“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us...”
~From A Tale of Two Cities, Charles Dickens
If you’ve read A Tale of Two Cities and know the history of its author, Charles Dickens, you know he was about possibility, rebirth and transformation, the kind of visionary we desperately need in the boat/RV-storage building market right now.
If you’re interested in developing a facility, your rate of success will depend heavily on which “city” you choose: the real one, which involves risk but offers future rewards, or the misguided one in which development is being touted as unfeasible. The following discussion should guide you in your choice, dispelling common myths and highlighting some positive trends.
The Epoch of Incredulity
Let’s take a look at some misconceptions many self-storage investors and developers may have about boat and RV storage:
- Because the buildings are larger than typical storage with wider drive isles, they yield less square feet of building coverage per acre of land.
- The potential market for boat/RV storage is smaller than that of the storage for household and commercial goods.
- The rate per square foot of rent is less for boat/RV storage.
As a result of the amount of land required for a boat/RV facility, along with the difference in the return on investment, many developers choose to build traditional self-storage, leaving a great demand for boat/RV storage in most regions. However, the facts show customers who own luxurious RVs and large boats are not as affected by the economy, still have disposable income, and are looking for a safe, secure, convenient place to get their toys out of the weather.
In addition, construction material and labor costs are lower now than they were even two to three years ago, and much more so than four years ago. Some great sites are becoming available at more reasonable prices all the time. Developers and investors wary of jumping into the boat- and RV-storage market should steer clear of mistaken beliefs and focus on the facts.
The Epoch of Belief
Bottom line, there are still many lucrative markets out there, and this is a really good time to build. The self-storage market is finally seeing money loosen up a bit, with equity requirements that are improving all the time. It comes down to having the nerve to move forward in this economic environment.
Keep in mind that in most parts of the country, any project you’re just starting will most likely not even be out of the ground for at least six months, maybe eight to 12 months in some areas. What will the economy be like in a year? It’s a great question, but hasn’t that really always been the question?
We recently heard an industry “leader” say, “You would have to be a fool to get in this business right now.” Who’s the fool? The one who starts something in this kind of economic environment and patiently waits to reap the rewards when things turn around, or the one who looks back with the all-too-familiar regret, “I wish I had...”?