I am in the process of buying land for my first facility. Does anyone recommend having a consultant or project manager on my first facility? If so what is the best way to approach or look for a reputable source?

Hardway: I have represented a lot of people who get into the business. Two of the most common mistakes I see (and when I say mistake I mean disastrous mistake) are the failure to obtain a solid feasibility study and using their own company or a friend who has never built self-storage before, to build the facility.
In the first instance, many people think if you build it they will come. Not true anymore, you need to know not only who your competition is but also what type of units they have, what’s full and what’s not and the actual rent they are charging. You can quote rent rates all day but if you are giving away the first month or the administration fee, your loss to lease is going to be high. That is because industry wide the average “stay” is 6 months, give one month away and subtract 17% from your actual rent. Be wary of reports that do not show some of your occupants moving out after 6 months, it will over-inflate your expected net income.
Use a consultant that is independent and not in competition with you in your state. I am not allowed to recommend consultants on this site, but look on ISS’s website for vendors there is a whole category of consultants, interview a few.
Next is building without experience. Don’t do it, use an experienced self-storage supplier and let them erect it for you, again there are several of these companies on the ISS website. I see too often people who know how to build anything that have no idea how to build self-storage. These projects end up hundreds of thousands of dollars over budget and poorly designed and executed, diminishing their current use and their resale value. I know of one facility where the builder messed up the depth of the vehicle storage bays and they are not deep enough to get an RV into. What can you rent them for now? How much rent do you loose not renting them for the high priced RVs?
Don’t be penny wise and pound foolish, use experts in the field of self-storage.
Best of luck.

__________________
Jeffrey Greenberger
Moderator, Legal Issues Forum
Nothing in the post should be considered to be legal advice, all posts are for informational purposes only.
Katz Greenberger & Norton LLP
105 East Fourth Street, Suite 400
Cincinnati, Ohio 45202

Where are you planning on building? Perhaps if I knew, I could refer a few companies your way.

Hardway:
I would concur with Mr. Greenberger. The key to building your first facility, as with any complex business venture, is forming a strong team. You don't always have to have all the answers, but you have to be able to get them quickly, during your due-diligence, or feasibility period. In the pre-development phase your team should, at minimum, include a lawyer, accountant, RE broker, feasibility consultant, and engineer.

Good Luck!

__________________
Ben Burkhart
BKB Properties, LLC
StorageStudy.com
804-598-8742

Hardway;

You have received some great advice here in the forum. In your search for knowledge, do not forget to attend seminars, such as the one recently held in Las Vegas, put on by the Inside Self Storage folks. There are developers seminars, as well as workshops that will cover many of the subjects you are looking for indepth information on. Keep on reading the magazine, and look in the archive for subjects that catch your attention.

This is not a business or industry for everybody, it takes a lot of commitment to do it correctly, from both a capital and expertise perspective. The good news, is that there are lots of industry professionals that can help you. If you would like to speak in person, please do not hesitate to give me a call at 561.963.4004 x81, and I can refer you to some industry professionals like Jeffrey and Ben.

__________________
RK Kliebenstein
Leader,
Coast-To-Coast Storage
P: 561.963.4004x81
U: www.askrk.com or www.HowToInvestInSelfStorage.com
E: rk@askrk.com