Publicly traded self-storage real estate investment trusts (REITs) CubeSmart, Extra Space Storage Inc. and Public Storage Inc., along with investment fund Self Storage Group Inc., have declared dividends for the third quarter of 2014.

CubeSmart

The board of trustees for CubeSmart declared a dividend of $0.13 per common share for the period ending Sept. 30. This is a match to the dividend of the three previous quarters. The dividend is payable on Oct. 15 to common shareholders of record on Oct. 1.

The board also declared a quarterly dividend of $0.484375 for the 7.75 percent Series A Cumulative Redeemable Preferred Shares payable on Oct. 15 to holders of record on Oct 1.

CubeSmart recently released its second-quarter financial statements, reporting funds from operations (FFO) per share of $0.27, a 17.4 percent year-over-year increase. Same-store net operating income (NOI) at its 346 facilities grew 9.7 percent year over year. The company attributed this to 7.6 percent growth in overall revenue and a 3.2 percent increase in property operating expenses.

CubeSmart owns or manages 559 self-storage facilities across the United States and operates the CubeSmart Network, which consists of more than 800 additional self-storage facilities.

Extra Space

The board of directors for Extra Space announced a quarterly dividend of $0.47 per share on the company's common stock for the third quarter. This matches the dividend issued for the previous quarter. The dividend is payable on Sept. 30 to stockholders of record at the close of business on Sept. 15.

The REIT recently reported a same-store revenue increase of 7.9 percent for the second quarter, as well as an NOI gain of 9.9 percent compared to the same period in 2013. FFO was 63 cents per diluted share, resulting in 25.5 percent growth year over year.

Headquartered in Salt Lake City, Extra Space owns or operates 1,071 self-storage properties in 35 states; Washington, D.C.; and Puerto Rico. The company’s properties comprise approximately 715,000 units and 79 million square feet of rentable space.

Public Storage

Public Storage issued a quarterly dividend of $1.40 per common share, which matches the dividend issued for the previous three quarters, according to NASDAQ.com. It is payable on Sept. 30 to stockholders of record on Sept. 15.

The company previously announced revenue for same-store facilities increased 5.3 percent, or $22.6 million, in the second quarter, as compared to the same period in 2013. Cost of operations for same-store facilities increased by 1.2 percent, or $1.5 million, year over year. FFO was $1.99 per diluted common share in the second quarter, compared to $1.83 for the same period the previous year. NOI increased $38.9 million during the quarter compared to the same period in 2013, including $21.2 million for same-store facilities.

Based in Glendale, Calif., Public Storage has interests in 2,208 self-storage facilities in 38 states, with approximately 142 million net rentable square feet. Operating under the Shurgard brand name, the company also has 188 facilities in seven European countries, with approximately 10 million net rentable square feet.

Self Storage Group

Self Storage Group (SSG) declared a quarterly dividend distribution of $0.065 per share. This matches the dividend issued for the previous quarter. The dividend is payable on Sept. 30 to shareholders of record as of Sept 16.

SSG adopted a stockholder-rights plan in August. The move was another step in the company's decision last year to change from an investment company to an operating company with interest in developing and operating self-storage properties. SSG is working to qualify as a REIT for federal tax purposes.

The company previously operated as Global Income Fund. SSG owns seven self-storage properties under the Global Self Storage brand in Illinois, Indiana, New York, Pennsylvania and South Carolina through its wholly owned subsidiaries. Those assets comprise more than 80 percent of its net assets, according to company officials. As part of its new business plan, SSG has also invested in REITs, including Extra Space Storage Inc., Public Storage Inc. and Sovran Self Storage Inc.

SSG is a non-diversified, closed-end fund whose common stock is traded over the counter under the ticker symbol “SELF.” The primary investment objective of the company has been to provide a high level of income, with capital appreciation as a secondary objective.

Kurt O’Brien, president of Florida-based Simply Self Storage (SSS), recently purchased five facilities in the greater Nashville, Tenn., area from A+ Storage of Tennessee LLC for $33.6 million. The properties—located in Clarksville, Franklin, Gallatin, Hendersonville and Hermitage—will be managed by SSS.

The portfolio encompasses 346,264 rentable square feet of storage space and 2,800 units. The sale did not include A+ Storage’s flagship facility and corporate headquarters in the Gulch area of downtown Nashville. All of the properties were developed between 2004 and 2009.

O’Brien and the seller, A+ Storage founder Tommy Pierce, were represented in the transaction by Marcus & Millichap Real Estate Investment Services. The brokers were Michael Mele, senior vice president of investments in the company’s Tampa, Fla., office, and Anne Williams, senior associate in the firm’s Memphis, Tenn., office.

“This was the first time in the last eight years that a self-storage investment opportunity of this size and quality had been available in middle Tennessee,” Mele said. “The portfolio was strategically aggregated by a private Nashville owner and operator who developed, managed and expanded the majority of the facilities during the recession. This is a testament to the strength of the self-storage business and the portfolio’s viability and growth potential.”

“The stars were lined up for this one,” Pierce added. “Interest rates remained low, the self-storage industry fared the recession well, and Nashville became one of the top 10 business and real estate markets in the country. The purchaser already has a national presence, and this acquisition allows it to establish a strong presence in Nashville with one transaction.”

Marcus & Millichap has more than 1,300 investment professionals in offices throughout the United States and Canada. The company closed more than 6,600 transactions last year with a value of approximately $24 billion.

Founded in 2003 and headquartered in Orlando, Fla., SSS owns or manages more than 120 self-storage facilities in 16 states.

Also founded in 2003, A+ Storage still operates seven facilities in Downtown Nashville, Fortress, La Vergne, Mt. Juliet/Providence, Murfreesboro, Nolensville, and Spring Hill/Columbia, Tenn.

 

 

Update 9/16/14 – The proposed expansion of Midway Self Storage and Car Wash in South Middleton Township, Pa., is in jeopardy after the board of supervisors denied a conditional-use request to add commercial-trailer storage. Premier Trailer Leasing of Texas is interested in becoming a tenant on two sub-lots of 6.1 and 3.3 acres, with access off Midway Drive, according to the source.

The 6.1-acre parcel is already paved and used for boat/RV storage, but Midway owner Group & Group Excavating LP sought permission to change the use to allow up to 150 empty commercial trailers available for rent. The self-storage operator wanted permission to pave the undeveloped 3.3 acre parcel behind Midway Bowling Center to store an additional 100 empty trailers, according to the source. Paving the lot would have required a land-development plan.

Jim Hughes, an attorney with Group & Group, said he would recommend the company file a lawsuit against the township after the request was denied. “We strongly disagree with their interpretation of their own ordinance,” he told the source. “Certainly [Premier] is a good business that was going to come into town. That business probably won’t happen. We would have to go through the appeal process and let the courts make a decision.”

Group & Group could pursue a zoning variance, but Hughes indicated that would be a waste of time and resources based on the opinions of board members. Alternative uses for the two parcels is limited due to the lack of public water and sewer to the tract, he said.

In making a motion to deny the request, supervisor Rick Reighard said the developer’s presentation and arguments in favor of the conditional-use permit were disingenuous, calling some of the testimony from experts “really over the top.” “I cannot accept the testimony and interpretations as accurate,” Reighard said. “Arguments that this use is compatible with other uses have been very creative ... stretching meanings and definitions.”

Four of the five supervisors voted against the request, with one abstaining due to a conflict of interest.

---

8/14/14 – The South Middleton Township, Pa., Board of Supervisors will hold a conditional-use hearing on Thursday to discuss a proposed expansion of Midway Self Storage and Car Wash. Submitted by Group & Group Excavating LP, the project would add commercial-trailer storage and leasing services and increase Midway’s footprint to 32 acres. Midway would add two parcels estimated at 6.1 and 3.3 acres.

The self-storage facility at 1545 Holly Pike is between Carlisle and Mount Holly, Pa., on Route 34. It currently offers more than 700 units as well as boat/RV storage. The land for the proposed expansion is already zoned commercial and is surrounded by commercial and agricultural zoning, according to the source.

The township’s planning commission addressed the project on June 17 and recommended the board deny the conditional-use permit until zoning issues were addressed. The commission and some residents have expressed concerns regarding traffic along Holly Pike, and officials also cited stormwater management as a potential problem, the source reported.

Real estate investment trust Sovran Self Storage Inc., which operates the Uncle Bob’s Self Storage brand, is one of 17 publicly traded companies scheduled to present during the Western New York Investors Conference on Sept. 26. Presenting companies will discuss their strategies, financial performance and future outlook to institutional investors and analysts, conference officials said in a press release.

The conference will be held from 8 a.m. to 2:35 p.m. ET at the Embassy Suites Buffalo in Buffalo, N.Y. The event was first launched in 2002 by public companies operating in western New York to broaden their exposure to investors, analysts and financial advisors, event officials said.

Sovran CEO David Rogers will speak at approximately 8:35 a.m. ET. A live webcast of the presentation will be available from the Investor Relations section of the company’s website, according to a company press release.

Participating companies represent a variety of industries and a full range of market capitalization, event officials said. In addition to Sovran, presenters include Astronics Corp., Columbus McKinnon Corp., Community Bank System Inc., Computer Task Group, Corning Inc., Graham Corp., Evans Bancorp Inc., The ExOne Co., Financial Institutions Inc., Gas Natural Inc., Gibraltar Industries Inc., Greatbatch Inc., Hardinge Inc., Home Properties Inc., M&T Bank Corp. and Transcat Inc.

Sovran is one of nine companies on the event’s Founding Committee and a show sponsor, according to the release. Based in Buffalo, the company operates more than 500 facilities in 25 states.

All Star Self Storage, a 57,625-square-foot facility in Crowley, Texas, was recently purchased by a private investor. The 3.8-acre property at 786 FM 1187 E. includes 224 climate-controlled units, 214 drive-up units and two uncovered parking spaces.

Built in 2007, the facility's seven single-story buildings are comprised of brick and metal exteriors, metal interior walls, standing-seam metal roofs and slab-on-grade concrete foundations. Features include insulated ceilings, keypad entry, perimeter fencing and lighting, video cameras, fire sprinklers, extra-wide concrete driveways, a fortress-style perimeter, and a two-story onsite manager's residence.

The property was 84 percent physically occupied and 77 percent economically occupied at the time of the sale, according to a press release from Marcus & Millichap Real Estate Investment Services, which brokered the transaction. Brandon Karr, a senior associate in the company’s Fort Worth, Texas, office represented the buyer and the seller, a limited-liability company.

Marcus & Millichap has more than 1,300 investment professionals in offices throughout the United States and Canada. The company closed more than 6,600 transactions last year with a value of approximately $24 billion.

All Star Self Storage operates nine properties in the Dallas and Ft. Worth, Texas, markets.

A new self-storage facility is being built on a contested former church property in Richmond, Va. Mini Price Storage purchased the 2.6-acre lot for $850,000 last year from SP Five Properties LLC, but the land is part of a 17-parcel property that Richmond Christian Center, now in bankruptcy, allegedly sold by mistake.

The Christian center sold the 17 parcels in 2011 for $180,000 to Stephen Parson Jr., acting as SP Five Properties, according to the source. Parson is the son of the center’s pastor. According to court filings, the church meant to sell only a small parcel, not the entire lot. The property was recently assessed a value of $1.28 million, the source reported.

The land has been part of a legal battle between the church and lender Foundation Capital Resources (FCR), a company specializing in mortgage financing to churches and ministries. FCR won a federal-court injunction barring Parson from disposing of more than $370,000 of the sale’s proceeds. A trial is scheduled to begin this month in which FCR will try to recoup money to help pay down the church’s $2 million debt, according to the source.

FCR originally sued Parson, SP Five Properties and a limited-liability company run by Mini Price Storage to try to win back the land or the proceeds of Parson’s deal with the self-storage company. Mini Price was dismissed as a defendant in August when FCR determined the operator would likely succeed in defending the land purchase as a good-faith transaction made without knowledge of the conflict over the deal between Parson and the church center, the source reported.

Richmond Christian Center in currently in Chapter 11 bankruptcy, but FCR has requested its status be converted to Chapter 7 liquidation. A hearing on that request is scheduled for Sept. 26.

In the meantime, Mini Price has reportedly received $5 million in building permits and cleared the area in preparation for its construction. Michael D. Sifen Inc. of Virginia Beach, Va., will serve as the project’s contractor, according to the source.

Mini Price Storage operates several locations in Norfolk, Va., and the Richmond area.

U-Haul International Inc. recently acquired the former University Self Storage in Cedar Falls, Iowa, and has rebranded it as UHaul Storage of Cedar Falls. The property at 6110 University Ave. encompasses 41,308 square feet of storage space in 11 single-story buildings, a two-story office and a manager’s apartment on 2.7 acres of land. The facility is near College Square Mall, which includes more than 50 retail stores, specialty boutiques and restaurants.

“This facility will receive many renovations to bring it up to U-Haul standards,” said Randy Dickson, marketing company president of U-Haul Co. of Iowa.

The acquisition of University Self Storage was driven by U-Haul’s corporate sustainability initiatives, which supports infill development to help local communities lower their carbon footprint, according to a company press release. U-Haul’s adaptive reuse of existing buildings eliminates the amount of energy and resources required for new-construction materials and helps local cities diminish their unwanted inventory of unused buildings, U-Haul officials said.

Established in 1945, U-Haul International Inc. has more than 40 million square feet of storage space at more than 1,000 owned and managed facilities throughout North America.

A former manager of Northwest Highway Self-Storage in Dallas filed a disability discrimination lawsuit on Aug. 11 against the facility’s owner, Strategic Capital Holdings LLC, and its human-resources firm, TriNet HR Corp., for wrongful termination. Cynthia Ormiston said her former employer fired her after a work-related injury left her partially disabled and unable to perform her job duties.

The lawsuit, filed with the Sherman Division of the Eastern District of Texas, states Ormiston began working as the resident manager at Northwest Highway Self-Storage in 2009. The facility has since been branded as SmartStop Self Storage. In 2010, Strategic Capital hired TriNet HR to manage its staff, and Ormiston continued her employment with the company.

Ormiston injured her shoulder and hand while at work on June 27, 2011, according to the lawsuit. She continued to work until November, then underwent surgery, which was only partially successful. Ormiston was diagnosed as “permanently partially disabled” and unable to lift any significant amount of weight with her right arm, the lawsuit stated.

Although Ormiston continued to be employed as the facility’s resident manager, her medical restrictions included no heavy lifting, typing, operating heavy equipment or extended walking. Ormiston claimed she worked for another three months before her superiors began disregarding the restrictions and her injuries became agitated.

After presenting TriNet with a doctor’s note again explaining her limitations, Ormiston said Dale Bennett, TriNet’s district manager, wouldn’t allow her to return to work, according to the lawsuit. Ormiston claims Bennett said she should ask her doctor to change the restrictions to “cannot return to work,” according to the suit.

Ormiston then spoke with John Carbio, regional manager for Strategic Capital, who said he’d like her to continue working at the facility as the district manager, according to the lawsuit. She was told the promotion would occur in September 2012. However, Ormiston was summoned by TriNet employees on Sept. 7, 2012, and fired due to the inability to “type or lift heavy objects,” the lawsuit stated. Ormiston said the defendants didn’t offer her an alternative position to accommodate her injuries, and she has been unable to find other employment, the lawsuit stated.

Ormiston is suing for actual, exemplary and statutory damages to compensate for lost wages and benefits, inconvenience, pain and suffering. Attorney Nicholas A. O’Kelley of Dallas-based Kilgore & Kilgore is representing her and has demanded a jury trial.  

Strategic Capital Holdings is the sponsor of Strategic Storage Trust Inc., a publicly registered, non-traded real estate investment trust (REIT) that operates self-storage properties, and Strategic Storage Trust II Inc., a non-traded REIT targeting the self-storage market. Strategic Storage Trust II is a related but separate entity from Strategic Storage Trust. Both REITs rebrand their storage acquisitions under the SmartStop Self Storage trade name.

By Amy Daniels

While specific advertising opportunities will vary based on your focus and market, there are steps you can take to concentrate your efforts and draw in the business you seek. If you’re interested in widening the strategy for your self-storage business but aren’t sure where to begin, these tips will get you started. Here are three important components of an effective advertising program.

No. 1: A Campaign

Developing an advertising campaign can be as simple as choosing a start and end date. With this small act, what you’re really doing is setting your focus. Once the campaign is over, it also allows you to take a step back, assess your strengths, and unearth areas that need improvement.

A campaign may seem like an unnecessary burden in the advertising process. When done properly, it does take quite a bit more effort than just buying an ad in your local newspaper, for example. But while a campaign is more work at the beginning, it can actually make things simpler in the long run. The hardest part is often brainstorming the overall theme. Once you do that, you’ll find it’s easier to push out advertisements that fit into that vision; and it’s quite a bit better than creating a grand scheme with every new advertising piece.

When you stick to one general message for a long time, your customers can more readily remember you. This is crucial because you want them to think of your brand specifically when they consider self-storage.

A smart business tactic is to observe the branding strategies of hugely successful companies, even if their industries are unrelated to yours. According to “Forbes,” some of the most unforgettable ad campaigns of 2012 were run by Microsoft, Red Bull and Toyota; however, memorability doesn’t mean much if it doesn’t positively impact profit. So, how did these companies do in 2012?

 

Through smart ad campaigns, Microsoft was able to beat out some of its strongest competition, Red Bull was able to beat its record, and Toyota was able to overcome a massive hurdle. Imagine what a great ad campaign could do for your self-storage business.

No 2: A Tagline

Similar to a logo, a tagline or slogan is a useful tool to implement as part of all of your advertising materials. You can change your tagline with each campaign, or it can last as indefinitely as your logo. Hubspot once published a blog titled, “10 Companies That Totally Nailed Their Taglines.” The top five are below. Do any of these sound familiar?

• “Just Do It,” Nike
• “Think Different,” Apple
• “I’m Lovin’ It,” McDonald’s
• “Can You Hear Me Now?,” Verizon Wireless
• “Because You’re Worth It,” L’Oreal

The fact that you recognize these taglines is a testament to their success. These examples also demonstrate that a great tagline can have an extremely long shelf life. Nike’s was first used in 1988, Apple’s emerged in 1997, and the McDonald’s tagline has been working for the company since 2003. By taking the time to develop a great tagline now, you can reap the benefits for many years to come.

Did you notice none of the above taglines explicitly mention the company’s product? Instead, they appeal to the customer—his emotions and what the product does to benefit him. Rather than wedging “self-storage” into your tagline, think about what you’re really offering. Is it the ability to get organized? Alleviate stress during a move? Expand a business? Your tagline is a powerful opportunity to relay this message in your very first point of contact with prospects.

Steve Strauss, a lawyer specializing in small business and entrepreneurship, shared his expertise on creating a great tagline with “USA Today.” Here’s what the internationally recognized author of 15 books had to say:

• Focus on the benefit. Answer the question, “What do people get when they do business with you?”
• Consider your brand. Think about the personality of your business. What do you want people to remember about you?
• Keep it simple. Five words is a good place to start for length. Ensure your message makes sense.
• Test. This is important, especially if you’re new to writing taglines. Ask for feedback from employees and customers. You could even get your community involved by launching a contest on social media platforms.

 

No. 3: A Call to Action

A call to action answers the question, “What do you want your customers to do after viewing your ad?” Even if you employ a genius advertising campaign and your tagline is golden for years to come, each of your ads should compel your prospect to do something. Here are some ideas to get you started:

• A coupon or current special: Include an expiration date to evoke a sense of urgency, and clarify whether the customer needs to bring in the ad to receive the discount.
• Your storage facility’s contact information: Your customers don’t want to take any extra steps to find you. Make sure your phone number and address are easily visible.
• Links to social media: If you have a contest going on or you’re making a push for more involvement, invite your customers to join the conversation.
• Direct appeals: Do you want college students to think of you over summer break? Sometimes there’s nothing wrong with saying that. If an explicit call to rent self-storage helps your customer understand what you want him to do next, it might be appropriate.

As with any change you make at your company, it’s wise to measure your results. Whether you put tracking numbers on each ad or you simply compare your quarterly/annual efforts against your profit, keep record of your most rewarding approaches. Use and measure the effectiveness of these three advertising components, and you’ll have uncovered a successful promotional strategy for your storage businsess.

Amy Daniels is the content-writing manager at StorageAhead, a provider of online-marketing services for the self-storage industry, and StorageFront, a self-storage lead-generation site. She enjoys the process of combining self-storage industry research, powerful Web-marketing strategies and small-business experience to cultivate the growth of facilities nationwide.

The self-storage business can appear pretty straightforward. Landlords provide buildings so tenants can rent space to store their personal property. Those tenants sign rental agreements and, if they don’t pay their rent, the landlords are entitled to sell the tenants’ property to regain use of the space and recoup their lost rent.

But it’s this self-help remedy where the landlord is able to sell a tenant’s property without first going to court that makes the self-storage business unique. This process, where the landlord is permitted to conduct the sale after written notice and public advertisement, certainly resolves tenant defaults more quickly than a court process. Unfortunately, it also requires strict compliance with regulations that can include complicated elements. It’s often within those rudiments that storage operators make mistakes and can subject themselves to tenant claims of wrongful sale.

Avoid Lien Sales

Historically, the wrongful-sale claim has been the largest financial risk self-storage operators assume when running their business. Although rental agreements contain value limitations and other exculpatory provisions to reduce the risk of financial liability should a tenant’s property be wrongfully sold, those contractual protections can often be overlooked by the courts if the landlord intentionally failed to follow statutory requirements. Wrongful-sale claims can include the financial value of sold items as well as punitive damages, where tenants assert the operator should be punished for non-compliance with law.

That’s why it’s often the best strategy for a self-storage operator to seek a resolution to a tenant’s default rather than sell the property. Once a sale occurs, it’s commonly impossible to reverse, especially once property has been removed from the facility. Conducting a lien sale should be viewed as an action of last resort, where the tenant simply has failed to communicate with the operator to resolve the account and otherwise ignores all efforts to avoid the sale.

In other words, no matter how hard an operator may try to avoid a lien sale, sometimes there’s just no other choice. It’s in those situations where an operator can be supported by laws that permit such sales as a landlord remedy.

Meet the Requirements

If an operator is required to pursue the enforcement of his lien and must sell a tenant’s stored property, the best way to avoid a wrongful-sale claim is to meet the statutory requirements outlined the lien law for the state in which the facility operates. Currently, 48 states and the District of Columbia have a law that governs the disposition and sale of a self-storage tenant’s property upon default.

Typically, those statutes require a notice of default to the tenant, and many states are now permitting those notices to be sent via e-mail or verified mail. After a cure period has passed, the public advertisement of the lien sale is also necessary. A number of states are now permitting the advertisements to be via “publically accessible websites” rather than local newspapers.

Unfortunately, each state lien law is different. Some require additional preliminary lien notices, some permit the option of the tenant to request a court hearing, and some require multiple public advertisements. The operator who chooses to follow his statute should also understand each action must be done within a particular time frame, with each notice or advertisement coming after certain periods have elapsed.

Acting too swiftly can itself be a violation of the statute. It’s within the unique characteristics of each state law that there can be traps for the unwary self-storage operator. It’s important to study the state lien law and even seek assistance to understand the law when necessary.

Another important part of avoiding wrongful sales is demonstrating a good-faith effort to avoid the sale. That’s why, in addition to the statutory lien notice required under most state laws, an operator should send additional default notices to tenants via e-mail and text (assuming the tenant has consented to such communication in the rental agreement). The operator should also continue to make phone calls and reach out to the tenant via social media websites. All of these actions demonstrate a good-faith effort by the operator to avoid the sale of his tenant’s property.

Hold a Commercially Reasonable Sale

Another key component to avoiding a wrongful-sale claim is to have a “commercially reasonable” sale. This can help the operator avoid the claim that he didn’t obtain enough money for the value of the items sold. This would apply if insufficient funds were recovered to pay off the tenant’s debt to the facility, which resulted in a deficiency claim against the tenant, or if the property didn’t sell at a high enough value to provide the tenant sufficient “proceeds” from the sale.

Both of these arguments can typically get dismissed if the operator has at least three independent bidders who have no relation to one another at the sale. It doesn’t mean the three bidders must actually bid on the stored property—the property may not be worth anything, for example. It only necessitates that there were three independent observers to create a true “market value” for the property being sold.

Under a number of state laws, the three-independent-bidder rule has been added as a definition of a commercially reasonable sale. For those states that don’t have the rule, it certainly provides some support for operators to reach that goal. Getting three bidders to your lien sales shouldn’t be that hard to do now that sales in many states can be done online, providing a world full of possible bidders. Getting three independent bidders to participate in a lien sale should be much easier.

Protect Yourself With Insurance

Notwithstanding all of these protections, sometimes an operator can make mistakes in the sale process, which can lead to a wrongful-sale claim. Also, even if the operator has done everything in compliance with the law, a disgruntled tenant still has the right to bring forth a lawsuit.

That’s why all operators should invest in sale and disposal insurance for their business. This specialty coverage will not only defend an operator from tenant claims for wrongful sale—whether or not he conducted the sale in compliance with the law—it will cover the losses of any successful action, with the exclusion of certain punitive-damage claims. Since wrongful-sale claims are a risk of doing business, just like property loss and damage claims, it’s extremely important that operators carry this type of insurance protection.

At the end of the day, the best sale is no sale. Self-storage operators aren’t in the business of selling their tenants’ property. They’re in the business of renting space suitable for storage. But if you have to sell, take your time and follow the law. It’s your best defense.

Scott Zucker is a partner in the law firm Weissmann Zucker Euster Morochnik P.C. in Atlanta, where he specializes in business litigation with an emphasis on real estate, landlord-tenant and construction law. He’s a speaker at industry events, author of “Legal Topics in Self Storage: A Sourcebook for Owners and Managers,” and a partner in the Self Storage Legal Network, a subscription-based legal service for storage owners and managers. To reach him, call 404.364.4626; e-mail [email protected].