Construction Corner is a Q&A column committed to answering reader-submitted questions regarding construction and development. Inquiries may be sent to [email protected].

Q: We are planning to install a music and paging system at two of our facilities. We are not familiar with the wiring or electrical requirements of these systems and thought you could offer some help.

Robert in Farmingdale , N.Y.

A: Music and paging systems come in many flavors. Electrical and wiring needs will depend on the type and size of the system. First, consult your supplier or installer to determine what will work best for you, keeping in mind each speaker or horn requires power, and the amplifier for the system must be able to handle the load. Most systems require the use of a 22- or 18-guage wire (depending on distance) that is shielded with two conductors.

Q: At my facility, I currently have a manual chainlink gate I push open in the morning and close at night. I would like to switch to an automated gate that will allowmy tenants access after I leave for the day. I would likely run the entire conduit myself, but do not know what size or type, or from which points I need to run it. Could you offer a guideline?

Dave in Reno, Nev.

A: Most access-control systems are controlled by outdoor keypads that use a common type and size of conduit. Your local codes and regulations will usually dictate exactly which type of conduit and how deep it must be buried. However, as a guideline, you will usually want to use PVC or Rigid conduit underground and have it buried at least 24 inches below grade.

You have two paths that are important for a standard gate system: from the office to the gate motor, and from the gate motor to the keypads. Following are examples of common installations: Run a 1- to 1.5-inch conduit between the office and gate motor. The larger of the two will allow for added features, such as a keypad camera or intercom. Run a .75- to 1-inch conduit between the gate motor and each keypad location. It is recommended to have the keypad-stand foundation be concrete and at least 18 inches deep.

Tony Gardner is a licensed contractor and installation manager for QuikStor, a provider of self-storage security and software since 1987. For more information, visit www.quikstor.com.

In 1985, Mid-City Storage was simply an abandoned shoe factory in Cincinnati. By the end of the following year, this complex of approximately 140,000 square feet had been converted into artists studios and workshops, bulk storage, records storage and, more important, self-storage units. Inside the buildings were sprinkler systems, elevators and boilers. There was also a substantial amount of existing plumbing, electrical and wall systems that needed renovation, removal or replacement to convert the vacant space into a multipurpose self-storage destination.

Self-storage developer and visionary R.A. Hermes and his team had to rely on their experience in design and construction to plan the conversion. At that time, selfstorage was only a concept to many, and resources were few and far between. There were no pre-engineered partition systems, only a handful of feasibility experts, and many financers had the opinion that self-storage was speculative real estate. It took a little imagination and a lot of perseverance to overcome the challenges of a conversion. This article outlines some of the most important considerations for a conversion project.

A Sure Foundation

When undertaking a conversion, the primary focus should be on the overall structure of the building. You must have a sure foundation, including floors. Ideally, floor-load capacity needs to be 125 pounds per cubic foot; however, in one instance, we were able to overcome the building departments objections to converting a second-floor space where the floor load was only 85 pounds.

After thorough research, we discovered the loading capacity of moving trucks and shipping containers designed to move household goods do not exceed 10 pounds per square foot. The storage units were limited to 8 feet in height, meaning a total of 80 pounds per cubic foot. In addition, 20 percent to 25 percent of the floor area was hallway space and common area that is normally unused. It made sense to us that if the prospective tenants couldnt get their belongings on the road in a moving truck, they wouldnt be able to bring their goods into the building.

The building department was likewise convinced. With the condition we hang signs that read 85 Pounds Per Square Foot, Household-Goods Storage Only, they granted our building permit.

A Sound Roof

The cost of roof repair or replacement can be the largest unexpected cost of a conversion project. Whether the roof is built-up or rubber, if its close to 20 years old, youll want to consider complete replacement. Roof leaks can be extremely detrimental to a self-storage operation. It usually isnt a matter of if your roof will leak, its a matter of when. In a conversion, the roof is usually higher than the tops of the storage units, so you know immediately when you have a leak. Your tenants know as well, and even if no damage is caused to goods, it causes tenants to re-evaluate their need to store at your facility when they see water in buckets or hallways.

The most common replacement options for a flat commercial/industrial roof are EPDM rubber or another type of single-ply system. Another option gaining popularity is to replace the current roof with a metal- Galvalume one. The Galvalume process is similar to galvanizing, which is a zinc coating; but Galvalume is 80 percent zinc and 20 percent aluminum, thus having a superior rust-protection coating. A Galvalume roof can last up to 50 years.

What option is best for you? Determine the cost over the life of the roof. Add the cost of the repair or replacement to the cost of financing the work. Divide that number by the life (in years) of the option. Also consider the following: If the roof can be seen, will it improve the look of the facility? How will the new roof affect the resale price? How much is peace of mind, tenant longevity and good will worth?

A Good Layout

Next, consider the overall layout of the building(s). What about customers? How will they access the building? When will they require access? Where will they load or unload their belongings? What sections of the building will be climate-controlled? How do you monitor access? Try to keep units no farther than 100 feet from the nearest point of entrance. Larger units should be kept closest to the entrance of the building.

When working with an older building, handicap access may have to be installed. If you have an existing dock area, consider installing a ramp next to the dock to provide the handicap access. Handicap ramps are not allowed to be more than a 1-in-10 slope. Most loading docks allow for a tractor-trailer length. By doubling-back the ramp, you can use one dock area as the handicap access ramp.

When creating the rental office and choosing your security systems, keep in mind more than 60 percent of self-storage shoppers are women. Even though you may have taken an old warehouse building and turned the space into self-storage units, it shouldnt feel like a maze of units in a big old warehouse. Use white or battleship gray and paint everything, including the ceilings of the existing building.

To hide an unsightly ceiling, paint it black. To make this more effective, extend the black paint down the walls 1 to 3 feet. A final touch is to paint a bright band around the bottom of the black paint. This creates an illusion that prevents a person from looking up past the wall to the area above the bright band. Thus, the average eye does not notice the ceiling. Another option is to highlight the exposed ductwork, sprinkler system, conduit, etc., by painting bright colors to create a designer look. Be aware this option is a little tricky and more difficult to pull off.

A third option is to install a suspended ceiling. Be sure the suspended- ceiling system does not interfere with the sprinkler system. In some cases, you can facilitate drop out panels in your suspended system. If building code allows it, these panels can be installed below the sprinkler heads. In the case of fire or sprinkler- head activation, the ceiling panels drop out of the ceiling grid. Egg-crate panels are another option below sprinkler heads. These consist of open squares, available in different colors. They create a nice effect for high-profile areas and rental offices.

Comfortable Environment

It can make sense to facilitate the existing heating, ventilation and air-conditioning (HVAC) system to provide climate-controlled storage. However, the existing system may not have the most desirable control system. Weve seen some heating systems that run continuously from the time the system is turned on in the fall to being shut off in the spring. It can be as easy as having a thermostat installed to turn the system on and off as necessary; however, more elaborate systems are available. Depending on the system, this can pay for itself in as little as one day of operation.

If your building only has a boiler system or space heaters and you want to add air-conditioning, a rack system is an effective option. A rack system consists of A/C units (and heaters if needed) and a high-powered blower unit mounted above the storage units. The air-conditioning units run as needed to maintain the desired temperature while the blowers run constantly, continuously circulating the air. This eliminates the need for ducts, maintains a consistent temperature throughout the space, and helps prevent mildewing of tenants goods. A rack system is effective for heating and cooling in a new climate-controlled facility as well.

If maintaining heat in the building is not cost-effective, consider converting wet sprinkler systems to dry ones. Dry systems need routine drainage of the low-point valves to alleviate any condensation that may build in the lines. Wet systems only require the building temperature does not fall below freezing.

Intercoms, sound systems, video surveillance and electronic access create a more inviting presence. Remember your clients will be unloading goods, moving through the building and into their unit. It should be easy for them to find their spaces. Try to make the hallways line up as in a grocery store. Use automatic sliding doors for convenience. Post directional signage. When numbering the units, use the first and last number of the hallway units as indicators.

Convenient Access

Weve noticed many buildings shut down when the rental office does. This means if your rental office is open Monday through Friday, 9 a.m. to 5 p.m., your customers have to access during those same hours. These times may not be convenient for tenants who work during the day. One option is to extend the rental-office hours. Access to the building must be secure and monitored, but convenient for tenants. Some doors may be set to open during office hours, but require a code or key faub.

Reasonable Expectations

Finally, another ingredient essential to your conversion success is to have reasonable expectations. Conversion facilities are not the same as conventional self-storage facilities. Because the units are not subject to the weather and rain doesnt wash the doors off, dust builds up. Allow enough time to keep the facility looking neat and clean. Also allow for maintenance contracts on the building systems, i.e., elevators, sprinklers and HVAC systems. Realize your costs will be higher than those at a conventional facility.

A Little Luck

Converting a vacant building that no longer fulfills its need to a useful self-storage operation is a noble concept. Self-storage is a need-driven product. Communities need self-storage for their residents. In the past, conversions have been successful in densely populated and major metropolitan areas where available land for a conventional facility is either cost-prohibitive or not available. However, many suburban communities are facing changes in zoning or retailers. Likewise, many department stores have consolidated stores or abandoned smaller stores for larger big-box operations.

In these markets, many opportunities exist for future self-storage development in an existing vacant building. With a little imagination, a sure foundation, a sound roof, a good layout, a comfortable environment, convenient access, reasonable expectations and a little luck, you may find your diamond in the rough.

Erik Hermes began developing self-storage facilities in 1980 with his father, R.A. Hermes, and is president of Hermes Construction Co., a design/build firm specializing in self-storage, conversions and multistory construction. For more information, call 859.781.7198; e-mail [email protected].

Melissa Hermes is co-founder and president of the Ohio Storage Owners Society and Kentucky Self Storage Organization. She is also president of Manager On-Call, a national call center devoted to providing professional answering services to the self-storage industry. For more information, call 866.271.0066; e-mail [email protected].

In part I of this article (Inside Self-Storage, July 2003), we looked at the following questions:

We answered the first two questions by studying a ficititious facility. What we learned was that, by giving away 8.62 percent of its rental income in monthly discounts, the facility was only gaining a 4.32 percent increase in its length of tenant occupancy. Until we did our math analysis, we could only guess at the true value of offering rental discounts. Several of you sent me the results from your storage facilities. Most of you were quite surprised by your findings.

Now lets analyze another popular promotion, the first-month $1 move-in special. As before, we will start with an exported report from our management software and keep only three columns: street rent rates (column A), actual rent being paid (column B) and the tenants move-in date (column C). (If you want a refresher on how to do this in Microsoft Excel, refer back to the July issue.) Here is a short sample output representing our small facility:

Is a $1 first-month move-in special more profitable than offering rental discounts?

Lets assume the tenants currently paying a discounted rent had instead been given their first months rent for a $1. As before, we will place our formulas in the empty D column and explain their meaning in column E. For consistency with part I of this article, the listed answers will presume today is 6/1/03.

Lets start by highlighting cell D1 and typing =SUM(IF(C1:C9999=,0,IF(A1:A9999>B1 :B9999,A1:A9999*DAYS360(C1:C9999, TODAY()),0))/30).

Hold down the SHIFT and CTRL keys while you press ENTER. This last step instructs Excel that you are using data sets. Curly brackets are automatically applied to the ends of the formula as confirmation. Move to cell E1 and fill in what this new number represents: Gross Potential Rent on Discounted Units.

Now move to cell D2 and type =SUM (IF(C1:C9999=,0,IF(A1:A9999>B1:B9999 ,A1:A9999-1,0))). Again hold down the SHIFT and CTRL keys while pressing ENTER. In cell E2, type Net Loss With $1 First- Month Move-In Discount. Finally, move to cell D3 and type =100*D2/D1. This time, just press ENTER, move to cell E3, and type Percent of Lost Revenue on Units With Discounted Rent.

For our example, the value in cell D3 is 19.12 percent. This is an extreme loss in income just to achieve a 4.32 percent increase in our length of occupancy. It is even worse than the 8.62 percent loss that resulted from rental discounts. As before, try these formulas with your site data, as it may produce very different results.

Does offering automatic rent collection make financial sense?

Do you mail a tenant statement prior to rent payment being due? If so, your tenant will review the merits of his monthly rent expense before sending each payment. He may decide to vacate the unit and save his money. But what if you could diminish this risk and reduce postage expenses for you and your tenant?

Automatic rent collection eliminates the need to pre-inform your tenants of each rental payment. The tenants signatureon- file allows you to automatically debit rental funds from his checking or savings account (the banking term for this is ACH). Without monthly invoice reminders, most tenants will stay longer. I have found 60 percent of tenants will choose automatic ACH debiting, and 70 percent of those will remain renters for one additional month.

Your ACH-merchant bank fees are set by the management software you use, and those rates can vary dramatically. Some software companies charge as low as 20 cents per transaction while others tack on profit-sharing and raise your fee to 1.3 percent of every transaction. Again, we will use our oversimplified sample site to perform some calculations.

First, we need to know how many tenants we have at our site. Lets start at cell D4 and type =SUM(IF(C1:C9999=,0,1)). Hold down the SHIFT and CTRL keys while you press ENTER. Now move to cell E4 and type Occupied Units.

Now lets calculate the average retail-rack (nondiscounted) rate for our site. In cell D5, type =SUM(IF(C1:C9999=,0,A1:A9999))/ D4. Hold down the SHIFT and CTRL keys while pressing ENTER. Now move to cell E5 and type Average Rack Rate of Occupied Units.

Here comes our formula to calculate the average length of occupancy for all tenants who pay the street rate. In cell D6, type=SUM(IF(C1:C9999=,0,IF(A1:A9999=B1:B9999,DAYS360(C 1:C9999,06/01/03),0)))/(30*(SUM(IF(B1:B9999>0,IF(A1:A9999= B1:B9999,1,0)),0))). Hold down the SHIFT and CTRL keys and press ENTER. Move to cell E6 and type Months of Occupancy For Nondiscounted Units.

Finally, lets combine all the above values to determine our monthly gain from implementing ACH rent collection. We will assume the merchant fee is 20 cents per transaction and remove those fees from our total. As noted above, 60 percent of our tenants will choose this ACH service, and 70 percent of those people will stay for an extra month. In cell D7, type =.6*.7*D4*D5/D6-.6*D4*0.20. Press ENTER and move to cell E7 to type Net Monthly Increase From ACH Rent Collection. To turn these these dollars back into a percentage, go to cell D8 and type =100*D7/D4/D5. Press ENTER, move to cell E8, and type Percent Income Increase From Automatic Rent Collection. Your spreadsheet should now look like this:

From our table, we see that offering automatic rent collection is increasing our income by nearly 8 percent without giving anything away. This increase far exceeds the gain we achieved when we tried rental discounts and the $1 move-in special. This savings has encouraged hundreds of storage facilities to switch to ACH. The added income can pay for your door alarms, e-commerce, a kiosk station or video surveillance. In turn, these items will make your facility more valuable. Talk to your current vendor about which of these products/ services it offers.

On a personal note, I would like to thank the hundreds of readers who have sent me their suggestions and questions over the last two years. This is my final TechTalk column. I will, however, continue to reply to all reader inquiries.

Doug Carner is on the Western-region board of directors for the Self Storage Association. He is also the vice president of QuikStor Security & Software, a California-based company specializing in access control, management software, digital video surveillance and corporate products for the self-storage industry. For more information, call 800.321.1987; e-mail [email protected]; visit www.quikstor.com.

The discovery of hazardous materials in a self-storage unit can happen to even the most cautious storage operator. You might come into work one day and discover gas has spilled onto your property from a nearby construction site. Perhaps you find an abandoned unit filled with old tires and cans of oil or, even worse, toxic chemicals. Your local health department requires you to hire a certified remediation contractor to clean up the contamination; but since the tenant cannot be found, you get to foot the entire bill.

Cases like these are typical, and self-storage facilities grow more attractive to criminals and freeloaders alike. Reports of people dumping tires, oil, gasoline and even biohazardous chemicals in rented storage units seem to accumulate. So how can you protect your facility from becoming a toxic-waste dump? Prevention is the best approach, but there isnt one specific way to keep tenants from storing and dumping such materials. There are measures you can take to reduce your risk, and insurance-coverage options are available should you fall victim to pollution from a covered cause of loss.

The Cost of Clean-Up

When a tenant leaves behind hazardous chemicals, even the smallest cleanup and disposal jobs can cost thousands of dollars. Check your insurance policy to see what type of clean-up and disposal coverages you have or may want to consider purchasing. Most policies have a built-in limit for pollutant clean-up that covers up to certain amounts per occurrence.

Keep in mind coverage only pays for covered causes of loss such as fire, vandalism, theft and windstorms to name a few (an actual list of covered causes can be found in your insurance policy). For example, if you have a fire on your property and the aftermath leaves behind chemical wastes that must be extracted from the ground, your pollutant clean-up coverage would most likely cover the costs as long as it happened on the property during your policy period.

Pollutant clean-up does not cover the expenses to legally remove hazardous contents left in a unit by a tenant such as tires, oil, gasoline, meth labs or biohazardous chemicals. Hazardous-contents removal is an optional coverage that will reimburse you up to certain limits for expenses you pay to remove such contents dumped by a tenant. Please note this optional coverage does not cover any fines or legal fees the storage owner may have to pay.

It is important to evaluate the surrounding neighborhood of your storage facilityparticularly its crime ratewhen considering this coverage. Storage owners who set up shop in industrial or high-crime areas may want to consider purchasing a higher limit. Storage facilities in less-populated areas with a low crime rate may not need higher limits or any coverage at all.

Stop the Problem Before It Starts

Sometimes people store prohibited items simply because they do not know better. Make prospective tenants aware of the types of materials considered hazardous and why they are not allowed to be stored at your facility. They may not realize items such as tires and cleaning materials become a fire hazard when stored at warm temperatures.

Make it clear that storing hazardous or toxic materials in units is not allowed, and reinforce the policy by including it in the lease agreement. Remind existing tenants of this policy by posting signs in the rental office and around the facility. The goal is to educate uninformed tenants as well as scare off potential dumpers. The more difficult you make it for people to abuse your units, they more likely they will go elsewhere.

To avoid purposeful dumping or criminal activity, request positive identification from every tenant, including a drivers license and Social Security number. Authorities can find most people with these two items, so do not accept anything less. In addition, do not accept a P.O. box as the sole contact address. Insist on a physical address where the tenant can be located if necessary. Some say this may deter people from renting units, but more important, it will decrease your risk of renting to a dumper or someone looking to engage in illegal activity.

Once you have the prospective tenants contact information, quickly verify its veracity. Mail a welcome letter to the address and make courtesy phone calls to the given numbers. If any of the contact information is inconsistent, confront the tenant immediately and have it corrected before allowing him access to his unit. Most likely, an incorrect phone number will be nothing more than a simple mistake, but it is better to be safe than sorry.

If someone is looking to store hazardous materials at your facility, he may bring it in a truck or van, as most of these items cannot fit in smaller vehicles. Make your tenants aware all vehicles may be searched on entry to the facility. This way, you can deter someone from bringing in prohibited materials and stop the problem before it starts. Enforce the search policy whenever you have suspicious-looking vehicles entering your property, such as unmarked covered trucks or vans, especially if they tend to back up into the unit on every visit.

There is no guaranteed system for preventing a self-storage unit from becoming a haven for hazardous materials. You can reduce the chances of your facilitys exposure to toxic dumping by taking preventive measures, enforcing policies and having appropriate insurance to assist with costs should you fall victim.

Universal Insurance Facilities Ltd. offers a comprehensive package of coverages specifically designed to meet the needs of the self-storage industry. For more information, or to get a quick, no-obligation quote, call 800.844.2101; fax 480.970.6240; e-mail [email protected]; visit www.vpico.com/universal .

This article discusses the selection and use of facilities, units or alternative space for a records management operation within the walls of self-storage. There are common misconceptions and misunderstandings about the maximumization of space that prevents owners and operators from achieving the highest return on investment.

The most common question asked by self-storage operators seeking advice about a new records-storage operation is, How much space do I need? There is no single answer to this question. My usual response is quite simple: Start with what you already have. Now, that response requires a little further explanation.

Starting a records-storage and management facility with a self-storage operation can be done in several ways. Over the past few columns, I have discussed how nontraditional records management differs from traditional. I have explained how a self-storage facility can be profitable in 90 days or less. But that result requires one primary component: storage space. Lets look at the space issue from three perspectives: conversion of existing storage units, one at a time; conversion of a whole area or block of units; and conversion or construction of a separate building.

Conversion of Existing Units

It is always best to select the largest units possible for records storage. Never select units smaller than 10-by-10-by-8, and always choose those with the highest ceiling. Units smaller than this size do not effectively accommodate racking. A recent density study conducted by a provider of records-storage shelving showed the best standard unit sizes are:

Note: Yield per square foot is based on 35 cents per unit for storage and 65 cents per cubic foot of billable storage for service. In my recent column titled Price and Yield Differences (May 2003), I discussed the difference between price and yield per cubic foot of storage. It is common in nontraditional records management to yield one-and-a-half to two times the computed yields above. Now lets add a higher ceiling height of 12 feet to the mix and see what happens:

Do you see the difference here? The higher the ceiling, the more revenue you achieve per square foot.

Conversion of an Area

Choosing a contiguous area for records storage is always a good decision. I know one owner who chose 20 side-by-side 10-by- 10-by-8 units, took out the dividing walls, and achieved 10 percent more density. Aside from getting the additional 10 percent or so from maximizing storage space, your operation is simplified by grouping boxes in an area of your facility rather than scattering them around.

Conversion or Construction of a Separate Building

If you have a separate building with an area of 5,000 square feet or more, and if ceiling heights range above 16 feet, you may have a great starting scenario. Lets look at the make-up of such a structure and its attributes.

If we compute length times width times height of a 5,000- square-foot building with a 16-foot clear ceiling, we get a cubic area of 80,000 cubic feet. Using a density ratio of 50 percent, we find we have 40,000 billable cubic-foot units:

With 16 feet or higher ceilings, it is possible to introduce catwalks to your shelving system. This will allow you to have 30-inch aisles, which provide maximum density and reduce the need for access ladders. My experience indicates once you have achieved approximately 35,000 cubic feet of billable storage, you have the ability to use your cash flow to support the enlargement of your facility and move toward the more traditional model of records management.

Optimum Facility Size

Is there an optimum facility size? Throughout the world of traditional records-management facilities, there is a variety of sizes and shapes and ceiling heights, ranging from a 10-by-10-by-8 unit to a 20,000-square-foot area to a building more than 100 feet high (in cities such as Hong Kong and Singapore). The optimum building size I suggest is 10,000 square feet with a 30-foot ceiling height, or 300,000 cubic feet:

There are many in the industry who would argue this is not the optimum size with which to start. But lets see if I can make my case. First, using standard industry statistics, this size building grosses monthly revenue of $1.04 million over 12 months. But most commercial records centers are underachieving in revenue. It is my observation they typically leave more than half of every sale on the table. Based on potential revenue, records-storage operators could yield as much as twice this amount. Is it easy? No. But if it were, everyone would be doing it! It requires diligence, management and control, plus a formidable selling process.

The second reason this building size is optimal is its contribution to protecting your assets. Fire has caused problems in this industry in the past. But since you limit your contractual liability to only $2 per box and your facility is presumably insured, what, then, is really the problem? If there is a fire in a records center and it is not extinguished quickly, chances are the entire facility will burn to the ground. The problem is not the lost records or the lost buildingit is the lost revenue stream. Lost revenue on 125,000 boxes is a difficult pill to swallow, but by segmenting your records into several smaller buildings, you can limit your loss. I recommend putting 30 feet or more between buildings.

Finally, the industry has a common myth. I call it The Myth of the Six-Month Sales Cycle. My recommended selling method controls the sales cycle to 60 work days, or three calendar months on average. The process requires 25 predisposed prospects in the sales cycle at any one time and closes four to five accounts per month. The expectation for a single salesman is 100,000 cubic feet of records storage in the first 30 months. This size building would support the sales effort and provide a base for future expansion.

Perhaps I have convinced you about the optimum size, perhaps not. There is certainly room for argument. But dont believe the naysayersrecords management works in self-storage in many different ways!

Regular columnist Cary McGovern, CRM, is the principal of FileMan Records Management, which offers full-service records-management assistance for commercial records-storage startups, marketing assistance, and sales training in commercial records-management operations. For assistance in feasibility determination, operational implementation or marketing support, call 877.FILEMAN; e-mail [email protected]; www.fileman.com.

The competitiveness of todays self-storage industry has forced us into the same realm as retail businesswhich relies heavily on marketing and salesto fill our facilities. These days, self-storage companies spend tens of thousands of dollars per month, not only on Yellow Pages advertising, but on radio and television. All this is designed to do one thing: get the phone to ring. But after all of that money and effort, it is still up to somebody to handle the call in a professional manner and convince the caller this is the facility he should choose.

The primary role of a self-storage manager is that of a salesperson. Consider the top three reasons people choose a facility:

1. Convenience/Location

The majority of customers (90 percent) pick three to five ads out of the phonebook and call them based on where they are located.

2. Security

Not to be understated in this category is perceived trustworthiness. When it comes to security, most of the competition is pretty evenly matched as far as features are concerned. Most have computer-controlled gate access, fencing, lighting and video surveillance. Therefore, it is the person behind the counter who makes the prospect feel a particular facility can meet his needs better than others.

3. Price

This is actually third on the list, and if youve done your homework, you know what your competition is charging. Since the playing field is usually pretty level in this category, it can only be the person who does the better job selling who gets the customer.

Nobody is inherently born with all the skills, knowledge, professionalism and communication talent necessary to handle phone sales in an efficient, effective manner and produce desired results. It takes education and practice. To educate yourself in telephone-sales techniques, you need to understand the five basic steps of the phone sale.

Step 1The Greeting

A professional, rehearsed but sincere greeting will make a lasting first impression on anyone.

Step 2The Inquiry

You cannot properly advise someone as to how you can best fill their need for storage without determining when, why and even how long they need it. The inquiry is not only necessary for determining the customers needs, it allows you to control the flow of the conversation by asking questions and leading the discussion away from the subject of price. Often, Q&A will allow you to begin building a relationship. It will also alert you to the customers primary concerns. You can then address those areas first and put them to rest.

Step 3Value-Building

Once you know the customers needs and primary concerns, you can tell him about the features your facility offers and how they benefit the customer (meet his needs, address his concerns). If you have done this well, the price of the recommended unit will come across as a value, not an expense.

Step 4The Appointment

The object of the sales presentation is to get the prospect to visit your facility. Once there, the odds are in your favor (90 percent) that he will rent from you. The next logical step is for him to come in and determine for himself what size and style unit will best meet his needs. To get a firm appointment, it helps to create a sense of urgency. And it is OK to ask for the appointment. Our industry is need-driventhe prospect needs storage or he wouldnt have called you. One final note: Be sure to give him directions and landmarks to your store. This not only confirms he knows where you are located, but gives you the opportunity to steer him away from the competition.

Step 5The Close

End the call by asking if there are any further questions. This ensures you have addressed all the prospects concerns and dont leave anything for your competitor to answer. Offering to forward a brochure or some literature not only shows you are going the extra mile to help, but gives you a reason to get the persons information, which can then be used to follow up in a few days. Finally, giving him the name of your facility while thanking him for his call, is a proven method of solidifying your facility in his mind: Thank you, Mr. Jones, for calling ABC Self Storage.

Once you understand these steps, you can create a phone script, which will help you consistently achieve the maximum impact of your sales presentation. It will also help keep track of the important points you need to cover to be most effective in obtaining your goal: to realize the value of that call! You need to sell prospects on using your facility over others. You can do this by outselling your competitors on the phone.

The Mystery Shop

Mystery shopping is when you call a competing facility as a prospective renter to get an understanding of the managers phone skills, what specials the facility is offering, what features it has, and even its prices. Once you have an idea how good your competitors are, you can compare them to your operation by mystery shopping your own managers.

This should be done by an independent, third-party company for reasons of maintaining objectivity. These companies can supply you an audio tape of the conversation, as well as a previously agreed score sheet that details via a point-rating system the strengths and weaknesses of the call. They will even outline what the individual needs to do to strengthen the sales presentationall for between $25 to $50 per shop. If you think that is too much to spend on training for better sales presentations, consider what is at stake.

To figure out the cost of the average prospect call (which is very different from its value), divide your total advertising and marketing dollars for a given period of time by the total number of calls in the same period. For instance, if a facility spends $500 on a mailer one particular month and receives 50 calls, each call costs $10. This is money paid in advance. It is spent and gone whether the manager decides to answer the phone or not.

The value of the prospect call is what is at stake in your phone-sales presentation. It depends on whether you convince the customer to rent from you. It is determined by taking the average unit rental rate and multiplying it by the average length of stay. If the average rental rate is $75 and the average length of stay is 13 months, the value of the call is $975. This is what is at stake during every sales call.

It is expensive and difficult to get customers to call you. You must capitalize on the finite number of people who actually need storage at any given time. You cannot increase call volume at will by spending more money, regardless how well you do on the phone. It is easier and more cost-effective to increase the number of calls you convert to rentals by improving your sales skills and raising your closing ratio. In fact, the amount of call volume you do not convert to rentals becomes a tremendous missed opportunity.

For example, lets say you received 50 calls one month. Statistically speaking, only 88 percent represent valid businessthat is, only 44 of those callers will actually rent from someone. If you achieved an average closing ratio (35 percent is the national), you only closed 15 of them, leaving 29 potential rentals on the table. At $975 each, youve missed $28,275 for the month, or $339,300 per year. Thats a lot of missed opportunity. Perfect the phone-sales presentation, close more calls, and reap greater profits.

David Fleming is the director of operations for North State Storage LLC of North Carolina, which acquires and manages properties throughout the southeast region of the United States. Mr. Fleming provides operational consulting, training and auditing services to the self-storage industry as well as third-party management. He can be reached at 919.313.2764; e-mail [email protected].

 

This month, I gathered a roundtable of experts to discuss the state of selfstorage in the Western United States. Lets hear what local experts have to say about their respective cities and regions. Our panel of brokers includes: Richard Arnold, Arnold/Forcum & Associates, Portland, Ore.; John Battle and Clifford Crowe, Lee & Associates, Carlsbad, Calif.; Larry Hayes, Hayes & Associates, Missoula, Mont.; and Joan Lucas, Joan Lucas Real Estate Services, Denver. Because of the unique economic times in which we find ourselves, I have contributed comments on the national market as well.

Why should investors in other real estate types think about investing in self-storage?

Arnold:

Besides the lower maintenance costs and the ability to put their eggs in many baskets, investors should consider self-storage for the greater return they can achieve than from most other types of real estate. Buyers are currently purchasing other real estate showing returns of 7.5 percent to 9 percent, whereas buyers acquiring self-storage properties are showing debt-free returns of 9.5 percent to 10.5 percent.

Battle:

Self-storage as a real estate investment vs. other property types offers many advantages: low maintenance, virtually no roll-over expense, no long-term tenancy, and no barriers to entry, especially in many areas of the West.

Crowe:

Those self-storage facilities that have sold in Southern California are yielding to the purchaser approximately 1 percent or more yield than office, retail or industrial products, and 2 percent to 3 percent more yield than apartment investments.

Lucas:

Its the good news/bad news story. Potential investors should think about getting into self storage because it is an industry that seems to be relatively (but not totally) recession-proof; it provides great returns on investment with lower overhead, repair and maintenance than other types of real estate. Two people can manage a property that is 45,000 square feet. When a customer moves out, the manager sweeps out the unit, closes the door and waits for the next guy to come along. And lenders still have money available for this type of product. The bad news is there are very few good, well priced properties on the market. Hence, those properties that are on the market are often priced at aggressive cap rates.

Hayes:

Self-storage is still providing a better return on investment than most other real estate investments. In our area, it is providing a 2 percent to 3 percent better return than apartments or NNN (triple-net) properties.

A percentage point or two may not sound like much, but it is a 10 percent or 20 percent increase in cash flow!

What kind of returns can an investor reasonably expect before and after debt service?

Battle:

Returns in California before debt service range from 8 percent to 9.5 percent, depending on location, age and competition. After debt service, the cash-on-cash returns vary widely, depending on whether the financing on the property was placed within the last six to 12 months. If that is the case, the returns would be in excess of 10 percent.

Crowe:

You can expect an 8.5 percent to 9.5 percent capitalization rate (annual return before tax) and 10 percent to 12 percent cashon- cash return, assuming 25 percent down and 6 percent financing. While these returns are great in California today, Im encouraging some of my buyers to look out of state, where they can get higher cap rates and higher returns.

Hayes:

Depending on the quality of the facility, an investor can expect between 9.5 percent and 11 percent. A facility with a 10 percent return based on cash, leveraged 75 percent over 20 years with 6 percent interest, would give a return in the 14 percent range.

Lucas:

Lets say a property is sold for $1.4 million. It kicks off $140,000 in net operating income (NOI) per year. The investor will usually put down about 25 percent of the loan amount, leaving a balance in the amount of $1,050,000. His NOI the first year is $140,000, and he puts $350,000 into the deal, so his cash-on-cash return for the first year (before debt service) is 40 percent. How cool is that? However, then we calculate return after debt service. Lets assume the buyer gets a $1,050,000 loan at 6.75 percent, with a 20-year amortization and a five-year balloon. His annual approximate debt service would be $96,000 (before taxes) per year. Therefore, if the site was netting $140,000, his after-debtservice cash would be $44,000. Cash-on-cash return is then 12.6 percent.

These low interest rates may make cash on- cash returns astonishingly high for those of us with long memories in the real estate business. It was only about four years ago we had a negative spread of NOI return to debt service constantly creating negative financing leverage.

What impact is the change in the capital gains tax rate going to have on the market?

Arnold:

The lowering of the rate should make all investments more attractive.

Battle:

It should make the decision to sell easier, since it wont be nearly as costly to sell if one does not do a 1031 tax-free exchange.

Crowe:

Historically, a capital gains tax cut has meant a stronger market, more new issues and economic growth for a long time. More product should come on the market due to less tax. In California, owners have not had a good alternative for improving their investment and, therefore, have held on to what they own. The lower capital gains rate may influence more owners to sell.

Hayes:

Historically, because the after-tax dollars are greater, reduced capital gains have been a positive incentive to sell.

Lucas:

I think it will stimulate more 1031s.

I agree there are no negatives to the reductions in the capital gains rate; however, the time limitations on the law provide a little uncertainty for the future and may force some owners to sell sooner than later.

Is financing readily available?

Arnold:

Yes. Decent properties and strong borrowers can readily obtain 10-year fixed loans at or below 7 percent.

Battle:

There is an ample supply of capital for financing of ground-up development and investment sales.

Crowe:

Yes! In the mid-5 percent to low-6 percent range.

Hayes:

In our area, money has been available to strong buyers.

Lucas:

Yes, there are several banks and lenders in Colorado that are making good loans right now. Its often difficult to find a lender who will do small loansthat is, $500,000 up to $1 million. But I have seen deals made in this price range.

We are going to look back on these days and say, Why didnt we borrow more and buy more real estate? It is so obvious we may be missing part of the uniqueness of these times in history.

Considering the potential returns, are buyers being too picky?

Arnold:

I dont believe so. There is a lot of demand for any good, well-managed selfstorage property.

Battle:

The problem is not that buyers are being too picky but the lack of product to buy, at any price. Most of the deals that hit the general market are snatched up within a matter of days. There is a pent-up demand for self-storage facilities throughout the West.

Crowe:

In the California market, there are plenty of buyers. Since they cannot find product, they seem to have adjusted to what the market is and are prepared to step up to the table for it. Any prudent buyer is going to do his due diligence, make sure everything is as represented, and make sure he can meet his expectations.

Hayes:

Buyers are not picky, theyre spoiled. They are probably remembering the good old days.

Lucas:

How can you ever be too picky when it comes to your own financial situation? We have all seen a dramatic loss in our worth in the last several years. I encourage everyone to be cautious.

You cant play in this world of wonderful interest rates unless you have a property.

Are sellers just too greedy, or are there anygreater fools?

Arnold:

I dont believe real sellers, as contrasted with those who say Everythings for sale for the right price, are too greedy. Some are ill-informed. I have found few owners who discuss selling their properties who have any idea what is going on in the market. If they want to sell, they pay attention to the information we provide. If they will only sell for a stipulated figure, they probably arent sellers.

Battle:

The biggest objection to selling owners make is, What do I do with the money? They are enjoying excellent cash flow that is very difficult to replace with a bigger or better project. Unless they are really motivated to sell for reasons such as estate planning, partnership problems, etc., they will not sell.

Crowe:

The peak in the market sales price (maximized returns), is mostly determined only in hindsight. But if I were to pick a time to sell and maximize my return in California for self-storage facilities, I would say now would be a good time.

Hayes:

I dont think many sellers realize what an ideal time it is to sell. When interest rates return to historically higher levels, self-storage properties are going to require larger down payments, provide lower cash returns and bring lower prices.

Lucas:

Unfortunately, I know some sellers who are just pricing themselves right out of the market due to their inexperience and lack of knowledge on what it takes to put a deal together. And they dont want to listen and learn. The bottom line is they arent really sellers. They sit there with a facility priced too high, on which they get a lot of inquiries, but never get a deal put together. As brokers, we dont want to work with them because we know a deal cant be made. It is a waste of everyones time, and can hurt the long-term salability of the property.

The irony is that the best time to sell is the same as the best time to buy. A great mentor of mine always said, Make your own deal, not the other guys. His advice sure keeps you from passing on a good deal by hoping to take future profit away from the buyer. He has to have something too!

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

When the staff of Inside Self-Storage contacted me about an article for this issue, I was asked if I would be interested in addressing the topic, Selecting a General Contractor. My answer was, yes and no.

If youre going to build a self-storage site, yes, you will need a general contractor (GC). However, this role seems to be ever-changing in our particular industry. More and more, I see facility owners acting as their own GC or construction manager, or putting together some other form of design-build team. The end goal, of course, is to save time and money.

I have been involved in some very successful design-build projects, and I have seen some disasters. What makes the difference? I hate to sound cliché, but the simple answer is cliché: Coordination and planning on the front end. Therefore, a more fitting topic for this issue is Coordinating a Design-Build Team, with emphasis on the word team.

Whats Your Problem?

In construction, there are always going to be problemsyou can count on it. The difference between good and bad contractors, subcontractors and suppliers is how they respond to them. The obvious challenge is to eliminate as many of these potential obstacles in the beginning as possible, which is not always easy to do.

There are some issues that seem to show up in construction projects again and again. This article gives me the opportunity to discuss some reoccurring problems that cost all of us time and money. More important, these are some items you can add to your checklist when coordinating with your design-build team.

In the Beginning

To understand todays construction environment, we must first take a quick look at the traditional role of the general contractor. In the beginning, all that was created came from the architect. He and his engineering team would put together the bid documents. These consisted of a very large, very detailed set of plans along with a thick specification book. Every material to be used was specified in detail, including application, testing and warranties. Plans, elevations and details were drawn for every aspect of the projectsite work, concrete, steel, finishes, mechanical, plumbing, electrical, etc. Usually, approximately half of the specification book was boiler plate. This section dealt with insurance requirements, billing procedures, change orders, arbitration of disputes, etc.

Why all of the fuss? It was an open-bid environment; these documents would be distributed to anyone and everyone who might be interested in submitting a bid for a project. Suppliers and subcontractors would submit their bids to the participating GCs. These contractors added up all of these bids, put together a total project price, and submitted their bids to the architect. The GC who had made a mistake or left something out had the low bid and was awarded a contract (insert sarcasm here).

The bid documents then became the contract documents. These were considered part of the contract between the owner and the contractor, the contractor and his subs, the subs and their suppliers. It was the architects job to ensure these plans and specifications were strictly adhered to throughout the project. The architect was in total control from start to finish; everyone, including the GC, answered to him. While this can be a lengthy and costly process, it was designed to relieve the burden of liability from the ownerhence, the detailed plans, specifications and rigid structure of hierarchy.

Take Me to Your Leader

The design-build and construction-management processes can be set up in a variety of ways. In most, the GC takes on the leadership responsibilities. He will select and coordinate the architectural and engineering team. He will hand select subcontractors and suppliers to submit pricing, and even participate in the selection of materials and the design of the project.

Plans and specifications for this process can be less detailed than what would be required for the open-bid situation. The entire team takes on more responsibility and ownership. However, the owner takes on more of the liability and risk to ensure he is getting what he paid for. He will also have to take a more active role in job-site visits, scheduling, billings, etc. This can save time and money. The question is how much of his time and resources can the owner commit?

The key is a lot of homework, and even more planning. The amount of time spent on coordination before a shovel of dirt is ever turned will determine the level of success of any building project. The following is a short list of issues that seem to come up time and again. These are a good start for a project checklist.

First Things First

How local building officials rate the occupancy of your buildings is going to determine everything from the number of parking spaces to the location of firewalls and fire-sprinkler requirements. From the very beginning, it is crucial your architect and/or engineer work with these building officials to show them these are not occupied buildings. The tendency is to rate self-storage buildings the same as a retail building or office complex. But these are storage buildings; they are not occupied by the number of people or for the periods of time as other types of buildings.

Often times, zoning or other factors may affect the occupancy rating, and building officials simply will not budge. However, it is most certainly worth pursuing to get them to reconsider your occupancy. If an apartment, office or retail area is involved, firewalls can be used as occupancy separations. This will allow for the occupied areas to be rated separately from the storage areas.

Its My Party

Every subcontractor on your project thinks his part of the work is vastly more important than all of the others and everything must revolve around his schedule and requirements. Without proper coordination, one subcontractor can dominate a project, and his work can get in the way of or adversely affect everyone else. I have seen trades create chaos and cause changes to the work of others, which, in the end, costs the owner money.

Earth to Owner

When laying out a storage facility, the goal is to get as many square feet as possible on a piece of property. Many times, the slope of the property is not taken into consideration, and the buildings are situated against the natural drainage pattern. It is much less costly to rearrange the buildings than it is to rearrange the shape of the earth. Simply evaluate the cost of the dirt work compared to the resulting increase or decrease in rentable square feet.

Phased Out

When building a project in phases, always consider if there are some things that can be done now that will save time and money on the next phase. More important, consider what you might be doing that is going to cause problems later. Dont paint yourself into a proverbial corner. For example, ask your electrical and security subcontractors what new innovations may be coming in the near future, or what upgrades you may want to consider that you can run the underground conduit for now. Or you may want to grade, compact and secure the entire site to allow for boat and RV storage until such time you are ready for the next phase.

Set in Stone

Most metal-building suppliers will provide certified concrete and footing design along with their steel shop drawings. If an outside engineer who is not familiar with storage buildingsespecially stick framedsystemsdesigns the concrete based on conventional steel construction, you can end up with a lot of concrete.

If your building supplier does provide concrete and footing design, verify that local requirements or a local inspector does not require something above and beyond what is required by the governing code. If your engineer is providing concrete and footing design, be sure he is familiar with standard details for sheeting notches and recesses for the roll-up doors.

The Reinvented Wheel

Involve your building supplier during the planning stages. Building suppliers will provide complete, certified steel shop drawings as a part of their packages. These drawings can be included with the architects and engineers drawings to be submitted for permit. If your architect or engineer comes up with his own building-framing design, materials and layout, and a building permit is issued per these plans, the building supplier either has to revise his system to conform to this design or the suppliers drawings will have to be resubmitted for approval. It is always less expensive to go with the suppliers standard materials and details.

Its Not a Leak

Metal-roof panels will condensate. During freeze-thaw cycles, in humid environments and during a rain, condensate will form on the bottom side of metal-roof panels. A simple (and inexpensive), vinyl-faced fiberglass blanket under the roof panel will eliminate this problem.

Your Ducts in a Row

A common conflict developers run into is having to adjust soffit-system heights for airhandling units and duct. To save time, many mechanical contractors will build the ductwork off site. Often times, purlin depth, soffit framing, electrical conduit or sprinkler systems are not accounted for when the size of the duct is determined. Or the size and location of the air-handling units vs. the height of the soffit is not taken into consideration. Yes, it is a problem to lower the soffit after the system is on site. Also consider where you are going to locate the air-conditioning condensing units.

The Labyrinth

I was recently involved in a project where the fire-sprinkler system was not clearly laid out prior to construction, and the fire-sprinkler subcontractor was given free reign. I received a call from the owner, informing me the buildings were too short. I quickly referred to the plans and confirmed the building heights were correct. I asked why the height was a problem, and the owner said he could bump his head on the sprinkler pipes. When I arrived at the job, I found a complicated maze of sprinkler pipes crossing the buildings in every direction. These pipes penetrated almost every unit partition, and large holes had even been cut through the hallway and door-filler panels. There was nothing I could do at that point, and the next call from the owner was to ask, Where am I supposed to run the AC ducts with these sprinkler pipes everywhere?

Simple, complete plans and coordination with the sprinkler, mechanical and building subcontractors prior to construction could have eliminated this problem.

Shocking, Isnt It?

Where are you going to locate the electrical- service panels? Remind your electrician the conduit will remain exposed. It does not take much effort to run conduit in a straight and orderly fashion rather than crisscrossed inside the hallways and units. Keep the exposed conduit out of the hallways whenever possible.

Have your electrician and security-system installer coordinate all of the underground work required. You would be surprised how many times new concrete gets cut to install underground conduit or other underground lines.

To Name a Few

These are just some current issues that come to mind. Most, if not all, of these problems can be avoided by planning and communication on the front end of a project. Have all of your subcontractors and suppliers communicate with each other to coordinate their work. Get all of this information on a set of plans. Remember, these plans are your contract, so get it in writing.

As you see, planning and coordination is not always as simple as it sounds, especially in construction. If you do not communicate, to quote Rabbi Bob Cohen, all that you are doing is nothing.

L. Bruce McCardle is the Eastern division manager for Mako Steel Inc., a supplier and installer of storage buildings from coast to coast. Mako focuses on building relationships, with more than 80 percent of its business coming from repeat customers or their referrals. Mr. McCardle enjoys working with first-time facility builders from design through grand opening. He has been involved in almost every aspect of the metal-building and construction industry for more than 20 years. Look for his presentation at the upcoming ISS expo in New Orleans. He can be contacted at 888.795.7594.

Zoning laws come into play in almost every real estate development project. Zoning laws and regulations are those that govern how a property can be used and developed. Local governments adopt zoning regulations to set development standards for properties within their jurisdictions. Development standards ensure that land is used for the common good and development can be guided by an orderly process. Generally, zoning is divided into categories: residential, commercial, industrial, agricultural and recreational. The desirability of locating a self-storage project on a highly visible site has raised many new zoning issues.

Permitted vs. Conditional Use

A permitted use allows land use by right. No public hearings are required and, hence, a project can proceed straight to building permit with no public input. Be sure to meet all requirements of the zoning ordinance, such as setbacks, landscape requirements, building-coverage limitations and floor-area ratio (a ratio of land to gross building area). When a land use is permitted by the governing agency, politics dont enter the process. Compliance with the development standards is all that is required.

A Conditional Use

The majority of cities have placed self-storage in the zoning category of a conditionally permitted use. Eight out of 10 projects will fall into this category. When a land use is categorized as conditional, it is permitted subject to circumstances the governing agency may impose on the project to mitigate any potential impact.

Generally, a conditional use requires the filing of an application and a set of design drawings with the governing agency for approval. Initially, the design drawings are evaluated by the planning staff and a report is written and forwarded to the Planning Commission. The Planning Commission will hold a public hearing, take public input, hear the applicants presentation and then vote the project up or down. Politics can and do play a major role in obtaining a conditional use permit. Architecture, aesthetics, hours of operation, landscape and overall design also play a large role.

As homeowners associations, neighborhood groups and various political groups have learned how much clout they can bring to bear on local politics, the zoning process can be complex. In this situation, it is always a good idea to meet with these groups prior to any public hearing. The public will assume the worst in the absence of a carefully thought-out presentation by the project sponsor. Many neighborhood groups that started out negative on a particular selfstorage projecteven to the extent of circulating petitions against itcan be turned around when presented a well-executed design.

During the processing of a recent conditionaluse application, a petition with 90 signatures opposing the project surfaced before the Planning Commission hearing. But a Saturdaymorning presentation to the homeowners association turned the opposition into supporters.

Originally, when asked if they had seen the design drawing for the project, the group replied, No, we dont need to see it. All selfstorages are ugly. When presented with project renderings and an explanation of how the project had been designed to protect them, the negative response turned positive. The Planning Commission hearing was made considerably easier when those homeowners showed up to support the project enthusiastically. Even though the city was not in favor of the project given its high-profile location, 80-plus neighboring homeowners vocal support won the day. The project was approved unanimously.

Design Review

The design review is somewhat simpler in that the question of land use has already been answered. Design review is a process whereby the local jurisdiction will assess the design of a particular facility. Normally, it occurs when the land-use category (in this case, self-storage) is a permitted one, but the jurisdiction wants a say in the facility design. Usually, projects undergoing design review will be evaluated for architectural compatibility with surrounding properties, landscaping, project colors and overall aesthetics.

Zone Change

A change in zoning is referred to as rezoning. It often involves changing a parcel of land from one land-use classification to another (i.e., from residential to commercial). Zone changes usually involve public hearings that give the community and governmental agency a chance to voice their opinions.

Zone changes can be difficult. Again, it pays to meet with the surrounding neighborhoods before any public hearing. A rezoning application for self-storage should emphasize the positive attributes of the land use:

• Self-storage generates low traffic and low crime.
• Facilities are closed at night, with limited access.
• Self-storage projects often bring enhanced security.
• Facilities frequently have noise-reducing qualities, such as acoustical buffering from major boulevards, highways, etc.

Politics will play a role in any zone-change application. Competing interests of surrounding properties can also play a role. Generally, a rezone can be more difficult than a conditional use permit. From the publics vantage point, an applicant filing a rezone application is trying to change the rules others have to follow.

The subject of self-storage as land use is commonly misunderstood. All too often, a governing agency will lump self-storage in an industrial category usually reserved for manufacturing or warehousing; but the operational characteristics of the industry differ significantly from those categories. Self-storage has fewer employees, less traffic, less noise and, hence, much less impact. So, the first order of business is convincing the local planning department self-storage is not an industrial land use and, in fact, can be compatible in most zones.

A quick note: Rezoning should not be confused with a variance, which is a request to deviate from current zoning requirements. A variance is not a change in the zoning law but a waiver of a particular requirement.

Persistence

In 20-plus years of processing conditional-use applications, the three rules I have learned are:

1) Never take no for an answer.
2) Do your homework.
3) Never take no for an answer.

Many highly successful self-storage projects would not have been built if a developer had stopped with the first negative reaction from a city planner. As self-storage had made its way from bare-bones boxes in industrial zones to sophisticated architectural edifices on the major boulevards, the zoning process has grown in complexity. The customers are out on the major roads and your self-storage project should be, too. When it comes to zoning, thorough homework, good design, effective communication and persistence is the recipe for success.

Bruce Jordan is president of San Clemente, Calif.-based Jordan Architects Inc., a fullservice architectural firm specializing in the design and entitlement of self-storage projects. For more information, call 949.388.8090 or e-mail [email protected].

Self-storage construction has evolved considerably over the past decades. Since the infancy of the industry in the late 1960s and early 1970s, the use of building materials has changed, especially for exterior facades and roof systems.

Originally, exterior walls were predominantly plain concrete-masonry units (CMU) with reinforcement. Roof systems comprised bar joists, steel deck and built-up roofing. Interior partitions consisted of plywood or gypsum board on wood-stud framing. Interior doorsif anywere solid- or hollow-core wood swing doors. Exterior doors were generally overhead sectional units on tracks. These doors were very high maintenance and would limit stacking heights. Normally, there was not much concern in regard to curb appeal. In fact, there were blatant attempts to add bright and sometimes garish colors to the outside to get attention from passerby.

In the early to mid 1980s, the industry began to explode. During this period, self-storage owners and developers began looking for building materials that were more efficient and economical. The somewhat-new pre-engineered/pre-fabricated metal-building industry fit this demand. Thus, the all-metal self-storage building was born.

Present-Day Buildings

Today, typical interior areas of a self-storage building consist of coldrolled Cee columns on a 5-by-10-foot grid system with Zee purlins at 5 feet O.C. (on center). Local codes, roof snow loads and lateral wind loads determine the size and gauge of these components, which is why the buildings are called pre-engineered. The sizes, gauges, lengths, etc., are manufactured by a fabrication plantthus the term pre-fabricated.

The framing materials can either be primed red or gray oxide, or can be galvanized-coated. Most full-service building suppliers and contractors offer both coatings. Roofing materials are predominantly metal and preferably standing-seam or standing rib with concealed fasteners. The gauge of roof deck is 26, 24 or 22, with 22 being the heaviest. Close to 100 percent of this type of roof material is Galvalume-coated and, on some occasions, this finish is over-coated with a long-lasting architectural color.

A condensation blanket is very popular in storage units to curb moisture from forming on the bottom of the roof deck and dripping on stored goods. This material is usually a thinner metal-building insulation (MBI) and, in most cases, is a 2-inch, vinyl-faced fiberglass blanket. If the storage building is climatized, temperature or thermal transfer control is another big consideration.

Presently, in many jurisdictions, an owner may choose the thickness of insulation he wants. Wall insulation can be 3.5-inch (R-11) or 4-inch (R-13). Roof insulation is usually 4-inch (R-13) or 6-inch (R-19). It should be noted here that many jurisdictions require minimums, such as Floridas energy codes that require a 6-inch minimum. Many areas in northern states with harsher weather conditions require even thicker insulation, normally accomplished with two layers of fiberglass one vinyl-faced and one unfaced. The new International Building Code, rapidly being adopted by most states, requires 6-inch R-19 with few exceptions.

Unit partitions are a form of rolled, corrugated metal sheets, either 29- or 26-gauge, and are finished with Galvalume. These metal partitions are attached to the Cee columns with tek screws. The metal partitions serve at least two purposes, providing a bigger bang for the buck. First, they divide each unit for security. Second, they serve a structural purpose. These partitions are very strong and, when attached properly, act as shear walls in the buildings to resist lateral wind loads.

Storage building exteriors come in many varieties. Due to demands by local planning and zoning boards and neighborhood committees, as well as to blend with the architectural theme of an area, the exterior look may require a mixture of two or more materials. The pre-engineered steel building can easily be adapted to receive a brick veneer or EIFS (exterior insulation and finish system), architectural CMU infill, other siding products or a combination of many. Because of stricter design criteria, other architectural materials are slowly replacing the typical metal siding that has been seen in past years.

The exteriors are also made up of steel rollup doors made expressly for the self-storage industry. Planning and zoning departments are making efforts to disallow these doors to face the main road. Instead, a decorative façade is used where required, or areas the size of doors are painted a different color to denote them.

As storage building sizes increase, more stories are added due to land costs, and more elaborate designs are created, many other building systems can be used in addition to these basic materials. There is hot-rolled steel framing with post and beam; poured in-place, reinforced concrete framing; pre-stressed concrete components and others. Any of these systems can be used with a variety of façades.

It should be noted that typical building components will vary in each geographical area. Coastal areas such as Florida and the Gulf Coast tend to use more reinforced CMUs, with cells poured with concrete grout to create mass and withstand up-lift caused by high winds over semi-flat roofs. In the northern tier of states, components are used to create pitched roofs to shed snow loads. In many of these varieties, cold-rolled steel interiors are used, or the ever-more-popular prefabricated, light-gauge, steel-truss system. In the future, you may not be able to say there are basic materials for self-storage construction, because so many varieties of materials are being used.

Heath Mulkey and Joe Trepke are part of Compass Building Systems Inc., a full-service materials supplier and contractor exclusively serving the self-storage industry in the Eastern United States. Compass is unique in that inhouse employees erect the majority of its work. A much smaller portion of the labor is performed by dedicated firm subcontractors under the companys control. This creates a single point of responsibility for a complete self-storage building. For more information, call 800.243.8438; visit www.compassbuildingsystems.com.