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The Marijuana Market: Self-Storage Operators Should Stay Informed and Prep for Changes

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Due to these reasons and more, Andy Betts, general manager of Denver Relief and Denver Relief Consulting, says marijuana production would be an "unlikely fit" for the self-storage business. "There is such a regulated model here in that it's tracked from seed to sale.” Security and access, labeling, compliance, and odor control are storage challenges in addition to regulatory issues, he says.

A Case Study

Self-storage may not seem like the best place to grow or store marijuana, but at least one operator is giving it a try. In 2012, "Inside Self-Storage" reported on a Sedro-Woolley, Wash., facility that was entertaining the use of its units for the controlled growth of cannabis. A1 Heated Storage found itself at the center of a debate when it applied for additional permits to add medical-marijuana growing rooms to the facility, which is in a residential area.

Neighbors expressed concern that the facility, which is allowing tenants to store and grow dozens of legal pot plants in units that have access to water and artificial light, was creating traffic and safety problems in the neighborhood. They also feared an overall increased number of cars and impaired drivers resulting from a proposed facility expansion.

Over the next couple of years, the request to expand went back and forth between local governing bodies. Though A1 was not available for an update on the progress of its original application, a Jan. 24 article in the “Skagit Valley Herald” reports that after reviewing several zoning proposals, Sedro-Woolley's city council decided "to consider allowing some recreational marijuana businesses in both industrial and residential 5 zones." However, the council ruled any businesses selling, storing or growing recreational marijuana would be required to meet the state's minimum 1,000-foot buffer from public property, schools and child-care centers.

Now, with the legalization of recreational marijuana, Washington city and county governments have new laws to consider in regard to marijuana production, processing and retail activities. Skagit County offers online information for recreational-marijuana permits that includes language addressing the "production inside an opaque structure," such as a self-storage unit.

Self-Storage Industry Leaders Speak Up

With the recent approval of recreational marijuana in its state, the Colorado Self Storage Association is watching how regulations unfold. "We will be following the implementation of the new marijuana law for awhile, and then we will make a presentation to our members," the group said in e-mail communication with “Inside Self-Storage.”

Lynn Prather, a past president of the Washington State Self Storage Association and a current member of its board of directors, also believes a wait-and-see stance is best. "People in self-storage should not be concerned about it right now. My personal feeling is that it is—and should be—low on the self-storage radar because we don't know what is going to happen. Colorado doesn't, Washington doesn't, and there's a lot that our state is going to learn by trial and by error."

A practical approach for operators is to stay informed, follow industry best practices and abide by current rental agreements, says Prather, who’s also owner and president of Sound Storage Management Inc., which owns and operates two Washington facilities.

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