Storage Investment Advisors (SIA) was formed by eight partners to provide advisory services to the transactional side of the self-storage industry. Headquartered in Houston, the firm offers brokerage, valuation analysis and value- enhancement consulting services. Financing is also available through its alliance partner Beacon Capital.
In SIAs first year of operation, it generated $250 million in transactions. Managing partner Aaron Swerdlin attributes this success to SIAs unique corporate structure and philosophy; for example, every partner owns the company. Our mission statement is that we share equally with each other, Swerdlin says. Also, the firm is driven by relationships rather than revenue. We begin every year without a revenue goal. We simply execute our plan better than anyone else. If we do that, theres no need for a revenue goal.
Swerdlin, a seasoned Realtor, entered the self-storage world in 1993 when a friend asked him to sell a facility. Swerdlin admits he knew little about the industry but identified the top U.S. storage companies and successfully sold the site to Storage Trust. Over the next several years, he handled about $20 million in storage property sales in the Houston market.
In 2005, Swerdlin formed SIA and attracted seven more industry experts as partners. When a client hires us, he is hiring all eight of us, he says. Everyone participates in every deal, and we truly are a team, not a group of producers under a company name. No single transaction takes precedence over another, although each partner independently contributes ideas and leads. Every dollar that comes in the door is split the same way, regardless of who sourced or managed the transaction, he says.
The company opened without a single client but quickly formed a customer base from previous market relationships. People werent concerned with the fact they were entrusting multimillion-dollar investments with a new company because they knew the partners experience, Swerdlin says. Within the first 12 months, SIAs caseload was full, and it was transacting deals in 19 states.
Relating to Money
In the conduit debt market where all debt is secured by U.S. Treasury, storage has the lowest failure rate of any product type in that industry. The maturation and better understanding of the storage industry over the last 15 years has resulted in more lenders willing to loan money and kept interest rates stable, Swerdlin says. It also increased transactional activity between buyers and sellers.
Although interest rates over the last two years have fluctuated, theyve stayed within a trading range that keeps the storage market fairly active, Swerdlin says. As long as rates persist within that range, the storage industry will be stable. No one should be afraid of an up tick or downtick in the interest rates, he says.
Sometimes, though, there is a disconnect between the expectations of the seller and the buyer, Swerdlin says. SIA resolves this by eliminating the surprises. What we bring to the table for a seller is real-time knowledge of what the market is offering, he says. The information assists the seller to develop a realistic price for his property and not feel as if he left money on the table at the close of the deal.
Growing Through Relationships
SIA markets every facet of its business, fostering the companys industry relationships. The partners write articles, hold seminars and participate at trade shows.
We use every word we say, every e-mail and every proposal to educate the market, Swerdlin says. Perhaps someone we are talking to today we wont transact with for three or four years, but we communicate with them as if theyre already a client.
SIAs goal is to grow its market share and reputation through continuing development of relationships. We are very proud of what weve accomplished and that we arrive at our goals by focusing on the human experience, Swerdlin says.
For more information, call 713.838.8000; visit www.siallp.com.