By Glenda Vosburgh
Reprinted with permission from "The Storage Facilitator" blog.
For-rent storage space is a trend with legs in the apartment industry, as more and more complexes offer this amenity. Helping to fuel demand is a growing appetite for urban living, as many Millennials turn away from the suburbs and more people—such as empty-nesters—downsize from homes to apartments. The key question for self-storage operators is whether the accessibility of these for-rent storage options is a threat to their business.
A Trend With Momentum
Doug Culkin, president and CEO of the National Apartment Association, says he expects the apartment storage trend to build steam. Although the association doesn’t have any statistics on the number of installations or tenant use, it’s important to note that more than one quarter of self-storage tenants live in apartments or condos.
“Apartment square footage, in general, is decreasing, leaving storage and closet space at a real premium for residents,” says Culkin. “The popularity of these spaces has also grown because renting has become a preferred lifestyle choice for many empty-nesters and retirees who want to downsize and forgo the maintenance and upkeep that a large home requires. This demographic also has a home’s worth of possessions and furniture, some of which they can’t—or don’t want to—get rid of.”
Sizes and rental fees for the spaces vary depending on the property and location, he notes, adding that most apartment complexes have unused areas in parking garages and parking lots that are ideal for creating storage space.
Units placed in the parking lots of garden-style communities are typically the size of a parking spot and can be divided into two, three or four storage spaces. Some communities also are experimenting with garage units, which are similar to gym lockers. They often are mounted on a garage wall, with room for the car to be parked underneath, or they can stand alone in unused garage spaces.
“They’re most often built to blend in with the individual apartment community and are mobile, so they don’t require footers or concrete pads for installation,” explains Culkin.
Revenue and Marketing Opportunity
With offices in Dallas and Boston, Criterion Development Partners specializes in developing and managing apartment complexes. For-rent storage spaces are included in all of Criterion’s new properties, according to development associate Brandon Hancock. “This is in addition to large closets, pantries, coat closets and bicycle storage,” he says. “Storage for bicycles is a frequent request from residents.” At Criterion’s Dallas-area communities, bike storage is free; but the company’s apartment residents in the eastern states pay for it.
For-rent storage space adds a revenue stream for apartment owners, Hancock says, and can be a valuable marketing tool. “The one thing you can never have enough of is closet space,” notes Culkin. “In cities such as Washington, D.C., where square footage is at a premium, residents must often rely on alternative storage options that are outside of their apartment.”
For Dallas-based Lincoln Property Co., which operates apartment complexes across the United States, demand for extra storage space is strong in most of its markets, according to Jennifer Staciokas, vice president of marketing and training.