Vehicle Storage and Profits
|Copyright 2014 by Virgo Publishing.|
|By: Rex W. Young|
|Posted on: 04/01/2001|
Vehicle Storage and ProfitsAn evolving business adds to your bottom line
By Rex W. Young
There has been a great deal written in the past few years about boat and RV storage, but often the reader is left with more questions than answers. There is a good reason for this. The vehicle-storage business is like the self-storage business was 30 years ago in its sophistication. Once, an open dirt field with a fence around it was the norm. That is changing and will continue to change as the vehicle-storage industry evolves, just as the self-storage industry did.
If you are looking to expand your self-storage facility to include vehicle storage, you should have a good feel for the demand as indicated by your customers. If this is not the case, the first thing you need to do is determine if there is a need for this type of storage in your area. If there are no other storage facilities (including dirt fields) offering vehicle storage, that may be a good indication that a demand has not made itself evident.
The development-radius concept of one facility every three to five miles does not apply to vehicle storage--in this case, the radius is usually about 10 miles. One of the quickest ways to determine need is to use your Yellow Pages and check how many RV, boat and trailer dealers--as well as their counterpart service facilities--exist and where they are generally located. This information will be very useful when it comes time for choosing a site location.
Look up city ordinances to see if they restrict both on- and off-street parking of recreational vehicles. Also check to see how many retired persons live in the area, as they are the ones with the highest percentage of RVs, fifth wheels and trailers. Break down the demographics and study them closely. Finally, listen to your "gut feeling," as this can sometimes be the best indicator of all. Remember, there are no books of answers regarding vehicle storage as of yet.
Definition of 'Vehicle'
One facility has decided to define a vehicle as "anything on wheels or that can be put on wheels that needs to be stored." The individual/consumer side of the vehicle-storage business includes RVs, boats, fifth wheels, trailers, pop-up camping trailers, box trailers and automobiles. On the commercial side, it includes small cranes, commercial trucks of any nature, landscape trailers, 45-foot construction trailers, church buses and small business vans. They have had an Indy racing team store their support vehicles as well as a TV satellite truck. These are examples of some nontraditional vehicles that require storage.
There are three basic development choices: expansion of an existing self-storage facility, a new self- and vehicle-storage facility, or a stand-alone vehicle-storage facility. Some operators have developed at least two of those choices. Then whether they are discussing the integration of 300 to 350 vehicle spaces into an existing self-storage facility or the construction of a 550-space vehicle-storage facility, the project will require a minimum of five acres for expansion or 10 acres for stand-alone vehicle storage.
Operating a first-class facility requires that it be paved and offer at least some covered parking for all the lengths of vehicles you will store. A simple answer is to provide 50 percent covered and 50 percent uncovered spaces, but each market has its own demand. One advantage of vehicle storage is that you can paint over your "mistakes" or adjust to your customers' changing needs. One facility repainted the 40-foot covered spaces twice to provide more width until something worked. They repainted all the uncovered 35-foot spaces from 90-degree angles to 45 degrees. They lost spaces, but gained paying customers because the aisles were widened.
You should include, as a minimum, a free dump station, 24-hour-a-day, seven-day-a-week access, separate ingress and egress gates for the vehicle area from the self-storage area, night-patrol security, TV surveillance with a recorder on all gates, excellent lighting, and electrical outlets on the poles of the covered parking for keeping batteries charged. Other amenities may include a wash rack or special vehicle services, but first check your liability and its costs. One philosophy is that you are in the vehicle-storage business, not the service business.
Finally, if you design your canopies to extend more than 5,000 square feet, most cities will require you to include fire sprinklers. A loop fire line with hydrants and retention basins may also be required. Check with your local fire marshal.
Location, Location, Location
This is one of the most used expressions in real-estate development. At the same time, it is the least understood. In the self-storage business, "location" consists of accessibility, visibility and market area. All three are necessary in order to be successful.
Accessibility. Your customers must be able to easily ingress and egress your facility. Remember, they are driving 45-foot or larger vehicles. You must also have accessibility to a freeway, state highway or other major traffic artery that leads to recreational areas such as lakes, ocean marinas, camping sites, etc.
Visibility. If they cannot see or easily find you, potential customers will not store with you. Street signage is extremely important. Visibility can also be achieved through advertising in the Yellow Pages with a clear map in all the listings, i.e., household storage, RV storage, boat storage, trailer storage and so on. Cold call all the RV, boat and trailer sellers or service facilities in your area and leave them with your information.
Market area. There are always additional ideas to explore. For example, look for new home subdivisions and see if they ban outside vehicle storage in their CC&Rs. This is also an excellent place to provide information to home builders so they can easily answer their customers' questions about where to store their "toys."
Check with your city's planning department to determine the type of zoning required for your facility and with the building department to find out about building codes and retention requirements. Now comes the biggest contraint: price. It's been determined $1.75 to $2 per square foot is the maximum you can pay or allocate for vehicle storage in order for economic viability to exist. Before you start yelling that there is no land available for that price, get in your car and start driving through the general area where you wish to locate your facility. Take an aerial map to assist you. There are usually sites tucked away that have been leaped over by development or have unusual configurations. The sites exists--you just have to find them.
Whether it is a combination or stand-alone facility, you must determine your mix of space sizes and widths, isle widths, canopy locations, sun orientation and ingress/egress gates. Remember: A 30-foot fifth wheel or trailer is really 40-feet-plus with the hauling vehicle when you consider the turning radius and space needed for backing into a space.
The economic feasibility or costs of this type of facility have been avoided in this discussion because there are just too many variables involved to make broad generalizations. Suffice it to say, it could be economically rewarding at your facility.
Rex Young of A-Secured Self and Vehicle Storage Centers in Glendale, Ariz., has more than 30 years experience in commercial development, 11 years in the self-storage industry and five years in the development of vehicle-storage facilities. His entities own and control a total of 1,641 vehicle-storage spaces, 642 of which are covered.