A five-alarm fire Wednesday at Scully Welding Supply Corp. in Collingdale, Pa., quickly spread out of control, extending to neighboring business, Kaisers Storage Center, and destroying 80 self-storage units.

Hundreds of shards of flying metal and chunks of concrete rained down from the explosive fire.  Eighty of Kaisers Storage Centers 350 self-storage units were destroyed by fire. Others were damaged by smoke and water.

Owner George Kaiser and several tenants sifted through the smoldering remains on Thursday, looking for salvable items among the soot and charred clutter.

Fire investigators dont yet know the cause of the fire, which sent shrapnel and exploding propane tanks into the air. Its believed the fire, which began at 1 p.m. and raged for hours, may have started as an accident at the plant. Homes and nearby businesses were evacuated. There was concern about a 30,000 gallon and 18,000 gallon propane tanks located in the back of the plant.

More than 300 emergency workers from 30 companies in Delaware County and surrounding communities battled the blaze for more than three hours. Several people were injured in the fire, including one Scully employee and five firefighters who suffered heat-related illness.  Residents were allowed to return to their homes around 7 p.m.

Kaiser was at the facility when the fire began at the plant. He and his wife also have a home on the property. Kaiser, whos also the Collingdale fire marshal, predicts the total loss at the property will be well over $1 million. Kaiser also lost personal property, including two antique fire trucks, his father's farm truck, and memorabilia from his 27 years in the Navy and Navy Reserve.

Police in Dorset, Vt., are looking for a utility trailer stolen in August from Safe Place Self Storage on Tennis Way.

The trailer is a blue, 24-foot 2002 Wells Cargo box-style utility trailer with a single ramp-style door off the back and a side door on the passenger side. The words Little Rooster Café appear on the front and back.

The trailer was parked at the storage facility, and went missing between 9 a.m. on Aug. 26 and 5 p.m. on Aug. 29. The trailer was full of catering equipment including grills and propane tanks. Police estimate its value at several thousand dollars. Anyone with information can contact Vermont State Police at 802.442.5421

G5, a provider of local marketing solutions for self-storage properties, released an adaptor that connects SMD Software Inc.s property-management system, SiteLink, with the G5 Local Marketing Software Platform.

This integration will allow both companies to provide common clients a website and lead-capture solution that leverages up-to-date unit availability, special promotions and facility details to drive real-time reservations through a highly optimized online-reservation experience.

Other benefits include centralizing management tasks and streamlining work flow, and reducing the need for time-intensive, error-prone manual input and correction of data transmitted between sources.  

The partnership between G5 and SiteLink offers storage owners a valuable new way to leverage their existing technology investments, said SMD COO Markus Hecker. Integration ensures that the system of record is driving online offers while consolidating lead and reservation workflow for marketing and facility managers.

G5 is a provider of vertical-specific local marketing solutions that help mid-market companies generate more qualified leads, convert leads into new customers and track marketing performance.

By David Smyle

Over the past couple of years, the big banks were bailed out; smaller banks were sold, taken over or merged with other institutions; and mid-sized banks struggled to work out problem portfolios and keep regulators at bay. Where does that leave the availability of credit for self-storage owners, and how has the overall financing landscape changed in phase one of the recession?

The Recession: Not Over Yet

Yes, there will be a second phase to the recession. It will come during the second wave of residential foreclosures and the first major wave of commercial foreclosures as a result of continued weakness in the leasing market and lack of job creation. There are several factors that might lead to a double-dip recession:

• Enormous budget shortfalls in federal, state and local government, requiring further cuts in jobs and spending programs.
• The huge amount of residential foreclosures forecasted to occur in late 2010 and 2011.
• Under performing commercial-lending portfolios being sold to note buyers whose sole intention is to get control of the properties at bargain prices. This will allow them to offer rents at better rates than neighboring properties and cause competitors to lose tenants or reduce rents to keep the market from deteriorating.

The current administrations policy of spending our way out of a recession might have been more productive if the expenditures went to create jobs as opposed to union and state bailouts. Screams from the other side of the aisle for tax cuts to stimulate the economy may or may not help.

Were in a business cycle, and it will take time to work through. The recession that occurred in the late 80s and early 90s took about five to six years for recovery. Then we had about 10 to 12 years of putting the pedal to the metal before loose underwriting on residential and commercial loans finally came home to roost.  We can expect the current recession to last about five to six years, so expect recovery around 2012 or 2013 if the government can stop over regulating and over spending.

Fixed Rates

Eventually, rates will rise, and with them the Treasury Bills and federal discount rates. You dont have to an economics professor to predict that. Remember, it was only a decade ago that an 8 percent fixed rate for 10 years was considered great, and 7 percent was a good short-term rate. Most of us would gag on those rates today, but over time, 6 percent to 7.5 percent will return as a norm and, in many cases, were already there. Still, three- to five-year fixed rates under 6 percent can be found in the banking and insurance-company world, with longer-term insurance-company money for 10-year fixed rates under 6 percent in many cases for well-qualified properties.

Nationwide lending giant Citibank is reduced to multi-family lending, while many others have limited programs that steer clear of high-vacancy properties such as retail, single-tenant and office. Self-storage lending is viewed as somewhat risky to many lenders today, because they already have a full portfolio of self-storage loans. Hesitation about lending on storage is due in part to vacancies caused by previous overbuilding and economic job loss. Move-in specials abound in nearly every market as facilities complete for the coveted renter.

As banks become more solvent, well see a return to more lending programs and options, and maybe a little loosening of lending parameters and underwriting requirements. Well continue to see banks consolidate and merge as the FDIC works its way through the backlog of failing banks. Big banks will get bigger, and a few new, small community banks will start to show up, but will likely not have any huge lending power in the beginning.  

Conservative Underwriting

Lending varies greatly from market to market, with conservative underwriting guidelines being a common factor. What once was a loan-to-value (LTV) of 70 percent to 80 percent in most areas is now 60 percent to 70 percent, with 75 percent on occasion to strong borrowers with well-run and occupied properties. The East Coast seems to prefer 15- to 20-year amortization, with 20 to 25 years more common in the West. Its rare to find 30-year amortizations anymore except for an occasional credit union and large conduit transaction (commercial mortgage-backed securities).

The majority of fixed-rate terms have dwindled to three- and five-year periods from seven- and 10-year, with insurance companies, pension funds and conduits providing most of the available long-term fixed rates on better-quality properties. During a recent review of financing options for a New Jersey property, local banks were either not lending on self-storage or limiting amortizations to 15 to 20 years and LTV to around 60 percent to 65 percent. This is not uncommon for many areas of the country.

One of the biggest issues facing borrowers today is reduced occupancy from the downturn. Unless a lender is forced to modify an existing loan, funds are scarce to refinance an under performing property, or to purchase facilities with high leverage or ones that reflect reduced cash flow. Cap rates have risen significantly in the past few years and arent expected to see a major drop. The good news is financing is out there. While not at the low interest rates of the mid-2000s, rates are still relatively low historically and typically lower than cap rates.

In the meantime, expect banks to continue to be the main source of financing, with fixed rates in the three- to five-year range, either as a balloon note or part of a 10-year term. Expect to see amortizations topping out at 20 years, with 25 years being part of a more liberal loan program. Most lenders will top out at 65 percent to 70 percent LTV on a purchase, and if cashout is involved, 60 percent to 65 percent. But operators should have a good reason for the cashout, as lenders are wary about giving cash back if its not going back into the property or to reduce debt.

Also be prepared to possibly move your banking relationship to a new lender. A relationship is becoming more a part of the overall lending transaction. If your property value has declined or cash flow and occupancy have dropped to where refinancing with another lender will be difficult, your best bet is to negotiate with your current lender for an extension or modification to help you through the difficult times.

Keep your seatbelts buckled. Were still in for a bumpy ride a little while longer.

David Smyle is president of La Mesa, Calif.-based Benchmark Financial, a commercial mortgage banker providing financing options for self-storage and other commercial property types nationwide. For more information, call 877.862.7916; visit www.benchmarkfin.com.

By Dr. Maurice A. Ramirez

Social networks like Twitter, Facebook and YouTube have put the power of the media in the hands of average citizens. Entrepreneurs, information marketers and college students have learned they can be the media for audiences large and small. Theyve also discovered that the nightly news and traditional print media will share their stories. This shift in the power of the press carries with it these three rules of social-media marketing for businesses:

• Silence is not golden It's guilty.
• The first story told is the story most retoldand the story most believed.
• Buzz is the bomb. It can propel you to the top or blow up in your face.

Silence Is Not Golden It's Guilty

In high school science, we learn that nature abhors a vacuum. Nowhere is this truer than on the Internet. If a business fails to comment on an event, good or bad, the social media will rush to fill the void around the corporate brand. It's very simple: The construction of search engines and social media is such that there will never be silence associated with any brand.

Whether the brand is iPhone, Coca-Cola, Pepsi, Disney, Universal Studios, or an unknown convenience store on the corner of Smalltown, USA, if something happens, somebody must comment. Thats the nature of the Internet and social media in the 21st century.

With the advent of Internet-enabled cell phones, YouTube-enabled smart phones, text messaging and location-enabled Twitter, everybody is not just a news reporter, theyre a video historian. Watch the evening news in any market, anywhere in the world, and youll see a YouTube video broadcast about a news event that happened that day. Nothing is more powerful than eyewitness testimony, both in a court of law and on the six o'clock news.

Its important to remember its not just the occasional user of the social media whos making these reports. Its the regular blogger, Twitter broadcaster and YouTube poster. They have followers, and their followers have followers. The average reach of these individuals is more than 20,000, and their audience is reliable. This means companies cannot just broadcast a message in the social media when something happens. They must have a presence 24/7. The social-media presence of a business must be part of an ongoing plan and deliberate social-media optimization process that ensures the business has an audience, and the audience is larger than that of any customer who may come through its door.

The First Story Told

Social media is a cultural phenomenon based on a conglomerate of social norms and behaviors that span age groups and demographics. As a result, the rules are difficult for many entrepreneurs and executives to negotiate.

But one of the rules thats constant across all social-media platforms is the first story told is the first story believed. Furthermore, in social media, the first story about a major eventpositive or negativewill be retold, retransmitted and shared among users. It will be converted to e-mail and re-sent. Its also the most likely story to make the transition to traditional media. In other words, it will become news.

Because of this, its not enough to respond when a message appears on one of the popular social-media platforms. When an event occurs, a business must have a prepared statement ready to transmit immediately through an established social-media optimization program to ensure the corporate message is the first story told. Ideally, this message will even precede those messages, blogs, tweets and YouTube postings that may be coming from customers actually involved as participants in the event.

In social media, the saying "The best defense is a strong offense is completely true. The only way to counter a negative message is to send a positive one, even before the first negative message can be transmitted.

Buzz Is the Bomb

In the social media, whats said absolutely matters. The sentiment surrounding the brand determines the degree of influence a message has and the action taken by those who receive it. The goal of all marketing is to influence potential customers to make a purchase. In the social media, that means they must be influenced to reach for their wallet and make the purchase.

Positive buzz means theres positive message activity around your brand. Theres positive buzz when people are sending your message to their friends, and their friends are sending it to their friends, influencing someone to make that positive buying decision.

If the sentiment surrounding your message is negative, buzz can blow up in your face. Research shows a negative message will be sent on four times more frequently than a positive one, thus doing four times the damage, influencing four times as many people not to buy.

The easiest way to ensure something good is said is to influence those who influence others to say something good about you. Again, this is done by having a constant positive presence in the social media, even before anything noteworthy happens at your place of business.

There are three rules of social-media marketing for businesses large and small. Turn on the news any night and you will see big businesses that have failed to follow these three simple rules, whether its a cruise ship with a passenger falling overboard and 124,000 tweets telling the story of how they left him behind, or a major amusement park with the most anticipated theme ride in a decade breaking down, trapping riders for 45 minutes and generating 50 YouTube uploads. To succeed in the social media remember: Silence is not golden; businesses must be in the social media early, regularly and constantly; and the first story told is the first story retold.

To be the one telling your story, influencing others to retell your story, businesses must take ownership of that message, or someone else will fill the void and tell your story for you from their perspective. Buzz is the bomb, but that buzz must be positive so the bomb doesnt blow up in your face.

Dr. Maurice A. Ramirez is founder of the consulting firm High Alert LLC. Hes a renowned speaker on the importance of social networking and has presented to national organizations. As a consultant, Dr. Ramirez assists companies to align business continuity plans with personnel and customer behavior during adversity. Hes the founding chairperson of the American Board of Disaster Medicine and a Senior Physician-Federal Medical Officer. For more information, visit www.high-alert.com .

Storitz Inc. this week launched a new website aimed at consumers looking to find and rent self-storage online. Storitz.com uses custom-built Web-based technology to provide a comparison shopping experience for storage consumers and an Internet marketing channel for self-storage operators.

Consumers using the website can also pay and move in 24 hours per day, which short-circuits the typical process of holding or reserving a unit, then having to call or e-mail back and forth with one or more storage operators. Offering consumers the opportunity to finalize their move-in online offers convenience for the consumer and storage operators alike, said CEO Adrian Comstock. Consumers will no longer have to wait for office and call-center hours of the storage property operators to nail down the details of renting a unit and prepare for the move because Storitz provides all of those details online.

Self-storage operators can show off their assets through detail pages that include photo galleries, property-feature icons and bulleted lists about the facilitys security, convenience and amenities.

Guardian Self Storage supported the World of Dance Competition Squad by hosting a carwash fundraiser Aug. 28 at its Saugerties, N.Y., facility.

World of Dance opened in 2001, offering dance instruction in hip-hop, jazz, and tap, and the fundamentals of ballet to children, teens and adults.

Family-owned Guardian Self-Storage opened its doors in Fishkill, N.Y., 25 years ago. Since that time the business has grown to 12 locations throughout Dutchess, Orange and Ulster counties.

Baltimore County Police in Maryland are still investigating a string of burglaries at Timonium Self Storage.

The facility had three break-ins in August, most recently on Aug. 17 between 3 a.m. and 5:40 a.m. An unknown number of suspects broke into one unit then smashed through the drywall to access additional units. A total of 85 self-storage units were ransacked during the three break-ins.

Police have asked the victims of the break-ins to provide a list of missing property so they can compare it with inventory at local pawn shops. Police have not identified any suspects. Anyone with information about the incident can call Metro Crime Stoppers at 866.7.756.2587. Callers can remain anonymous and might be eligible for a cash reward of up to $2,000.