Self Storage - Equilibrium Sq Ft per person in rural areas
Specialist · Charleston SC · Member since 2016 · 73 posts · 42 votes
Self Storage - Equilibrium Sq Ft per person in rural areas
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Investor · Fishers, IN · Member since 2012 · 520 posts · 499 votes
7y@Forrest Shealy This is where it gets "fun" because you're a detective trying to find the rest of the story and the manager (if they're worth their salt isn't going to give it to you).
So the best way would be to visit the local Facilities and ask to rent a particular unit, say 10x10, and then go look at it, (you can certainly request a few different sizes or climate control so you have a reason to tour the Facility). If possible, skip the golf cart ride the manager will give you and ask to walk it.
If it's run well you should see silver locks for those that are rented, green for vacant, & red for over-locked (the latter typically having two locks). Or if it's not, you should see the common scheme of things for vacant versus occupied units, even if they are zipped tied shut.
You MAY need to actually rent a unit at the place for a month so that you can have some leeway in order to count locks. Or on those trips up & down the aisles - count fast!
Please note that it usually requires a physical visit & count as the Manager is not typically going to give you the information you want over the phone as there's always scarcity and urgency to rent. A manager's role is to get you to visit the Facility, rent you a unit before you leave regardless of what it takes, and accompany you wherever you go. So asking how many 10x10's, or 5x5's available are there, and how many total are on the premises, may or may not work.
I hope this helps.
10 Replies
- Rental Property Investor · Rutland, VT · Member since 2017 · 61 posts · 16 votes7y
I’ve read this too. Interested in others opinions also.
- Investor · St. Augustine, FL · Member since 2016 · 75 posts · 46 votes7y
A lot of variables to consider for a more rural facility but what is your goal? Purchase an existing storage facility? Develop a new facility? Do you have a specific market picked out or are you just asking a conceptual "broad stroke" question?
- Specialist · Charleston SC · Member since 2016 · 73 posts · 42 votes7y
I would be looking at acquisition/value add opportunities. I have some experience on the development side but I'm making a stronger effort to look at the acquisition market this year.
I will be moving to Charleston SC in a few weeks (from Connecticut) but I was thinking more of the rural sections of South Carolina, North Carolina and Georgia.
- Investor · Fishers, IN · Member since 2012 · 520 posts · 499 votes7y
Hey Steve!
Yes, that is basically the national average Supply Index range (though some use 6.5 - 7.5), but it can vary lower or higher depending on individual market conditions & variables.
As far as what "number" to use? I'd say instead, what "method"?
I'd still complete a Market Supply Index just to have a number to work with. Then I'd put it into context by looking at the other Facilities nearby. Stabilization is also a range (80% - 90%) so if most of the other Facilities nearby have high vacancy, you can assume that it is systematic. That cuts both ways if most of the Facilities are all experiencing either high or low occupancy.
All things being equal the delta shouldn't be that great between Facilities as storage is pretty much a commodity. You may have outliers (e.g. high occupancy on all the others and low occupancy on the one you are pursing) and that is usually an indicator of a mismanaged Facility which is good. The opposite is true, if all are low occupancy and the one you are pursuing is high, then that would be bad as you'd be the trendsetter and not much promise in raising the value as everyone is or will soon be competing on price.
And you want to look at typical lot sizes. If it's rural with small property lots versus those with acreage then the latter probably has more leeway to store their "treasures" on their own property. And municipal "code" may drive folks to store their goods offsite versus having them scattered around the house. And though I'd like to make a funny comment about some of the things I've seen in some of the places I've seen across the country, it goes back to you can't paint it all with a broad brush.
So in brief, it depends.
Please remember, as @Brandon Hobbs said, there's a difference between buying an existing Facility where you're pretty much assuming the existing business and improving it. You should still know the Supply Index but it's not as imperative if you're bringing new storage online either through a ground-up development or an expansion. Then being oversupplied may most likely be a deal killer.
If it's existing, checking out the nearby competitors as mentioned above will paint a picture on the market supply, and if it's the latter, you're most likely going to need a Feasibility Study to move forward, especially if you're borrowing money.
And if there's no facility anywhere nearby and you want to build one - well, that's a crapshoot.
I hope this helps.
- Rental Property Investor · Charleston, SC · Member since 2018 · 46 posts · 12 votes7y
Originally posted by @Scott Meyers:
Hey Steve!
Yes, that is basically the national average Supply Index range (though some use 6.5 - 7.5), but it can vary lower or higher depending on individual market conditions & variables.
As far as what "number" to use? I'd say instead, what "method"?
I'd still complete a Market Supply Index just to have a number to work with. Then I'd put it into context by looking at the other Facilities nearby. Stabilization is also a range (80% - 90%) so if most of the other Facilities nearby have high vacancy, you can assume that it is systematic. That cuts both ways if most of the Facilities are all experiencing either high or low occupancy.
All things being equal the delta shouldn't be that great between Facilities as storage is pretty much a commodity. You may have outliers (e.g. high occupancy on all the others and low occupancy on the one you are pursing) and that is usually an indicator of a mismanaged Facility which is good. The opposite is true, if all are low occupancy and the one you are pursuing is high, then that would be bad as you'd be the trendsetter and not much promise in raising the value as everyone is or will soon be competing on price.
And you want to look at typical lot sizes. If it's rural with small property lots versus those with acreage then the latter probably has more leeway to store their "treasures" on their own property. And municipal "code" may drive folks to store their goods offsite versus having them scattered around the house. And though I'd like to make a funny comment about some of the things I've seen in some of the places I've seen across the country, it goes back to you can't paint it all with a broad brush.
So in brief, it depends.
Please remember, as @Brandon Hobbs said, there's a difference between buying an existing Facility where you're pretty much assuming the existing business and improving it. You should still know the Supply Index but it's not as imperative if you're bringing new storage online either through a ground-up development or an expansion. Then being oversupplied may most likely be a deal killer.
If it's existing, checking out the nearby competitors as mentioned above will paint a picture on the market supply, and if it's the latter, you're most likely going to need a Feasibility Study to move forward, especially if you're borrowing money.
And if there's no facility anywhere nearby and you want to build one - well, that's a crapshoot.
I hope this helps.
Those are very helpful suggestions. How would you find out the vacancy level at surrounding facilities.
- Specialist · Charleston SC · Member since 2016 · 73 posts · 42 votes7y
@Scott Meyers Thank you so much for the response. All this info was very helpful.
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Steve Cheslock:
I would be looking at acquisition/value add opportunities. I have some experience on the development side but I'm making a stronger effort to look at the acquisition market this year.
I will be moving to Charleston SC in a few weeks (from Connecticut) but I was thinking more of the rural sections of South Carolina, North Carolina and Georgia.
I have some really cool new construction in Charleston if your looking you can buy direct from the builder. IE me LOL
- 7yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Originally posted by @Steve Cheslock:
@Scott Meyers Thank you so much for the response. All this info was very helpful.
Steve Scott has some really good detailed information in his school.. if your not in the space currently I would recommend engaging in this. you will meet other owners from all over the country and unlike how to flip a house.. this is a very specific business model that does take some advanced education I think you would be money ahead in the long run.. I know I would not venture into this specific of a niche without advanced education and training.. to much to risk making a boo boo
- Specialist · Charleston SC · Member since 2016 · 73 posts · 42 votes7y
@Jay Hinrichs Sending you a DM
- Investor · Fishers, IN · Member since 2012 · 520 posts · 499 votes7y
@Forrest Shealy This is where it gets "fun" because you're a detective trying to find the rest of the story and the manager (if they're worth their salt isn't going to give it to you).
So the best way would be to visit the local Facilities and ask to rent a particular unit, say 10x10, and then go look at it, (you can certainly request a few different sizes or climate control so you have a reason to tour the Facility). If possible, skip the golf cart ride the manager will give you and ask to walk it.
If it's run well you should see silver locks for those that are rented, green for vacant, & red for over-locked (the latter typically having two locks). Or if it's not, you should see the common scheme of things for vacant versus occupied units, even if they are zipped tied shut.
You MAY need to actually rent a unit at the place for a month so that you can have some leeway in order to count locks. Or on those trips up & down the aisles - count fast!
Please note that it usually requires a physical visit & count as the Manager is not typically going to give you the information you want over the phone as there's always scarcity and urgency to rent. A manager's role is to get you to visit the Facility, rent you a unit before you leave regardless of what it takes, and accompany you wherever you go. So asking how many 10x10's, or 5x5's available are there, and how many total are on the premises, may or may not work.
I hope this helps.
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