Public Storage Inc., a self-storage real estate investment trust (REIT), has opened a new facility in Humble, Texas, a growing suburb that lies northeast of Houston. The three-story asset at 8717 N. Sam Houston Parkway E. comprises 140,000 square feet in 1,183 units. The climate-controlled building includes three drive-up units. The property is part of the REIT’s “ongoing effort to expand in the region,” according to a press release.

“A lot of the storage facilities near Humble are older, far away and don’t have climate control,” Dan Matula, vice president of real estate development, said in a blog post published on the company website. “We wanted to build a facility that would look great and provide modern features for people close to their homes.”

The facility uses VRV multi-split air-conditioners from Daikin Industries Ltd., which are specifically designed for commercial structures and use variable refrigerant flow control to help “maintain individual zone control in each room and floor of a building,” according to the manufacturer.

The location is near Lake Houston and five miles from the George Bush Intercontinental Airport. It’s also close to the Fall Creek and Park Lakes neighborhoods. Fall Creek is a 2,000-acre community along Beltway 8, just east of U.S. 59 North.

The REIT is investing in Humble due to population growth and affordable housing, as well as commuter visibility from Beltway 8 and proximity to State Highway 99. Known locally as the Grand Parkway, Highway 99 is an ongoing 180-mile project that will eventually traverse seven counties and encircle the Greater Houston region. Planned since the 1960s to provide better road access between communities, the most recent segments, which are north of Houston, opened to the public last March.

“It is the new, fourth freeway ring around the city,” said Roger Clark, a senior manager who will help oversee the property. “Before you’d have to go into the city and go back out, if you needed to get from the northeast side to the northwest side and alike suburbs. Now they’re all connected.”

Based in Glendale, Calif., Public Storage has interests in 2,354 self-storage facilities in 38 states, with approximately 155 million net rentable square feet. Operating under the Shurgard brand name, the company also has 220 facilities in seven European countries, with approximately 12 million net rentable square feet.

By Chris Weismiller

As self-storage grows within the commercial real estate industry, new investors are increasingly entering the market. Many are starting from scratch with no prior knowledge of the business. If you’re in this situation, this article will help you navigate the buying process.

Before You Invest

When considering an investment in self-storage, first ask yourself:

• What do you want to get from your investment?
• What’s your long-term goal for this property?
• Are you investing solely for an income stream, or to eventually sell the site for a larger profit?

There are many reasons people choose to invest, and it’s important to have a plan and an exit strategy from day one. This will align your goals and implement a process to be successful and manage costs.

Weighing Potential

When looking at property for purchase, first consider the functionality of the site. Is it big enough to run efficiently from a financial perspective? Is it a class-A facility in top shape or a “fixer-upper” that will require a little TLC to turn a profit? It’s important to gauge the potential of the facility so you know what to expect. The easiest way to do this is to examine its size, expansion capabilities and expense ratio. Let’s look at each.

Property size. The scope of a facility is important because different sizes require different operating procedures. Remember, the less rentable square footage you have, the less income you’ll make. If you buy a site that’s too small, you run the risk of it not being financially feasible. If you do opt for a smaller site, consider running it via an automated kiosk rather than a flesh-and-blood property manager. This can save as much as $50,000 annually. For a small facility, that’s a lot of cash flow.

Expansion capabilities. Examining the future potential of a facility is also important because adding to an existing property will allow you to create more rentable income. It’s cheaper to build self-storage than other types of real estate. A small investment in an expansion could double your profit in the long run.

Expense ratio. Facilities should ideally run at an expense-to-income ratio of 30 percent to 40 percent. If you’re seeking to invest in a low-performing facility to turn it around and make a profit, look closely at the expenses. Are there things you can cut or places where you can save money? Can you raise the rent to grow income? There are many facilities that seem to be under-performing or a bad investment; however, with the correct management, they can be successful.

Red Flags

We’ve talked about property characteristics to consider, but it’s also important to be aware of red flags. The below items can be more hassle than they’re worth, causing delays in the sale process, which can generate more issues. Avoid properties with the following challenges:

• Environmental contamination: For example, there could be an oil tank on the property or an adjacent parcel that’s slowly leaking onto your site and contaminating the soil. As the new owner, you’d be responsible for fixing this problem. This can delay the sale and cost a lot to remediate.
• Easements: Make sure you understand what, if any, easements are on the property as well as the associated process and costs. For example, an easement for water or draining needs to be properly documented. If it isn’t, it could lead to the need to create a new easement for entering and leaving the property, which will cost you time and money.
• Zoning: Find out if all connected parcels, including expansion land, are properly zoned for self-storage. Also, ensure the zoning permits the total square footage of any potential expansions.
• Capital expenditures: Understand which capital improvements the seller has completed as well as any deferred improvements and repairs, such as a new roof. If there are a lot of deferred items, or they’re high-ticket items, it can cost you extra up front.
• Tax reassessment: Understand the tax laws in the area, as property taxes vary in each location. It’s best to contact the local property assessor who handles self-storage and discuss how the sale will directly affect the property’s assessed value.
• Leasing vs. owning land: Make sure the seller owns the land and isn’t leasing it. A lease will complicate things and add more parties to the mix. The more groups connected to this process, the less control you and your broker will have.

Due Diligence

Due diligence is a critical aspect of any real estate transaction. This is when you’ll investigate whether a property is worth the money and risk involved. Most due-diligence periods range from 30 to 45 days. Once this period has passed, your earnest-money deposit becomes nonrefundable, so make good use of the time. The process should consist of numerous inspections, audits and third-party reports to verify the property is a suitable investment.
For this process, you’ll want a transactional attorney on hand to review legal documents and investigate pertinent issues. He’ll need to look over things such as the purchase and sale agreement, title-insurance binder, zoning compliance, and environmental reports. You’ll also want him present at closing (on the day of escrow, when deeds are filed and funds are received, etc.). It’s best to work with someone who understands the self-storage industry and has experience in real estate transactions.

First, you’ll need to ensure everyone knows and agrees with all deadlines set forth in the contract. People often assume everyone is on the same page, but contracts typically include legal language that specifies how dates should be counted.

After securing a great attorney and setting up a timeline, evaluate the property’s physical condition. When you conduct a site visit, pay attention to the condition of the roof, asphalt, unit doors, fire-sprinkler systems and HVAC units, as those will cost you the most if they need repair or replacement. In addition, you’ll conduct an environmental audit. You’ll also want to confirm any financial information and other documentation provided by the seller and conduct an in-person, onsite lease audit.

Lastly, investigate the financing of the sale. You need to know if the purchase will require you to assume the seller’s current financing or secure a new loan. You may need to demonstrate your ability to obtain funding. If you must finance, work with a qualified mortgage intermediary who’ll contact several prospective lenders to get you the best loan terms. Be prepared with any paperwork a lender might require to keep things moving.

While investing in self-storage can be beneficial, there are important steps you need to take early in the process. Follow the advice above and you’ll make the right investment decisions and be successful.

Chris Weismiller is vice president at SkyView Advisors, a national investment sales, debt and equity and advisory firm focused exclusively on self-storage. He assists owners and sellers through a range of advisory services, including acquisition, disposition and recapitalization strategies, asset valuation, joint-venture structures, and debt and equity financing strategies. For more information, call 813.579.6363; visit www.skyviewadvisors.com.

Vince Toenjes, the former general counsel and corporate secretary for Chicago-based self-storage operator LifeStorage LP, which was purchased last year by Sovran Self Storage Inc. (now known as Life Storage Inc.), has joined the Atlanta law firm of Weissmann Zucker Euster Morochnik P.C. (WZEM) to serve in its real estate and corporate practice. In his new role, Toenjes will work with self-storage operators as well as owners of other business types.

Toenjes’ career has involved a full range of corporate counseling, with legal practice in the areas of bankruptcy, commercial leasing, construction, corporate governance, employment law, finance, investor relations, land use, mergers and acquisitions, and real estate, according to a press release. "We are excited to have Vince on board. He is a very talented, versatile and approachable real estate and corporate attorney who has experience in a wide variety of complex transactions across multiple industries for more than two decades,” said Scott Zucker, a partner with WZEM and a well-known self-storage attorney. “He greatly bolsters our already prominent real estate and self-storage practice and overall corporate-transaction capabilities."

In addition to his experience with LifeStorage, Toenjes previously served as deputy general counsel, assistant corporate secretary and vice president of real estate for publicly traded retailer Coldwater Creek Inc. Before going in-house, he was also a shareholder at Denver-based law firms Gorrell Giles Gollata PC and Moye White LLP. He has advised numerous companies including Dick's Sporting Goods, Quizno's and Vineyard Vines.

Admitted to practice law in Colorado, Toenjes received a juris doctor degree in 1994 from the University of Denver School of Law. He also holds a bachelor’s degree from the University of Colorado and a master’s in finance from the University of Houston.

LifeStorage was acquired in 2016 by real estate investment trust Sovran Self Storage Inc., which has since changed its name to Life Storage Inc. While with the company, Toenjes helped build a portfolio of more than 90 facilities and assisted in closing the 2016 transaction, the release stated.

WZEM is a transaction- and litigation-services firm assisting all types of businesses with legal needs relating to banking, construction, employment, finance and real estate. With offices in Atlanta and Denver, it specializes in business litigation with an emphasis on real estate, landlord-tenant and construction law.

Zucker is a regular contributor to industry publications and events, including “Inside Self-Storage” magazine and the Inside Self-Storage World Expo. Video copies of seminar presentations made by Zucker can be purchased and viewed at www.iss-store.com.

SiteLink, which provides facility-management software and payment-processing services for self-storage operations, has added enhancements to the U.K. version of its cloud-based software and assigned dedicated customer-service representatives to assist the British market. The U.K.-specific product was developed with input from operators in the region and the Self Storage Association of the United Kingdom (SSA-UK) to meet local requirements, according to a company press release.

The software is designed to offer secure, built-in credit card options, dedicated technical support and ready-to-use website integration that includes online payments, unit rentals and reservations, the release stated. To execute online transactions in the U.K., SiteLink partnered with payment-processing company First Data Corp.

"We are delighted to be helping SiteLink achieve its objective of delivering added value to its members,” said Raj Sond, general manager of First Data UK. “Businesses often don’t realize they have a choice in who they choose for their payment-acceptance services. At First Data, electronic payments are all we do, and we focus on helping our customers turn payment acceptance into increased profitability."

The SSA-UK is the trade association for the self-storage industry in the United Kingdom. Its mission is to support member operators and vendors, promote best business practices, and raise public awareness.

First Data provides commerce-enabling technology solutions to about 6 million business locations and 4,000 financial institutions in more than 100 countries. Its customers process more than 2,800 transactions per second and $2.2 trillion per year, according to the release.

Founded in Raleigh, N.C., in 1996, SiteLink offers cloud- and Windows-based self-storage management software as well as built-in, in-house payment processing. Its software integrates with dozens of technology partners’ services including call centers, insurance, kiosks, mobile devices, websites and other platforms.

Storage Deluxe, a Manhattan-based self-storage owner and developer, faces an uphill battle to secure a special-use permit that would allow a facility to be built at 1401 4th Ave. in New Hyde Park, N.Y. The board of trustees tabled the request last week after listening to several residents argue against the four-story project, according to the source.

Though the facility would be built next to a car-storage provider, the property is across the street from residences. Homeowners complained the community has already been impacted by the construction of a third track at the nearby Long Island Rail Road and suffers from noise caused by trucks visiting the neighboring World Courier Inc. facility, the source reported.

“It’s bad enough we have to deal with all these other problems, but now you’re adding this new big structure, and it’s another added problem,” Matt Hawkeiser, who lives across the street from the proposed building site, told the board. “There’s no real upside to this.”

Christopher Lynch, a management executive with Storage Deluxe, is listed as the applicant. In addition to the special permit, the project also requires a zoning exception from the board of zoning appeals, which is scheduled to address the project on Aug. 9.

Founded in 1998, Storage Deluxe has developed 46 projects totaling approximately 5 million square feet, including 42 self-storage facilities, three art-storage facilities, 58,000 square feet of retail, and an exotic car-storage property. In 2011, the company sold 22 of its New York storage facilities to CubeSmart for more than $560 million. At the time, it also transitioned day-to-day management of its remaining properties to CubeSmart. Storage Deluxe has remained active in the New York Metro area since the portfolio sale, completing 19 acquisitions, and the company is aggressively seeking new development and acquisition opportunities.

The Spartanburg, S.C., Planning Commission voted unanimously last week to recommend approval for a zoning change on 2.3 acres at 899 E. Main St., which would enable local real estate developer Montgomery Development Group (MDG) to build a self-storage facility. The project would include the conversion of 43,000 square feet of warehouse space and the addition of up to five single-story structures, according to the source.

Though the property currently houses warehouses, it’s been zoned for residential use for nearly two decades and hasn’t been used for at least 15 years. MDG is negotiating to purchase the land from Arthur State Bank, but the city must rezone the property to general-business use to enable the project, the source reported.

MDG CEO John Montgomery told the commission the storage facility will serve the city’s growing apartment communities near downtown. It’ll be well-lit but remain secluded from neighboring properties due to existing buffers, he said. It will offer climate-controlled and traditional storage.

City planner Natalia Rosario indicated the storage business would add to the municipality’s tax base.

Though some residents voiced approval for the project during the meeting, others indicated they were concerned about other potential business uses should the property ever be sold. “I’m not in opposition to what John Montgomery wants to do,” resident Sidney Fulmer told the board. “I know it would be of the utmost quality. It’s the zoning to B-3 that is the problem … I do feel like we need to have some assurances that if this property got sold down the road that some of those [uses] do not end up there.”

Montgomery, who has ownership interests in the nearby Drayton Mills Lofts and Drayton Mills Marketplace, told planners he has a personal connection to the Main Street property because his family owned the warehouses during the city’s textile boom. The developer is open to restrictive covenants on the property, he said.

The city council will have two opportunities to discuss and vote on the project, according to the source.

Based in Spartanburg, MDG specializes in commercial, industrial, master-planned and multi-family development projects.

The Mill Hall, Pa., Borough Council this week gave conditional approval for a self-storage facility to be developed on the site of the former Benji’s Bar. JET LLC, which owns the property on N. Water St., plans to build a 40-by-150-foot metal building containing 32 to 38 units in various sizes. The facility is expected to open within four to five months if all goes as planned, according to the source.

The development still needs a highway-occupancy permit and erosion-control approval from the Clinton County Conservation District, according to Dennis Norman, owner of Norman Engineered Designs, who presented JET’s plans to the council. Tom Smith, a JET representative, was also in attendance. Norman noted that although a portion of the site is in the flood plain, the building will be above flood level.

Heard about Google Analytics, but not sure how to start using it for your self-storage business? You’re in the right place. Read on to get the details on what this tool is and how to begin leveraging its power.

What Is Google Analytics?

Google Analytics is a free Web-analytics service, offered by Google, that comes with optional, premium (paid) features. One of the most widely used Web-analytics services, it’s been around since the early 2000s. Google Analytics allows you to track and understand your customers’ Web behavior, enabling you to see what your website visitors are looking for and whether you’re effectively converting leads.

Why Do You Need It?

Wouldn’t it be nice to be all-knowing? To know exactly when, where and why potential customers decide to visit your website? To understand the real reasons they chose you—or didn’t—for their self-storage needs? Well, Google Analytics is the closest you can get. The intelligent tool allows you to track and understand customers’ behavior from start to finish so you can hone your marketing strategy and save money on advertising. Here are just a few of the questions you can answer:

• How many people are visiting my website every month?
• From what part of town are my customers coming?
• Are my prospects accessing my website from desktop computers or mobile devices?
• What search engines are people using to find my website?
• What social media site is most effective at sending people to my website?
• Which of my marketing tactics is bringing in the most leads?
• Which of my Web pages are the most popular?
• How many website leads have I converted to paying customers?
• What path did converted visitors follow on my website?
• Is my website slow to load when using certain mobile devices or Web browsers?

Now that you have an overview, let’s expand on some of the most noteworthy information you can gather from your Google Analytics statistics.

Web Visitors

When prospects walk into your office and chat about their storage needs, they’ll often comment on how they found out about your services. It could be they were referred by a friend who had a good experience with you, or they noticed your eye-catching sign on their daily drive to work. These comments give you some insight into what’s working to bring in leads. Shouldn’t Web marketing be the same?

With Google Analytics, you can track the origin of every website visitor and use this information to hone your marketing strategy. Once you know where most of your leads are coming from—whether it be organic search results, Facebook or pay-per-click ads—you’ll be able to eliminate wasteful spending and put more effort into what’s really working.

Geographical Regions

With Google Analytics data, you’ll know everything there is to know about your online traffic, including where visitors live. You won’t be able to access their sensitive information, just their continent, country, region, city and metro area. This helps thousands of businesses large and small pinpoint the regions that are bringing in the most leads. It’s simple to use, easy to analyze, and can help you save additional bucks on advertising.

Google’s geolocation tool is especially useful if your business is in a large metro area. If you find you’re underperforming in neighboring townships or your leads are coming from somewhere unexpected, you can tailor your website content to target those markets. You can also focus your pay-per-click or social media ads on underperforming areas that could use a little love. By keeping track from month to month, you’ll be able to monitor visitors’ geolocation stats and see how your latest marketing efforts are affecting your website numbers.

Bounce Rates

Tracking your website’s bounce rate (the percentage of visitors who navigate away after viewing only one page) is key to increasing conversions and measuring the quality of your website. When your bounce rate is high, it means a lot of people are leaving from your landing page without browsing any further, and it may be time to reassess.

If your website is ugly, outdated, slow to load or difficult to view on mobile devices, you might be scaring away visitors. To improve your bounce rate, you may need to redesign your home page to more prominently display your “call to action,” which includes your action-focused messaging such as “Contact us” or “View available units.” If users aren’t sure how to complete an action on your page, they’ll quickly get frustrated and head back to search results to find an easier-to-use website.

If your bounce rate is high, you’re likely bleeding leads and sending prospects to competitors with better sites. Remember: A high bounce rate means lost revenue. Make sure you’re monitoring this number from month to month, as a decrease could be a sign you need to make Web improvements.

How Do You Begin?

If you have a professionally designed website, you may already have a Google Analytics account for tracking performance. If not, all you’ll need to begin is a Google account. Follow these steps to get started:

1. Contact your Web-marketing provider. If you’re working with a professional Web-design company, it’ll be able to gather your Google Analytics information for you, allowing you to access reporting and data logs. If you have administrative access on your website, you may be able to log in and view these reports behind the scenes. If your website is connected to your facility management software, you may also be able to view Google Analytics data in your dashboard via custom reports and graphs. Contact your Web-marketing provider to find out how you can access data obtained from your Analytics reports.

2. Become a power user via free online tutorials. While Google Analytics may seem intimidating at first, there are plenty of free resources that explain how to use it. You can take free online courses from Google Analytics Academy or view free how-to YouTube tutorials by search engine optimization specialists. If you enjoy looking at data or just want to improve your business, you’ll gain a wealth of knowledge and understanding from learning more about this tool.

Now that you know how to use Google’s free analytics, give your website a performance checkup and see how your digital marketing stacks up. If your website visitors aren’t converting or if they’re leaving from your home page without taking any action, your website might need a facelift. Check out your stats today to improve your online marketing effectiveness.

Jana Haecherl is a marketing-content writer for storEDGE, which offers a comprehensive suite of technology solutions designed specifically for the self-storage industry. She enjoys bringing technology, Web marketing, and industry news and tips to self-storage owners and managers. For more information, call 913.954.4110; visit www.storedge.com.

A disabled woman was allegedly struck in the head with a sign on Saturday by a Colorado Springs, Colo., self-storage employee who reportedly told her she was trespassing. Rachel Flanary was walking home from a nearby store when she became dizzy and stopped to rest on the sidewalk in front of Stetson Commons Self Storage on Tutt Boulevard, according to the source.

After two or three minutes, a man came out to confront her, allegedly hitting her in the head with the sign and repeatedly telling her to leave. "I just thought that was completely inappropriate to do to someone who is on the ground [and] can't get up,” Flanary told the source. “It was just really degrading."

Flanary indicated the dizziness she experienced was connected to her “medical disabilities,” though the report doesn’t detail her ailments.

It’s also not clear from the report what the sign was made of or its size. No description or identification of the employee who confronted Flanary was provided.

A related video posted to Facebook by Flanary has been viewed more than 11,000 times, the source reported.