrmasel, The Preferred Realty Group, Lincolnwood, Ill.; Larry Goldman, Prudential Commercial Real Estate, Kansas City, Mo.; Matt Libman, The Preferred Realty Group, Lincolnwood, Ill.; and Robert Off, Coldwell Banker Commercial, Cincinnati. I asked these brokers straightforward questions every owner and potential buyer will find pertinent. My comments are in italics.

1. What are the cap rates for reasonably projected incomes in your market? Describe your view of the recent cap-rate trends in self-storage.

Goldman: Cap rates continue to remain in the 8.5 percent to 10.5 percent range, depending on the outlook for future growth of a property and the amount of exposure it receives from prospective buyers. Several properties have sold for cap rates below that range, with buyers relying on a longer time frame to achieve stabilization. Cap rates will start to increase as interest rates increase. The question is, how much will the fundamental performance of the properties start to improve (or decline) to offset the increase of the cap rates?

Libman:

I see cap rates on projected 2005 income in the 9 percent to 10 percent range. In general, cap rates have been hovering below 10 percent and are still in step with current interest rates. I also expect cap rates to increase as interest rates rise.

Off:

Reasonable means different things to different people. Unfortunately, from a brokerage perspective, there have been very few self-storage sales in my market over the past few yearsthough a number of facilities have been actively marketed and then withdrawn from sale. I think this is a direct result of the unrealistic expectations of the owners. The Midwest is not the hotbed of speculation that Arizona, California and Florida are. Consequently, our buyers are not willing to pay 6 percent, 7 percent or 8 percent caps for self-storage properties. With that said, I think an appropriate and reasonable cap rate for our markets is in the range of 9.5 percent to 10.5 percent of trailing NOI, depending on the facility condition, location, etc.

Its beginning to look like the cap rates will move up with interest rates. They have to do so to keep the returns up for investors. Also, I would not be surprised to see the general level of cap rates go up in response to concerns about overbuildingmaybe a lot.

2. Is there more or less 1031-exchange money in the market now than in the past? There seems to be a lot. Do you see this changing?

Goldman:

There is an enormous amount of 1031 money chasing self-storage investments. Many apartment investors are trading into the storage business because of the relative ease of management. However, these 1031 buyers may start to dwindle and quit chasing replacement properties as the prices go beyond reasonable levels.

Libman:

There is more 1031 money in the marketplace than one or two years ago. The real estate market is active across all sectors, and more 1031 money is flowing from all types of investments. If interest rates rise and the real estate market cools, we could certainly see a decrease in 1031 exchanges. However, we find that money is shifting from residential and traditional commercial investments to self-storage. One owner in the Northwest is in the process of liquidating a portfolio of apartment buildings and looking to acquire or develop several storage facilities.

Off:

Ive been selling real estate in the Midwest for more than 25 years, and during that time, Ive heard of and gotten more inquires about 1031 exchanges than I care to think about. I have seen few of them end well for the buyer in the long term. Today, the street talk about exchanges is escalating to a shrill with the arrival of TICs (tenants in common). Time will tell, but with todays low capital-gains tax rates, I would pay the tax and move on.

Im inclined to agree with Off. When you run the numbers, the amount you save with a 1031 exchange is not much in comparison to being sure you get the real estate you want, when you want it. Getting someone elses hand-me-down property might not look like such a good deal. Take your timethis is a tricky market.

3. Is overbuilding becoming a significant factor in your market?

Bahrmasel:

Each local market, submarket and trade area is different. Many secondary and rural markets have not attracted competition from large regional and national firms. The addition of one facility to a small community could affect the entire marketplace.

Goldman:

In much of Kansas and Missouri, development slowed in 2003, and absorption increased in 2004. In many submarkets, as 2005 projects begin their lease-up, the consequences of overbuilding should show themselves in 2006.

Off:

The question should be: Where is overbuilding not occurring? If I knew the answer, I would be on the next plane. I think the only folks who think overbuilding isnt a problem are the self-storage manufacturers and contractors.

If the new numbers for the major Metropolitan Statistical Areas are anywhere near correct, overbuilding is a problem almost everywhere. Survey your market to see what is being planned and built. If general occupancy levels are below 85 percent, there may well be a serious problem.

4. Are buyers concerned about vacancies of more than 10 percent? How is this concern addressed in the sales process?

Bahrmasel:

Buyers are not overly concerned about a 10 percent vacancy in our market. In fact, most buyers look at an 85 percent economic occupancy as being a stable figure.

Goldman:

It depends greatly on the perception of the overall growth of the area and the confidence in the incoming management team. In many markets, 80 percent to 85 percent is considered to be stabilized in the near term.

Off:

The 10 percent vacancy threshold has been largely passed in my market. Owners todaythough not happy about itaredealing with vacancies in the 15 percent to 20 percent range. To make up for these lost dollars, smart operators are seeking to enhance revenues by adding new profit centers such as retail sales, equipment rentals, self-service car washes, wine storage, records storage, etc.

5. What is the status of financing for experienced buyers? Are industry newcomers having a hard time getting money?

Goldman:

I have not seen any lack of enthusiasm on behalf of lenders for most selfstorage investments. Keep in mind that while storage has suffered from overbuilding and declining fundamentals, many other property types have fared far worse. And lenders still need to lend, even if they have to reduce their spreads.

Libman:

Experienced buyers are obtaining financing without any trouble. Newcomers are also able to get financedmore often through small local banks familiar with the projects and geographic area.

Off:

Financing for larger loans made to larger owners is very competitive. Its clear the financial institutions have money to give. In addition, self-storage loans are particularly attractive to these lenders because, historically, the default rate has been one of the lowest of all real estate types. However, smaller loans continue to be a bit tougher to get, and the terms depend, to a large degree, on the quality of the property, the track record of the borrower, and the facilitys balance sheet.

There is still a lot of money chasing every deal. How long this condition will last is anyones guess, but Im guessing that sooner than later, the party with cheap money and generous loan-to-value ratios will begin to disappear.

Michael L. McCune has been actively involved in commercial real estate throughout the United States for more than 20 years. Since 1984, he has been owner and president of Argus Real Estate Inc., a real estate consulting, brokerage and development company based in Denver. In 1994, he created the Argus Self Storage Real Estate Network, now the nations largest network of independent commercial real estate brokers dedicated to buying and selling self-storage facilities. For more information, call 800.55.STORE or visit www.selfstorage.com.

In Arizona, weve tumbled over the precipice of mild weather and landed with both feet in the land of blisteringly hot. But just a couple of months ago, we languished in that lovely time of year when the evenings are cool for comfortable sleep, mornings are ripe with warmth, and afternoons are resplendent with sunshine. April marks that rare point on the cycle when we actually might consider keeping doors and windows openif it werent for other concerns.

In the desert, air conditioning is non-negotiable for six months of the year. But as I was growing up in Connecticut, it was reserved for only the steamiest times. Most nights of the spring and summer, our windows were propped open, allowing the scent of lilac to waft into our dreams. I knew when friends were coming to call because I could hear their approach through the screen door. My dad left the hatchway open while he worked on the lawn after work, and the garage was always gaping to allow for the comings and goings of bicycles.

Back then, people didnt worry so much about intrusion. There was still trust in the world. Now, most everyone I know uses a home-alarm system. We lock our cars when we go out. Heck, we lock everything: computers, filing cabinets, closets, the shed in the back yard And we dont leave windows open when we sleep. We are more aware of potential danger and have more security technology available to us than ever before, yet we make ourselves prisoners in our own homes and feel compelled to look over our shoulders in every deserted or dark parking lot.

Im sure not all of you feel this way. There may yet be little corners of this country where safety prevails, and those of you in them are fortunate indeed. So lets look at the brighter side of things: There are circumstances in which the need for security creates greater freedom. Self-storage happens to represent one.

Its true the increased sophistication and competitive nature of our industry have necessitated greater security trappings. Sites lacking the basicsperimeter fencing, access gates, unit alarms and surveillance camerasare not only at risk of crime and other physical peril, they suffer a marketing disadvantage where customers are concerned. So modern-day facilities bone up on the options, including new, high-tech tools.

Among the latest offerings are smart security devices and streamlined integration betwixt software and hardware. The Internet, in particular, has played a key role in heightened site security, as it allows operators to view and monitor facilities remotely from anywhere in the world. Toss in an automated kiosk, electronic door locks and the right connection speed, and you have the possibility for unmanned sites that operate as efficientlyand safelyas any with full-time staff.

This months issue will enlighten you on the basics of a sound security system, the demands of government vigilance, the evolution of defense products and the future of site technology. You can rest easy knowing the plethora of options available and how easily and inexpensively they can be implemented. When it comes to self-storage security, could the window of opportunity open any wider?

Heres to safe sleeping for all,

Teri L. Lanza
Editorial Director
[email protected]

• The property-management software you use directly impacts your security system. Rather than trying to operate your facility with two separate systems, consider an integrated product that is stable and easy to use. Automated features will allow you to accomplish more daily, weekly and monthly functions.
• A number of vendors provide security systems specifically for this unique market. Todays equipment options include keypads, card readers, individual door alarms, CCTV, site graphics, drivers license/ID scanners, perimeter beams, etc.
• When searching for the best system, determine which one meets the majority of your needs. Not all systems do the same things. Sometimes you must choose which options are the most important.
• The physical configuration of your site will impact your security decision. For example, consider whether your facility is single-story or multistory, has inside or outside units, etc.
• Take a look at your competition before making a decision about security. If another facility is equipped with door alarms and yours isnt, can you offer tenants the same protection? If competitors offer 24-hour access, you may be tempted as well. But will this compromise your site security?
• Use security to bolster your a marketing plan. While cost-effective, the flash and sizzle of your system will also help you sell your site to tenants.
• Dont wait until too late in the development process to choose your security system. Hesitation may result in not having access to the resources you want or need.

Its critical to take your time when investigating the numerous security products on the market. How do you choose whats right for your facility? To be an informed buyer, conduct thorough research and make your own product comparisons. An overview of self-storage security systemsaccess control, individual door alarms, and ancillary deviceswill help focus your search. Lets take a look.

Access Control

Access-control systems allow you to award selective access to your facility. The most common method uses an entry and exit keypad in conjunction with a motorized gate. Your customer keys in his unique passcode at the entry keypad and, if certain conditions are met, the system signals the gate to open, recording the date and time he entered. Exiting the site is handled in the same manner. With pinhole cameras mounted in the keypads, not only can you visibly identify the renter, you can cross-reference the image with the gate-activity log.

Access systems can also control door entry with an electric lock, i.e., to an interior corridor. The more sophisticated systems support gates and doors, and permit access only to particular areas where a tenant is renting. The vast majority of self-storage facilities use keypads, but card readers are also available with many access-control systems. Some use proprietary cards that must be obtained from the supplier, while others use customers debit/credit cards.

Remember that access-control systems only signal the gate to open. Its the gate motor (often referred to as the gate operator) that controls how long the gate remains open and when it closes. An open-gate status is most often accomplished with the use of safety loops connected to a loop detector inside the gate operator. Loops are wires embedded in the ground in front of and behind the gate. The loops and detector sense when a vehicle is in the way of the gate, holding it open until the vehicle has cleared. They act as a safety as well as a signal to the gate to close. There are several layers of security you can add to the safety loop, such as photo electric beams and the Miller safety edge. I suggest using at least two of these devices.

Gates can also be operated via an electric door strike. With this method, an entry gate is always locked unless a customer uses a card or PIN, triggering several seconds of downtime for him to physically open the door. (Remember exit gates must always be unrestricted.)

Gates

Gates are available in a huge variety. Sliding and vertical-pivot gates are the most common in the self-storage business. Sliding gates are equipped with rollers, which follow a track on the ground to keep the gate on course or come in a cantilever style. Cantilever gates are built to support themselves, i.e., they have rails and rollers that support the gate, allowing it to open and close without touching the ground. Vertical-pivot gates also support themselves. The gate and operator are purchased as a package. The gate opens by pivoting 90 degrees and is counter-balanced so it can be easily raised manually if necessary.

The optimum size for a gate in our business is 16 feet wide by 6 feet high. This will allow any vehicle that can legally travel the roads to access your facility with room to spare. The reality is your local fire department is probably going to dictate the width of the opening. Dont give up the fight too easily, as very large gates and openings can complicate your operation and add unnecessary cost to your project.

Entry/Exit

Designing your entry/exit is something that should be done early in your project. Too often, I see plans reflecting gates that dont fit, lacking provisions for keypads or card readers, lacking specifications for conduit, and giving little consideration to the flow of traffic. As an industry, we seem so preoccupied with coverage and unit mix we dont consider how our customers are going to get in and out of our facilities.

In a standard self-storage scenario, the gate opening would be 16 feet with a shared entry/ exit (one gate). The traffic flow would be reversed so customers enter and exit on the left side of the driveway. Keypads or card readers would be placed on the left side, 12 feet from the gateone for entry on the outside of the property and one for exit on the inside.

Access to either keypad should be possible from the window of the customers vehicle. Provide ample space so the customer can easily straighten the path of his vehicle to line up with the keypad and proceed through the gate. The gate, which ought to be visible from the office, should be back from the main thoroughfare to allow room for three or four vehicles. Also, allot sufficient parking outside the gate for prospective tenants, delivery vehicles, etc. There are, of course, many acceptable variations, but you need to comply with your local fire codes.

Your access-control system vendor should provide you with scaled drawings to assist in your design: placement of entry/exit, placement of keypads/card readers, size and placement of required concrete pads, and placement of conduit. Todays systems are rich with features to meet the unique requirements of self-storage. Individual pass-codes, multiple pass-codes per unit, multiple time zones, holiday programming, multiple access levels and automatic lockout with nonpayment of rent are just a few standard abilities you will need. Evaluating the practical use of features in how you want to run your business will help you decide.

Individual Door Alarms

By design, door-alarm systems, which come in hard-wired and wireless varieties, have inherent access-control ability. The most common configurations use the entry function to open the gate and disable the alarm on a tenants unit door. An entry message as well as the date and time the unit door is opened is recorded, for example, Unit 101, Robb Dalton, OPEN, 9:12am 4-07-2005. Thus, you not only have a record of when the tenant entered the site, you have a record of when he entered his unit.

When the unit door is closed, the system records a close message: Unit 101, Robb Dalton, CLOSE, 9:26 am, 4-7-2005. When the tenant keys out at the exit keypad, the system opens the gate, records an exit message, and re-arms the unit. At this point, you have a permanent record of the tenants entry, open door, close door and exit from the facility, a much more complete record of the tenants onsite activity than the enter and exit message provided by an access-control system.

Considering that most facility break-ins (60 percent or more) are perpetrated by actual tenants, electronic monitoring of unit doors makes a lot of sense. The classic break-in scenario goes like this: An individual rents a unit, probably paying in cash. He spends a fair amount of time on site, observing move-ins and other activity where unit doors are open (so he can see whats inside). As each good tenant leaves and the opportunity presents itself, the culprit cuts his lock, sorts through the unit, places valuable items at the front, closes the door, and secures the unit with his own lock. When he has 10 or more units secured, in comes the truck and out go the goods. The unit doors are left locked, and no one is the wiser until the real tenant returns and his key doesnt fit.

Individual door alarms prevent the above from occurring. I occasionally hear arguments that burglars will just cut through unit walls to sidestep the door alarm. While this may happen, its rare, as it involves at lot more work and risk for the criminal. Not only that, but criminals tend to avoid facilities that actively market their alarm system using the appropriate signage, advertising and onsite demonstrations.

Wiring and Switches

When it comes to self-storage security, there are several wiring schemes in use, with multiplexed being the most prominent. In this situation, one or more multiplexers are placed on each building and used as a central connection point for the wiring from each unit. Multiplexers are connected to each other using communications cable, which can be routed in a variety of ways and placed to minimize lengths and conduit requirements.

Generally, a reed switch (also known as a floor switch) is placed inside the unit, and its associated magnet is placed on the unit door. They are positioned so they align and are within the operating gap of the switch (normally 2 to 3 inches) when the door is closed. The newest industry standard uses a door contact that detects the movement of the latch on the door as it passes through the switch. This method saves installation time and eliminates false alarms.

Hard-wired door-alarm systems operate in a normally closed condition. This means each circuit has continuity when the door is closed. An easy way to understand this is to consider a light and light switch. When the light switch is on, the circuit is complete and closed. When the switch is turned off, the circuit is broken or open. These systems protect against wires being cut or components being disconnected, since either will create an open condition, generating an alarm.

Retrofit and Wireless

Hard-wired systems are normally installed during construction, so all the components can be placed inside each unit before occupancy. However, a hard-wired retrofit system or wireless door-alarm system is also an option.

A retrofit system uses a higher security, anti-defeat door-switch set mounted on the exterior of the door and door frame. The switch has an armored lead that protects its wires, which are routed to a special surface-mounted molding that runs above the door. This molding can closely match or even contrast your existing building colors. The advantage is you have the reliability of the hard-wired system with an unparalleled level of access for service purposes. The biggest disadvantage to this system is it can take more time for installation.

In recent years, wireless door-alarm technology has advanced. Wireless systems come in two varieties: a complete radio network from the transmitter on the individual door and office; and a hybrid. By hybrid I mean a wireless connection from the door to a series of receivers on the facility, which are hard-wired back to the office. The wiring to the office works on a dedicated line or via a modulation on the buildings AC-power system, where information is interpreted by a device and fed back into the main system.

The primary advantages of a wireless system are obvious. First, you have a much easier installation once the systems backbone is installed. Second, it allows you to offer individual door security to the tenants as an add-on feature at a premium. On the other hand, when transmitting a wireless signal from point A to point B, there is always a chance the signal will be reflected, absorbed or otherwise corrupted. Because each of the door transmitters in a wireless system is battery-powered, you also have a perpetual maintenance obligation.

Door-alarm systems are reliable and can be a productive security and marketing tool. They are, however, dependent on the quality of the material used and proper installation. As with any system, preventive maintenance will ensure proper operation. Your vendor should provide you with a specific installation overlay on your site plan indicating conduit requirements, multiplexer locations and how each door switch is to be wired.

When deciding between a hard-wired or wireless system, the best approach is to request proposals for both. Only you can decide which will be most affordable and effective for your particular operation. Fortunately, door-alarm systems come in many variations that can be tailored to your facility.

Multiple Units

One highly useful alarm feature is multiple units, which allows you to link all units rented by the same customer. This means your tenant has only one code for entry and exit, no matter how many units he rents from you. The feature eliminates the problem of false alarms, which frequently occur when a tenant disarms one unit, and then decides he wants to access another without going back to the entrance to enter the additional pass code.

The multiple-unit feature has another advantage: Many system changes can be made through programming rather than physical alterations. For example, if you take two 5-by-10s and combine them to make a 10-by-10, the resulting unit will have two doors. Without the multiple-unit feature, youll have to wire both doors together or lock the second door so the customer cant use it. With the multiple-unit feature, its a simple programming change to designate the second door as a secondary and give the customer full use.

Ancillary Systems and Devices

There are numerous security devices and systems available today. The most commonly used in our industry are perimeter beams, intercoms, closed-circuit television (CCTV) and site-graphic displays.

Perimeter Beams

With perimeter beams (also knows as PIR beams), an alarm sounds if the line of sight projection of an infrared beam is interrupted (something gets in the way). These are commonly used along fence lines surrounding a facility but can be installed at other points.

PIR beams were originally introduced as a single-beam system. They were only moderately dependable, as almost anything (weeds, birds, dust, etc.) could interrupt the beam and cause an alarm. Dual beams followed and reliability increased, since both beams had to be interrupted at essentially the same time to cause an alarm condition. Quad beams (four) are now the most common and much more dependable.

PIR systems are priced on a distance sensitive basis, i.e., the longer the beam, the more the system costs. Many offer control and annunciating equipment that allow them to operate as an independent entity. Beam systems used in self-storage are more commonly connected to the site access-control system and operate under its control. They should be treated as ancillary security and used only when a specific need is identified. They have limited value as a general security system.

Intercoms

Intercoms are an easy and reliable way to provide voice access between the rental office and key points throughout a facility. Systems include a master station and one or more substationsin many variationsand are priced accordingly. The larger their capacity, the higher cost. Substations are relatively inexpensive, generally come with a plastic or metal face, and should always include a call button.

All primary self-storage security systems need intercoms. The substations are integrated into the primary systems keypad faceplates. In the past, intercoms were used as a matter of convenience. Today, theyre viewed as a safety requirement and are being installed throughout the site, particularly in inside corridors, multistory buildings, etc. The decision is not whether to install an intercom system, but how large a master station to buy.

Closed-Circuit Television (CCTV)

CCTV is available in black and white or color and, in its most simple form, consists of one camera displaying an image on one monitor. But few CCTV systems are limited to one camera, and since it doesnt make sense to add a monitor for every camera you use, the manufacturers have developed equipment to handle multiple placements.

Early systems used a switcher that would allow the office to select which camera image to display or switch from camera to camera at specified intervals. Switchers were commonly built to accommodate four or eight cameras. Next came the quad system, which split the monitor screen into four equal parts so the images from four cameras could be displayed at once. These systems could also display a full screen for a designated camera to enlarge an image.

Todays systems allow cameras to be multiplexed and recorded digitally through a DVR (digital video recorder). They also allow the monitor to view eight, nine or 16 different images at the same time. Single, enlarged images can still be viewed easily. DVRs have the ability to record video directly to a hard drive, and most can use the Internet to view live or recorded video.

There are a number of reasons to use CCTV. They range from wanting to see gate activity and having video of all entries and exits to having a comprehensive record of site activity, including what was stored and by whom. You can spend as much as you want on CCTV systems, but remember they have marketing value when monitors are prominently displayed in the rental office. You should also consider that these systems require some human intervention to be effective; therefore, their value is often after the fact of a crime, as opposed to electronic systems like door alarms.

Site-Graphic Displays

Site graphics provide a full-color view of your facility indicating units, buildings, corridors, grounds, etc. A units color changes as its status changes; for example, there are different colors to indicate a unit is rented or vacant, the tenant is on site, the tenant is in the unit, there is an alarm condition, etc. Site graphics often include activity messagesproduced by the primary security systemacross the display.

Some graphic displays only address the activities of the security system, while others also provide management information, such as the payment status of each unit. Some vendors give you the ability to customize your display according to your unit mix and other preferences. Display monitors are often placed in a cabinet with CCTVmonitors or on a flat screen monitor mounted on the wall. This creates a hightech control center in the office that makes a great impression on customers.

Management-Software Interface

These days self-storage management software has the ability to communicate with the access-control and door-alarm systems. This is important since it reduces work in the rental office and ensures the management and security systems are in sync.

The primary protocol for merging these systems is called interfacing, meaning the management software is downloading information to the security system, which acknowledges receipt in some way. Information commonly sent to the security system includes move-ins, move-outs, passcode changes, delinquent units, etc. New developments will allow for the assignment of time zones, access levels and multi-pleunit designation.

Security and software systems can be purchased and operated independently, but they can also be integrated if obtained from the same vendor. Integrated systems completely avoid the interface question since they are essentially a single program, written in the same code and sharing the same database.

In the End

A security system is a necessity for every self-storage operation, but you have countless options when it comes to customizing your access-control, door-alarm and ancillary systems. The proper equipment and well-executed installation will not only make your facility safe for employees and tenants, but more competitive in the marketplace.

Joell Reddick-Dalton is vice president of Lakewood, Colo.-based Sentinel Systems Corp., which has manufactured self-storage software and security systems since 1975. Mrs. Reddick-Dalton would like to thank John Suder, director of sales, and Joe Burt, international sales manager, for their collaborative efforts on this article. For more information, call 800.456.9955; e-mail [email protected]; visit www.sentinelsystems.com.

Does evolving technology drive business trends, or do business trends drive the need for technology? Its sometimes hard to tell if the dog is wagging the tail or vice versa.

For example, an engineer thinks how great it would be to view surveillance cameras via the web. A business owner thinks how great it would be if his cameras would alert him any time they sense motion on his property after hours. Ultimately, business needs and new technology meet in the open marketplaceone trend filling the demand of another. So what self-storage needs are driving the birth of industry technology, and what technology is inspiring changes in self-storage?

Whats on the Horizon?

Talking with fellow industry professionals at a recent tradeshow, I asked, What does the future hold for self-storage technology? The consensus was its hard to predict. In 1993, who would have foreseen the power of the Internet? Now I cant figure out how we ever did business without it, one owner said.

We wonder how we ever got along without computers, fax machines and cell phones. What will be next on the must-have list? Four technology trends seem to be evolving:

• Better, more flexible security solutions:

Security has become a very high priority for self-storage, and the security industry has responded with a vast array of solutions to meet owner and tenant needs.

Better tools:

Business-management applications are adopting more powerful database engines and web interfaces for easy worldwide access and simpler manipulation of information for business reporting.

Wireless technology:

Including a lot more than just cell phones, wireless technology is becoming increasingly affordable and available.

The Ethernet

: This is now the backbone for almost any networkable technologynot just PCs, but surveillance cameras, intercoms, access controllers and more.

Technology products are maturing and becoming easier to use, with better features for business owners and customers. Together, they comprise an infrastructure that allows storage facilities to create new business models, particularly when it comes to site security. Some of the advantages created are: an easier way for smaller facilities to compete with storage chains; personalized services for tenants; staffing flexibility for storage owners; the possibility of unmanned sites; an increased marketing edge; and rejuvenation for older facilities.

Making Small Businesses Competitive

Self-storage is one of the most entrepreneurial industries in America. For every Extra Space or Public Storage facility that springs up on Main Street, there are a handful of sites started by a single investor or small investment group. Self-storage is one of the few industries in which a small business owner can actually compete with a big corporation, because the size of a company provides little advantage in the acquisition of land and building materials, management, marketing know-how, and the implementation of technology.

Unlike other industries in which an investment in security and management technology can be costly, making it difficult for smaller companies to compete, self-storage enjoys options that are affordable and easy to employ. These days, even small facilities arm themselves with gates, access control, door alarms, surveillance cameras, intercoms and management software, creating quality security and automation that equals or surpasses that of the corporate competition.

Some would argue small businesses have more flexibility to add security solutions as they evolve, especially as they dont need to accommodate several to hundreds of sites. An incremental investment can sometimes provide better security and customer service, which helps the small business get and keep customers.

Providing Personalized Service

Security technology has progressed dramatically over the past decade. First came keypads that managed access gates, then door alarms. Next, we got video cameras with VCRs for recording data, and so on. Each development has helped tenants understand that storage owners are serious about providing secure sites to store goods. The newest advancements will take things a step further, personalizing the storage experience.

For example, electronic door locks are entering the market, targeted toward customers wanting to store high-value items or commercial customers with business files and inventory that require a higher degree of protection. These have long been a staple in the commercial market, and now theyre finding increased usefulness in self-storage.

In addition, online customer service is here and getting more sophisticated every day. Web-based options have created a slew of advantages on the management side of operations. Similarly, they will provide better security and access control. For example, integrating web software with surveillance cameras allow facility owners to keep an eye on their facilities from anywhere in the world through an Internet connection. It can also allow tenants to view their particular units, also via the web. In short order, all alarm events will be sent directly to the owner with a picture or short video of the alarm source, which will enable him to assess the security breach.

Creating Staffing Flexibility

There is a growing trend in the industry toward the use of part-time management teams. While plenty of companies still use resident managers, others keep staff on a 9-to-5 clock. How do these business-hour sites handle after-hour security? Can they safely offer 24-hour access? The latest security tools make anything possible.

Evolving technology for access control and CCTV allows owners to centralize all of a sites security functions on a single computer at a home or regional office or with a security-monitoring company. Information sits at the fingertips of those who need it, when they need it, no matter where they are. Moving forward, security alerts will be super specific, telling the responsible party which unit alarm was triggered and the camera that sensed motion. They may even include video of the event.

With all these great tools, owners can rest easy when giving managers leave at the end of the day, knowing they can view their site from a remote computer or be notified in an emergency. In the future, even tenants will be notified when something is amiss with their units, increasing the personalization of security services.

Venturing Into Unmanned Territory

A step beyond staffing flexibility is no staff at all. Some enterprising operators are venturing into the realm of completely automated self-storage operations that function with minimal to no human interventionnot withstanding tenants, of course!

Unattended sites are not new to this industry. Theyve been used in self-storage for years, though not at the current level of sophistication. For example, sites in extremely rural communities are sometimes left unmanned for sheer practicality. In these situations, the owner or manager generally lives a short distance away and can be summoned to the site when necessary.

But high-tech options are here, making unmanned storage a possibility even in urban markets. Tools like electronic door locks, self-serve kiosks, video conferencing, intercoms, cameras and the Internet all play a role. Try to imagine an office bedecked with kiosks, cameras and microphones. On-screen wizards help tenants rent units, pay rent, print rental agreements, even buy locks via the kiosks. Video conferencing and intercoms are available when tenants need help. A code-based web interface lets tenants access the views of surveillance cameras aimed at their unit doors.

Whether technological security tools are sufficient to make customers feel they and their goods are protected, only time will tell. But the features work well and efficiently; and as we have seen, where technology exists to support a notion, opportunities abound.

Making the Most of Marketing

Lets face it: Security sells. After customer service, security is the No. 1 reason customers choose to rent from you. Its one of the best investments you can make. As security hardware and software evolve, it will only become more valuable to your operation. When you can offer 24-hour service and access to your facility, its an advantage. When customers view your security logs, surveillance monitors, unit alarms and site-graphics displays, its a distinct benefit to your business. All these features combined create a powerful marketing message.

Think in particular of those customers who store high-dollar items, such as RVs, boats, antique cars, business records, art, etc. For them, peace of mind is not just a gate and a door alarm, but a surveillance camera, motion detector, perimeter beam, alert system and other hightech items. Offer these, and you can sell your site to tenants with ease.

Rejuvenating Older Facilities

Now that the storage industry has survived several decades, there are a few generations of facilities. First-generation sites were built with little or no security, as the available options of the day were minimal. But that doesnt mean they cant compete in todays competitive market. A well-planned retrofit can bring a sites security up to snuff. Doesnt that involve a lot of work, you ask? Not with wireless security tools.

Wireless door alarms have made it possible to renovate a facilitys security offerings with little hassle. The cost is even reasonable, and will continue to become more affordable as the technology improves. Not only do wireless options allow owners to upgrade older sites, they create a revenue opportunity: Individual unit alarms can be added to an entire facility, serving as justification for a full-scale rent increase; or they can be sold to tenants as an ancillary option for which they pay a premium.

Even wireless keypads and intercoms are on the horizon. The only security component for which wireless options have not been realized is the video camera, due to the large amount of data it transmits. While quality wireless cameras at affordable prices may not be around the corner, rest assured some engineer will let trends drive the cause.

So, do self-storage trends give rise to new technology, or does technology mold the industry? Perhaps its a little of both. In either case, high-tech tools are coming available, and the business need for competitive advantages is sharp. What newfangled developments lie around the bend? We cant be certain; but let me know if you get the inside track!

Tom Lewellen is the sales and marketing manager for Scottsdale, Ariz.-based PTI Integrated Systems Inc., which offers a complete, integrated, management-software and access-control system for self-storage worldwide. For more information, call 800.331.6224; visit www.ptiaccess.com.

Margaret Lee understands the quest for comprehensive security and property-management solutions. She manages Storage by George in Napa, Calif., a sprawling 650-unit storage center nestled in gorgeous wine country. To meet customer needs, the facility offers climate-controlled wine storage in addition to standard storage units. The entire site uses state-of-the-art security equipment, such as 24-hour video surveillance, alarms and motion detectorsstaples that give operators and tenants peace of mind.

Where Storage by George goes beyond the norm is in its visitor tracking and integrated, coded keypad system. The facility takes advantage of access-control hardware and software that work seamlessly with property-management tools. The combination simplifies operations and creates tremendous security benefits.

The management program allows the site to operate on a day-today basis, explains Trent Sosnowski, a customer-support technician for Lakewood, Colo.-based Sentinel Systems Corp. It handles tenant move-ins and move-outs, billing, the sending of late letters, lien completion, payments and merchandise sales. It also tracks tenants activities at the site. On top of all this functionality are integrated hardware solutions for access control: keypads, door alarms, video cameras, and drivers license scanners for tenant identification and records. The result is a multifaceted, comprehensive system that covers all the basics of running a storage operation.

Know Whats Up

One of the things we wanted was to always know whats going on at the site, using CCTV cameras with digital video recorders and software that tracks all activities, says Lee. This desire is echoed throughout the industry, especially as trends for lightly staffed and even unmanned facilities develop.

Of the features Storage by George enjoys, visitor tracking and report generation have been among the most useful. Our cameras are hooked up to the alarm system as well as the gate, so every time a door is open, a report is generated, Lee explains. We can assign a different password to each person who has access to a particular unit, so we can tell companies exactly who entered their space and when. For Lee, this feature proved to be an effective selling point to prospective renters.

Know Whos Who

Stricter protocol for collecting tenant identification and maintaining customer records has become the norm for storage operations throughout the country. Lee takes advantage of drivers license scanning and database tools now on the market. After the Oklahoma City Bombing of 1995 and the events of 9/11, were all more aware of how important it is to get correct, detailed information from each and every tenant, she says. One of the major concerns in self-storage is the possibility of illegal activities being associated with a tenants unit.

While its common to require proof of a tenants identification during the rental process, advanced hardware that integrates with management software makes it easy to collect data. An ID scanner scans, verifies and catalogs information. A good one will recognize drivers licenses from all 50 states, as well as passports, military IDs and select international ID cards. By using a scanner, you get accurate and complete information in a snap, including a digital image of the card itself. Some scanners will even cross-reference a cards data with captured license-plate and Social Security numbers to create all-inclusive tenant files.

With so many new technologies available to self-storage owners, solutions are quickly becoming integrated and standardized. They provide more cost-efficient, comprehensive ways to manage facilities while providing the best security and customer service. State-of-the-art equipment is also an effective marketing tool. With the marriage of management and security hardware and software comes complete control and a competitive advantage.

The author would like to extend a special thank-you to Lakewood, Colo.-based Sentinel Systems Corp. for its assistance in writing this article. Sentinel has manufactured self-storage software and security systems since 1975. For more information, call 800.456.9955; e-mail [email protected]; visit www.sentinelsystems.com.

Julia P. Shih is the marketing manager for Card-Scanning Solutions, a developer of card-reading systems. Based on OCR (optical character recognition) technology, its systems are designed to quickly and accurately read the information from drivers licenses, passports and other ID cards. The companys software provides extensive database capabilities for automatically processing, storing and manipulating acquired data. For more information, call 310.691.8920; e-mail [email protected]; visit www.card-scan.com.