Update 5/27/19 – The Jenkins Organization has opened EaDo Storage in Houston. The property at 1025 Sampson St. comprises 110,000 square feet in 850 climate-controlled and traditional units.

“The property’s unique design compliments the area well, and its color scheme pays homage to the Astros and Dynamo, both of whom play in our backyard,” said Ricky Jenkins, president. “We are very excited to bring a class-A storage property to the EaDo community.”

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6/7/2018 – The Jenkins Organization Inc., a Houston-based developer and operator of 45 self-storage facilities in five states, plans to build a new facility in East Downtown Houston (EaDo). Expected to open this summer, the property will comprise 108,000 square feet of storage space in 830 units. Features will include climate control, gated entry, video cameras and a resident manager.

“We are excited to become part of the EaDo community. The ground-up development of a full block off York Street allows us to conveniently serve downtown, east downtown, Eastwood and the University of Houston,” said Robb DeJean, director of development. “Our management team is preparing to open, and eager to become the premier class-A destination for self-storage within the area.”

Jenkins has opened several new facilities in Texas this year and has seven new developments underway. It’s also expanding three existing sites and plans to purchase three more.

Formed in 1989, Jenkins currently has an ownership and management portfolio comprising more than 3.5 million square feet of storage space in Louisiana, Minnesota, Missouri, Oklahoma and Texas.

Elevation Capital Group, an Orlando, Fla.-based real estate investment company, has increased the maximum offering amount of its investment fund, MHPI VII LLC (Fund 7), to $150 million. Launched in April 2017, the fund has reached $100 million in subscriptions from more than 500 members. It’s focused on investments in manufactured-housing communities and self-storage facilities. To date, it controls 19 assets in seven states, according to a press release.

The fund is an affiliate of the Dahn Corp., which operates self-storage facilities under the Mini U Storage brand name. The fund’s principals are Brian Dahn, president of the Dahn Corp., and Jamie and Ryan Smith, according to its website.

"The growth of Fund 7 is a testament to the quality and discipline of our team,” Ryan Smith said in the release. “While we are making great progress towards the stated objectives, there is still work to be done. We are committed to building strong partnerships with our investors and assets alike as we continue to grow this fund to its goal of $150 million."

Many Fund 7 investors have made investments under previous Elevation funds and are attracted to the performance track record of the manufactured-housing and self-storage markets, according to a source. “They believe there’s a possibility the income can be more predictable than retail or office, [and] other types of real estate,” Brian Dahn said. “They like the tax benefits.”

The fund is primarily targeting larger properties valued at $10 million to $20 million. In self-storage, its managers look for undermanaged facilities with deferred maintenance issues to be improved upon. In the manufactured-homes sector, they prefer mobile-home parks with at least 150 lots, a source reported.

Fund 7 is Elevation’s seventh investment offering since 2013. Through its affiliates, the company has acquired properties worth more than $475 million and holds interests in more than 175 assets across more than 30 states, the release stated.

Based in Newport Beach, Calif., Dahn Corp. develops and manages self-storage real estate investments through its Dahn America360 LLC division. The company and its affiliates have acquired, developed or sponsored more than 6.5 million square feet of storage. It owns 44 facilities comprising more than 2.8 million net rentable square feet.

Sources:
SpareFoot Storage Beat, Elevation Capital Group Expands Fund to Buy More Self-Storage and Mobile Parks
PR Newswire, Elevation Capital Group Reaches $100 Million in 7th Real Estate Investment Fund
Fund 7, Website

Over the years, analysts have attempted to calculate the financial impact of violence in the workplace. Many of those statistics are based in the national aggregate, relying on reports from workers’ compensation and law enforcement as well as numbers compiled by the U.S. Bureau of Labor Statistics. Such a methodology arrives at a minimum cost of many tens of billions of dollars per year for American industries, including self-storage.

While such information is important, most business leaders are keener on the question, “If a violent incident occurs at my workplace, what is the possible financial impact on my organization?” The answers are contingent on many variables, such as the size of the business, the nature of the incident, the type of industry, etc. However, it’s possible to identify types of financial impact.

Hidden Costs Before the Fact

Before we examine potential financial effects of workplace violence, let’s address an issue no one writes about in the context of this discussion, though it really should be a part of the conversation. Worker-on-worker violence doesn’t happen in a vacuum or out of the blue. In nearly all cases, abusive supervisory styles, bullying and a sense of injustice have been part of the work culture. In turn, these elements are always associated with multiple hidden costs to the organization.

Actively disengaged workers are less productive, intentionally undermine morale, call in sick more often, can perpetrate acts of passive or active sabotage, and contribute to employee turnover. This is the point: By the time a violent incident occurs, your organization has already been paying the hidden costs of the circumstances that brought it about, often for years. It’s been said, “A good workplace is much cheaper to run than a bad one.” This is true.

The Costs of Workplace Violence

The differences between organizations and the violent incidents that occur make it difficult to estimate financial impact for every case. However, the categories below will be true across the board. Given the many variables, it isn’t practical to suggest specific figures, but you can easily apply the following impacts to your storage business.

• Critical incident debriefing for affected workers: Survivors of violent events at work, even those with no physical injuries, often struggle to regain a sense of normalcy. Facilitating such an experience for employees isn’t only a moral and ethical obligation, it’s in the best interests of all concerned. In most cases, it’ll require outside facilitators.
• Temporary closure of the facility: You can arrive at a ballpark figure for your organization by multiplying your estimated daily revenue by the number of days your facility will be closed. This could be anywhere from one day to perhaps three or four.
• Revenue lost to decline in productivity: Again, the magnitude of this impact is dictated by several things, including the nature of the violence, how many it affected and your organization’s daily revenue. This impact is persistent and slow to resolve.
• Cleanup and/or restoration of the site: Of course, this is contingent on the nature of the violence and may require a cleaning service.
• Rise in healthcare premiums triggered by a greater need of psychological services: Even workers who aren’t directly affected by the violent incident will often experience an increase in anxiety and other negative impacts.
• Increase in workers’ comp premiums: These premiums are calculated based on the size of the workforce, the nature of jobs and your organization’s claims history. Violent incidents with injuries will raise your claims-history index and result in an attending increase in premiums.
• Litigation costs: These costs have risen substantially in the last decade. Jury awards of several million dollars aren’t uncommon.
• Replacement costs for up to 10 percent turnover in the workforce: Studies have shown that employee turnover spikes after violent incidents. Human-resources professionals tell us that the cost of turnover can be between two-thirds to twice the annual salary of the person being replaced.

There are other wildcard effects not listed above, such as a possible impact on shareholder value, a public-relations effort to counter negative publicity, etc. When you consider all the ways a violent incident at your workplace can impact your storage business’ bottom line, prevention programs just make good sense.

Gary Sheely is an associate of the Safety Institute and a tactical-confrontation specialist focusing on workplace violence. He’s the author of four books including “Safe at Work: How Smart Supervisors Reduce the Risk of Workplace Violence.” He conducts training workshops for corporations and offers keynotes for organizations across the United States. To learn more, e-mail [email protected] or visit www.safetyinstitute.com.

Update 5/24/19 – BDG has opened its multi-story self-storage facility in Woodstock. A public grand-opening celebration was held on May 16.  The property will be managed by industry real estate investment trust CubeSmart and branded under its name.

The project had been rejected twice by city planning commissioners and the council, only to be approved on the third attempt. Mayor Donnie Henriques cast the deciding vote, a source reported.

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9/4/18 – BDG is adding another self-storage facility in Woodstock. The company is developing a four-story, 100,000-square-foot property at 185 Woodstock Parkway. The property is strategically located near historic Downtown Woodstock, which features an array of artisan shops, eclectic bars and restaurants, and mixed-use developments. There’s also several multi-family and townhome projects in the vicinity, according to a press release.

“The development will be visible from Interstate 575 and is aesthetically designed to complement the architecture of downtown,” Sheth said. “Boardwalk Development Group is excited to bring this institutional-quality self-storage asset to Woodstock.”

Woodstock is in Cherokee County, which is the third fastest growing county in the Atlanta area. It’s expected to add nearly 160,000 residents by 2040, raising the local population to 392,500, the release stated.

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4/24/18 – Boardwalk Storage Fund II has acquired two self-storage facilities in Metro Atlanta and rebranded them under its name. Both sites are near the Lake Lanier recreation area and provide vehicle storage in addition to traditional storage. The company plans to add self-serve kiosks, and customers will have access to online reservations and a call center, according to a press release.

“Technological advances in self-storage leasing and management have now removed a major barrier to consolidation of self-storage assets in secondary markets,” said CEO Rajen Sheth. “Thanks to the introduction of low-cost automated systems, many self-storage properties can now be completely unmanned.”

The 4-acre property on Grant Road in Dawsonville, Ga., also contains 7,150 square feet of retail and office space. The facility is near the North Georgia Premium Outlets shopping center. The second facility, in Cumming, Ga., sits on 5 acres and contains 25,000 square feet of traditional storage and 12,000 square feet of enclosed vehicle storage.

Boardwalk Storage Fund was launched last year by Boardwalk Development Group LLC (BDG), a self-storage acquisition and development company. The company’s strategy is to acquire dislocated self-storage assets in secondary and tertiary markets in the Southeast, with the goal of applying the latest technologies. Boardwalk plans to acquire 60 to 80 facilities, the release stated.

Headquartered in Johns Creek, Ga., BDG is led by Sheth, who launched the ValueSpace Storage Fund I in 2008. The brand sold in 2015 to SecurCare Self Storage, one of eight participating regional operators of National Storage Affiliates Trust, a self-administered and -managed REIT headquartered in Greenwood, Colo.

Source:
Cherokee Tribune & Ledger News, Grand Opening of Cube Storage in Woodstock Set Thursday

With marketing today trending heavily toward digital strategies, do self-storage operators still need to focus on building relationships with the media? Yes! These outlets can still be influential in creating a positive image for your facility. If you’re a smaller business, it can help build brand awareness in your community. If you’re a larger operator, it can help spread your message across bigger audiences, making yours a well-known brand.

It’s imperative that your marketing plan include brand-awareness strategies. You want your facility to be the first that comes to mind when a person needs storage, and for your name to be recognized during online search. Forming media relations and building relationships with key contacts can ensure your brand has a positive image locally and even nationally.

Like other businesses, journalism has evolved in the digital age. Reporters are on Facebook, Instagram and Twitter, discovering and sharing news. They push their articles out in these avenues, which can give your business more traction for telling its story. The reach from these outlets can positively impact your operation, so let’s discuss how to build your media-relations strategy.

Define Your Audience

The first step is to define your audience. Who do you want to reach via local media? For most self-storage facilities, you’re looking at a 10-mile radius around each location.

Examine your tenant base to determine your customer personas. Use your management software to look at your current demographics. During the rental process, you should be tracking why people store with you, their age range, their gender, how many miles they live from the facility, etc. This information will help you target your marketing and media content.

Develop Content

Once you know your audience, the next step is to create press content. You want to be selective and compelling with releases and stories you pitch to the media. The headline should be attention-grabbing, and the information relevant and appealing. You want to submit interesting news people will want to read. It should explain who you are and why this is exciting for them and your business.

When writing, think of the story from an outside perspective. Would this headline and content make you want to read further? Remember your audience. What type of news do they read? Content is the most important piece of your media-relations strategy. If your story isn’t fascinating, it won’t reach far. Just remember that it also needs to be factual and credible.

Build a Contact List

Using your defined audience, you can start to build a list of publications that would serve your target market. Think of where your release or story should be placed. For example, if you find your customers are coming from a neighboring town, include reporters from media outlets in that area in your distribution list.

Finding the right contacts at each news outlet is key. You can often find a “Contact us” page on the company’s website. It’s OK to include a generic e-mail for press releases if you find one but also dig deeper to find additional contacts. Reporters typically include their e-mail with their article bylines.

The local or business section of your city’s newspaper is probably a good place to run any stories you want to promote. Seek out the writers of these sections and include their contact info in your distribution list. Having these e-mails along with general addresses will give you more exposure. Save your list and update it regularly, checking to see if there are new reporters in these positions.

Distribute Your News

Now that you know your audience, have a great story and know who to contact to help you spread the word, it’s time to disseminate your news. Here are some best practices for distributing your story:

• If you’re submitting via e-mail, blind copy your distribution list to protect your contacts and keep them private.
• Include your attention-grabbing headline along with an alert such as “Media Alert” or “For Immediate Release” in the e-mail subject line.
• Paste the story in the body of the e-mail. Also attach it as a PDF or Word doc along with any corresponding photos or videos. This helps the journalist read the story in the format that’s easiest for him or to forward it to other contacts if necessary.
• Only send newsworthy articles. Overloading your contacts with stories will take away the urgency and interest. You want reporters to be compelled to open your e-mail, not delete it or being annoyed when they see your name in their inbox.
• Provide your contact information, including your phone number. This allows people to reach you if they need more information.

To extend the reach of your story, you can also consider using one or more public-relations (PR) services. When choosing a service, read the reviews and make sure it’s a credible source. Ask to view examples of its distribution lists and make sure the firm understands your audience. PR could get your story to more people, but this doesn’t do much good if those readers aren’t in your target market.

Be Available for Follow-Up

Now that you’ve distributed your news release, you can’t just sit back and watch it “go viral.” You need to be accessible to reporters. If the story is of interest, they may reach out with questions. Be available at the contacts you provided and ready to answer inquiries.

By being available, you begin to develop a relationship. Strengthening it is key in getting your content published. A reporter will remember his interaction the next time he needs an expert to weigh in on an article or thinks about publishing a story from you. The more amenable you are, the more likely your news will be covered.

That doesn’t mean you should shorten your distribution list to only contacts with whom you’ve been friendly, however. Continue to research and send your information to all applicable contacts. Once you develop a good relationship, you could give certain contacts early access to your information to bolster it.

Create Some Buzz

When it comes to spreading the word, don’t just rely on media. You can create excitement around your story on your own! Share it on your website, social media, and internal and external e-mail lists. Creating this buzz could attract reporters and compel them to publish it as well.

When creating a media-relations strategy, the first step is to understand your goal: building brand awareness. Your content, headlines and distribution list should all reflect this. After disseminating your story, be available to reporters. This fosters a relationship that builds trust and will help your content get published. The time spent developing your media contacts can pay off big when the extra brand reach brings in more rentals.

Melissa Stiles is director of marketing for Storage Asset Management Inc., where she’s responsible for the direction of marketing for the company and its 120-plus managed facilities. This includes the development and execution of local marketing plans, digital marketing, social media, advertising, public relations, and special events. She’s been a frequent presenter at state and national industry tradeshows. For more information, e-mail [email protected]; visit www.storageassetmanagement.com.

Private-investment firm Crystal View Capital is targeting self-storage properties more aggressively under its second private-equity fund, Crystal View Capital Fund II, according to recent reports. While the company’s initial fund spread investments across several property types, the new fund focuses only on manufactured homes and self-storage in the West. To date, 60 percent of the assets in the Fund II portfolio are self-storage compared to about 40 percent in Fund I, self-storage marketplace SpareFoot reported in its “Storage Beat” blog last week.

Since its launch in 2017, Fund II has raised $11.2 million of it $35 million target. In that time, it’s acquired five self-storage properties and expects to close on another $14 million in assets, including three storage properties, by mid-July, the source reported.

As part of its acquisition strategy, Crystal View uses an internal sales team to call self-storage operators seeking off-market deals. “Sometimes it takes years, but if the returns are there, it’s all worth it,” Matthew Ricciardella, principal and managing partner, told the source.

Under Fund II, the company looks for underperforming, class-B facilities in secondary markets that are owned and managed by a single operator. It typically prefers properties with a minimum monthly cash flow of about $25,000 and comprising between 40,000 and 120,000 square feet, according to the source.

In April, Crystal View announced it would make an 8 percent preferred distribution to the fund’s limited partners for the first quarter, which was equal to the distributions for each quarter in 2018.

Founded in 2014, Las Vegas-based Crystal View specializes in manufactured-housing and self-storage investments. Through its two funds, the company has raised nearly $20 million in equity capital and currently has approximately $60 million of assets, according to its website.

Sources:
SpareFoot Storage Beat, New Private Equity Fund Targets Off Market Deals to Grow Portfolio
Crystal View Capital, Website

The Associazione Imprese Selfstorage Italiane (AISI), known to English speakers as the Self Storage Association of Italy, hosted a conference earlier this month at the Hotel NH Venezia Laguna Palace in Venice. The May 11 event drew 50 self-storage operators from cities including Forlì, Milan, Modena, Rimini, Rome and Trento, according to a press release. Activities included seminars, networking events and Q&A sessions focused on topics such as revenue, rental agreements, marketing, growth, development and more.

Author and consultant Christel Friberg Land, founder of business-coaching firm Clover Four, was a guest speaker. Land spoke at the annual Federation of European Self Storage Associations (FEDESSA) conference in Paris last fall and will be a featured speaker at its London event in October. Additional guests included Christian Schmutz, CEO of Zebrabox in Switzerland; Paul Fahey, director of Easybox, which operates facilities in Genoa, Milan, Rome and Turin, Italy; Paul Whittaker, director of SureStore in England; and Paola Barraza, membership-services officer for FEDESSA. Sponsors included Italian Institute of Auctions, Janus International, PTI Security Systems, Reason Global International Insurance Brokers, Store-It and Universal Storage Containers.

“We are facing exciting times, and we always like to know where self-storage is heading. We would like to make the next conference much bigger by adding a facility tour. Milano would be the perfect place for the next conference,” said Cesare Carcano, AISI President and CEO of Casaforte Self Depositi.

“Every year, the awareness is increasing, and people are finally understanding the advantages of self-storage. The industry is expanding, and Milan is getting bigger and bigger, so it is the place to be,” said Giovanni Tronchin, manager of Self Storage Milano Est. in Segrate, a town and comune in the Metropolitan City of Milan.

AISI represents and supports Italian self-storage operators and suppliers. Acting as the voice of the local storage industry, it aims to promote the best practices and facilitate the development of the sector.

The self-storage industry is growing across Europe, led by the United Kingdom. In fact, the U.K. represents 48 percent of the European market, with France at No. 2 and considerably smaller.

In terms of number of operators, rentable space and number of users, the U.K. market dominates in Europe. Local operators remain bullish, with many predicting increased demand and occupancy, leading to an ability to charge higher rates. According to 2018 data from the Self Storage Association United Kingdom (SSA-UK), there are more than 1,500 sites in the country, up 5 percent from the previous year. They comprise 44.6 million square feet, up 8.8 percent over last year.

Indicators point to continued progress in the region. Occupancy and profitability are rising, demonstrating strong customer demand. Yet, the market is fragmented, with significant numbers of container-based facilities, and product awareness is still low. Together, these factors present great opportunities for expansion. Let’s look at some market trends and factors.

Major Players

The U.K. market is led by three major players: Big Yellow Group PLC, Lok’nStore Group PLC and Safestore Holdings PLC. Combined, they represent 17 percent of the market. Beyond them, large operators managing 10 or more sites account for more than 40 percent of the market. Twenty-two percent of the market is container-based storage.

In Scotland where my company, Kangaroo Self Storage, is based, there are only a few operators. They’re clustered around the Central Belt and focused largely in Edinburgh and Glasgow, reflecting population density and travel infrastructure.

Store Openings

Last year was very active for self-storage. The SSA-UK reported 2.4 million square feet was added through more than 70 store openings, 29 of which contain more than 150 units as part of the first phase. More space was added by new builds than by facility expansions and fit-outs. For the first time, the openings of purpose-built or converted sites exceeded those of container-based sites.

In addition, store openings were in regional locations, indicating expanding geographic interest. London and South East England have traditionally been the focus for new development, and large operators have largely focused their efforts in these areas. As a result, London’s amount of storage per capita is about twice that of the U.K. average.

Rental Rates

Average net rental rates in the U.K., while on the up at £23.08, show regional variances with London at £28.22. Scotland comes in at £20.49. (Operators are pushing yields aggressively here, so rental costs are proportionally more expensive.) The lowest rates are in the East Midlands at £15.68.

Compared to the mature markets of Australia or the United States, the U.K. has limited land availability, and the price of land is much higher, particularly in London and the South East. This impacts individual store profiles and product pricing.

Product Use

Despite being relatively mature, the U.K. self-storage market is still developing. While only 2 percent of the population uses self-storage, of those that have stored, more than 40 percent will use the product again. Move-in incentives are still common. They remain largely unchanged over the last five years, with the aim being to raise industry awareness.

Self-storage remains a needs-driven purchase rather than a lifestyle choice. Education about the product’s value and benefits is key. Most customers—whether students, homeowners or businesses—have no concept of storage prices and unit sizes. However, domestic and commercial customers are storing for longer periods, with business users storing the longest. The average length of stay at our facilities is more than 100 weeks. Customer retention is key.

While the average size of rented units is increasing, domestic users tend to use smaller spaces, with just under 70 percent renting less than 100 square feet. These customers are usually older and will travel around 20 minutes to a facility. Business renters choose larger units, with a significant proportion renting multiple spaces. The balance between domestic (60 percent) and business (40 percent) customers has stayed largely unchanged for many years, but there are regional and store variances driven by location.

Some operators are also beginning to offer a wider range of services including goods disposal, extended operating hours, unit shelving, Wi-Fi and more. However, most customers (34 percent) only visit their unit about once per month and are unlikely to use these services.

Operator Challenges

As potential customers increasingly turn to the Internet to search for storage, it reduces their level of interaction with staff. While this is undoubtedly the way forward, in the short term, it makes it difficult for customers to understand the product and how they can use storage to their benefit.

In addition, the U.K. is still post-recession, with the availability of mortgages only now increasing. We’re still seeing relatively low levels of housing transactions. Both trends impact the self-storage market.

Limited land has also affected storage operators. Only recently have expectations around land prices adjusted to realistic levels. Going forward, the U.K. industry should expect to see more sites available for development. In addition, there’s a preference by operators for freehold sites, with a move toward increasingly higher levels of freehold in maturing portfolios.

Acquisitions Activity

The growth of the U.K. market has stimulated the appetite for self-storage as an asset class. Investment-management firm JLL (Jones Lang LaSalle) reported more than £250 million in transactions in the last year in the U.K. alone. And while the government-funded Enterprise Initiative Scheme concluded in April, there’s been an uplift in significant activity by institutional investors.

Global investment-management firm Schroders PLC entered the U.K. market last year, purchasing The Self-Storage Co.’s five-property portfolio in London for £44 million. My company entered the English market this year with the acquisition of Smart Storage Ltd. The £13 million deal tripled our portfolio to nine locations 442,000 square feet, with 310,000 square feet under lease.

More portfolios are expected to change hands this year, with the real estate investment trusts as active players. The SSA-UK reports the following significant acquisitions in England in the past 18 months.

Like many U.K. self-storage operators, Kangaroo is looking to grow, organically and through acquisitions. However, until recently, there’s been limited supply. Our Smart Storage acquisition was the right opportunity at the right time. We’ll continue to pursue growth when appropriate across North England and, indeed, in Scotland.

Chris Stevens is CEO of Kangaroo Self Storage Ltd., which he established as an independent company in Scotland in 2004. It operates facilities in Dundee, Edinburgh and Glasgow, and entered the English market in 2018 with the acquisition of six Smart Storage facilities in North West England. For more information, visit www.kangarooselfstorage.co.uk.