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.
Heather Williams, a spokeswoman for Lincoln’s southeast region, says for-rent storage space has been a growing trend in her market, particularly in Florida and Georgia, which were hit hard by the housing crash and saw many homeowners downsizing from large homes. The extra storage can be a strong selling point for new tenants. “Storage units are now a must-have in the inside corridors with direct access outside their front door or on a separate level,” says Williams.
Lincoln’s storage spaces range from closet-size to garage-size, and the company also provides shared, partially enclosed areas with fencing. “At 12 South Flats in Nashville, Tenn., we rent specific spots with their parking space in the parking garage that have fenced-in areas in front of the car spaces,” explains Williams. “These rent for a premium of $75 to $100 a month for the parking spot and storage.”
The Chicago market also is seeing strong interest in for-rent apartment storage. “I think it happens more in urban environments where the living spaces are smaller,” says Irini Boeder, regional marketing director at Lincoln. “All of our Chicago high rises have them, but only some of our suburban communities do.” Depending on the market, storage prices in the company’s Chicago district range from $20 to $55 a month for lockers and up to $125 for garages.
Downsizing in Dallas
Paschal Dunn, a Dallas-based sales and marketing consultant, says he put additional, onsite storage near the top of his list of must-haves when he was looking for an apartment. “I was downsizing and I had extra furniture and other things that I wanted to store, so having that extra space was a requirement for me,” he says. “I didn’t even consider moving to a location that didn’t offer it.”
Dunn’s apartment community, the Winsted at White Rock, added for-rent storage as part of a remodeling project, according to Jacque McGehee, assistant manager. Dunn pays $50 a month for a 5-by-10-foot space under the ramps on the ground level of the community’s parking garage. “It was less expensive for me to pay for onsite storage space near my apartment than it was for me to rent an off-site storage facility,” he says.
Glenda Vosburgh is a writing, editing and communications professional with more than 20 years of experience. She lives in the Dallas-Fort Worth area. Her work has appeared in publications such as “D CEO” magazine, “GrandLuxe” magazine, “Housing Wire” magazine, the “Dallas Business Journal,” and “The Storage Facilitator,” a self-storage blog managed by SpareFoot and hosted by partners SelfStorage.com.