appy New Year! As we step into 2024, we are excited to announce that the new MSM Store is open for business!

As you may know, for more than 40 years Modern Storage Media has been the voice of the industry and the most trusted source for self-storage news and insight. In keeping with that tradition, we have launched our new e-commerce website Shop.ModernStorageMedia.com.

The new site, powered by Shopify, brings together all MSM’s current publications, both books and subscription magazines, in one convenient, mobile-friendly location. On the new site, visitors will find MSM’s most popular subscription-based offerings, including Messenger, Self-Storage Canada, and Self-Storage Now. In addition to its own publications, shoppers can also pick up books by the likes of Carol Mixon, Jim Ross, Marc Goodin, Jon Dario, Michael Rotondo, and others.

The store will be managed by Carlos “Los” Padilla, MSM’s new Sales & Circulation Manager. Padilla is also a self-storage operator with a technology background, giving him insight into both e-commerce operations and the self-storage industry.

Visit Shop.ModernStorageMedia to shop online, or just click through to the store from the main MSM menu.

alen is a child who loves being active and playing sports; he just wants to be a child like any other. However, Jalen was born with sickle cell disease (SCD), a disease of the blood that requires regular blood transfusions.

Jalen’s story is just one of the many stories highlighted on the American Red Cross website of people who survive or have survived thanks to blood donors.

Last fall, the American Red Cross posted they are facing a national blood shortage. The reasons, their website explains, are many.

What does this have to do with the self-storage industry? Red Cross blood drives are an excellent way to reach out and give back to the community, according to Stacie Maxwell, vice president of marketing and training for Universal Storage Group in Atlanta, Ga. “It’s really a good event to do, very simple,” she says. “The Red Cross does most of the set up and work; we just help with traffic flow.”

Some events, such as the blood drives, serve a dual purpose. “We may do a blood drive as one of our days of service to the community,” says Maxwell. “We always have a good traffic flow for those.”

Of course, the effort assists the community first and foremost, but also achieves what other less serious events do–getting people on the property and maybe putting the facility at the top of people’s minds. “Hosting is great for generating traffic,” she says. “Just creating an event that shows we care, but if it’s set up properly, we can also show off the property as people are waiting.”

Maxwell says the company has one property in Florida that sets up several successful blood drives every year. “Events have proved to be phenomenal marketing for the property,” says Maxwell. “They have all kinds of events all summer long on the property and they’re all very successful. Some of those events are blood drives.”

USG’s events are all well-publicized.

Todd Amsdell, president/CEO of Compass Self Storage in Cleveland, Ohio, says his company has rarely conducted blood drives on their properties. “We had an employee who had a relative that needed blood, and the event was very successful,” says Amsdell. That event wasn’t publicized to the community, but he says, “That might be a good publicity tool for the property.”

As described in Jalen’s story, there are many reasons a person in the community may need blood. “Patients undergoing cancer treatments often require blood or platelet transfusions during their treatments. In fact, nearly half of all platelet donations are given to patients undergoing cancer treatments—a disease all too familiar to millions of Americans and their families. Approximately two-thirds of all children diagnosed with cancer will require a blood transfusion at some point during their treatment,” the Red Cross said in a statement.

Some of the patients who need blood may require up to 100 units per year. The American Red Cross supplies 40 percent of the nation’s blood supply.

The Red Cross says there are many reasons for the current shortage, “There are several reasons for the drop in donor turnout—one of the busiest travel seasons on record, back-to-school activities—and back-to-back months of almost constant climate-driven disasters. The Red Cross is working with hospitals around the clock to meet the blood needs of patients but can’t do it alone. The need for blood is constant. Every two seconds, someone in the U.S. needs blood—an often-invisible emergency that the rest of the world doesn’t see.”

• Work with your Red Cross representative throughout the process.
• Set the date well in advance, avoiding scheduling conflicts with other major events in your area.
• Select a location, preferably a large, open room with space to ensure donor interviews are conducted in a private and confidential manner. If your facility doesn’t have a large separate enclosed space, such as a conference room, it can be an outdoor event, just space the tables and chairs far enough apart so donors can feel their privacy is secure. Maxwell says it’s best to have people moving through different areas of the property so they can see the amenities the property has to offer.
• Recruit volunteers to help sign up donors. You’ll also want volunteers to help the day of the drive to ensure it goes smoothly.
• Recruit donors with the help of your volunteers. Recruiting is most effective when done face to face, and you can reach more people by spreading the effort among your team than doing it alone. Publicize the drive through your community contacts and email lists.
• Sign up donors using the Red Cross online scheduling system; this will help you keep track of your signups and offer donor reminders and thank you email templates.
• Engage community partners to supply donor incentives, thank you gifts, and treats such as extra cookies or pizzas for your donors and volunteers. Maxwell says they always offer a prize drawing. Once someone has won the prize, this can be used as publicity on social media.

• The facility will need to provide chairs, which Maxwell says can be rented, as well as a few tables. The Red Cross will bring some tables and chairs, but it is helpful to supplement what they bring.
• Arrive early to meet the Red Cross team; they will arrive up to two hours prior to the first appointment to set up.
• As Maxwell points out, their staff assists at the refreshment and prize tables, as well as helping with traffic flow onto the facility.
• Send reminders or make calls to scheduled donors, especially those who miss their appointments.
• Manage the volunteer schedule so the registration and refreshments areas are always covered.

he main goal of a self-storage facility is to attain maximum occupancy through sales, but many owners and executive managers don’t realize that selling the job to their employees is just as important as selling units to a tenant.

One important aspect of hiring and retaining excellent self-storage managers is building leadership skills in those employees.

“We have to first hire the right people and then allow them ownership of the job,” says Ann Parham, CEO of Joshua Management, a division of The Parham Group in Bulverde, Texas.

Surveys show that hiring the right people for the job is the first step in instilling leadership and the second is allowing employees the autonomy to perform that job. A recent Gallup Poll showed that 58 percent of employees surveyed responded they would be happiest in a job that allows them the autonomy to do what they do best.

Hiring and instilling leadership skills and autonomy will ultimately make your employees happier and strengthen the retention rate.

Here are five steps you can follow to foster leadership skills in your employees:

1 Hiring – Good self-storage managers are “people people,” says Parham. “We started doing personality type surveys to find the people who are good salespeople and good customer service people,” says Parham. “We can put a lot of money into a facility, but if we aren’t hiring the right people for customer service, it won’t work. We can train people on the computer and how to do leases, but we can’t teach good customer service skills.”

According to Eddy, an employee management software company, employees who become good leaders also possess motivational qualities, integrity, empathy, confidence, the ability to be humble, good communication and problem-solving skills, as well as accepting accountability.

2 Training – Stacie Maxwell, vice president of marketing and training at Universal Storage Group in Atlanta, Ga., says instilling leadership in each employee is important, and for USG, it starts in the training process. “We instill leadership by showing them how to take ownership and by having them hands on in the training process,” says Maxwell. USG’s training process is implemented into four phases:

• Storage 101 – In this phase, new employees work through the basics of the processes, including completing leases.
• Storage 201 – In this phase of training, employees learn about revenue management, managing street rates and delinquent tenants, completing rent increases, selling product, and increasing sales, as well as the fundamentals of ROI.
• Assigning a mentor – At USG, each new employee is assigned an internal certified trainer to act as a mentor for 45 to 60 days. “This phase is all about marketing; we get them used to the product so they can sell,” says Maxwell.

  The HR firm Eddy says assigning a mentor is one of the top ways to instill leadership in employees. “A mentor can guide the employees to improve as well as set an example,” explains Eddy’s website. The company also recommends allowing employees who have demonstrated leadership skills to eventually act as mentors to other employees.

• Auction training – The final step in the training process is teaching new employees all they need to know about the auction process. “All of our training occurs within the first 60 days, but there is continual training for everyone once a month,” Maxwell says. These training sessions are called “The Company Broadcast,” in which all employees participate via video conference.

Part of the meeting encompasses important personal announcements for employees such as birthdays, anniversaries, and birth announcements. “Employees are encouraged to share anything important,” says Maxwell. “This segment helps everyone feel like they are part of the company, a team.”

Managers and employees then share issues and other business topics. Finally, there is a training segment in which trainers refresh employees on topics that may be causing concerns within the company.

3 Encourage employees to take ownership – All successful experts within the self-storage industry say this is one of the most important steps in instilling leadership in its employees. “We try to enable our managers to take ownership in the property,” says Parham. “We have one facility in a small town in which the town actually thought our managers owned the facility and we just let them think that.”

Parham adds that it’s important employees don’t feel like “monkeys behind a desk” and says employees at her company are involved in decisions such as budgeting and expenses. “We’ve hired managers from other companies who say they never had involvement in decisions at their former jobs,” says Parham. “It’s important to employees to have that. Some companies make their employees memorize a sales script; we don’t do that because we don’t want robots. People all have different needs and approaches.”

They do not micromanage, which allows employees to make more decisions on their own and instills leadership skills. “We also believe if we make money, our employees make money,” says Parham. “That’s another way they feel they are taking ownership of the property.”

Anne Mari DeCoster, president of Kingdom Storage Partners and Self Storage Investing in Scottsdale, Ariz., agrees in allowing employees to take ownership through participation. “I promote open discussion and debate,” says DeCoster. “Once we make a decision, we also ask for buy in from employees on the decisions.”

Todd Amsdell, president and CEO of Cleveland, Ohio-based Amsdell Companies, which operates facilities as Compass Self Storage, says it’s all about creating a company culture that fosters ownership. “We tell our employees they need to do the right thing for the customer and the company and to run their facility as if they own the company,” says Amsdell. “At the end of the day, we would rather them be a part of the process and share in the success.”

4 Assign projects – Another tool DeCoster uses in helping to instill leadership is identifying an employee’s strengths and assigning special projects. “We give them an opportunity to lead through leading a project and seeing how they demonstrate communication and other qualities,” says DeCoster. “We always circle back and hold people accountable for their projects, but it’s those people who approach me before I have to ask who are rising in leadership skills.”

5 Provide feedback and expect accountability – DeCoster says it’s very important to help employees develop leadership skills by providing feedback. “If we have something that hasn’t worked as it should or we aren’t making numbers, we will tell the employee what happened and if that’s what they intended to happen,” she says. “This approach helps them think through their decisions and the impact of their decisions.” DeCoster cites an example of someone coming into the facility and reporting not feeling welcome. “We will tell the employee what happened and ask if that was the desired outcome, and we then talk about how they can do things differently,” she says. “We also keep in mind to praise publicly and coach privately.”

Amsdell also says accountability is important. “We tell our employees to go with their gut about what is the right thing. They might make a mistake, and we also think it’s better for them to talk about it and own up to it rather than take a chance it wasn’t the right thing to do.”

or nearly 30 years, the Arizona Self-Storage Association (AZSA) has been strengthening the self-storage industry in Arizona by promoting professional business standards and presenting a unified voice on issues affecting owners/operators throughout the state. The association, which aims to engage, educate, and empower its members, has grown its membership to approximately 500 facility and vendor members since 1996. And one of its former vendor members began facilitating the association’s return to its roots in 2020.

That volunteer experience proved to be a lifechanging event for Amideo, who admits she “wasn’t happy in finance,” which she calls a stressful and highly competitive industry. “Anne Mari DeCoster [former AZSA executive director] was taking a position elsewhere,” recalls Amideo. “She thought I’d be a good fit for it, and I was ready for something new.”

For Amideo, “watching industry competitors giving each other advice” at AZSA’s 2019 conference was an eye-opening incident. She realized the association—and the entire self-storage sector—was formed by cooperative, helpful individuals who want to see each other succeed, even if they are competing for market share, and make charitable giving a priority.

With DeCoster’s endorsement in February 2020, and admiration for the self-storage industry’s sharing nature, Amideo made the decision to join the Arizona Self-Storage Association as the interim executive director in March 2020.

Though initially apprehensive about the position, she says the entire “incredible” AZSA board “rallied around” her; their support enabled her to help maneuver the association and its members through the uncharted waters of the COVID-19 pandemic.

Despite the chaos, there was one silver lining: “I had a year to figure things out,” says Amideo, who remains appreciative of the assistance she received from the AZSA board members during that adjustment period.

One of the key changes Amideo implemented for that year’s conference was utilizing a separate but connected exhibitor area and attendee area. The exhibit space was designed to have easy access to the attendee area; they were divided by an airwall with doors leading in and out of both areas. She also ensured that the trade show was accessible to attendees throughout the entire conference, with dedicated exhibit time on both days as well as open accessibility.

Amideo has been responsible for executing several new initiatives as well, including “Ruralpolooza” (see the Ruralpolooza sidebar for details); new corporate sponsorships (see the corporate sponsorships sidebar); “Project Hope,” an endeavor that aims to provide operators and managers with resources to pass along to their homeless tenants; new legislative efforts and the online “Legal Connection” with Jeffrey J. Greenberger, partner at Greenberger & Brewer, LLP; networking breakfasts; and townhall-style meetings within the eight regions of the state—all of which are enabling her to home in on the three main objectives of the AZSA’s mission statement (engage, educate, and empower).

In conjunction with Ruralpolooza, she is in the process of reinstating the association’s 20-plus-year-old district liaison program to give AZSA’s rural members a more prominent voice. It will be fully functional by the end of 2024. “While I was out meeting the owners and managers, I was also building relationships and seeing who might be a good fit for the district liaison position,” says Amideo. “It’s vital to have representation in parts of the state such as Flagstaff, Yuma, Lake Havasu, and the White Mountains. The main purpose was to have that local person who knew the people and the town well be an extension of the AZSA board. They would have much more influence on owners attending regional meetings, workshops, and networking events. When self-storage was a new industry, the board wanted to make sure everyone was aware of the laws and statutes and promote what was a novel idea then—collaboration. The board has always believed in strength in numbers.”

She goes on to say, “The district liaison will have direct access to a designated board member. This will now be a mentor role for the AZSA board member.”

Building on the hard work of long-time and former AZSA board members, Amideo is dedicated to engaging and empowering the next generation of self-storage professionals and AZSA members through the district liaison program and various in-person events that foster collaboration.

“AZSA has the direct line to what our regional issues are and the owners’ best practices to share with their communities and the state at large,” Amideo says about the association’s efforts to uphold collaboration. “It will give them a sense that they are part of something bigger, a feeling of community. It also helps everyone realize the importance of the association’s legal and legislative pillar. This is difficult to see on a daily basis, but it’s crucial when laws are being proposed that are unfavorable to our industry.”

Speaking of laws, Amideo mentions that AZSA has received a grant from the Self Storage Association (SSA) to fund a two-pronged bill that aims to incorporate a towing statute and a $5,000 liability cap into the state’s existing self-storage laws. Along with the SSA, Triadvocates, and Barb Meaney, AZSA and Amideo have been working with lobbyists to make these legislative improvements. “By June or July, we’ll know if it’s passed,” she says, pointing out that simply having a liability cap within a rental agreement or lease may not hold up in court, should a litigious tenant file a lawsuit. “We have a great operations manual and resources, including the Sales and Foreclosure Manaul, to help owners operate their business with peace of mind.”

“I’m really excited about where we’re going!” Amideo says, adding that she has a strategic plan for 2024 to increase AZSA’s market share by 20 percent.

hen you’ve been in the self-storage industry for nearly four decades, you’re likely to learn priceless lessons about the business and how to weather any economic climate. That’s the kind of experiential knowledge Charles Plunkett, CEO Capco General Contracting and Capco Steel, Inc., who founded Capco Steel in 1985, brings to the table and candidly shares with new developers.

“With being in business for 38 years, there have certainly been many ups and downs,” Plunkett says. “I have been through so many cycles of economic growth and shrinking.”

And anytime there’s volatility, he’s asked one question on the regular: Is this a good time to build or develop self-storage?

• Interest rates are up “significantly.”
• The costs of building materials have escalated.
• Steel is more expensive.
• Shipping and delivery fees are higher.
• Labor costs have increased.

Although these statements are accurate, Plunkett points out that he’s been having the same discussion for 38 years. “Costs shouldn’t be the deciding factor. Costs will only continue to increase over time. They zig zag up,” he says, adding that any line item would create a stair-step graph. Even when costs decrease, “they never quite go down to where they were” before they increased.

All things considered, Plunkett says that potential developers should “assume it will never be less expensive than it is now. It’s difficult to time a ‘sweet spot’ without a crystal ball.”

Instead of wondering if costs and interest rates will recede enough to make their proposed projects more lucrative, or waiting around for better values that may never come about, he advises developers to determine whether the development would meet their minimally acceptable return on investment with the present-day pricing.

“It’s always a good time if the projected returns are there,” Plunkett says about building or developing self-storage. “Does it work today? If it will work today, there’s no reason not to move forward with it.”

What’s more, as Plunkett explains, “There’s aways upside to the business.” Populations, rental rates, and values all grow alongside construction costs.

For those seeking an industry average for cost analysis, Plunkett says, “We currently have projects with all-in construction budgets ranging from the low $70 per gross square foot to well over $100 per square foot. The average ranges that we see are roughly $75 to $90 per gross square foot.” These averages apply to projects they are building throughout Texas, as well as the lower Midwest and some along the East Coast and Southeastern U.S.

According to Plunkett, location can significantly impact costs in several ways. For starters, the cost of land will vary depending on the project’s location. Obviously, land within a primary market will be more expensive than land in a tertiary market, but the difference could make the project unfeasible.

“Location is a big factor in cost adjustment,” he says. “… if you are building in Houston, Texas, you have that regional cost. However, if you are building in New York City or San Francisco, those are two completely different circumstances. It could be as much as 50 percent higher, or even double the cost or more, to build in these areas. These costs are driven by cost of labor, unions, and many other factors. In my experience, there is always a parallel between the cost of construction and rents. Basically, this means that if you are building in an area where the cost of housing, cost of living, cost of land, and costs of construction are high, the rental rates in that area are also going to be high as well.”

And, as he knows all too well, some areas require extensive foundational work. “Across the country, there are many varying types of soil conditions,” says Plunkett. “Along the coast lines you can have sandy soil with the water table very shallow below the top of the soil, or bay mud that is not supportive of structures. You can have very rocky soil or even hard flint rock to deal with, or you can have highly expansive clay soils. All of these require different types of procedures to provide a suitable sub-grade to build on.”

He goes on to say, “The additional cost to repair the soil condition could range from an added $3 to $7 per square foot of gross building. So, if you are developing a three-story, 120,000-square-foot building, this could cost an additional $360,000 to $840,000 for your project depending upon the procedure necessary. If you are not aware of this potential expense, you may be in for a very big surprise.”

Building in phases is a strategy that has helped many developers get their projects across the finish line. Typically, phasing includes building a multistory, climate-controlled facility first, then constructing additional buildings as (or after) the first building leases up. Income from the climate-controlled rentals can be used to fund future phases.

When it comes to modifying the original design, Plunkett says to “tailor it to the market but really look at it” because the design may include unnecessary elements. As an example, he recommended that one developer redesign his project to include one multistory facility instead of two buildings. By doing so, they essential cut costs in half as fewer stairs, elevators, walls, etc. were required. Eliminating the covered, drive-thru loading bay also helped make the project pencil. Moreover, developers can dial back on the finishes and build less extravagant offices to save money; you can build an appealing property without going over the top with glitz and glamor.

“Temper the dream,” he says, adding that developers should question what’s driving the project. “What’s most important to the project? Be willing to compromise. Eighty percent of something is better than 100 percent of nothing.”

On another note, while it was previously considered more costly to build multistory projects, Plunkett states that the costs to build single-story and multistory facilities are comparative. Multistory facilities require elevators and stairs, but single-story facilities need more land, paving, site work to prep the earth, and cement slabs.

“Analyze the costs and demand,” he says. “Look at all the elements and how the costs compare to the revenue it will produce. There is a market for drive-up storage in most markets, but climate-controlled storage produces more revenue.”

n today’s digital world, it’s imperative that your self-storage website ranks well in online searches. But its position is largely determined by search engine algorithms and optimization.

In the modern era, it’s important to have a basic understanding of digital marketing and website ranking, especially if you operate a business like self-storage. You need to get your brand in front of online customers who would otherwise not know of your existence.

To begin, it’s imperative to understand how search engine algorithms and search engine optimization (SEO) work. Both are constantly evolving in response to societal and technological changes. Let’s discuss the main concepts you need to know as a self-storage operator and some best practices to follow.

Over the years, many companies have found ways to manipulate search engine algorithms, using practices like keyword-stuffing and over-linking. These’ll help a website rank well in the short term, but shady tactics will only hurt your digital progress in the long run. Google will continue to improve its parameters, which become more sophisticated and complex every year, to wipe out sites that use such methods.

As people spend more time conducting business and living life in cyberspace, Google will invest more to enhance its user experience. As a result, we can expect more algorithm updates that make online information easier to find and more accessible than ever.

• Make sure you have a clean, fast website that’s easy to read and accessible. It should be full of industry-relevant information.
• Optimize your website content and tags.
• Earn Google Trust by adding your company and facility information to online business directories and social media pages. Verify that all NAP (name, address, phone) details are correct and consistent across the web.
• Complete and verify your Google Business Profile. It’s also important to stay active by adding pictures over time, responding to all reviews, and answering questions promptly.
• Don’t forget to submit your website to search engines and set up Google Analytics. Track your data and results for ultimate success.
• Scan your website with speed and performance tools, then make adjustments as needed.

The best way to avoid such issues is to keep up with Google algorithm changes. Always follow SEO best practices. Monitor your data, analytics, and keyword rankings.

If you’ve offended Google and find your ranking has dropped, or worse, your website has disappeared altogether, you’ll need to determine the reason. My best recommendation is to hire an SEO expert who can analyze your website. They’ll check your Google Search Console (GSC) to see if there’s been any manual action from a Google auditor. If so, they’ll correct any errors they find and submit the fix to GSC. Once this is done, you should see improvements within a month.

If you’re less fortunate, and were penalized from an algorithm update, your SEO expert will need to look through all the latest updates to see why and correct any errors. Traffic improvements tend to take significantly longer in these cases, with some businesses reporting that it took up to two years to full recovery.

Once you have a solid knowledge base, keep building on it and stay current. As you now know, algorithms are constantly changing. Keeping up with modifications and understanding how they impact your self-storage website rankings will help your business compete for organic results within your local marketplace.

It’s important to note that not all search engine updates are explained or even announced. To help you identify what updates may be impacting your self-storage website, it may be helpful to do some A/B testing. Then, make any necessary corrections based on the results. It may take a couple of months before you see any improvement. If you instead see your rank drop, more testing may be needed, or you may need to reach out to your SEO expert for assistance.

The best advice is to keep up with Google’s best practices. Following them along with the other items mentioned above is vital to your self-storage business’ online success.

elf-storage development has been appealing to many industry investors, owners, and operators over the past few years, following years of minimal development from 2009 until 2016 and solid fundamentals. Development activity sunk as low as 12 million net rentable square feet annually in 2011 and 2012, or around 1 percent of existing supply. As net operating income grew much faster than most other property types during this period, development activity started to pick up in the middle of the last decade and reached a peak in 2018 and 2019 with over 70 million net rentable square feet per year or over 5 percent as a percent of stock. With over 4,598 properties or 415 million net rentable square feet delivered since 2017, this has been one of the most active development cycles in the history of the industry. Despite the new supply, the industry has managed to maintain occupancy levels over 90 percent, a testament to strong demand patterns that for years have outpaced new supply. Looking forward, Yardi Matrix projects supply will remain elevated, yet as a portion of existing supply, annual deliveries will be below the long-term average of 4 percent.
(see National Annual Completions chart)

Despite the supply and demand imbalance, strong performance, and plenty of interest in self-storage development over the past several years, it remains a challenging investment strategy to pull off at scale. Laborious land assembly and acquisition, contentious site and zoning review, delayed inspection and final approvals, rising construction costs, and sometimes elongated lease-ups and unpredictable market rents are all barriers to development, and it takes an experienced and savvy company or individual be successful at it. Still, since 2017, self-storage development has been surprisingly fragmented with local and regional players doing most of the heavy lifting. Data from Yardi Matrix shows that since 2017 there has been a total of 2,313 different entities and individuals that have built a self-storage property. The Developers Since 2017 chart shows that approximately 39 percent of all developments have been completed by an individual or company with only one project and slightly approximately 60 percent of developments undertaken by an entity with less than five projects over the past six years. Less than 9 percent of new properties have been completed by a company with 50 or more developments, and only three companies have accomplished this feat (Amerco Real Estate [dba U-Haul], Public Storage, and Johnson Development Associates), while 15 companies have built 20 or more new stores, accounting for 15.5 percent of total stores built this cycle.
(see Developers Since 2017 by Number of Developments chart)
(see Top Buyers of Properties Built Since 2017 chart)

A few of the largest national owners/operators have avoided creating new construction and development divisions to go after development in a significant way and participated in development in limited capacity, for instance, as a joint venture partner with a partial interest or engaging in a pre-sale, including CubeSmart and Extra SpaceOthers, like National Storage Affiliates, have stayed out of development completely. Many of the top developers have been development-focused companies without an acquisitions portfolio, like Johnson Development Associates, SAFStor, and Northpoint Development. Still others are small to mid-sized national operators, like The William Warren Group (dba StorQuest). The Sterling Group (dba Mini Mall) or Madison Capital Group (dba Go Store It), or regional owners/operators like All Storage, The Carrol Companies (dba Bee Safe Storage), or Stein Investment Group (dba Space Shop Self Storage).

Of the 4,598 stores delivered since 2017, over 32 percent of them have since been sold, many of them in large portfolio transactions like the Public Storage/NorthPoint Development portfolio sale in early 2021, in which NorthPoint sold 22 stores to Public Storage, 20 of them developed since 2017. Other stores developed since 2017 were sold as part of larger portfolios, like the $1.5 billion Public Storage/All Storage transaction in December 2021, which included 20 stores developed by All Storage in Dallas/Ft. Worth. A few developers have sold off most or all their stores developed since 2017, either one-off sales or portfolio sales, to recycle the capital on other developments. Sales of newly developed properties have been a significant part of the transactions market the past few years. Of the nearly 5,000 self-storage properties sold since 2020, 26 percent of them have built since 2017. These properties have supported higher pricing in recent years, selling for an average price of $176 per net rentable square foot vs. an average of $137 per square foot for properties built before 2017 (excluding the StorageMart/ Manhattan Mini portfolio).

Top buyers of properties built since 2017 are shown in the Top Buyers table. Most of the top buyers of newly built properties have been REITs, making up 38 percent of sales activity in this cohort of properties since 2017. Some of these acquisitions were conducted through joint ventures with large financial firms, and many were part of portfolio sales. Other large buyers of new developments include NexPoint Group, which acquired Jernigan Capital in 2020, and their portfolio of newly built properties in November 2020. Prime Group has also been one of the most active buyers; it closed on $2.5 billion early in 2023 for their third fund, the largest such fund raised for self-storage investment in history. Other top buyers include large national and regional owners/operators like Strategic Asset Management (dba SmartStop Self Storage), Andover Properties (dba Storage King USA), and Madison Capital, as well as large private equity groups like KKR and Harrison Street Real Estate Capital.
(see Top Buyers of Properties Built Since 2017 table)

Many developers have enlisted larger operators, usually the self-storage REITs, to assist with planning and to lease up the properties for a variety of reasons. Many times, lenders to self-storage developers will request third-party management, and the REITs have responded by rapidly expanding their third-party management platforms. The self-storage REITs have managed nearly 50 percent of all properties delivered since 2017. This has resulted in consolidation of management in the industry, with the REITs expanding their third-party management portfolios by 198 percent, from 767 stores in Q4 2016 to 2,289 stores in Q2 2023. CubeSmart and Extra Space have largely been the operators of choice for many developers and have by far the largest third-party management platforms, managing a total of 1,705 properties for third parties as of Q2 2023. In many cases, this has helped these companies build market intel, sometimes in new markets and submarkets for them. It has also helped companies gain access to deals off-market, acquiring the third-party managed stores from developers during or following their lease-up. New York has been one of the most active markets for development this cycle, and the REITs have been the manager of choice for new stores there.
(see Top Managers of Properties Built Since 2017 table)

Although construction lending is less fragmented than development activity, there are only three banks that have made more than 50 construction loans for self-storage over the past few years (Truist Bank, Live Oak Bank, and Renasant Bank), accounting for only 6.3 percent of total loan volume. A majority of lending activity has come from companies with between three and 25 separate construction loans, accounting for 53 percent of total volume. For developments currently under construction, the three largest lenders since 2017 are still active, but the lenders with the most loans for properties under construction are SouthState Bank and Bank OZK with 10 construction loans each. The three largest banks in the U.S. (JPMorgan Chase, Bank of America, and Citibank) have made only six total tracked construction loans to self-storage projects over the past few years, accounting for $62.4 million of volume, or just 0.3 percent of total volume. The fourth-largest bank in the country, Wells Fargo, has also been the fourth-largest lender to self-storage developments, with nearly $400 million in volume, and over 91 percent of these loans have closed.
(see Top Construction Lenders Since 2017)

V, boat, and vehicle storage is in high demand these days, and you may be sitting on land that could be converted into additional income. RV sales soared during 2020, and more than 600,000 were shipped wholesale during 2021, making that year one of the biggest in industry history. The need for storage also exploded, as many homeowner associations (HOAs) and cities prohibit them from being parked in residential neighborhoods.

If your research finds there is a need for it in your area and you have one to two excess acres not built out for your storage business, you can convert that acreage to uncovered monthly rentals for relatively low cost.

Jurjevich offers these tips when deciding to convert unused land to RV/boat and vehicle storage:

• Start slow. “Get one or two customers through a small ad in the local newspaper or through word of mouth and see how it works,” Jurjevich advises.
• Invest as little as possible. Until you see what the demand is for this type of storage in your area, keep investment as low as possible.
• Join a trade association for RV/boat storage. Jurjevich says this is important as it will give you access to those in the industry, as well as to attorneys who specialize in this type of lease contract. “The most important step is not to go to a local attorney and have a general real estate contract drawn up,” says Jurjevich. “Go to an attorney who can specializes in leases designed specifically for this use.”

If you find demand is growing for your RV, boat, and vehicle storage, think about expanding and offering more amenities. He says at minimum you will need:

• Gravel or some sort of surfacing if there is grass – “You don’t want to be mowing in between the RVs and vehicles stored there,” says Jurjevich.
• Fencing or a wall – Unless your storage is in a very rural area, Jurjevich says you will likely need at least an 8-foot to 10-foot fence, or ideally a wall.
• Access control gates – This will allow your tenants access during off-hours, while also keeping a record of who is coming and going.
• Sufficient lighting – Many people who store their RVs and boats pick them up before dawn and bring them back after dark. Jurjevich also says, “Tenants want to feel safe, and lighting helps that.”
• Cameras and security – People who park their RVs and boats have a significant investment, and they want to know there is sufficient security to help detour crime. If your facility is in a high-crime area, you may also consider private security drive-bys. At the very least, create a relationship with your local police departments so they can keep an eye on your facility as they patrol.

Of course, the investment for providing uncovered parking is less than covered parking, which you might want to expand to later if your customers are asking for it. As well, rents you will be able to collect are less.

Jurjevich says, “Rental pricing is really a red herring; I’ve had facilities that have a 30 percent price difference within a 45-minute drive.” He adds, as with self-storage, the rent you’re able to charge depends on the demand. “If you’re full, you might be charging too little, and if you’re having trouble filling up, you may be charging too much. You get an idea where to start by talking to competitors and then doing the best you can until you hit the spot.”

Other advantages to using a small plot of land for uncovered parking include:

• Turning land that isn’t generating income into a profit-generating part of your business.
• If you eventually intend on building another phase to your self-storage, intend on using the property for something else later or selling it, you can easily convert the land back for that use.
• Customers who are seeking outdoor uncovered storage are generally “a little more self-sufficient,” says Jurjevich. “They don’t ask you for much or require much attention.”
• Delinquencies are generally low. Jurjevich says in a decade of being in the business, he has had to do less than one dozen auctions.
• The items are collateralized. Even if you go to auction, Jurjevich says you’re sure to collect your bad debt.

If you aren’t on site, you might want to hire a professional management company. However, if that isn’t possible, you will need to monitor what is being parked on the property and make sure tenants are caring for their vehicles and boats.

“If you let something go, before you know it, you will have a bunch of unkept vehicles and boats on the property, which will attract more people who don’t keep their property in working order, and you don’t want those types of renters,” says Jurjevich.

ike airline travelers bracing for expected turbulence, business owners are preparing for a tricky operating environment in 2024. On the upside, the economy will continue to grow, although at a slower pace. Consumers and businesses are both feeling fairly optimistic, unemployment remains low, capital investments are plugging along at a healthy pace, and the all-important housing market is burgeoning.

Throwing cold water on the good times, though, is a significant downer that no one can control: Higher interest rates established by the Federal Reserve to control inflation are putting a damper on business activity. Economists are taking note by lowering expectations for the next 12 months.

“We expect real GDP to grow 1.4 percent in 2024,” said Bernard Yaros, Jr., assistant director and economist at Moody’s Analytics. That’s slower than the 2.1 percent increase expected when 2023 numbers are finally tallied, and below the 2.0 percent to 3.0 percent considered emblematic of normal business growth. (GDP [gross domestic product], the total value of the nation’s goods and services, is the most commonly accepted measurement of economic growth. “Real” GDP adjusts for inflation.)

Slowing commercial activity will affect the bottom line. Moody’s Analytics expects a decline of 4.5 percent in corporate profits for 2023 and forecasts only a modest recovery of 0.3 percent in 2024.

Reports from the field confirm the economists’ readings. “Our members are experiencing a business slowdown, due largely to the effect of increasing interest rates,” said Tom Palisin, executive director of The Manufacturers’ Association, a York, Pa.-based regional employers’ group with more than 370 member companies. While businesses understand the need for higher interest rates, they nevertheless hope for early relief. “If inflation does not continue to drop, interest rates will have to be increased further, which will be a big problem,” said Palisin.

So, are the Federal Reserve’s efforts paying off? There’s some good news here, as well as a sunny forecast. Moody’s Analytics expects year-over-year consumer price inflation to average 3.2 percent when 2023 numbers are finally tallied, down from over 6 percent a year earlier. Moreover, the number should continue to drop until it reaches the Fed’s target rate of 2 percent late in 2024. (These figures represent the “core personal consumption expenditure deflator (PCED),” which strips out food and energy prices and is the Federal Reserve’s preferred measure of inflation.)

Indeed, Moody’s Analytics believes the Fed will start to lower interest rates around June of 2024, although more slowly than previously anticipated because of persistent inflation and ongoing labor market tightness. Cuts of about 25 basis points per quarter are expected over the next few years until the Federal Funds Rate reaches 2.75 percent by the fourth quarter of 2026 and 2.5 percent in 2027.

The public mood is a strong driver of the economy. And here the news is good. “Consumer confidence has been trending higher, and I think prospects are good for it to improve next year,” said Scott Hoyt, senior director of consumer economics for Moody’s Analytics. “Things should normalize as the economy continues to grow and gas prices stabilize.”

One major driver of consumer confidence is a healthy job market. “The unemployment rate has been very low, bouncing around between 3.5 percent and 3.8 percent for some time,” said Hoyt. A slowdown in job growth orchestrated by the Federal Reserve’s interest rate hikes should moderate things. “We think unemployment will trend upward a bit, ending 2023 around 3.9 percent and 2024 around 4.2 percent.” (Many economists peg an unemployment rate of 3.5 percent to 4.5 percent as the “sweet spot” that balances the risks of wage escalation and economic recession.)

Low unemployment may fuel happy sentiments among citizens, but it presents employers with two practical challenges. The first is the need to raise wages to attract sufficient workers. “Wage and salary income growth has been strong, fueled by a tight labor market,” said Hoyt. “We’re expecting it to increase just a shade over 5 percent both for 2023 and 2024.” In 2022 the growth was a little over 8 percent.

Reinforcing the estimates of the economists, Palisin said his members have had to hike their compensation to remain competitive among themselves and other economic sectors. The group’s entry-level hourly wages increased an eye-popping 8 percent to 10 percent in both 2022 and 2023, far higher than the historic average of 2.5 percent to 3.0 percent.

Problem No. 2 is a scarcity of workers. Inability to hire enough people, particularly of the skilled variety, can affect the bottom line. Two problems contributing to a labor shortage are the retirement of baby boomers and a post-pandemic reordering many people are making of their life goals. “Demographic structural changes in the U.S. mean we just don’t have, in many cases, the number of workers needed in manufacturing to meet demand,” said Palisin. “That’s not going to change.”

The situation has become a bit nuanced as the recent economic deceleration resulted in a hiring slowdown. “The labor market is still tight, but it’s not as bad as it was a couple of years ago,” said Bill Conerly, principal of his own consulting firm in Lake Oswego, Ore. “While we still have more job openings than unemployed people, the margin is not as large, and we don’t have all the quiet quitting that we had before.”

While employers never like having to raise wages, putting a cap on paychecks has taken a backseat to a more urgent concern: keeping valuable talent from jumping ship. “The big question now is not so much who can pay the most for entry-level and skilled jobs, but what can they do to retain these folks within their companies,” said Palisin. “Manufacturing in the U.S. over the last year has continued to hire pretty significantly, and we’re not seeing a lot of layoffs, so that tells you that companies are hoarding talent.” Employers are fine tooling their operations in the areas of workplace flexibility, benefits, and culture changes.

Given the generally upbeat consumer sentiment, prospects are good for the housing sector, an important driver of the overall economy. “New home sales are running at the top end of the range set in the decade preceding the pandemic,” said Yaros. “One reason is that a lack of existing inventory is pushing buyers to consider new homes. The construction industry is stepping in to close the gap, and housing starts have exceeded expectations.”

The construction of new homes is being fueled by a cold, hard fact: There aren’t enough existing homes to meet demand. “The 3.1 months’ supply of existing homes remains well below the four to six months of inventory that is considered a balanced housing market,” noted Yaros. Strong demand caused a 10.3 percent increase in the median price for existing homes in 2022, and a 0.6 percent increase in 2023. A correction of 1.1 percent is expected in 2024.

For an explanation of the scarcity, look no further than the run-up in mortgage rates. The ultra-low interest rates of existing mortgages amount to a strong financial incentive for existing homeowners to stay put. “Current homeowners had refinanced their investments at 3 percent or 4 percent,” noted Conerly. “Replacing what they had with better homes would require walking away from those mortgages to take on new ones at 7 percent. I think we’ll see this trend continue for another year, but I think we’ll also see a lot of strength in remodeling, and that will be financed probably with home equity lending or second mortgages.”

High interest rates, an inflationary environment, and rising worker wages are a trilogy of challenges that in normal times would dampen business confidence. And there are other threats to corporate wellbeing, such as high energy costs resulting from the Russia-Ukraine war and an appreciation in the U.S. dollar that hampers export activity.

Despite all this, companies don’t seem to be planning any dramatic adjustments to their operations, in marked contrast to their cautious attitude of a year earlier. “While our members have moderated their expectations for the future, they are still feeling slightly positive,” said Palisin. “One reason is that we seem to have avoided the recession that many were predicting.” Moody’s Analytics believes that the nation will avoid a recession in 2024, attributing its forecast of a soft landing to resilience in labor markets and consumer confidence.

Another driver of optimism is a recent brightening of the supply chain picture. “There has definitely been a shift in the awareness of the risks of doing business in China,” said Palisin. “This has resulted in a reorganizing of supply chains into nations such as Vietnam, Philippines, India, Mexico, and the U.S. The jury is still out as to what nations will benefit most.”

Indeed, many businesses are taking action on their good feelings. “The commercial sector looks very strong to me,” said Conerly. “Given the current level of interest rates, I’ve been surprised to see the healthy level of capital spending.” Conerly said that manufacturing facilities seem to be the biggest gainers in non-residential construction, with new semiconductor facilities especially benefitting from the CHIPS Act. Suburban office construction has been doing surprisingly well, despite vacancy rates in urban centers. So have suburban neighborhood strip centers, which had been neglected for too long because of fears that Amazon would capture all the retail business.

Conerly identifies three forces propping up equipment purchases. The first is the CHIPS Act and the construction of semiconductor facilities. The second is the automation being installed by companies nervous about being able to hire people. And the third is the trend toward reshoring by companies that are trying to shorten their supply chains.

Businesses looking to borrow funds to fuel capital investments, though, had best prepare for a tougher negotiating environment. “The banking sector is in retrenchment and lenders are becoming more risk averse,” said Anirban Basu, chairman and CEO of Sage Policy Group. “As a result, developers are having more difficulty lining up financing.” Fueling the concern among financial institutions is a recent spate of loan delinquencies and bankruptcies. Banks are looking at their portfolios and seeing where they can tighten up. Companies holding inexpensive pre-pandemic loans will see an earnings hit when they need to refinance at 6 or 7 percent.

In the opening months of 2024, economists are advising businesses to keep an eye on some key statistics to get an idea of how the year will turn out. Among them:

• Inflation – “If progress in core disinflation stalls out, that would likely mean the Fed will keep interest rates at their current level for longer than we are currently assuming,” said Yaros.
• Employment – “Total employment in the country is a good measure of current conditions,” said Conerly. “And any increase in initial claims for unemployment insurance could foreshadow a slowdown.”
• The Yield Curve – “A reversion in which short-term interest rates exceed long-term ones could foreshadow a coming economic slowdown,” said Conerly.

Whatever the condition of the tea leaves, businesses in general will encounter a tougher operating environment in 2024, characterized by a need to finesse a tight labor market and reluctant lenders. “In the coming year we will face uncertainty about inflation and interest rates, shortages of labor, higher energy costs, a slowdown in China’s economy, and recurring threats of a federal government shutdown,” said Palisin. “There are a lot of spinning plates in the air, and some of them may fall and crack.”

he REITs have always taken the lead in how to manage self-storage rental rates for maximum profits. This included online rates vs. office rates, sign-up rates, discounts, and rate raises. Given their size and massive data collection, they can quickly determine what works the best for them. And once again they have a new pricing strategy that may work or turn out to be a grenade. In the long run, having REITs as your competition was good because they regularly raised rents and street rates, whereas many mom-and-pop operators did not even raise rates when they were full.

Typically, the REITs had teaser discounted sign-up rates. Then in three to five months, they would raise the rates. And then a second rent raise in seven to nine months. After the first year of two rent raises they might reduce it to a rent raise every nine months. A $29 rent raise was often the maximum rent raise. At this price point, they found most tenants did not move out.

The REITs often offered a free month with their teaser rate. In the past, when they were full, they would eliminate the free month’s rent or reduce it to a half month. The REITs would also raise existing tenants above the street rates they charge new customers. So, a long-term renter could be paying $200 plus more than the current move-in for a 10-by-20 unit.

I can tell you firsthand that renters were frustrated when they received a second $29 rent raise in less than a year. A Storage Authority Franchise owner opened a facility in Houston, Texas, about four years ago. They were surprised in the first month open that they got a dozen clients who moved over from the nearby REITs because they felt deceived by high rent raises, and they were frustrated enough to move.

Late fees and administration fees were often $20. Now we are seeing them up to $37 plus tax.

Many of the REITs have a new pricing strategy. It’s based more on short-term occupancy, and I assume they hope for long-term profits. They are substantially reducing moving rates and then substantially increasing rates in three months without warning. They are often raising the rental rates a whopping 50 percent.

I just got a call from one of my managers who had a renter move to our facility from a REIT facility because they just got a $90 per month rent raise.

I just read a national ad for one of the four REITs: One month free and 40 percent off. No one can survive financially with these rates, unless, of course, rents are raised significantly just after the free month.

Make no mistake, this is a problem for existing owners who are not willing to follow in the REITs’ footsteps. It is also a problem for existing developers.

If you’re an independent, you need to know your competition strategy so you can beat them at their own game. Call your competition, and once you get a rate, ask how long it is good for. Most of the time the answer is “I do not know” or two months. It might be worth renting a 10-by-10 unit and experience their rental rate increases firsthand so you can share with your prospects what will happen down the street.

The good news is 60 percent of renters rent at the first place they visit. So, you must have a superior sales and marketing plan that is implemented to compete with the REITs. The REITs use call centers that use the perfect script, while mom-and-pop managers are still winging it. It’s time to change your business model from a real estate-based self-storage operation to a hospitality-based operation.

This new strategy is tough for self-storage developers when they are going for a loan. The average bank/lender sees the REIT move-in rates. So, when you have higher rental rates in your projections, they ask if you are sure you can get these rates. Developers need to make sure the company that does their feasibility study understands the new REIT move-in rental rates strategy, so they do not use the temporarily discounted competition move-in rates as your rates for your new facility. In many cases, the numbers will not work with the REITs’ new move-in rates.

It will be interesting to see how this new pricing strategy plays out. So far it is working for the REITs. Published rental move-in rates are down year over year, but their profits are up.

We have come so far over the last 20 years, let’s hope the need for profits by some does not give us all a black eye. Imagine if you rented an apartment and they raised your rate in three months and again in nine months. Already renters have been complaining to their state legislation about unfair practices. A couple of state legislators have discussed limiting self-storage rental rate increases.

Our industry has worked hard to ensure we do not have excessive regulatory oversight. Let’s hope the REITs’ new pricing strategy does not put us in the crosshairs of regulators who could significantly add burdens to our industry operating procedures like our lien laws.

uring the holiday season, it is common to be inundated with commercials that tug on your heartstrings. Images of children hoping for a cure and animals shivering in the cold cause lumps in your throat and a heaviness in your heart. So many needs to be met, all of which deserve your attention.

But what about the needs that are rarely discussed? The ones that are even more difficult to learn about. The ones that cause anger to swell up and grief to overwhelm you. The ones that don’t just tug at your heartstrings but have an all-out tug-of-war with them.

In November, attendees of the Louisianna Self Storage Association’s 2023 Fall Conference and Expo began to cross the hallway of the Baton Rouge Crowne Plaza from the trade show floor to the banquet hall, where they would attend a StorageGives fundraising auction and dinner reception. By now, most self-storage industry professionals are well aware of the philanthropic opportunities that StorageGives presents. They have heard about the donations that have been made to charities like Autism Speaks, Homes for Our Troops, and many others, through the efforts of StorageGives.

But no one expected what came next.

As Lonnie Bickford, founder of StorageGives, took the stage to introduce the charity selected to benefit from the night’s auction, he began to choke on his words. Quickly wiping the tears from his eyes, he ushered a fiery, curly-haired redhead with matching red lips to the stage and handed her the microphone. Her presence quickly grabbed everyone’s attention. The laughter and side conversations subsided within her first sentence.

She meant business. She was a change agent.

“She” was Alliece Cole, former investigator for the Department of Family and Children’s Services, FBI Director’s Community Leadership Award winner, and founder of the Sparrow Foundation—the night’s recipient of the charity auction that would soon take place. For the next 30-plus minutes, she would delicately, but clearly and passionately, educate the guests on the often-undiscussed world of sex trafficking and its victims.

“When Lonnie and I talked about me speaking at the event, he originally asked for five or 10 minutes,” Cole said. “I went over to Lonnie and Jackie’s [Lonnie’s wife] house to plan for the event, and by the time I was done there, they are like looking at me and he goes, ‘OK, probably 20 minutes.’”

When Cole arrived at the event that Tuesday, Bickford encouraged her to take as much time as she needed to educate the audience on the Sparrow Foundation and its mission to end sex trafficking. “He said, just do whatever you gotta do,” Cole said of Bickford. And she did just that.

That evening, with just a few handfuls of auction items, $40,000 was raised to benefit the Sparrow Foundation, a foundation that takes care of victims like Dani, an autistic girl who began being trafficked after her mother passed away, providing her with safety, resources, and a new outfit to wear when she starred in a PBS special about the foundation, and a 14-year-old girl who had been sent to a mental facility after being labeled a sex-worker. “When I first met her, she was talking about needing snacks, T-shirts, and shorts,” Cole said. The girl ran track, but her traffickers would periodically take that from her as a tool to control her. “I asked her to give me her snack list, and she put her head down and started crying. I was like, ‘What’s going on? Why are you crying?’”

Cole said the young girl turned to her and said, “Why are you so nice?” Through her tears, Cole replied, “This is not nice. This is appropriate.” After a short time of building trust with the victim, the victim enthusiastically shared the entire organization chart for the sex trafficking ring she had been captured by.

Because funds at the Sparrow Foundation were low at the time, Cole reached into her own pocket to buy the snacks. She knew that somehow the money would show up to meet the needs of these victims. “StorageGives’ donation that night means that now, StorageGives gets to be a part of these moments. They get to do things to help my team continue doing what they do and to empower me to continue to go out and help sex trafficking victims,” Cole said with tears in her eyes.

That young 14-year-old will never return to her family again. She has nowhere to go for Christmas or Thanksgiving. “So, the night before Thanksgiving,” Cole explained, “we drove up to North Louisiana to see two girls who were in a group home and would not be able to go anywhere.” The night before, Cole asked her great-niece to make two Thanksgiving cards for the girls. She stayed up all night but was so disappointed that she was unable to finish coloring them in. “Both of the girls were so excited that they had something to color,” Cole said. “They said, ‘I have something to do today!’”

With the $40,000 donation from the auction, StorageGives gets to be a part of these, and many other, special moments. Cole has story after story of girls and boys who, at very early ages, were trafficked, and how the Sparrow Foundation, and now StorageGives, has made a difference in their lives. Many of these heart-wrenching stories can be found on their website, thesparrow.foundation, and their social media platforms. Dani’s PBS special can also be found on their website.

While the statistics on sex trafficking are staggering, Cole tends to steer away from quoting them. “They study the data, write papers about them, give opinions on them,” Cole said. “They form organizations, but no one is hands-on like we are. I have data, but I also have the stories. I can tell you that the average age of victims is between 10 and 12 for girls, and for boys, eight and 10,” she said. “But the youngest I’ve ever met with was an infant. I can give you the national and state statistics, or I can tell you my stories.”

And the stories have found her. From an early age, Cole was always drawn to people in need. It’s no wonder that she has worked for the Department of Family and Children’s Services, Joyce Myers’ Ministry, and Operation Blessing, where she first met Bickford, who was cooking for Kartina volunteers. Cole was never looking to solve the human trafficking epidemic. “I was looking for the hurting,” she said.

Not everyone has the time or resources to be the boots on the ground like Cole, but everyone can contribute because every donation counts. As Bickford says, “A lot of a little adds up.” Information about partnering with the Sparrow Foundation and StorageGives can be found on their websites, thesparrow.foundation and storagegives.org.

SA members are all too familiar with ineffective and costly newspaper advertisements. Most self-service storage facility acts historically required the owner to advertise the sale twice in a newspaper of general circulation before proceeding to sale. Thankfully, the SSA and state associations have been able to amend the law in most states to permit alternative advertising methods that reach the target audience of potential bidders and are more cost effective.

However, the SSA’s great white advertising whale has long been California. Any efforts to amend the newspaper advertising requirement have not gained traction—until this year. The SSA and California Self Storage Association (CSSA) were able to work with their Sacramento lobbying team, MKP Government Relations, to secure sponsorship of the legislation from Assemblymember Juan Carrillo (D-Palmdale) for Assembly Bill 542.

Assemblymember Carrillo was instrumental in getting the bill through the legislative process. In fact, the bill did not receive a single “no” vote at any committee stop or floor vote in either chamber. Gov. Gavin Newsom signed the bill into law on Oct. 10, 2023. The law took effect on Jan. 1, 2024.

Prior law required California storage owners to advertise lien sales twice in the public notice district where the sale was held. The amendments take three important steps to reduce the cost of advertising in California:

1. It reduces the mandated newspaper advertisements from two to one, as long as the operator also advertises the sale on a publicly accessible website that customarily conducts or advertises online auctions or sales.
2. It eliminates the requirement to include a description of the goods in the newspaper advertisement. If a newspaper is charging by the word or by the line, this change will lead to a reduction in advertising costs.
3. It provides for more options when selecting the newspaper to advertise a sale. Operators may advertise sales in a newspaper in the county where the facility is located, rather than just in the public notice districts that are subdivisions of counties. That amendment should result in additional savings for storage operators as it provides greater access to more newspapers of general circulation.

Overall, this legislative success should provide significant financial relief for California operators. The SSA is grateful for its collaboration with the CSSA and the steadfast support of Assemblymember Carrillo and MKP Government Affairs. The SSA hopes to return in an upcoming legislative session to eliminate the newspaper advertising requirement entirely.

Additionally, in 2024, the SSA intends to pursue newspaper advertising amendments in Alaska, the District of Columbia, Florida, Idaho, Minnesota, Missouri, Maryland (consumer permission), Nevada (pre-session work), New Jersey, Pennsylvania (ad timing), and Rhode Island.

If you are uncertain about advertising requirements in your state(s) of operation, visit the Legal Resource Center on the SSA’s website. It provides an overview of every state’s advertising requirement.

As always, please contact me with any questions at dbryant@selfstorage.org

s kids, we all look forward to the future—to see what is coming and when. The older I get, the faster the future turns into the present; however, the futuristic things I believed would be coming are taking longer than I anticipated. I haven’t been the only one who thought we’d have flying cars and interplanetary travel by now. The original Blade Runner was set in 2019. I, Robot’s future is supposed to be in 2035—a mere 11 years away. Marty McFly and Doc Brown traveled to the future–the year 2015–to ride hoverboards and wear self-tying Nike’s in Back to the Future. While there have been some amazing advancements, for the most part, technology takes time and usually more than we think.

In almost every panel I am on, at every industry show I attend, and on every investor meeting I take, the inevitable question of “What is your company doing with AI (artificial intelligence)?” comes up. I have heard other companies answer by saying things like, “AI builds our pricing models,” or “AI gives us customer and demographic data to know where to buy properties,” or “AI answers our customer phone calls.” But AI is not the same thing as a highly developed algorithm or database, regardless of whether you name it that. In fact, beyond my kids using Chat GPT to do their homework for them, I don’t think I’ve seen real AI being used—and certainly not in storage yet.

Artificial intelligence will be a powerful tool when it is utilized to build and better itself—that’s the real power of AI, not just serving data from a database, answering a question, or helping a call center route calls. The idea of real AI is when code is written that is then used to create new code, solve its own problems, and find new problems to work on—without human intervention. Right now, the limitations for AI in storage is that as an industry, we aren’t ready for that. While Extra Space prides itself on having access to a large amount of data, we’re still missing the essential data we’d need to be able to ask effective questions for AI, not to mention we would need programmers to code and build a new AI tool (Netflix is reportedly paying AI engineers over $900,000 in starting salaries because, as of now, those engineers still don’t exist).

I know the industry is excited for artificial intelligence, just as excited as I was as a kid to get a hoverboard in 2015. I simply believe it’s going to take a little longer than we think before we’re utilizing true AI in self-storage. In the meantime, keep renting units, buying good real estate, and treating your managers well, because that’s what your customers really want—real intelligence.