Update 8/10/17 – The Fort Wayne, Ind., City Council this week approved Dealpoint Merrill’s zoning request to convert the former Scott’s Food Store to self-storage. The facility will include all interior units, according to the source.

“This building has been empty for quite a while,” said council member Paul Ensley, who represents the district. “Perhaps everybody's first choice would not have been self-storage. It would have been to get another grocery store or something like that in there; but I think if that was going to happen, it would have happened by now.”

A written commitment submitted with the rezoning application prohibits several development types, including auto-body shops, gas stations and outdoor automobile sales, according to Michelle Wood, senior planner for Allen County Department of Planning Services.

City council president Tom Didier and council member Jason Arp were absent from the vote.

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8/9/13 – Another empty grocery store in Fort Wayne, Ind., may soon become a self-storage facility. Dealpoint Merrill, a subsidiary of investment firm Merrill Lynch Group of Cos., hopes to convert the former Scott’s Food Store in the Stellhorn Village shopping center into a self-storage facility. The Fort Wayne Plan Commission and Board of Zoning Appeal is expected to consider the proposal as early as September.

The project comes on the heels of another grocery-store conversion opening this month in the city. Self-storage operator Fort Wayne Storage is building a 46,000-square-foot, single-story building and property on Spy Run and State Boulevard. The two-story facility, which will be called Downtown Self Storage, will contain 440 storage units, half of which will be climate-controlled.

Dealpoint Merrill has completed two similar conversions of empty retail buildings and has plans for several more, according to Mike Gaertner, the designer of the Fort Wayne self-storage project.

The proposed development at 4522 Maplecrest Road will have a yet undetermined number of climate-controlled self-storage units. The facility could also offer commercial space for up to 10 businesses.

The grocery stores, both of which are owned by Kroger, closed in 2010 as part of the company’s $100 million restructuring of its Fort Wayne operations.

Compass Self Storage, a member of the Amsdell family of companies, has acquired Brightwood Self Storage in Whitsett, N.C. It’s the company’s fourth location in the state and its 10^th acquisition of 2017, according to a press release. The site was purchased by separate affiliates of Amsdell Group LLC and Compass Self Storage LLC and will be rebranded under the Compass name.

The property at 6605 Burlington Road comprises more than 70,000 net rentable square feet of climate-controlled and drive-up storage space. Compass plans to add a two-story building containing 49,000 square feet of climate-controlled storage, expected to open in January. Additional upgrades will include a new access-control and security system. The facility currently offers a retail office that sells moving and packing supplies, and truck rentals.

“We are proud to expand our service area in North Carolina to include the residents and businesses of the Whitsett community. We look forward to providing great customer service, and to making moving and storing with Compass Self Storage an easy process,” said Todd Amsdell, president.

Headquartered in Cleveland, the Amsdell Cos. draws its roots from the family-owned construction company founded in 1928. Since its inception, the company has been active in several billions of dollars of real estate ventures, with a primary focus on self-storage. It has owned and operated more than 500 storage centers under various trade names in more than 27 states. It currently owns and operates properties in 15 states.

By Carrie Aubrey

Self-storage has become a hot topic in the commercial real estate industry. The process of buying and selling storage properties is detailed and complex, requiring hard work from all parties involved. A successful transaction requires several important steps, and items that must be closely and efficiently managed.

Investors and sellers need to keep the big picture in mind, understand the human side of the process and pay close attention to detail. They must understand the seller’s top priority, whether that be achieving the highest value or the quickest closing, or finding the most hassle-free buyer. They must monitor broader economic trends such as interest rates and keep track of closing documents. Finally, they must complete the following steps:

• Create the purchase and sale agreement.
• Develop a timeline.
• Put the buyer’s deposit into escrow.
• Engage in the due-diligence process.
• Gather the final documents.
• Close the transaction.

Advice for Sellers

Before even listing your property, take care of any deferred maintenance issues to ensure your property is positioned in the best light to attract buyers. You’ll also want to hire a good, deal-making real estate attorney. This will help the whole process run smoothly.

Look to hire a quality broker who has a proven track record in closing self-storage transactions. You want to work with someone who has your best interests in mind. An experienced broker will serve as an intermediary and trusted advisor during a potentially stressful process. He’ll make sure deadlines are met and everyone leaves the transaction achieving their goals. He’ll also assist in managing all the documentation required for the sale. This is a lengthy list that can amount to as many as 160 documents.

The transaction process is very detailed, and it’s important that you do everything possible to keep the train moving. During the creation of the purchase and sale agreement, for example, there could be up to five or six drafts going back and forth. It’s important to keep this exchange as short as possible, since every day that passes without a fully executed agreement can affect your ability to close due to changes in the economy.

The timeline should keep the process moving forward per the contract, ensuring everything runs efficiently. Maintain tight deadlines and make sure everyone is communicating clearly, particularly about dates for deliverables, to keep negotiations as quick as possible.

For your own security, make sure the buyer’s deposit goes hard as soon as possible. Remember, the buyer can back out of the deal with no loss incurred until the end of the due-diligence period. Though the process can be frustrating, act with a sense of urgency, put your best foot forward and assist the buyer with everything he needs.

At the close of due diligence, many sellers make the mistake of breathing a sigh of relief, thinking the hard part is over. In reality, there are nearly always last-minute issues that arise. Mentally prepare for these inevitabilities to help minimize stress.

Once due diligence expires and the closing period begins, there will still be a litany of items to accomplish that perhaps you haven’t accounted for, such as canceling or transferring your Internet-service provider, shoring up financial items, tackling security issues, training new managers, etc. This is when an experienced self-storage broker will come in handy.  

Advice for Buyers

Buyers also have several items to consider to ensure a smooth transaction. For example, if you’re not paying cash for the property, begin working with a quality bank or mortgage broker before you even make an offer. This will ensure you aren’t wasting your own time or the seller’s. Bear in mind that self-storage is different from other commercial real estate sectors, and it behooves you to work with an individual or institution with a track record in storage transactions.

A site visit is an integral part of the due-diligence phase. While touring a site, pay attention to the condition of the roof, asphalt, unit doors, fire-sprinkler systems and air-conditioning/heating units. Any of these can be high-ticket repair items if replacement or maintenance is required.

You’ll also want to order a Phase I environmental report, a property-condition assessment, a site survey, a title report and an appraisal (if financing is involved).

A self-storage transaction can be difficult and stressful. The buyer’s and seller’s ability to effectively work through each stage depends on several factors. Following the steps outlined above should help you navigate the process; however, never be hesitant to leverage the expertise of an experienced broker who can help manage the small details and maintain a big-picture view to alleviate any worries you may have.

Carrie Aubrey is the transaction manager for SkyView Advisors. She works as the liaison for all parties in a transaction, ensuring everything stays on track. Her in-depth knowledge of self-storage real estate helps her efficiently manage the process and keep all parties moving quickly and seamlessly toward closing. For more information, call 813.579.6363; visit www.skyviewadvisors.com.

storEDGE, a provider of software and other technology for the self-storage industry, has expanded its Kansas City, Kan.-based engineering team to Denver following several years of rapid growth. The company has doubled its software development and engineering team over the last two years, according to a press release. It plans to replicate that growth in the Denver office as it continues to add more technologists to the team over the next year.

“The new Denver team is a physical sign of storEDGE’s dedication to growth and development in self-storage,” said Adam England, chief technology officer. “As we outgrew our current space and looked at expanding, it made sense to think outside the box and explore physical locations that provided additional diversity in talent. We have a robust technology roadmap that can be executed from various locations based on our agile development methods and tools.”

The company launched a research and development group last year to advance its technology to include mobile apps, hardware and telephony solutions. The Denver expansion will help develop and support storEDGE’s current and future applications, such as its data warehouse, which collects data across a client’s business portfolio.

storEDGE is a part of Red Nova Labs Inc., a provider of marketing, mobile and Web technology to the self-storage industry. Its products include management software, website-creation services, online rental-center tools, business intelligence and other integrated services.

Citizen Storage Management and Affiliates, a Michigan-based self-storage operator led by president and CEO Peter Spickenagel, has launched behind the acquisition of two storage properties in Fenton, Mich. The facilities comprise 86,000 square feet, with an additional 100 vehicle-parking spaces. The unidentified properties will be rebranded as Citizen Storage Fenton North and Citizen Storage Fenton South, according to a press release.

Citizen intends to renovate both assets through a “robust expenditure program,” and will invest in staff training and new technology, the release stated.

“I am very pleased to announce the acquisition of these two investor-grade properties,” Spickenagel said. “These properties fit perfectly into our value-add acquisition model and long-term growth initiatives. I believe in the strength of the Fenton market and witnessed the results first-hand in my previous endeavors.”

The industry veteran most recently directed self-storage conversion and new-construction projects for Farmer Development Inc. He also served as vice president of operations for Storage Pros Management LLC, where he oversaw 80 storage properties across the nation comprising more than 4 million square feet, according to the release. Spickenagel also serves as director of business development for CallPotential, a provider of lead-management and do-it-yourself call-center solutions for self-storage operations.

Based in Royal Oak, Mich., Citizen intends to pursue additional self-storage acquisitions as well as offer consulting and third-party management services.

Boardwalk Development Group LLC (BDG), a self-storage acquisition and development company, has launched an $80 million Boardwalk II Strategy that will focus on storage-property acquisitions in secondary and tertiary markets throughout the Southeast. BDG plans to purchase up to 80 “stabilized” self-storage facilities with the intent of operating them as unmanned properties, according to a press release.

The investment strategy will focus on properties “cash-flowing at 8 percent or more annually, located in areas with population growth of at least twice the national average, [and] have an average household income of $70,000 or higher in the one-, three- and five-mile radii,” the release stated.

BDG will implement automated kiosks and Web tools to facilitate unit rentals and payments. The integration of automated technology “will allow these facilities to be completely unmanned,” according to the release. Company officials believe the strategy will enable BDG to “acquire and cost-effectively manage across broader geographies.”

The company’s strategy to invest in secondary and tertiary markets is driven by “Wall Street’s obsession” with self-storage assets similar to those coveted by real estate investment trusts (REITs) within the top 50 U.S. Metropolitan Statistical Areas (MSAs). The focus of other investors on the largest MSAs “has left a hole in the market to acquire numerous stable, cash-flowing, self-storage properties,” CEO Rajen Sheth said. “These terrific, steady-earning, high-margin, low-risk businesses are available in large numbers and at reasonable valuations. [BDG] is excited to be part of this next wave of the self-storage industry’s consolidation.”

The developer launched a $10 million equity-investment fund called Boardwalk Storage Fund I LLC last year, with the intent to purchase $50 million in self-storage properties. The fund will focus on facilities valued at $2 million to $8 million in Alabama, Florida, North Carolina, South Carolina, Tennessee and Virginia.

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.

Self-storage finance firm ValueXpress LLC has promoted Dennis Suh to senior vice president of originations. Suh joined the company last August as a vice president for the firm’s commercial loan originations group, focusing on agency and commercial mortgage-backed securities (CMBS) loans in national markets.

“As anticipated, Dennis has utilized his extensive investment-banking knowledge and relationships to problem-solve complex issues on a number of transactions; and he was able to close transactions in which borrowers were unsure that a loan closing was possible,” Michael D. Sneden, executive vice president, said in a press release.

Suh came to ValueXpress with experience in originating fixed-rate conduit loans in the Midwest, Northeast and Southeast. He previously underwrote CMBS loans for Barclays Capital Inc., Credit Suisse LLC and UBS Securities LLC in New York City.

“I take great personal satisfaction when I am able to close a loan for a client that provides a financing solution that allows a borrower to grow his real estate business,” Suh said. “Along the way, I have successfully worked through some intricate issues that provided some stress relief for the borrower, and I often get that satisfying ‘thank-you’ call at the closing of the transaction.”

Based in New York City, ValueXpress offers guidance in the underwriting and securing of financing for acquiring and refinancing self-storage. It has worked directly with Wall Street investment banks and private lenders since 1995.

Residents are angry about a four-story self-storage development that’s under construction in Hobsonville, a rural suburb of Auckland, New Zealand. The National Mini Storage facility on Hobsonville Road is across from several homes and a school.

Approved by the city in 2016, the project will include 1,400 storage units and 22 parking spaces. The property is zoned for light industrial under the Auckland Unitary Plan, and although the Auckland Council hasn’t received any complaints, one resident claims neighbors are “horrified” about the building, according to the source.

"Now they've got this humungous thing … going up, and it's gob-smacking. And they've only done one half of it so far. The other half is going to block out the sun, literally,” said John Carrodus, chairman of the West Harbour Residents Association and the Hobsonville Residents and Ratepayers Association.

Although Carrodus said he knew the site was zoned light industrial before construction began, he expected the building to face the freeway and be less intrusive. Now he’s concerned the property will have a negative impact on home values in the area. In addition, he claims the facility lacks an overall aesthetic plan, the source reported.

Resident Murray Cooper, who lives down the street, also questioned why the building wasn’t placed closer to the freeway. He noted his previous view of the hills is now “blanked out totally” by the storage building. Oliver Ivisoni called the structure’s height “not ideal,” but hoped the facility would bring new jobs to the area.

Auckland Council Manager Stefan Naude noted the storage facility is in line with the type of development permitted in the zone. Public notification wasn’t necessary, as the project was considered to have a minor adverse effect on the area, the source reported. The structure’s height of 15 meters falls under the city’s 20-meter building restriction. In addition, National Mini agreed to focus on landscaping as well as create an urban design, particularly where the property faces the road and school.

The storage facility is part of a wider subdivision at 106-108 and 110 Hobsonville Road, which contains 38 industrial lots. With a focus on high-employment density, the redevelopment includes part of the Hobsonville Village Centre, between Hobsonville Road and the Upper Harbour Motorway.

Founded in 1991, National Mini operates nine facilities in Auckland. In addition to traditional storage, it offers vehicle storage, and sells moving and packing supplies.

A development proposal from self-storage owner Joseph Giardino was reviewed last week by the Amsterdam, N.Y., Planning Board, which pushed it forward for examination by the Montgomery County, N.Y., Planning Board. Giardino, who already operates a Secured Storage USA facility in the city, intends to build three single-story storage buildings at 133 Route 67. The 30-by-90-foot structures would comprise about 8,100 square feet on less than an acre, according to the source.

Amsterdam planners had previously expressed concern about whether the facility’s drive aisles would be gravel or paved and asked to see detailed blueprints. Giardino presented detailed plans during the meeting and indicated the aisles would be gravel.

When presented with photos of his existing self-storage location at 4786 State Highway 30, Giardino confirmed the new buildings would be “exactly the same, but a different color.” Planners described the design as “very clean,” the source reported.

The Secured Storage facility on Route 30 is just north of a proposed $15 million U-Haul self-storage development under consideration by Amsterdam and Montgomery County officials. It serves as an authorized U-Haul truck-rental dealer, according to its website.

The Amsterdam board scheduled a public hearing for Sept. 6 to discuss the Route 67 project.