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Building Self-Storage on Petite Parcels: Factors to Consider

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By Kenneth Carrell

There are many reasons to build your next self-storage facility on a small site. Typically, there’s less competition, so you can charge more for your units. A smaller footprint also means you might pay less money for the land; and you’ll build a reduced structure, which costs less, too. However, there can be some challenges to a small land size when it comes to your building design.

First, your customers need to be able to maneuver easily around the structure and parking area. Second, you need to build enough units to make the project financially viable. This usually means you’ll need to go vertical. When designing a multi-story building, you need to keep in mind several important design factors. These include building height, building and unit access, loading areas, and the location and look of the office and retail store.

Here are some pointers to designing a superb and functional self-storage building on less land.

Impact on Rental Rates

There’s a huge need for self-storage in most urban areas, where land parcels tend to be smaller and more expensive, since there are fewer facilities. With less competition, you can typically charge more per square foot—sometimes twice as much as a similar facility in a more competitive market.

Rent rates can also be dependent on unit location. In general, there are three levels of unit pricing for multi-story facilities. Ground-level, drive-up units tend to be the most profitable for the majority of operators. On a smaller site, you’re going to have fewer of these, so you need to maximize them where possible.

The next most profitable units are the ground-level, interior spaces. These tend to go for a little less than the outside-access units but are still considered better than ones on upper levels. Units on higher floors typically have a lower rate per square foot compared to ground-level interior and drive-up units due to lack of customer convenience.

Building Height

The number of floors you can add will be limited by local building codes and zoning requirements as well as how the city jurisdiction interprets the codes. For example, installing fire sprinklers in the structure will often allow you to go higher.

Also remember that the higher you go, the higher your construction costs will be. Typically, for every floor you go up, you can expect to pay $5 to $10 more per square foot.

The type of construction you use will have a huge impact on the number of floors you can develop. Building with wood won’t let you construct as many floors as you can with metal. Concrete will let you go higher than metal, but the tradeoff is the cost to build. Most people in the self-storage industry use metal since it’s inexpensive and fast to construct.

Building and Unit Access

Building multiple stories gives you the additional square footage you need to make the project feasible, but keep in mind that access is one of the most important factors for your tenants. Most don’t want to travel more than 100 feet to get to their unit. After all, who wants to make numerous trips with heavy carts or furniture?

In addition, most building and fire codes will require that there be an exit within 150 feet to comply with safety mandates. All of this will dictate how many elevators and stairwells you’ll need. You may have one elevator and two sets of stairs, or two elevators and three sets of stairs. It never hurts to add extra stairs to the structure. If a person only has one or two boxes to store and he’s closer to the stairs than an elevator, he’ll often use them to get to his unit.

On smaller sites, you can often put the building up against the property line on one side and create central access to the upper floors. This allows you to maximize the square footage but does sacrifice some drive-up units.

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