Washington Self-Storage Owner Expands Portfolio With Construction-Challenged Conversion Opportunity

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By Greg Moore

A Washington lumber company forayed into self-storage and expanded with the conversion of a former beer-distribution warehouse. Though its project was not developed without difficulties, the mill-town star succeeded and went on to build an award-winning facility.

When H.O. Seiffert Co. was established in 1901, it owned and operated one of the largest retail, wholesale-lumber and building-materials businesses in Everett, Wash. The company grew with the mill town, and in 1987, it shifted its focus from lumber to self-storage, building its first development on a portion of its own property. Today that facility consists of 464 units and 43,380 rentable square feet.

In 2002, H.O. Seiffert purchased a downtown building constructed in 1918. It had been converted to self-storage in 1987, with 19,063 rentable square feet over three floors and 292 units. Despite this acquisition, the company felt there was additional demand for storage in the area, and it sought more opportunities.

The company quickly focused on an industrial area on the downtown perimeter. After several months, it found a 48,000-square-foot beer-distribution warehouse that had been vacant for several years. Because there was no onsite parking, several potential sales for manufacturing and warehouse uses fell through. However, the property was zoned properly for self-storage and in a market H.O. Seiffert knew well. The building emerged as a good portfolio candidate.

The Decision to Build (And Bumps Along the Way)

After entering the building through one of its truck-loading bays, the H.O. Seiffert team found it had a clear ceiling height of about 22 feet. They realized a second floor could be added, increasing the square footage to 96,000 gross square feet of heated self-storage. Given these numbers, everyone knew this was a good site for the project. The company closed escrow on the property in September 2007.

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