Evaluate your complimentary and company units. Make sure you aren’t giving away income-earning inventory. These, along with manager units, should be the ones that are undesirable or more difficult to rent, not your prime real estate.
The economy in recent years has played havoc on delinquency control at a lot of sites. Good people have been hit hard. This can make delinquency a challenge, especially for a manager who knows his tenants well. It didn’t happen overnight, and it will take some time to clean it up. Just start from where you are, make a plan, and move forward to get it under control. If delinquency is out of range, the asset value of your property is diminished.
Budget for Larger Items
Time flies and suddenly the office equipment is several years old, some of the cameras are burned out, and the golf cart doesn’t go very fast anymore. During your assessment, you may find several items that are potentially large one-time expenses.
Put this list in priority order and develop a time line for completing these repairs or upgrades. Rather than guess at these costs, get a few quotes so you can plan accurately. Will completing this task increase income, decrease expenses, limit liability or increase asset value? If it doesn’t fall into one of these categories, don’t spend the money.
Do Preventive Maintenance
Understand and anticipate the life expectancy of major facility components. Computers and cameras will fail, roofs will leak, the gate will get hit, etc. It’s all part of the business. Spending a few bucks to keep things in good condition can go a long way toward meeting or exceeding life expectancy.
Scheduled maintenance to change the air-conditioner filters, replace golf-cart batteries or defrag the computer are easy ways to get the most out of your equipment. As items age, budget for their replacement or repair rather than wait for an emergency.
Self-storage technology has evolved. If you’re not keeping up, you’re falling behind. Updated management software that links gates, the security system and credit cards and provides an online payment option is a must. Web-based software allows for stronger controls and greater accountability than older standalone software. The ability to have real-time data is crucial, and the integration with QuickBooks saves time and avoids data-entry errors. The initial cost to convert software is minimal, and the process is pretty easy. The time saved and efficiencies gained are well worth the making the change. As in any business, using the right tools is always the best answer.
When you look at your business as an asset manager would, it’s easier to evaluate the operation objectively and make a plan for how to proceed. Your assessment may only uncover minor adjustments, or you may find there’s some major work to be done. Either way, it didn’t get that way overnight, and it won’t get fixed overnight. The sooner you start, the faster it can be set right.
The economy has not been kind over the past few years, but business goes on. Accept it for what it is, rebuild, and prepare to get your share as the industry upswing continues and your asset value grows.
Linnea Appleby is the owner of Lime Tree Management, a self-storage management and consulting firm based in Sarasota, Fla. To reach her, call 941.350.7859; e-mail firstname.lastname@example.org; visit www.limetreemanagement.com .