|The Inside Scoop|
'Storage Wars' Good for Storage Business?
On Wednesday I watched the two premier episodes of “Storage Wars,” a new series on the A&E channel chronicling the exploits of four self-storage auction addicts in California. While the show certainly sensationalizes industry lien sales, its approach is no more dramatic than that taken toward the topic in national newspapers over the past two years; and I’ll admit to being entertained. The question is whether the hype will ultimately help or hurt the industry’s facility operators?
The program generated several questions from my husband, who volunteered to watch and assess with me. While he doesn’t represent your average public viewer, who probably knows little to nothing about self-storage, his viewpoint gave me insight to what might be going through a watcher’s mind. In particular he had questions about the auction process and proceeds: Why can’t participants go into the unit? They’re not allowed to touch anything? How do they know what they’re bidding on? Do they have to sign a contract before they can bid? Can the renter (or a representative of the renter) bid on his own stuff? Do operators make a ton of money on this? How long does a unit go unpaid before it gets auctioned? And so on.
These are all great questions, some of which an actual storage operator couldn’t even answer without consulting a state statute. Unfortunately, they’re not questions all public viewers will ask. Most will watch the show and take away a handful of beliefs about our business:
1. If you don’t pay your storage rent, the operator will sell your goods. In fact, the show’s tag line is, “If you don’t pay your bills, they’ll take your stuff.” OK, this is true, but the show fails to explain there is a lengthy, detailed legislative process governing the practice. In most cases, the operator would prefer to resolve the delinquency in almost any other manner than a lien sale.
2. Self-storage operators make tons of money on these auctions, sometimes thousands of dollars! Wrong. Most operators are lucky just to recoup what they lost in unpaid rent. And while I’m not intimately familiar with the contents of all state lien laws, my understanding is in most cases, the operator must forward any overage from the sale to the renter. I’ve even heard operators tell stories about units being sold for as little as $5.
3. Self-storage “lockers” are often filled with incredible and bountiful booty, including cars, gold and cash. I nearly laughed my own booty off at the way unit contents were hyped up in “Storage Wars.” The intro flashes images of cash, coins, cars, guitars, furniture, signed celebrity memorabilia and more. I have no doubt that living in storage units around the world are darn good treasures; but the majority of units contain your average, run-of-the-mill household and business overflow. I won’t call it junk―almost everything can claim a price on eBay―but it ain’t the pot of gold at the end of the rainbow.
In one scene, buyer Jarrod, who runs a second-hand store, drops $350 on a unit, much to his wife’s chagrin. But wait! In a small box they find what appears to be a Movado watch. Pay day! Not quite. A visit to a local jeweler confirms the watch is a fake.
In another auction, buyer Dave, who runs Rags to Riches consignment store, does hit the jackpot with thousands of dollars in commercial kitchen equipment. It makes for a great show, but scenarios like these are not the norm. Many operators tell tales of units filled with old trash nobody would want―and disenchanted buyers who get left holding the bag for its disposal.
4. Self-storage auctions are vicious, cut-throat affairs that require diligence, skill and a gambler’s bravado. Maybe in Orange County! If this is the case, the media is largely to blame. The word is now out on self-storage sales, and bargain-hunters aplenty are on the prowl. But in a lot of cases, auctions don’t get the publicity they need to be truly successful. Many an auction is a lonely affair involving only the operator, maybe an auctioneer, and one or two interested parties. Rarely are there hordes of people pounding at the gate, and a “little person” on stilts with night-vision goggles. (Yes, my friends, you’ll see all this and more in “Storage Wars.”)
I’ll continue to watch the show. I rather enjoyed it, if for no other reason than it is causing my friends and family to take a mild interest in my work. But I’m concerned about the ripple effect the show will have on our industry. On one hand, I’m glad customers will get the message that they need to pay their rent. On the other, potential misconceptions could be dangerous.
I’d love to know your thoughts. Please post your comments on the blog. Did you watch the show? What do you think? Want to see it? Check it out here: www.aetv.com/storage-wars. You can watch full episodes, meet the players and get bonus footage online.
As a quick and final aside, hats off to Thomas Hayward Auctioneers, which had the foresight to buy some pay-per-click advertising around the search terms “Storage Wars.” The company came up at the top of sponsored search results when I Googled the phrase. Without doubt, a smart move for an auction-services company that serves the self-storage business.
- Real Estate Roundup: Self-Storage Transactions October 2015
- Author Mark Helm: Self-Storage Operators Must Invest in Themselves to Stay Relevant
- Tron Jordheim Joins Store Here Self Storage as Business Development Manager
- MD Investments Buys Pelandale Self Storage in Modesto, CA, for $3M
- What Self-Storage Managers Need to Know About the 3 Kinds of Facility-Occupancy Rates