Update 5/31/17 – Absolute Storage Management (ASM), a self-storage owner and property-management firm, announced operating results for the first quarter of 2017. The company increased same-store revenue by 6.9 percent and same-store rent per occupied unit by 6.3 percent compared to the same period last year. Occupancy at its 59 same-store pool was 85.9 percent as of March 31, according to a press release.

ASM gained four management contracts during the quarter. The facilities are Capital Boulevard Storage in Raleigh, N.C.; Killian Hill Storage in Lilburn, Ga.; Magnolia Self Storage in Sanford, Fla.; and Walton Security Storage in Monroe, Ga. The company also maintained management of Main Street Climate Storage in Chattanooga, Tenn., and Commerce Storage in Commerce, Ga., during property-ownership transfers, the release stated.

Founded in 2002, ASM operates 92 properties in 13 states. Headquartered in Memphis, Tenn., it has regional offices in Atlanta; Charlotte, N.C.; Jackson, Miss.; and Nashville, Tenn.

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5/11/17 – Sentry Self Storage Management, an industry management and consulting firm, has released its first-quarter 2017 operating results showing year-over-year improvement in revenue, net operating income (NOI) and occupancy. The company reported revenue growth of 7.1 percent and a 1.3 percent increase in property expenses, which resulted in a 9.1 percent increase in NOI compared to the same period in 2016.

Occupancy at Sentry operated self-storage properties was 90.2 percent, an increase of 40 basis points compared to the same quarter of 2016.

The company added one new management contract during the quarter for a self-storage property in Tampa, Fla. It also has development activity in Deerfield Beach and Hollywood, Fla.

Based in Coral Springs, Fla., and founded in 1997, Sentry owns or manages 26 properties comprising more than 2.2 million net rentable square feet. Its services include consulting, development, feasibility studies, acquisitions, renovations and facility management.

Update 5/31/17 – 10 Federal has started to raise the $10 million fund it will use to acquire traditional self-storage facilities and convert them to fully automated properties. The company has converted three of its own assets and recently used the fund to purchase South Point Storage Inc. at 1308 S. Point Road in Belmont, N.C., according to a press release.

10 Federal will implement its automated system at the Belmont property including controlled access, electronic locks, a kiosk and a roving camera. "South Point represented an ideal acquisition for the fund,” said Kris Bennett, director of acquisitions. “It was a mom-and-pop operated facility, with no website, no online advertising, a large property-manager salary and rents that trailed the market."

10 Federal has spent three years developing its automated system. The fund will target similar storage properties throughout the Southeast, with a concentration in North Carolina, the release stated.

"We are excited to have the fund underway,” said co-founder Cliff Minsley. “Our teams have worked hard to fine tune our systems and technologies, and to see it succeed in the field has been rewarding. We look forward to now scaling the platform."

The company yesterday hosted a webinar about the fund for accredited investors.

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12/6/16 – Encouraged by the successful implementation of automated technology in its self-storage portfolio, diversified real estate firm 10 Federal plans to launch an acquisition fund in 2017 with the intent to buy and convert traditional self-storage facilities in the Southeast to full automation. The company operates four North Carolina facilities through its 10 Federal Storage LLC division and recently automated a traditionally staffed property in Durham. The switch was spurred by the success of its unmanned, 155-unit facility in Graham, which recently completed lease-up in five months by averaging one rental per day, according to a press release.

The Durham facility initially operated with staff for a year, producing 35 rentals during its best month. Following its move to automation, the property rented 48 units during the first month, the release stated. The unmanned properties use a combination of various technologies including access control from PTI Security Systems, automated kiosks from Advanced Kiosks, electronic locks from Janus International Group LLC, management software from StorEDGE and other proprietary systems.

10 Federal has used automation in its other real estate interests, including multi-family properties, and built the 15,600-square-foot Graham facility to be automated from the beginning. “We feel it is where the industry is going,” co-founder Brad Minsley told a source earlier this year. “When the North Carolina DMV manages to start using kiosks and making their process unmanned, you pretty much know self-storage should be there, too.”

Based in Raleigh, N.C., 10 Federal acquires, develops and manages multi-family and self-storage properties in North Carolina. It has two storage facilities in Durham and one each in Graham and Hillsborough. Integrating technology into its operation is a core tenet of the business, according to the company website.

Nebraska Gov. Pete Ricketts signed Legislative Bill 492 (LB 492) on May 12, establishing the state’s first Self-Service Storage Facilities Act. The state previously operated without a comprehensive law to govern self-storage lien proceedings. The new measure enables storage operators to e-mail tenant-default notifications and conduct lien auctions online. They can also deny tenants access to their units if any part of rent is past due and can begin lien proceedings when a tenant is in default for more than 45 days. The act stipulates tenants must be notified at least 45 days before the date of a lien sale, and operators must advertise the sale “in any commercially reasonable manner” at least seven days prior to auction.

Similar to recent lien laws passed in other states, LB 492 deems the public lien-sale notice “commercially reasonable” as long as three independent bidders attend the auction in person or online. Lien sales can be public or private proceedings, and storage operators may buy a delinquent tenant’s property during the auction, according to the bill.

The law also allows self-storage operators to place limits on the value of belongings that may be stored. A value limit in a signed rental agreement would be considered the maximum value of the stored personal property should unit contents be sold to satisfy a lien.

LB 492 also enables operators to have vehicles towed if tenants are more than 60 days delinquent.

The measure passed the legislature on May 8. Its contents also update provisions related to the State Boat Act and Motor Vehicle Certificate of Title Act. It was supported by the Nebraska Self Storage Owners Association and national Self Storage Association (SSA).

Alaska is now the only state without a formal self-storage act, according to SSA officials. The association expects future legislative updates to be signed in Colorado, Florida, Hawaii and Texas, according to a May 29 e-mail newsletter to its members.

Update 05/30/17 – Kansas Gov. Sam Brownback signed the final version of SB 14 into law on May 15, giving self-storage operators in the state the ability to sell tenant insurance and collect premiums with rent. The final version includes a provision that allows the insurance commissioner to authorize the fingerprinting of license applicants for state and federal background checks. The language requiring operators to complete continuing-education courses on a biennial basis was removed in committee.

The house approved the bill 111-11 on May 2, while the senate passed it 37-3 on May 4.

"It was a terrific effort by our lobbyist Whitney Damron and the members of the [Kansas Self Storage Owners Association]," said Marcus Dunn, director of government relations for the SSA, in a May 29 e-mail newsletter to its members.

Kansas lawmakers are also considering a bill that would remove the sales-tax exemption from self-storage and several other services.

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3/23/17 – The Kansas House of Representatives yesterday passed an amended version of the senate bill that would allow self-storage operators to sell tenant insurance to customers. With a 99-24 vote, legislators approved adding a limited line of insurance in the state’s insurance code and requiring storage operators to obtain and maintain a “self-storage unit qualification” to sell coverage, according to the source.

The amended version also provides a path for self-storage businesses to sell other types of coverage, including bail-bond, crop, travel and variable-life insurance. New language would require operators to complete continuing-education courses on a biennial basis for each license held. Agents holding only the self-storage qualification would be required to complete two credits in courses “certified as self-service storage unit” under the property-and-casualty category, according to the bill.

Each agent would have to provide the insurance commissioner proof of course completion for each license held by his renewal date or face up to a 90-day suspension and $100 penalty for each license suspended.

Among the provisions removed from the bill was the $5,000 limitation in coverage on stored items.

Hawkins, a benefits consultant, was integral to the bill changes, the source reported. Rep. Tom Cox, who works for a company that operates self-storage facilities outside of Kansas and had advocated for the previous version of SB14, said earlier this week that the new language would likely “kill this bill.” “I would not consider this a friendly amendment,” he told the source. Cox indicated he voted in favor of the amended version anyway to advance the bill out of the house and allow discussion on the measure to continue in the senate.

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3/10/17 – The Kansas Association of Insurance Agents (KAIA) is fighting a bill under consideration that would allow self-storage operators in the state to sell tenant insurance to customers. Similar to measures adopted in other states, Senate Bill 14 (SB14) would grant facility operators a limited license to offer tenants up to $5,000 in coverage on stored items through an insurance carrier. Though self-storage employees acting as agents would be required to undergo training, they wouldn’t be fully licensed, according to the source.

“[Insurance agents] do not oppose storage facilities selling this insurance,” Will Larson, an attorney for KAIA, told the source. “What they do oppose is the people [who] will be selling it will not be licensed.”

Though any insurance training given to self-storage operators would have to be approved by the Kansas Insurance Department, KAIA believes this isn’t enough. “We oppose chopping up the insurance industry to limited segments and then employing non-licensed people to sell it,” Larson said.

SB14 easily passed through the senate in February with a 38-1 vote, but it’s currently under review by the house insurance committee. State representative Dan Hawkins agrees with KAIA’s position and told the source he plans to propose an amendment requiring self-storage operators to be fully licensed before selling tenant insurance.

He also believes the bill could cause other problems for insurance carriers. “I am worried the [storage] companies are not going to know how to handle claims and deal with these cases,” Hawkins said.

Whitney Damron, a lobbyist working on behalf of the national Self Storage Association, believes the objections are off base, pointing out that 25 states, including neighboring Missouri, have passed similar legislation. Safeguards in the bill include the coverage limitation and a requirement for operators to post a sign informing customers they may already be covered under an existing policy and encouraging them to contact their primary carrier, Damron told the source. “These policies make this law clearer and will protect customers,” he said.

Damron also argued the measure would benefit customers who don’t have homeowner’s insurance such as active members of the military who are deployed overseas.

A house vote will take place if SB14 is passed through committee.

Site grading began last week for a new self-storage facility in Anthem, a master-planned community in North Phoenix, nine years after storage was first proposed for the 7.5-acre parcel. Storage at Anthem LLC purchased the property on Gavilan Peak Parkway at King Drive a year ago to build Anthem Self Storage, according to the source.

The facility will comprise nine buildings, including a two-story structure, according Scott Patterson, supervisor for Johnson Carlier, the general contractor. It will include interior storage units as well as covered vehicle-parking spaces.

The project still needs final site-plan approval from the Maricopa County Planning and Zoning Commission, according to the source. It will also undergo a design review by the Anthem Community Council (ACC), said Kristi Northcutt, a council spokesperson.

Self-storage was first proposed for the site in 2008 when 7960 E. Thompson Peak Pkwy LLC requested a zoning change to build a facility containing 726 storage units and 53 outdoor parking spaces. The change was denied, but the county board granted a special-use permit to allow self-storage under the existing zoning, the source reported. The project failed to move forward and the site remained vacant until purchased by Scottsdale, Ariz.-based Storage at Anthem, the source reported.

A portion of the property formerly housed a temporary station for the Daisy Mountain Fire Department. It’s surrounded by Boulder Creek High School, Cross of Christ Church and a wastewater-treatment facility operated by EPCOR, a provider of electricity transmission and water distribution.

The seller was represented in the transaction by Americor Investment Group, a Scottsdale-based development and real estate firm. The county most recently valued the property at $1.4 million, the source reported.

Last month, ACC approved a request from U-Haul International Inc. to double the footprint of its facility in Anthem. The expansion will be built on an empty 4-acre parcel just north of the existing property.

Top Self Storage Three LLC is seeking approval to build a three-story self-storage facility in Pompano Beach, Fla. The city’s development-review committee will consider the application for the 7.24-acre site at 1501 Hammondville Road on June 7, according to the source.

Top Self Storage purchased the site just off Ronald Regan Turnpike last year for $1.6 million. If approved, the project will comprise 189,000 square feet of space. The multi-story structure will encompass 94,500 square feet, with the remainder contained in 11 smaller buildings, the source reported.

Top Self Storage is an affiliate of Fort Lauderdale, Fla.-based Albanese Group LLC, and managed by the firm’s owner, Arvid Albanese.

StorageMart, which operates more than 190 self-storage properties across Canada, the United Kingdom and the United States, has appointed Lise Nyrop as director of human resources (HR). A veteran of HR initiatives, Nyrop will support the company’s growth by building an HR program and department that will span all StorageMart sites, according to a press release.

"Internally, we've known that StorageMart is a great place to work for years. We look forward to the coming months as Lise helps us translate our great environment into meaningful employee-development programs that we can communicate with those looking to join our team," said Cris Burnam, president. "Lise's dedication to employee engagement made asking her to come aboard a no-brainer for us."

Nyrop’s work experience includes the public and private sector. She’s been employed at ABC Laboratories, Missouri Farm Bureau, Missouri State University and the University of Missouri. While in the education sector, she developed an academic/professional internship program for university students so they could gain real-life experience as well as school credit without sacrificing coursework.

"I'm looking forward to making StorageMart a destination employer, not only in the self-storage industry, but across the board," Nyrop said.

Founded in 1999 and based in Columbia, Mo., StorageMart is privately owned and operated by the Burnam family, which has been in the storage industry for three generations. It serves more than 75,000 self-storage customers, and operates in Chinese, English, Punjabi, Quebecois French and Spanish.

For seasoned self-storage veterans, walking around an industry tradeshow can be pretty eye-opening. Over the last few years, operators who were used to the brick-and-mortar simplicities of the business have witnessed a technological revolution. The list of advancements has lengthened as established vendors have created new tools and new entrepreneurs have entered the market with creative products, changing the way we do business.

As technology becomes a larger part of the self-storage world, not only must owners and managers adjust their operation to accommodate these changes, they must address related issues of legal compliance. Here’s how to stay within the confines of the law when using popular new tools.

E-Mail and Texting

E-mail and texting have facilitated the way we communicate with customers. Most significantly, they have reduced the delay inherent with snail-mail notification. Industry studies have confirmed these communication methods are considerably more efficient. Thus, delinquencies are down, and operators have a more effective way to contact tenants if there’s an emergency or other occurrence that may affect their goods in storage.

E-mail has become such a great way to contact tenants that many state laws have been amended to include it as an approved method of communication. More than 20 states now allow the use of e-mail as a notification method in the lien-sale process.

That said, because the use of e-mail as a “legal notice” was previously untested, many states also included a requirement that the facility operator receive verification of e-mail delivery to the tenant’s designated address. In turn, registered delivery services like those offered by RPost have become more commonplace. If an e-mail is proven to be undelivered to the tenant, the law requires a secondary notice be sent by mail to his physical address.

When it comes to texting, federal law requires the tenant give consent to receive texts, especially those that are automated. The easiest solution is to simply add a provision to the rental agreement permitting communication via text.

Electronic Contracts

Though remote and after-hours facility operation has been possible in the self-storage industry for a while thanks to various automation tools, we’re starting to see the integrated use of electronic contracts and signatures. Operators are increasingly adopting these technologies, allowing tenants to sign a lease and move into a facility via a kiosk or mobile device.

Products like DocuSign make this method of lease signing a breeze; and they’re completely legal. The Electronic Signature Act of 2000 codifies the legality of executing rental contracts by electronic or online signature. However, since the contract isn’t being signed in the presence of a store manager, the party executing the agreement must be given clear disclosures regarding the terms of the contract.

Online Advertising for Lien Sales

Although it’s been a slow transition from advertising lien sales in the newspaper to other methods of notice, the reality has hit home that people are more likely to search for self-storage auctions online than to review legal notices in the local paper. While only a handful of states have changed their laws to allow for this modification, more are open to the change, and the shift is expected to continue.

As many facility operators agree, the most successful auctions are those at which there are multiple bidders. Having numerous buyers enhances the potential that the final sale price will be enough to cure the tenant’s deficiency—perhaps even enough to warrant proceeds being sent back to the renter.

Some states permitting the use of online advertising for lien sales have added the legal requirement that the sale must be “commercially reasonable,” attended at least three independent bidders. In other words, the legislature measures the success of the ad by the number of people who participate in the auction.

Online Auctions

One of the most interesting evolutions in the self-storage industry has been the transition from live to virtual auctions. There are a growing number of websites where facility operators can post information and photos about delinquent units, expanding their universe of potential bidders from the few that might have attended a live auction to a much broader universe of online buyers.

Though about 10 states have modified their lien laws to specifically allow for online auction formats, there aren’t any that explicitly prohibit the use of an online format to accept bids. Even in states that require the sale be conducted on the premises, a buyer can place his bid online, and then visit the facility in person to complete the purchase. If you’re going to use an online platform, however, it’s essential to review and get comfortable with the site’s bid rules, as they govern the potential success of your lien sale.

With the outset of any operational changes, especially those derived from new technology, it’s inevitable that laws to support them will shortly follow. We’ve seen the legislature acknowledge the use of e-mail, electronic contracts, online advertising and online auctions in self-storage; but with legal approval comes the need for compliance. Facility operators must be cognizant of the statutory rules that apply when dealing with these technological advances.

Scott Zucker is a partner in the law firm Weissmann Zucker Euster Morochnik P.C. in Atlanta, which specializes in business litigation with an emphasis on real estate, landlord-tenant and construction law. Zucker is a frequent speaker at self-storage industry events, author of “Legal Topics in Self-storage: A Sourcebook for Owners and Managers,” and a partner in the Self-storage Legal Network, a subscription-based legal service for storage owners and managers. For more information, call 404.364.4626; e-mail [email protected]; visit www.wzlegal.com.

San Luis Obispo County, Calif., Animal Services officers found 42 ball pythons inside a self-storage unit on Wednesday at an unidentified facility in Arroyo Grande, Calif. Authorities responded to a report of an abandoned animal at the storage property on Grand Avenue when they discovered the snakes in stacked plastic containers inside the unit, according to sources.

In all, 22 snakes were dead and in “various stages of decomposition,” Eric Anderson, Animal Services manager, told a source. The 20 alive snakes were transported to the agency’s shelter in rural San Luis Obispo to be evaluated.

Ball pythons are popular pets that can be purchased from pet stores and reptile breeders. Named for their habit of curling into a tight ball, adult females can typically grow to 5 feet in length, while adult males tend to be smaller at 2 to 3 feet, according to “Reptiles Magazine.” When properly cared for, the non-venomous constrictors have a life expectancy of 30 years or more.

The incident remains under investigation, Anderson said. It isn’t clear what charges the self-storage tenant responsible for storing the snakes may be facing.