Location, location, location! British real estate tycoon Lord Harold Samuel (1912 – 1987) is credited with coining this phrase, highlighting the three things that matter when it comes to property. This is true when it comes to deciding on where to set up shop as a self storage facility too! So what makes for a good self storage location? We’ll get to that in a moment.
Importance of Your Self Storage Location
Along with Lord Samuel, businessmen have been studying the importance of location for years. In 1926, J. Freeman Pyle wrote about the importance of location for retailing in the Harvard Business Review. And in 1940, Kenneth D. Hutchinson developed a technique to select retail locations based on traffic patterns. Since then, many others have formulated theories and conducted studies about consumer behavior and commercial locations.
An argument can be made that in today’s digital world, physical location is no longer that important. While that may be true for ecommerce retailers, who are more concerned with rising to the top of Google searches and staying on the positive side of social media word of mouth, self storage locations still require a strong storefront. After all, while a potential renter may discover your facility through an online search, they still have to physically go there in order to store their belongings. So, onto the list of how to select self storage locations!
7 Considerations When Choosing a Self Storage Location
Whether you’re looking for the best existing self storage location to purchase, or wondering how to find a self storage location to build from scratch, we’ve identified seven key considerations.
One of the biggest challenges for new owners is zoning. Zoning laws are the rules that dictate how property can or cannot be used. They exist to minimize conflict between landowners and users by preventing things like putting a loud factory in a residential neighborhood. So while you may find an ideal location for your facility, that doesn’t mean the authorities are going to allow you to build on it. Of course, you can always attempt to rezone the land, but this can be a long, challenging, and expensive process. Plus, rezoning doesn’t guarantee your desired outcome if the regulatory bodies and populace in the area don’t agree with your ideas for building on the land.
Finally, you’ll also want to consider neighborhood associations. Many have recently begun demanding that new structures follow certain designs in order to avoid the development of an “eyesore” in their area. This means that today’s self storage operators need to look carefully at the area they intend to build in to be sure their design fits in with the landscape.
2. Welcoming to New Business
Anyone building a new commercial property is going to have to deal with the local authorities, and not just when it comes to zoning. So, is the area welcoming to new businesses? Some local governments will be excited about the construction of a new property, while others may be looking for a fight. They could find ways to increase your taxes, keep your permit in limbo for months, or charge extra fees or even impact fees. These are payments a local government may require of new developments, with the money going to expanding public capital facilities. In other words, you could be paying for new public utility vehicles or repaving a stretch of a badly worn road.
“If you build it, they will come.” It’s a nice thought, but it’s not necessarily true, which is why you want to set up shop in a densely populated area. People are not going to want to travel a great distance to store and retrieve their belongings, so you want to be as close to them as possible.
Of course, self storage facilities require quite a bit of space, which can be difficult to come by in highly populated areas (it’s also going to be more expensive). So, you’ll need to do some calculations to weigh the pros of the larger population and the cons of the expenses and space limitations.
While you want to choose an area with a large population, you also want to be sure there’s not too much competition in the area. This all has to do with “supply and demand.” If there’s a lot of people, but also a lot of self storage facilities, you may find yourself stuck with a lot of empty units.
This may be especially true if there are a lot of REITs in the area – those large privately-owned operators and publicly traded companies that may have a lot more marketing dollars to spend. Of course, it’s not impossible to compete with REITS: Be sure to check out our blog 8 Ways Small Self Storage Operators Can Compete with REITs.
You know what they say: “Out of sight, out of mind.” For this reason, it’s imperative that your location has high visibility. You want people to see your facility, so that when it’s time to store goods, they’ll remember it can come back. Try to find locations that offer easy access and that are situated at busy intersections where traffic has to frequently stop and idle.
If you’re eyeing a place off the interstate, be sure there’s an exit nearby and that your signage will be visible. You might also look for nearby billboards that you can use to promote your business to those driving by.
6. Ample Space
We touched on space before, and how it’s important to weigh the pros of a large population versus space limitations in these areas. So, be sure to calculate how many storage units you’ll be able to build at a certain location, and then decide if it’s economically feasible. Thinking of expanding in the future? You’ll also want to consider room for growth down the road.
In addition, here are some other considerations that can limit the space on which you have to build. For example, you’ll want to keep in mind setbacks. This is the mandatory minimum distance which your facility must be set back from a street, road, or walkway, a river or other stream, or any other place which is deemed to need protection. Also, you won’t be able to construct your facility underneath overhead power lines if they’re bisecting the area (though you may be able to use this space for parking instead).
7. Proximity to Police
Is there a police station near your potential site location? While not a deal-breaker, being located close to a police station or in an area with a high police presence can make renters feel more comfortable leaving their valuables with you. This is more true for high-crime areas and locations where there have been other break-ins. Thieves are less likely to attempt burglaries if they know the police are nearby, and if they do, the police can follow up on the break-in in a more timely manner. Of course, you have many other options for security.
Self Storage Consulting Services with Storelocal
Ready to break ground but unsure of doing all the required research just described? You’ll want to consider hiring a self storage consultant, which you can easily acquire by joining the Storelocal® cooperative. We are a group of self-storage owners and operators who work together to increase their competitive advantage in the marketplace, lowering operational costs and increasing profits.
Our vetted, knowledgeable self storage consultants will work with you to conduct a self storage feasibility study, providing their expert opinion on the financial viability of your planned property. The study estimates construction costs and determines viability based on size and location, local research (such as demand and competition), and industry standards and trends. Learn more about Storelocal today and check out our partners' page for more benefits.