Thirty-four items you don’t want to forget during the design process for a better and more profitable facility.

1. Early in the design process determine the parking requirements of the town for self-storage. They can vary from a half dozen to 30 for the same size facility. In some cases, where very high parking is required, parking in half of the 24 isles may be accepted as parking.  You want at least a half dozen customer parking spaces next to the office outside of the fenced in security area.

2. Provide a secure drop box for after hour payments. It’s been our number two request from tenants. If you remember prior to construction you can put it in the office wall. Otherwise, you can add a free-standing drop box.

3. For protection, provide steel bollards at all building corners, entrance gates, and entrance/exit key pads. I recommend 6”- 8” steel bollards filled with concrete. Over the years this will save big bucks and a lot of aggravation. Make sure these are in your original bid package because the change order price of $900 each will kill you budget.

4. Determine if you should put the outside lights on two circuits with timers so you can turn half the lights off after hours or at a certain time. You may also want the front entrance driveway, sign and parking lot lights on a third separate circuit, so you can leave them on all night. LED lights will cost a little more to buy but they will more than pay you back with reduced electric bills.

5. Make sure all utilities are designed to include future phases and are clearly included in your bid request. Make sure your electrical/camera underground conduit system for phase two is brought to the limits of phase one so you do not have to tear up phase one. Make sure the pull cords are in.

6. Have your engineer provide the largest driveway radius permitted at the street intersection for easy site entrance. A 25 to 45-foot radius is recommended. No matter how large you make them some drivers will still drive over the curb.

7. Make sure there is room at the end of the buildings for vehicles to safely turn. Thirty feet of pavement is recommended minimum with 40 feet preferred, and much larger if you need large RV’s or tractor trailers to make the turn.

8. Determine what percentage of climate control units to construct. We have constructed 15 – 20 percent and that has worked well for us in the northeast, but many areas like Florida build significantly more. Check to see what your competition has done. Learn more about climate control/humidity systems. Also, make sure the designer has experience designing self-storage heating & air conditioning & humidity systems. Self-storage systems are designed significantly different from then residential or typical commercial systems.

9. Your office will be a major showcase for your facility and a is a key factor in the success of your facility. It should be located outside the gated area. Visit several other self-storage offices to help determine your office size and layout. We have found that having a large product sale area and large windows helps increase the overall acceptance of our facilities and increase our unit rentals. The offices in our self-storage facilities are about 1,100 square feet, including a single bathroom and a small utility/furnace room.

A colorful bright large retail office and showroom will increase your rentals.  Remember the majority of the rentals are by the ladies. Believe it or not you are in the retail and fashion business and need to wow your customers.

10. Typically an access gate has a security loop installed in the pavement that can detect a car, so the gate will not close on a car. Make sure it is clear who is responsible to provide and install the safety loop. Will it be installed under the pavement or will the pavement be saw cut and patched? It is a much nicer job if the safety loops are under the pavement and not saw cut into the pavement. The gate should also have a safety mechanism, so the gate cannot accidentally shut on a person that meet present building codes.

11. It’s always a nice touch if the appropriate office doors are keyed alike.

12. If you use propane, consider buying your propane tanks versus renting so when you buy propane you can get the best price on the open market.

13. Put the fencing 30 feet or more off the pavement where snow will be plowed to leave room for snow.

14. A 4-foot person gate in the security fence near the office comes in handy for many reasons.

15. Typically the entrance/exit gate needs a clearance past the end of the gate of at least 1.5 times the gate opening. Be sure to check with your gate manufacturer and design accordingly. If you do not have the room you will need a lift gate.

16. In Connecticut you are required to get a CT Department of Environmental Protection “General Permit for Storm Water Discharge Permit for Construction Activities”, if the development (all phases included) disturbs over 5 acres of land. This permit requires several best management practices be incorporated into the designs, including weekly inspections of the erosion control. Often, there are similar or other special regulations in many states. Make sure you have a complete list of all approvals required when you start your design, so you can plan accordingly.

17. In many states, disturbance of wetlands may require a Federal Army Corps of Permit in addition to your local Wetlands Commission approval. Check with your soil scientist and engineer. An army Corps permit can add significant time and costs to your approval process.

18. Don’t forget to have an electrical outlet installed at your sign for your holiday lights. Also, electrical outlets should be installed in the 1 or 2 units of the facility you will use. An outside water nozzle is recommended. Typically, no electricity or lights is provided in self-storage units. You may want to put electric plug in 2 or three 10 x 10 units, so you can rent to pharmaceutical reps who will need a fridge in their unit.

19. If possible, place the larger units on the side of the building that do not have another building on the opposite side of the drive. This will make it easier for cars to access and be stored in these 10′ x 20′ or larger units. Nine-foot-wide doors are nice touch on 10’ x 20’ units for car storage.

20. Include a bank of 5′ x 5′ x 4′ lockers in your climate control buildings. One is stacked above the other. They typically rent out and provide the highest rent per square foot. It is a good design practice to have several different sizes typically from 5’ x 5’ to 10 ‘x 30’.

21. Slat walls in the office are great to hang locks and other products. Built in shelving for certain products is a good idea as well. Make sure they are included in your construction specifications. Change orders are expensive.

22. Review your landscaping plans. In addition to the various trees and bushes it is very beneficial to have a raised flowerbed or two for your clients to admire.

23. Handicap access should be reviewed early on and included in your design. Self-storage units typically have a lip at the door to keep water out. A ramp design and special doors are required for handicap access. The good news is if the handicap units do not rent you can rent them out as regular units. Your Engineer, architect and building manufacture should able to help you out with the handicap requirements. You may also want to do an online search regarding the new HC regulations.

24. Determine if there is any room for outside car storage or RV storage. Even a few spaces can help market the entire facility. Outside parking of vehicles should be clearly noted on the site plans and applications to the town. Typically, you will make more money with self-storage units than outside parking. Outside parking is provided if you have excess land.

25. Some states require two bathrooms, male and female. You may be able to request a waiver from the state for just one bathroom. I got waivers for just one bathroom in my facilities and there are no problems. Access to the bathroom should not require a user to go behind the office rental counter and should be clearly marked.
26. Most metal building manufacturers provide insulation in the non-climate control unit ceilings. This is a must because it helps prevent condensation and possible dripping onto the customer’s stuff. Double check to insure your building includes insulation in the non-climate control unit ceilings.

27. Avoid sheetrock construction in storage units. Sheetrock attracts mold and is easily damaged.

28. If you have a sidewalk directly abutting your office make sure the sidewalk elevation is coordinated with the building design. If the office is a metal building the sidewalk may need to be an inch lower than the office concrete floor to accommodate the metal lip that hangs over the concrete floor.  Even where the building is not metal it is a good idea for the sidewalk to be lower than the office floor by an inch.  Of course, the sidewalk should match the floor at the door for handicap access.

29. Many building codes have recently changed or are about to change based upon what state you live in. Insulation requirements, fire walls, separation distances, climate control building design, multi-story design requirements, handicap requirements are just some of them. Make sure you enlist the help of a self-storage building code expert early on, so you are not surprised.

30. Now is the time to determine your facility management software and gate control companies, website developer etc. Once construction starts you will be extremely busy.  Making sure they are compatible with each other is critical and a must.

31. Provide a driveway entrance light at the street. It’s been our number one request from tenants.

32. Make sure your camera/DVD system has enough capacity/ports for all phases. I recommend two large camera screens in your office. Safety/security is the second concern of most renters.  Meet with your security expert early on and show the camera locations on your site plan.

33. There are significant differences between video camera systems. Purchase high definition systems. And confirm you can view the cameras from your home computer and cell phone. There should be 2 cameras in the office on the customer and on the manager.

34. Several things can differ between building manufacturers. When you order a building, you should be aware of your door sizes and eve heights as both can have an impact on your facility.  I recommend minimum doors widths of 8’-8” feet wide and a minimum building eve height of 8’-4” and you should consider 9’ wide doors and 9’-4” eve heights.

If you want the whole scoop can buy the entire book at Amazon.com

https://www.amazon.com/Marc-Goodin/e/B0098B0A20

How much would it cost to buy huge forest of Oak trees?  Likely more than you and I have to spend.  But they all started with an acorn.  An acorn that was free.  To many people are wasting more and more good money trying to find the right “paid for marketing” that will make them oversized Self Storage Profits when they should be planting thousands of free acorns.

Take a look at this email I received from my manager last week.  8 Rentals in one day.  Seven on the phone (notice the P for phone rental) and 1 walk in.  Was this because we have a great manager? No, Kate is great, but this was just her third week on the job.

Was it because the nearby University of Connecticut is about to get out for the summer and all the students picked us because our prices are the lowest. Heck no, the guys right down the street rent a 5 x 10 for the summer for a total of $195 and we are $399 for the same summer rental.

So, what is the secret?  We plant thousands of acorns every year. Here are just a few that led up to that one day of fun phone rentals.  Which by the way are part of 150 rentals we will do in 45 days.

1  Our new manager of 3 weeks had a detailed manual that included rental scripts that must be followed.

2  Before she was hired Kate reviewed and practiced the scripts with us and agreed to use them word for word.

3  We did the hard work of role playing.

4  Our manual was clear it is our goal to rent over the phone to every caller.  And if we do not, we get their number and call them back in 2 days.

5  On every call we promote our facility, “show them a unit on the phone”, confirm the size is the right size for them, provide the price and say “would you like to get one in your name before they are all gone”. Then we take a full month’s payments – we only rent – no reservations.  FYI – next to none cancel and around 1 in ten transfers to a larger size.

6  Our manger is accountable daily and emails us every day detailing both the walk in and phone rentals and the walk ins and phone calls who did not rent.

To rent 8 units that day we had to more than be good at helping our clients finding the right unit for them.  We had to get them to call or stop in, in the first place.

7  Month after month we add all move out emails and other town and university emails to our mail chimp site for our newsletter.

8  Two week earlier we sent out a mass email via mail chimp letting the UCONN students know we love them and would provide them a free lock if the prepaid for the summer.

9  Earlier in the spring we were the only self-storage to attended the University student fair.   We handed out hundreds of cards and simply said have your mom or dad give us a call and we will take care of everything with them over the phone and they will just need to stop in and sign the lease.

10   For the last two weeks we had a table at two banks, one on campus and one in Town that highlighted our self-storage.  We bought $200 of candy and other goodies to make sure we attracted everyone in the bank to our table.  When my wife GP asked, did we really need to buy 50 lbs. of candy I reminded her each piece of candy is an acorn planted.  If we rent just one extra unit because of the candy it will pay for all the candy. And many non-students will see our name one more time so when one day when they need storage they will think of us.  And the great part is many students rent from us for 4 years!

11  We had already completed spring cleaning inside and out so both our employees and our renters are impressed.

12   Every morning we put out our Open banner and our sandwich board for thousands of people to see as they drive by.  This month one side reads Spring is here! and the other “We love UCONN.

13  Not only do we have a huge candy bowl but we also have a premium candy like York Candy right next to it.  Who could resist “Can you stop in this afternoon?  I know you will be very impressed with our facility and I have York Peppermint Paddies with your name on them”

Have you been planting acorns day after day or just wasting money?

Why be motel 8 when you could be the Ritz?

By Marc Goodin

President of Storage Authority

Author of Cush Your Competition,

102 weeks of guerilla marketing for oversized profits for your self-storage.

Thirty-four items you don’t want to forget during the design process for a better and more profitable facility.

1. Early in the design process determine the parking requirements of the town for self-storage. They can vary from a half dozen to 30 for the same size facility. In some cases, where very high parking is required, parking in half of the 24 isles may be accepted as parking.  You want at least a half dozen customer parking spaces next to the office outside of the fenced in security area.

2. Provide a secure drop box for after hour payments. It’s been our number two request from tenants. If you remember prior to construction you can put it in the office wall. Otherwise, you can add a free-standing drop box.

3. For protection, provide steel bollards at all building corners, entrance gates, and entrance/exit key pads. I recommend 6”- 8” steel bollards filled with concrete. Over the years this will save big bucks and a lot of aggravation. Make sure these are in your original bid package because the change order price of $900 each will kill you budget.

4. Determine if you should put the outside lights on two circuits with timers so you can turn half the lights off after hours or at a certain time. You may also want the front entrance driveway, sign and parking lot lights on a third separate circuit, so you can leave them on all night. LED lights will cost a little more to buy but they will more than pay you back with reduced electric bills.

5. Make sure all utilities are designed to include future phases and are clearly included in your bid request. Make sure your electrical/camera underground conduit system for phase two is brought to the limits of phase one so you do not have to tear up phase one. Make sure the pull cords are in.

6. Have your engineer provide the largest driveway radius permitted at the street intersection for easy site entrance. A 25 to 45-foot radius is recommended. No matter how large you make them some drivers will still drive over the curb.

7. Make sure there is room at the end of the buildings for vehicles to safely turn. Thirty feet of pavement is recommended minimum with 40 feet preferred, and much larger if you need large RV’s or tractor trailers to make the turn.

8. Determine what percentage of climate control units to construct. We have constructed 15 – 20 percent and that has worked well for us in the northeast, but many areas like Florida build significantly more. Check to see what your competition has done. Learn more about climate control/humidity systems. Also, make sure the designer has experience designing self-storage heating & air conditioning & humidity systems. Self-storage systems are designed significantly different from then residential or typical commercial systems.

9. Your office will be a major showcase for your facility and a is a key factor in the success of your facility. It should be located outside the gated area. Visit several other self-storage offices to help determine your office size and layout. We have found that having a large product sale area and large windows helps increase the overall acceptance of our facilities and increase our unit rentals. The offices in our self-storage facilities are about 1,100 square feet, including a single bathroom and a small utility/furnace room.

A colorful bright large retail office and showroom will increase your rentals.  Remember the majority of the rentals are by the ladies. Believe it or not you are in the retail and fashion business and need to wow your customers.

10. Typically an access gate has a security loop installed in the pavement that can detect a car, so the gate will not close on a car. Make sure it is clear who is responsible to provide and install the safety loop. Will it be installed under the pavement or will the pavement be saw cut and patched? It is a much nicer job if the safety loops are under the pavement and not saw cut into the pavement. The gate should also have a safety mechanism, so the gate cannot accidentally shut on a person that meet present building codes.

11. It’s always a nice touch if the appropriate office doors are keyed alike.

12. If you use propane, consider buying your propane tanks versus renting so when you buy propane you can get the best price on the open market.

13. Put the fencing 30 feet or more off the pavement where snow will be plowed to leave room for snow.

14. A 4-foot person gate in the security fence near the office comes in handy for many reasons.

15. Typically the entrance/exit gate needs a clearance past the end of the gate of at least 1.5 times the gate opening. Be sure to check with your gate manufacturer and design accordingly. If you do not have the room you will need a lift gate.

16. In Connecticut you are required to get a CT Department of Environmental Protection “General Permit for Storm Water Discharge Permit for Construction Activities”, if the development (all phases included) disturbs over 5 acres of land. This permit requires several best management practices be incorporated into the designs, including weekly inspections of the erosion control. Often, there are similar or other special regulations in many states. Make sure you have a complete list of all approvals required when you start your design, so you can plan accordingly.

17. In many states, disturbance of wetlands may require a Federal Army Corps of Permit in addition to your local Wetlands Commission approval. Check with your soil scientist and engineer. An army Corps permit can add significant time and costs to your approval process.

18. Don’t forget to have an electrical outlet installed at your sign for your holiday lights. Also, electrical outlets should be installed in the 1 or 2 units of the facility you will use. An outside water nozzle is recommended. Typically, no electricity or lights is provided in self-storage units. You may want to put electric plug in 2 or three 10 x 10 units, so you can rent to pharmaceutical reps who will need a fridge in their unit.

19. If possible, place the larger units on the side of the building that do not have another building on the opposite side of the drive. This will make it easier for cars to access and be stored in these 10′ x 20′ or larger units. Nine-foot-wide doors are nice touch on 10’ x 20’ units for car storage.

20. Include a bank of 5′ x 5′ x 4′ lockers in your climate control buildings. One is stacked above the other. They typically rent out and provide the highest rent per square foot. It is a good design practice to have several different sizes typically from 5’ x 5’ to 10 ‘x 30’.

21. Slat walls in the office are great to hang locks and other products. Built in shelving for certain products is a good idea as well. Make sure they are included in your construction specifications. Change orders are expensive.

22. Review your landscaping plans. In addition to the various trees and bushes it is very beneficial to have a raised flowerbed or two for your clients to admire.

23. Handicap access should be reviewed early on and included in your design. Self-storage units typically have a lip at the door to keep water out. A ramp design and special doors are required for handicap access. The good news is if the handicap units do not rent you can rent them out as regular units. Your Engineer, architect and building manufacture should able to help you out with the handicap requirements. You may also want to do an online search regarding the new HC regulations.

24. Determine if there is any room for outside car storage or RV storage. Even a few spaces can help market the entire facility. Outside parking of vehicles should be clearly noted on the site plans and applications to the town. Typically, you will make more money with self-storage units than outside parking. Outside parking is provided if you have excess land.

25. Some states require two bathrooms, male and female. You may be able to request a waiver from the state for just one bathroom. I got waivers for just one bathroom in my facilities and there are no problems. Access to the bathroom should not require a user to go behind the office rental counter and should be clearly marked.
26. Most metal building manufacturers provide insulation in the non-climate control unit ceilings. This is a must because it helps prevent condensation and possible dripping onto the customer’s stuff. Double check to insure your building includes insulation in the non-climate control unit ceilings.

27. Avoid sheetrock construction in storage units. Sheetrock attracts mold and is easily damaged.

28. If you have a sidewalk directly abutting your office make sure the sidewalk elevation is coordinated with the building design. If the office is a metal building the sidewalk may need to be an inch lower than the office concrete floor to accommodate the metal lip that hangs over the concrete floor.  Even where the building is not metal it is a good idea for the sidewalk to be lower than the office floor by an inch.  Of course, the sidewalk should match the floor at the door for handicap access.

29. Many building codes have recently changed or are about to change based upon what state you live in. Insulation requirements, fire walls, separation distances, climate control building design, multi-story design requirements, handicap requirements are just some of them. Make sure you enlist the help of a self-storage building code expert early on, so you are not surprised.

30. Now is the time to determine your facility management software and gate control companies, website developer etc. Once construction starts you will be extremely busy.  Making sure they are compatible with each other is critical and a must.

31. Provide a driveway entrance light at the street. It’s been our number one request from tenants.

32. Make sure your camera/DVD system has enough capacity/ports for all phases. I recommend two large camera screens in your office. Safety/security is the second concern of most renters.  Meet with your security expert early on and show the camera locations on your site plan.

33. There are significant differences between video camera systems. Purchase high definition systems. And confirm you can view the cameras from your home computer and cell phone. There should be 2 cameras in the office on the customer and on the manager.

34. Several things can differ between building manufacturers. When you order a building, you should be aware of your door sizes and eve heights as both can have an impact on your facility.  I recommend minimum doors widths of 8’-8” feet wide and a minimum building eve height of 8’-4” and you should consider 9’ wide doors and 9’-4” eve heights.

Memo:

Date: April 4, 2018

To:  Self-Storage Property Owners

From: Heidi Henderson, Executive Vice President of Engineered Tax Services

Many real estate investors are unware of how the top industry professional utilize the tax code to their benefit. And most think that their tax professional is aware of every aspect of the existing code to advise them of any applicable credits or deductions they are eligible for. In reality, the tax code is complex and expecting your CPA to know every aspect of it, is like expecting your family doctor to be able to perform heart surgery!

“Surrounding yourself with the right people and education on these topics are the keys to your success!

I am a real estate investor myself and through many years in tax and accounting I have learned from the best on how to apply every aspect of the tax code to create the most tax efficient real estate portfolio, leading to continued success.

Recent tax changes under the Tax Cuts & Jobs Act expound on the benefits of real estate investing. Taxpayers can now capture immediate deductions for business related tangible property, your depreciation can be front loaded, and for energy efficient buildings the available credits and deductions were renewed in February of 2018 and assets removed during demolition can be written-off or donated for a charitable contribution on your tax return.

These are just a few of the complex tax code sections which can make the difference between a profitable business, and a losing proposition. Below is an article outlining 11 Frequently Asked Questions about Cost Segregation, which is one of the methods you can apply to your property.

We partner with business owners across the U.S. and have worked on thousands of self-storage properties nationally. Give me a call today for more information and to discuss the some of the tax strategies that might be applicable to your business or property.  I can be reached at (801) 689-0325 or via email at hhenderson@engineeredtaxservices.com

11 Frequently Asked Questions about Cost Segregation for Self-Storage Properties

By: Heidi Henderson, Engineered Tax Services

1.  What is Cost Segregation?

Cost Segregation is the process of identifying personal property vs. real property, and individual building components for tax purposes, rather than treating a building purchase as one large asset. This determination allows a property owner to depreciate their assets over the useful life of each asset instead of assuming that the entire purchase amount applies to one long-term (39-year) asset.

2.  Does my property qualify?

All investment properties, including self-storage properties qualify for cost segregation.  When a cost segregation study is applied, you are telling the IRS that you are simply choosing one acceptable method for depreciation (MACRS*) vs. another approved depreciation method (straight-line). Both are acceptable, however MACRS requires an analysis to identify the value of each individual asset you own, rather than looking at your property as one large asset.

3.  When does it makes sense to do a Cost Segregation study?

Cost Segregation can be applied to a newly purchased building, a newly constructed building, or a building you have owned for around 15 years or less. If the property is not fully depreciated (39 years is the length of normal depreciation), then there is an opportunity to change the method with cost segregation. Although any property can be depreciated under MACRS, the costs of performing a cost segregation study may outweigh the benefits if the property was acquired for less than approximately $300,000.

4.  What items are reclassified via Cost Segregation?

Under straight-line depreciation a property’s total cost (less an allocation for land), is depreciated evenly over 39 years. Under MACRS the assets are identified and reclassified in 5-year, 15-year, and 39-year class lives depending on the IRS determination of its actual useful life. And whether the assets are used for your business use, or the basic function of the buildings use as a structure. Examples of 39-year property include; windows, walls, doors, roof, HVAC systems, plumbing, and electrical. Examples of 15-year property include exterior improvements such as; fencing, exterior signage, asphalt, curbs, landscaping, and exterior lighting. And examples of 5-year property are; carpet, appliances, specialty lighting, woodwork, unit partitions, individual unit locks and security, and business specific heating and ventilation systems.

5. Does the type of property affect the tax savings?

Some property types will have a higher reallocation percentage than others. Interior, climate controlled self-storage properties will see a higher amount than a shed-row or boat and RV storage type. The allocations are based on actual assets and values or each of the components within the property.

6.  What information is required to do a Cost Segregation study?

Surprisingly, the information required to perform the study is limited. For a recent purchase, the closing statement or HUD is the only requirement. Blueprints are helpful but not necessary. New Construction projects require cost breakdowns and total costs for construction and development, but individual invoices are not required.

7.    How do I choose a Cost Segregation provider?

Choosing a reputable firm is a vital to ensuring that every aspect of the IRS requirements are met, and in the case of an audit the report is upheld without disallowances or associated interest and penalties. The IRS Audit Technique Guidelines dictate that a physical site visit is performed, the analysis is performed by a professional with cost-accounting or engineering expertise, and the method of determining asset value is an approved methodology. Make sure that audit defense is included in your study, and that the final report offers complete detail over every aspect of your property. Choosing a low-cost provide may be tempting, but the ultimate savings, detail and support of a reputable provider will far outweigh any additional costs. And finally, ask for references!

8.   Will I get audited if I do a Cost Segregation study?

Cost Segregation is not a “trigger” for audit. The IRS issued automatic consent for deprecation whether applying a change from straight-line to MACRS at the time of purchase or retroactive for a property you bought 10 years ago. This means that taxpayers are allowed to make this change with the approved forms offered by reputable cost segregation firms. However, in the rare case of an IRS review, rest assured that a detail report with the proper IRS approved methods and audit support will affectively defend your tax filing position.

9.  How much does a Cost Segregation study cost?

The cost is usually based upon the type and use of the building, size, and location of the property. Beware of cost segregation providers who charge a percentage of the tax savings. The tax savings is relative to the entity type, number of owners, the year of acquisition and other factors, so the actual cash benefit can vary. Most providers will offer a quote along with projected tax savings, so you and your CPA have the information necessary to make an educated decision.

10. How much will a Cost Segregation study save me?

The tax savings realized with a cost segregation can vary depending on the type of building, your total acquisition cost, and length of ownership. Self-storage properties vary in type and size and may see reclassification percentages from 15% to as high as 40%. Request a detailed benefit analysis from a qualified and experienced firm who has a history with self-storage properties.

11. What does the Tax Cuts & Jobs Act (TCJA) passed in December of 2017 mean for my tax return?

The Trump administration passed the TCJA which is the largest tax reform bill passed in over 30 years. There are significant changes that offer tax cuts for real estate investors. The largest change being the adoption of 100% bonus depreciation for tangible personal property acquired after September 27, 2017. Tangible personal property is defined as assets with a useful life of 5, 7 or 15 years. Therefore, when cost segregation is performed to identify the personal property (5, 7 15-year property) apart from real property (39-year assets), it allows the property owner to capture bonus depreciation on those reclassified property and immediately expense the entire value in the year purchased!

*MACRS: Modified Accelerated Class Recovery System

Marc Goodin, President of Storage Authority LLC, 

Ed, you must be excited to have started construction on your self-storage facility?

Ed: Absolutely. We have put substantial time and research into this project and the team is excited to open Storage Authority Houston-Walters Rd.

Marc: First I want to congratulate you and your wife Jenny.  It was not that long ago we met as strangers in a Houston hotel lobby and you shared your goals with GP & I.  Now we are friends and you are well on your way to making your self-storage dreams come true.

Can you provide us a short background on yourself?

Ed: I do remember that meeting with you and GP and it has been a pleasure working with you all on this project. I have been in the transportation industry working in an executive role for many years and I have also been involved in a few technology startups, but I always have had a passion for real estate.

Marc:  I know you are all ready to starting your marketing for your grand Opening.  What is your projected construction time?

Ed: Approximately 6 months

Marc: How helpful was the Storage Authority preferred Houston Area real estate broker Richard Anderson?

Ed: Richard was both a resource and an advisor through the entire process. He has an extensive commercial real estate and development background, so his experience was invaluable.

Marc: How many acres did you buy? And How many square feet of self-storage did you get approved?

Ed: We bought four acres of land and will be building a 60,000 sq ft facility in two phases.

Marc: You and I did some conceptual early on and then once your offer was accepted we worked together with your architect & engineer to come up with the final layout for both the buildings and the individual units.  It’s a tradition civil engineers (like myself) get a little tough on Architects but other that did you feel the Storage authority process helped you understand the options and choose the right layout for you?

Ed: Yes indeed. You were involved in all reviews of the design process and we made many updates to the plans that gave us a much better final layout that I am confident is positioning us for a strong opening.

Marc: You actually had a very smooth design and approval process but what surprised you the most about the design or approval process?

Ed: Although the internal side of the design/approval was manageable, like any real estate deal I believe staying creative and alert to the details of the transaction is critical. We encountered several hurdles finalizing the deal that brought us to the close.

Marc: What advice would you offer a new franchise owner starting the design process?

Ed: Tap into Storage Authority’s experience and knowledge, while being sure to be mindful of local storage development trends. Bounce ideas off of Marc and collaborate to develop the best solution.

Marc: Obviously getting a loan is one of the very important steps of self-storage development.  How does it feel to have your first multimillion-dollar loan?

Ed: Exciting and challenging. I believe the due diligence that we performed, feasibility studies and local research were all keys to forming a solid working partnership with my lender.

Marc: Many people don’t realize there is a lot of work between the site plan design and having the final construction bid & permits the bank requires.  Sometimes inexperienced developers wait until after final site plan approval to start, the building design by the Architect and getting complete bids.  You had your Architect and Contractor on board during the site design process.  Do you agree this was critical for your project?

Ed: It was essential. I believe the site design process is essential to understanding the full scope of a deal’s feasibility. 

Marc:  What did you find the most challenging so far and why.

Ed: Keeping a detailed checklist, timeline and prioritizing all of the items was a challenge as we neared the final stages of the project. Large companies have teams that manage this process, and, in our case, it was me and the Storage Authority team.

Marc: Did Storage Authority meet your expectations? And what can Storage Authority do better to assist the next Storage Authority Owner?

Ed: Storage Authority exceeded my expectations. As for what can be improved, you all are already doing it. From enhancing your web platform to providing new operating guidelines your team is innovating to help me the other Owners be successful. 

Marc:  Thanks for share your experience and thoughts. One last question for now.  Are you excited to start your self-storage marketing and renting up your facility?

Ed: Marc, we are ready to get this one leased up, so we can get back to work with you and the team on our next project.

Why don’t most self storage implement a marketing plans?  Simple it takes a lot of self storage marketing experience, time and money just to develop a marketing and even harder to get your staff to implement.  This is great news for Storage Authority Franchise owners because not only do we know what works, you will have your  sales and marketing plan ready day one but even more important is we have the secret sauce of how to implement a successful marketing plan.

The Storage Authority Marketing & Sales Advantage for Higher Profits!

 We Bring the Ritz Carlton Experience to the Self-Storage Industry!

Simply put Storage Authority Platforms & Systems makes for happy customers and allows Storage Authority Franchise owners to charge premium rates for higher profits.  Storage Authority Franchises are the market price leaders, often renting up much faster at rental rates higher than their competition.

Overview

Sales and Marketing is 50% the environment and 50% people driven. Storage Authority Franchise owners start with the next generation facilities designs and the platforms, systems, tools, training, manuals and a detailed facility-specific marketing plan.  The Storage Authority Manager driven system is backed up by both the franchise owner and Storage Authority experts available 24/7. Storage Authority has replaced the losing one-month free marketing strategy (which costs a facility over $50,000/yr. in profits) with “it just feels right” feeling, sales and marketing.

The Storage Authority over the top sales, marketing and customer service philosophy is shared in detail with every potential franchise to confirm they believe in our marketing strategies and plans and are ready to embrace them before they are approved.

Manager Training & Marketing:

 Managers are hired for their friendly personality, and sales and marketing abilities and are taught the Storage Authority sales and marketing.  Some examples items managers learn starting day one:

• The Storage Authority standards and systems must be followed. Storage Authority is available to help and will do regular inspections and checks to help each manager and owner succeed.
• Individual facility Unique Selling Features.
• What makes us different.
• With every feature a benefit must be provided and often an action. Never “we have 10 sizes” but rather “we have over 10 sizes so you only pay for the space you need.  Let’s go take a look at a couple of units and find the right size for you.”
• We are not in the self-storage business but rather in the business of being remarkable, wowing our customers and providing over the top customer service. Storage Authority managers are trained how to be exceptional without giving discounts.
• Customers are looking to solve a specific need or problem. Storage Authority managers learn how to determine their needs, so we can rent more units.
• Renting units at a premium price is about building trust.
• We are the experts: We quickly assess the unit size range a customer needs and show them a unit.
• People enjoy doing business with people they like and trust. Storage Authority takes every opportunity to provide the “it just feels right” feeling for more premium rentals.
• Self-storage typically has a three-mile radius customer base. Storage Authority uses state of the art Geo Centric Target Marketing for 3 Mile Domination. (And maximum results for the least amount of time & money).

Storage Authority managers have detailed scripts they must learn and adhere to including the following scripts:

• Walk in Script: Introduction: shake hands – name – show a unit – confirm a unit -ask for sale (one extra rental per week = $93,600 in profits a year)
• Overcoming concerns & asking for the rental again script
• Phone rental script.
• Completing the rental agreement script.
• May I have your number (to follow up) script.
• Follow up script
• Autopay script – for an easy extra $30,000 a year profits and more time.
• Insurance script
• Disc Lock script for a safer facility and more profits
• Box & product script
• Thank you, script
• Rate Script ($15/month average higher rent for 500 units = $90,000 in profits a year.)
• Before & after hours kiosk & website have their own scripts as well (one extra kiosk/website rental per week = $93,600 in profits a year)

Storage Authority managers have a list of daily, weekly & monthly marketing duties they must adhere to that is completed because they are completed regular they become a habit. Examples:

Daily

• Walk site twice daily for security and ensure the facility is super clean.
• Contact at least five customers a day.
• Call at least one business a day to introduce Storage
• Follow up daily with past prospects.
• Walk the site daily – check units & facility super clean.
• Social network posting.
• Ask for referrals.
• Ask for online reviews.
• Sandwich board & banners out at street side daily.
• Constantly remind the customer on every contact they are special by providing the little things that count –Example: free soda or bottled water carried out to them at their unit on a hot day.
• Carry customer products to their car.
• Visit renters on site.
• Provide over the top remarkable service.
• Candy bowl overflowing.
• Offer free use of our “commercial car wash” vacuum.
• Surprise their customers.

Weekly

• Visit local business 2 hours every week (10 businesses a week)
• Weekly marketing project – often co-marketing projects with local businesses.
• 101 weekly marketing projects are provided in Storage Authority Founders Marc Goodin best-selling self-storage book CRUSH your Competition
• Facebook Friday special.

Monthly

• Improve drive-by impressions
• Visit top 40 business monthly
• Volunteer 4 hours a month on company time.
• Each month meet, email, mail a different major customer resources such as real estate agents, funeral homes, town hall, police dept., car dealers, universities, attorneys ect. and teach them how and why to refer to Storage Authority self-storage.
• Monthly Marketing project.
• Monthly marketing calendar used for month specific marketing for example:
  • Visit, email, and mail in October for winter vehicle storage
  • Pumpkin giveaway in October
  • College Campus marketing in March
  • High School car was in May
  • Free hot dog & Hamburg lunch cookout 3 times a year
  • Plant flowers in spring
  • Holiday marketing

Quarterly

Special Marketing projects and new marketing projects.

Storage Authority New Generation Facilities

• Minimal lighting replaced with brilliant LED lighting.
• Keypad entry replaced with cell phone app entry with geo-fence.
• Multiple ways to rent & pay including high-tech kiosk at every facility.
• Management program, security, gates & cameras all are cloud-based to detect problems & resolve immediately, even from off-site.
• Over the top landscaping provided to provide the “just feels right feeling” as a customer drives in.
• Free use of exterior “commercial Vehicle vacuum for clients.
• Large professionally design monument & building signs. Rent 24/7 Here kiosk signs.
• Customer Coffee bar. Free coffee, bottles of water and soda.
• A Remarkable oversized retail office that provides that “just feels right” feeling.
• Remarkable landscaping.
• Free Wi-Fi for our customers.
• Additional or specialty services such as wine cellar, power for car storage or pharmaceutical reps, extra secure fire rated rooms, handicap rooms.

 Storage Authority Mulbury FL

Storage Authority New Generation Service:

• Our motto: shake hands, call them by name 3 times and ask for the rental 3 times.
• Great customer service replaced with over the top remarkable service.
• The best guarantee in the business.
• Clean, replaced with spotless and beautiful.
• Staff empowered with solutions to solve problems immediately.
• Staff provided the resources, so they can do a better job and get more done in a day.
• Staff regularly secrete shopped to confirm Storage Authority Standards are met.
• The Staff has uniforms and dress codes for a professional appearance every day.
• The Site is walked two times a day to keep spotless and lock checks. (renters sometimes lock unit open)
• Every customer is treated like a Million dollars on every touch.
• Bringing the Ritz Carlton experience to the self-storage industry.
• We understand customers are looking to rent and we make it easy for them to do so on the first visit or phone call. And if they do not we will call them back in 1-3 days.

Storage Authority provides:

• Geo centric market.
• 24/7 Marketing & Sales hotline to assist franchisees.
• Systems and platforms to be professional starting day one.
• Marketing materials and sample marketing letters for different groups.
• Marketing & Sales start-up training and ongoing training.
• State of the art website and SEO.
• Operations & marketing manuals.
• Storage Authority has multiple vendors on board to provide the best customer service including movers, valet service, tenant insurance providers, merchant providers and more.
• Storage Authority is constantly reviewing options from the self-storage industry, other industries, and our franchisees to provide more options and systems to gain additional renters at premium pricing and to better serve our customers.
• National brand marketing.

Storage Authority New Generation Marketing

• Both High Touch & High-Tech Marketing.
• Social marketing daily on Facebook and other social networks.
• PPC marketing-lease up accelerated.
• Online rentals and reservations.
• Rent here 24/7 Kiosks.
• Every renter given the opportunity to make $30 and give $30 to a friend with our referral marketing.
• $17.95 locks on sale for $12.99 means every customer buys a lock.
• Autopay with 90% penetration.
• Paperless contracts/receipts for customers who want email copies
• Phone rental calls automatically recorded to management software for swift follow up.
• Text marketing & payment collections directly from management software.
• Employees empowered to help drive business.
• Employees are educated on networking for profits.
• Free Rental truck for new renters.
• Seasonal marketing: festivals, holidays, winter car storage, campgrounds, college students, etc.
• Special marketing promotions with local realtors since they represent the highest proportion of self-storage tenants, someone moving.
• Phones answered by on-site manager 1st (most knowledgeable) then rolled over to call center.
• Manager is the highest common denominator (vs the lowest for the REITs) for the closing the rental. Starts with the on-site manager answering the phone vs an out of town call center.
• Storage Authority employees are kept active and engaged with a purpose to help them drive better results.
• Owners are part of the local community and a large part of the sales and marketing team
• Home-town self-storage creating a value to the community & local businesses
• Cross marketing and promoting fellow businesses in three-mile radius
• Storage Authority Value coupon envelope for every customer who takes site tour. Envelope is filled with local businesses discounts to promote community relationships & compound referrals.
• Welcome cards and emails with referral bonus on move in’s and thank cards and emails with future discounts when our service is needed again on move out’s.

Storage Authority -Target Marketing Partners:

• Moving Companies, Truck Rentals (that don’t provide self-storage) & Senior Move Managers –

Co-operative marketing and referral partnerships opportunities

• Real Estate – Realtors / tittle companies / mortgage/ Home Inspectors / Staging / Designers

Great for cross-marketing

• Apartments / Condo HOA’s –

For their move-in Packages – Self Storage Rack Cards with a coupon for move in packets, helps         leasing consultants overcome an objection of downsizing to an apartment.

• Senior Communities – 55+ Mobile Homes / Assisted Living & Independent Living

Do they do move in Packages?  Resource Center?

• Senior Care Providers – like home health care services. Cluttered homes are a safety hazard and they can recommend storage is they don’t want to part with the items.
• Child Centers – Daycare /After School/ Recreational like ballet, karate, sports: – Families need storage
• Restoration Companies/Disaster/Construction Companies – Emergency cleanup and store items able to salvage while the home is being restored.
• Pharmaceutical Reps—They will target climate control units that are central to their distribution location, that will receive packages for them and store their sample drug inventory, marketing materials, and literature.
• Insurance Companies –

Auto/Boat/RV – (their clients may need a place to store these) Homeowners – Buying/Selling –      they call their insurance provider – may need temp storage or downsizing.

• Bankers and Attorneys—They are a perfect source for referrals and often need your self-storage services for time-sensitive record keeping complying with their industry regulations.
• Schools – Public & Private / Elementary – High – Families & Faculty need storage

What marketing opportunities with local school to participate in.

• Teachers – Teacher Lockers to store supplies during the summer and keep home clutter free.
• Colleges – Focus April & August – Student Flyer – Students use storage between summer semesters. Lockers during the school year to keep personal items locked up.
• Funeral Homes/ Crematoriums

Families need quick storage to clear out the house for sale, time to grieve and then go through stuff and decide to keep or give away.

• Local Businesses / Restaurants / Dr. Offices / Retail / Thrift Stores – store extra inventory, business records, catering supplies
• Laundromat, pizza places, etc. Look to see if they have community boards, place to put our display – Get lots of traffic.
• Home-based businesses – HVAC/Sales/Accountants/etc. – We accept package and deliveries, store inventory, equipment, business records.