Unless you’ve been under a rock for the past five years, you have probably noticed that self storage is booming. An active housing market and readily available lending has fueled growth in the industry. Meanwhile, the trend has been toward larger and more complicated projects. Here are some tips for speeding it up that we encourage you to share with potential clients that are looking to build self storage.
Tips for builders to guide clients through the process quickly
Don’t put your cart before thehorse; many new developers call us asking for a quote on a building. We ask them: “What size building? What layout? What features/details?” And they have no idea. This is like walking into a car dealership and saying I want a price on a vehicle without knowing which model you want. The problem here is that the new investor is trying to figure out if a project is worthwhile, but they aren’t ready to invest in the design work that is needed in order to provide solid quotes. At this stage, we encourage them to compare properties or markets, thinking in rough cost and revenue per square foot terms.
Most building suppliers should be able to give a ballpark cost per square foot. And you can easily calculate the revenue per square foot based on a typical unit price at similar nearby facilities. This will lead to a financial projection close enough to determine if it’s worth investing in the design work. A free tool for creating quick and dirty financial projections can be found here: www.trachte.com/ resources/calculator/basic-investment-calculator.
Timelines: The other common question from new developers is, “How fast can I get my building?” New developers are often very dismayed at the honest answer (which varies based on building complexity). However, when it actually comes time to ship a building, most projects’ delays are due to missing building permits, weather and site preparation.
Codes and zoning matter: Ask the client up front if self storage is an allowable use on the land. Many new developers underestimate the difficulty of changing zoning. Fire code can also affect the budget. Energy codes are also driving some changes in climate-controlled structures, and should be researched prior to building design if the project will have insulated structures.
Buy the land with cash: For most developers, banks will require about 10 to 25 percent equity. Land counts toward this. Buying land with cash and reserving the bank loan proceeds for construction make the land purchase a lot easier, and it means that the developer will not be dealing with loan paperwork and lending requirements until he is finally ready to build. Waiting until permits are in place to close on the loan will make that process easier, and may take pressure off the construction timeline by allowing the interest-only period of the loan to take place entirely after construction begins. The caveat: you should be sure the permits will be granted if you are buying the land first.
Simplify: The more basic your self storage project, the faster it will go. The easiest structures to build are simple rectangular structures that conform to a 5-foot grid. Jogs, multiple stories, custom colors and certain finish treatments slow things down. To add curb appeal, try to limit stone, brick or other architectural treatments to the office and blank endwalls of the storage building.
Avoid changes: Planning early and being decisive can reduce the delay that changes can bring. When the engineers need to rework plans and permit sets, that can add weeks to a timeline. Changes that affect building cost can also complicate lending.
About that fancy office: Self storage offices are increasingly personalized spaces. Prefabricated self storage buildings are a thing of wonder—most everything bolts together quickly with ease. But traditional stick-built construction is the better choice for an office. The space can be completely separate or attached to the self storage building.
Steve Hajewski is marketing manager at Trachte Building Systems, Sun Prairie, Wis., and regional manager for N.C. sales. Additionally, Hajewski owns and manages one completed facility and a second location that will be opened in 2019. To learn more, visit www.trachte.com.