Mini storage also known as self storage properties are a favored investment type for real estate investors from “mom and pop” investors to real estate investment trusts. These properties are attractive as they can be very “cookie cutter” in there design and construction. You can basically take the same design and increase it from 100 units to 500 units just by adding more buildings of the same design. Operating expenses are fairly stable and occupancy can be good both in good economic times and bad.
There are dozens of important steps that must be taken during the planning and building of a self-storage project. Here are six industry trends that’ll affect decision-making this year as you pursue your next development.
To develop a self-storage project that enjoys long-term success, regardless of whether you’re an experienced professional or new to the industry, you must grasp current trends that impact planning and building. Let’s look at some key factors that’ll affect your decision-making in 2020 and beyond.
More Stringent Zoning
Let’s start with the first step in the development process: obtaining municipal approvals. In recent years, storage developers have been successful by investing in better, more visible locations. In response, cities nationwide have demanded more architectural detail, nicer landscaping, greater lighting control and other design requirements. Some communities have banned self-storage development outright or placed moratoriums on existing applications.
If you’re planning to build in a premium location, be prepared to invest in the services of an architect upfront. A great location in a market where the approvals process is rigorous can pay off handsomely—if completed. It can also lead to tens of thousands of dollars in lost design investment if it’s ultimately denied or made financially unfeasible by local restrictions.
Overbuilding
Another topic on the minds of many developers is market saturation. Self-storage has had a well-earned reputation as a solid investment for many years, which resulted in a construction boom. Some developers have pushed many large markets to the point of overbuilding and are now expanding into smaller markets they previously ignored. Read entire article here in nreionline.com.
If you are looking to finance a self storage property and would like to discuss financing options contact us by email with the contact form or call directly to 918-274-0044
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