A private investor purchased two self-storage properties in Marion, S.C., for $1.96 million. The buyer formed an LLC to acquire White’s Mini Storage and Francis Marion Plaza Storage, according to a press release from Midcoast Properties Inc., the real estate firm that brokered the transaction. Combined, the facilities include 608 standard and climate-controlled units, a clubhouse, and a warehouse with loading dock on a total of 18 acres.

Opened in 1975 and expanded in 2009, White’s Mini Storage at 1834 Senator Gasque Road comprises 84,985 net rentable square feet of storage space in 22 buildings. Francis Marion Plaza Storage at 2816 U.S.-501 encompasses 42,000 net rentable square feet of storage space. The facility opened in 1991 and has 11 buildings. Both properties have room for expansion, the release stated. Security features include lighting, perimeter fencing and video cameras. Each also has a rental office.

Dale C. Eisenman, president of Midcoast Properties, represented the seller. The company offers brokerage services in Georgia, North Carolina and South Carolina.

 

Four self-storage operators in Sterling, Colo., have donated candy to Sterling Recreation Center’s “Trick or Treat Street” event that will take place on Oct. 31. The participating storage companies are Appelhans Self Storage, E and B Maxi Storage, Mike's Portable Storage and Mini Storage Co. of Sterling.

The annual affair is designed to be an alternative to door-to-door trick-or-treating for children age 12 and under, the source reported. Admission to the event, which runs 5 to 8 p.m., is free. This year’s theme is the "Wizard of Odd.” More than 70 local businesses donated candy and other treats, the source reported.

The event will take place in the rec center’s indoor pool-deck area. The pool will close at 9 a.m. on Halloween day, and the building will close at 4 p.m. to allow for party preparation, according to the source.

The rec center features an outdoor pool that includes four slides and other water features. It also has a fitness area, indoor pool, multi-purpose and youth rooms, and sports courts for basketball, racquetball and wallyball.

Update 10/12/15 – StorageVault Canada Inc. has completed the second of two tranches in the self-storage operator’s purchase of Cubeit Portable Storage Canada Inc. and seven storage facilities operated by Access Self Storage Inc. The tranche of $27.2 million includes the final three Access properties comprising 186,000 square feet in 1,657 units, according to a press release.

In September, the parties agreed to swap out two Ontario properties and a Quebec property in favor of a larger Ontario asset of equal value. The decision was made to “improve operational efficiencies for StorageVault when compared to the originally contemplated properties,” the release stated. The asset change didn’t alter the original purchase price.

A portion of the second tranche was paid with the issuance of more than 32.4 million StorageVault common shares to Access worth $12.3 million. The remainder was paid with the assumption of a $4.7 million mortgage and cash drawn from StorageVault credit, according to the release.

Upon completion of the second tranche, StorageVault issued more than 26.4 million common shares to Access, which now controls more than 56.6 million shares representing 42.09 percent of all issued and outstanding common shares, officials said. Access can increase or decrease its StorageVault investment depending on market conditions and other factors.

StorageVault now operates 17 self-storage facilities and more than 3,200 portable-storage units in Alberta, British Columbia, Manitoba, Ontario, Quebec, Saskatchewan and Nova Scotia.

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4/30/15 – StorageVault Canada Inc. has completed the first of two tranches in the self-storage operator’s purchase of Cubeit Portable Storage Canada Inc. and nine storage facilities operated by Access Self Storage Inc. The first tranche of $26.5 million includes the entire Cubeit business and four Access properties, according to a press release.

A portion of the first tranche was paid with the issuance of more than 30.2 million StorageVault common shares to Access at 38 cents per share. The remainder was paid with nearly $15 million in cash, according to the release.

In conjunction with the completion of the first tranche, StorageVault has reconstituted its board of directors. The board now consists of Rob Duguid and Alan Simpson from investment-management firm PFM Capital Inc., and Iqbal Khan, Steven Scott and Blair Tamblyn from Access and Cubeit.

Scott will replace Simpson as StorageVault CEO, and Khan will take over as chief financial officer from Glenn Fradette. Simpson will continue as executive vice chairman, while Fradette will remain with the company for six months to assist with the transition, according to the release.

The closing of the second tranche is expected to occur by Oct. 1.

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3/5/15 – StorageVault Canada Inc. will have until April 30 to complete the first of two tranches in the self-storage operator’s purchase of Cubeit Portable Storage Canada Inc. and nine storage facilities operated by Access Self Storage Inc. The initial deadline of Feb. 2 was extended by mutual agreement of all parties involved in the deal, according to a press release. The extension will enable StorageVault to complete its due diligence, company officials said.

As part of the extension, the initial condition period of the $51.3 million deal has been extended to April 24. StorageVault also has received conditional acceptance from the TSX Venture Exchange, but the transaction remains subject to final acceptance. All other terms of the proposed acquisition remain the same, according to the release.

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12/9/14 – Canadian self-storage operator StorageVault Canada Inc. has agreed to purchase all of the rights and assets of Cubeit Portable Storage Canada Inc. and nine storage facilities operated by Access Self Storage Inc. for $51.3 million. The acquisition will occur in two tranches and is subject to approval by the companies’ boards of directors, which is required by Feb. 2, 2015, according to a press release.

The first tranche includes four Access properties and the entire Cubeit business portfolio for approximately $25.6 million. The self-storage facilities comprise 133,000 square feet in about 1,500 units. The Cubeit business operates out of eight Canadian locations and includes 1,254 portable-storage containers. The deal includes a payment of more than 23.5 million StorageVault common shares at 38 cents per share, which is worth more than $8.95 million. The expected closing date on the first tranche is March 10, 2015.

The second tranche includes five Access self-storage facilities, comprising 250,000 square feet in 2,500 units, for approximately $25.7 million. The agreement includes a payment of more than 23.6 million StorageVault common shares at 38 cents per share, which is worth more than $8.99 million. The expected closing date on this tranche is Oct. 1, 2015.

As part of the agreement, the StorageVault board of directors will be restructured to include CEO Alan Simpson, a nominee from investment-management firm PFM Capital Inc., and three nominees from Access and Cubeit. If the second tranche of the agreement is terminated for any reason, the board of directors would be composed of Simpson, three nominees from PFM Capital and one nominee from Access/Cubeit, according to the release.

Another provision of the agreement requires Access and Cubeit to purchase “all of the issued and outstanding shares in the capital of Canadian PUPS Franchises Inc.,” which is the master franchisor of StorageVault's PUPS portable-storage business.

A five-year business plan connected to the transaction also lays out the possibility of future StorageVault acquisitions of additional Access assets, although it is not a requirement of the deal.

Trading of StorageVault common shares on the TSX Venture Exchange (TSXV) will remain halted until documentation required by TSXV has been reviewed and accepted, according to the release.

Access and Cubeit have been in the storage business for more than 16 years and operate 60 locations comprising more than 4 million square feet of fixed storage space and more than 1,250 portable-storage units. Access Self Storage facilities are in Alberta, Manitoba, Ontario, Quebec and Nova Scotia. The portable-storage business operates under the Cubeit brand, with operations in Alberta, British Columbia, Ontario, Quebec and Nova Scotia.

StorageVault owns six Canadian self-storage facilities, five of which are operated in conjunction with a PUPS portable-storage franchise. The company also operates standalone Canadian PUPS facilities in Edmonton, Alberta, and Saskatoon, Saskatchewan.

By Michael Ruge

Records storage can be a wonderful ancillary service for existing self-storage operations. Not only can it provide secondary income, it can attract new renters. Let’s look at what it takes to successfully run a records-storage business, including requirements for space, software, staffing and more.

Space

Records storage involves renting cubic feet or “air space” as opposed to traditional self-storage, in which you lease square feet. Units with the highest ceiling height will work best for this service.

Offering the proper shelving and equipment will minimize safety hazards. The type required will vary based on the ceiling height. Basically, the higher you go, the stronger the shelving needs to be so it offers more support.

The shelving should accommodate standard-size document-storage boxes. It’s much easier to organize the space if you use standard 1.2-cubic-foot boxes, as most everyone can lift this size. Nonstandard sizes aren’t practical and generally too heavy. Oversized boxes may also be over legal limits in some jurisdictions.

Climate Control

If you’re simply offering storage for paper records, climate control isn’t important. Paper doesn’t care about temperature, only dryness. Water, fire and rodents are a records-storage facility’s biggest enemies. Some operators will keep units hotter in the summer months and colder in the winter months than most humans will tolerate simply to keep pests away.

Software

There are five software companies that have designed programs specifically to address the needs of records-storage businesses. These programs can trace documents, file folders, tapes and traditional storage boxes, from deposit to destruction.

Many software vendors are also improving their mobile functions, allowing records-storage facilities to operate much more efficiently. The primary benefit is customers are able to go online at any time and book any required services, minimizing your staff requirements.

Staffing and Confidentiality

Outsourcing works very well in the records-storage business. All pickups and deliveries can be handled by local courier companies. In fact, all tasks, except management, can be outsourced. You can hire veterans, semi-retired people or those looking for part-time work on an “on-call” basis. The majority can be hired as contractors to minimize costs and long-term liabilities.

Records-storage personnel must treat all records in their care as confidential. It’s critical that records are kept secure at all times and only trained, screened staff are allowed to handle them. They must not at any time publish, release or disclose any records or information they come in contact with in any way.

Document Shredding

Some operators have taken their records-storage services to another level by offering document shredding. People who call you for shredding may ultimately choose to store records with you, and those storing records at your facility will likely need shredding services at some point. You may choose to do the shredding yourself using an onsite shredder, or store the records to be shredded and hire a mobile vendor once you’ve accumulated a sufficient number of boxes. Either of these is cost-efficient for records destruction.

Due to issues of dust and noise, as well as the potential for fire, bulk shredding should never take place in the same area where staff work and records are stored. The shredder area should be separated by a fire door and have appropriate ventilation to remove dust.

Marketing and Sales

Records can go from the basement to the boardroom in an instant. Clients are only slightly aware that records storage exists as an industry until they have a crisis and need their old records retrieved for a lawsuit or audit. Your marketing department’s job is to increase awareness and accessibility.

First, maintain a professional website. It should clearly define your records-storage offering, including the scope of services on offer. Optimize your site with keywords and blogs. Also promote your services on your social media channels. You can also benefit from belonging to local or national records-storage associations and other local business-networking associations, such as the chamber of commerce or rotary club.

The needs-assessment selling process brings the highest return. When followed properly, it can achieve a 70 percent closing ratio. Records storage is needed by the majority of businesses, but many just don’t know it yet. When you educate them on the laws and the benefits of records storage, it’s simply a matter of how to implement your services.

For more than 30 years, Michael Ruge has helped people start, improve, market, manage and sell all types of storage businesses including portable, records and traditional as well as warehousing. He’s the head advisor for Storage File Experts, which has offices in Canada and the United States. To reach him, e-mail info@storagefileexperts.com; visit www.storagefileexperts.com.

If there’s one thing we know in the self-storage industry, it’s that when a tenant gets behind on the rent, it can be challenging to save the situation. I don’t know if anyone has done a scientific study on this, but I would bet few people who become 30-plus days late on their bill ever get caught up.

So, let’s not let that happen! Instead, let’s keep collections to a minimum. Here are a few tried and true suggestions, plus a few new ones, to help you keep tenants current on their rental payments.

Make it Easy to Pay

Take all forms of payment: cash, checks, credit cards, debit cards, PayPal, electronic funds transfer and Automated Clearing House. Use online billpay, auto-charge and prepay. Not all of these will be easy to set up, so perhaps you can’t offer them all. But do make it easy for people to pay you. Encourage tenants to set you up as a payee in their bank’s bill-pay system, if they use one.

Also, make sure staff is available in the office when the rent is due. If you do first-of-the-month billing, set up extended office hours on the last and first days of each month.

Use Reminders

Use all means at your disposal to let customers know the rent is due. Post it on Facebook, e-mail your tenants, put it on your phone’s interactive greeting, send automated calls and text messages, and post a sign on the property noting when rent is due.

Just make sure you’re doing all of these legally. Some of these methods require an opt-in from customers. You can put language in your lease allowing for these communications. Check your local regulations to make sure you’re in compliance. If you have a “smart” CRM (customer-relationship management) and accounting system, reminders will be limited to renters who haven’t yet paid, which avoids making you look bad to those whose accounts are current.

Limit Access and Avoid Fees

How soon do you deny facility access to tenants who are late? After one day, three days? Your gate is a powerful tool. I recommend denying access on the day after rent is due, just to get the attention of anyone who’s delinquent. If people find this annoying, you can tell them this is your way of ensuring they’re not assessed late fees or collection charges. Your customers will find late fees far more annoying than denied access.

Send additional reminders to people who are late but still within the grace period. Use every means available to let them know you haven’t received a payment and a late fee is coming soon.

If you haven’t set up an aggressive late- and collection-fee schedule, do that now. Check with your state association or attorney to make sure you’re following local regulations and statutes, and then post your policy in your lease. Make sure tenants understand, when they sign the lease, that it will get expensive if they pay late.

Save people from fees by over-communicating with them until they pay. There was a time when storage companies loved late fees and saw them as extra revenue. That is so 1990. It’s far better to keep tenants long-term and have them pay on time than to collect late fees. In this world of instant social media contact, you want customers telling their online friends about how nice you were to save them from fees instead of what a jerk you were for charging them.

Go to Auction Quickly

Move your lien process as quickly as local statues will allow. The faster you cure a delinquency, the less hassle it is for everyone, and the faster you can get that unit generating revenue again. If your process is quick and consistent, customers will know they can’t stretch you out for past-due rent, and they’ll try very hard to avoid being in that position.

Sometimes it’s better to make someone an offer to move them out than it is to go to auction. You may collect more money this way and will definitely get the unit back into revenue mode more quickly. The tricky situations are those in which you can’t find the tenant to offer him a deal. If you’re careful about getting good contact info from new customers when they sign the lease, as well as alternate phone numbers and e-mail addresses, you’ll have fewer situations in which a tenant is unreachable. Just be careful about tenants who are on active military duty or filing bankruptcy. Again, follow your state statute.

Some of this may be old hat, but it’s all worth a review. Are you making it easy for customers to pay their bill? Are you reminding them rent will be due soon? Do you use your gate to get your point across? Are you actively saving people from late fees? Are you moving through your lien process as quickly as possible? If you answered yes to all of these, you should have hardly any delinquencies, and even those should be well under control.

Tron Jordheim is the founder and CEO of Tron Jordheim Enterprises. He has a long track record in management, marketing, sales and public-relations innovations. In his 15-year tenure as the director of the PhoneSmart self-storage call center and chief marketing officer of StorageMart, he’s developed a deep understanding of the self-storage customer. To reach him, call 573.268.5217 or connect at https://www.linkedin.com/in/tronjordheim.

Midland Storage LLC, a Missouri-based self-storage company, has purchased A Storage Inn in St. Louis from Mason Miniwarehouses L.P., a limited partnership led by Richard K. Mersman III. The property at 11210 Midland Blvd. sits on nearly 3.5 acres of land and includes 395 self-storage units. Near Lindbergh Boulevard, it features a gated entrance and perimeter fencing.

The facility sold within one month of its listing, according to a press release from Hilliker Corp., the commercial real estate company that represented the seller in the transaction. The broker was Jon Wilsonholme. The buyer was presented by Jon England, a principal in the Kansas City, Mo., office of Lee & Associates, a commercial real estate firm with offices nationwide.

Based in St. Louis, Hilliker has completed more than 10,000 sales and leases for industrial, office, retail and institutional clients since its inception in 1985.

Extra Space Storage Inc., a publicly traded self-storage real estate investment trust (REIT) and third-party management firm, has acquired Treasure Island Storage in Cherry Hill, N.J., for $7.25 million. The three-story facility comprises 92,214 net rentable square feet in 762 units and 13 vehicle-parking spaces. The property was purchased from Cayre Equities, a real estate investment and development firm, which also sold an adjoining retail asset to a separate buyer, according to a press release by HFF (Holliday Fenoglio Fowler LP), which represented the seller in both transactions.

The two properties comprise 9.38 acres at 101 Church Road and are across the street from the Cherry Hill Mall. There are 280,941 residents living within a five-mile radius, with an average annual household income of $81,000, the release stated. Cherry Hills is about five miles from Philadelphia.

The self-storage facility features commercial loading docks, a ground-floor loading area and a retail center for packing and moving supplies.

The HFF team that brokered the self-storage sale was comprised of Barbara Guffey, director, and Richard Schontz, managing director. Chris Munley, managing director, led the team that brokered sale of the Treasure Island Retail property, which was acquired by an affiliate of Paragon Realty Group LLC for $6.275 million.

The retail property comprises 107,390 square feet and is leased by Ashley Furniture HomeStore and Ollie’s Bargain Outlet.

HFF and its affiliate, HFF Securities LP, are owned by HFF Inc. The firm operates out of 22 offices nationwide and specializes in advisory services, commercial-loan servicing, debt and equity placement, and investment and loan sales.

Headquartered in Salt Lake City, Extra Space owns or operates 1,170 self-storage properties in 35 states; Washington, D.C.; and Puerto Rico. The company’s properties comprise approximately 787,000 units and 87.1 million square feet of rentable space.

Reliant Real Estate Management LLC, a self-storage development and property-management firm, intends to convert a former Kmart store in Greenville, S.C., into a storage facility. The project would refurbish about 4 acres of a 10.5-acre retail center at 640 Sulphur Springs Road. The proposed Midgard Self-Storage facility would comprise about 800 climate-controlled units and feature indoor storage for RVs and other vehicles, according to the source. If approved, the facility is expected to open in May.

Work is underway at the site to remove asbestos from the building, which opened in 1974. The store has been vacant since 2012. "We specialize in repurposing buildings," partner Lewis Pollack told the source. "We've converted bowling alleys. We've converted skating rinks. We've converted dark commercial boxes like this one."

Reliant submitted its plan for the property with Greenville County officials earlier this month, according to Bob Mihalic, a country spokesperson. The project is still subject to review before a building permit can be issued, the source reported.

The other parcels in the retail center are owned by Hughes Investments Inc. The company is marketing the remaining property for possible development, but no plans were immediately known, according to the source.

Reliant is the management arm of StoreSmart Self-Storage, which owns more than 20 facilities comprising nearly 1.9 million square feet in eight states. The company manages several independent facilities in four states, including South Carolina, and has an “internal development and acquisition pipeline” to help grow its portfolio, according to the StoreSmart website.

Real estate developer Timothy Wiskirchen received zoning approval on Sept. 30 from Clark County Commissioners to build a self-storage facility on 2.5 acres of land in Springfield, Ohio. The Clark County Rural Zoning Commission had previously recommended against rezoning the property at 6431 Springfield-Xenia Road, expressing concerns about water drainage, decreased property values and in increase in crime, according to the source.

Wiskirchen addressed these concerns during the meeting, reassuring commission members they were non-issues. He consulted with two engineering firms about the property’s drainage. The firms suggested he add a retention/detention area in the northwest corner of the property as well as use gravel instead of pavement for the surface areas to slow down water runoff, the source reported. Wiskirchen also noted the property was currently dry and may have been wet due to a soggy spring.

In addressing property values, Wiskirchen said half of the storage buildings would be constructed around the property’s perimeter to create a privacy wall for nearby residents. This would also allow more units to be built.

Wiskirchen consulted with two other self-storage operators in the area about recent crime. He reported the facilities had made six calls to police in the last year, two of which were for vehicle break-ins. The other four involved issues with late-paying tenants who were attempting to cut the locks off their units, the source reported.

Wiskirchen also noted the neighborhood has changed drastically in the past 40 years when it was zoned agricultural. Only one property in the area still falls under that category. Of the mile-long stretch of U.S. Route 68 that runs north and south of the property, 7,900 feet of the frontage is commercial and 3,200 feet residential. “This is no longer an area in which property owners desire to build new residences,” Wiskirchen said.

He also noted there was a high demand for self-storage in the area, and the facility would create as many as 15 new jobs.