When building a self-storage facility, there’s a lot of information to gather and consider before construction begins. First and foremost, you need to buy a site, and every investor is out looking for that “perfect” parcel for the right price.
In many cases, it comes down to whether you can design enough net rental square footage (NRSF) to make a deal favorable. Each lot may come with its own set of barriers when trying to get to that magic number, but the right building type will be key to reaching your ideal. Below, I’m going to address the four common structure types used in the industry, what they entail, and a few other development considerations.
Single-story self-storage facilities are typically the least complex and often the most cost-effective to build. They lend themselves to a variety of unit sizes and types as well as interesting combinations. For instance, the building might offer exterior, drive-up units around the perimeter with corridors with temperature-controlled spaces in the center. Some industry professionals refer to these buildings as “hybrids.”
When developing a site that contains more than one single-story building, adequate drive-aisle space is imperative. Many builders use a standard 25 feet for the aisle width. This allows for two-way traffic and provides adequate space for code-required turning radii.
Wise Space Storage in Boise, Idaho (single-story)
If a development parcel is on the small side, the self-storage developer may decide to construct a multi-story building. In some cases, it’s the only way to get to the targeted NRSF. These structures take more effort to design and construct, but they can be worth it.
A multi-story facility has an abundance of design possibilities. It can be as simple as temperature-controlled storage units on all levels to a complex, mixed-use building that includes other business uses. Sometimes being creative with multi-story will even get you through the red tape of municipal approval. For instance, the city planning department may only allow your project if the lower floors provide retail space.
A major consideration when erecting multi-story is how high the building should be. It’s a delicate balance between the required NRSF to make the investment viable and your construction costs. Structural steel isn’t required for buildings that are three stories or less, but once you go to four or more, expenses start to climb due to that need. If you’re facing a height restriction, you may decide to add a basement. This counts as a level and will increase cost; however, it’s a solution to staying under a specific height while adding more NRSF.
Extra Space Storage in Tigard, Oregon (multi-story)
Bi-Level (aka Over/Under)
Bi-level, or over/under, is a unique building type. It’s also called “two story into a hill,” as it works best when the property has a significant slope. The structure has two floors, but each is accessed independently from the exterior. In its essence, the lower level is like a walk-out basement built out from the ground.
Bi-level self-storage buildings can comprise a mixture of temperature-controlled and exterior drive-up units. It’s a great solution, as you get to essentially double your square footage while keeping your building footprint the same, plus there’s no need for stairs or elevators. There are additional costs in comparison to single-story building, but it’s typically not as expensive to construct as a multi-story facility.
Fairview Storage in Fairview, Oregon (bi-level)
This type of storage is the cheapest to construct, as it involves the least amount of materials and complexity. Used for boat/RV storage, canopies work great on parcels with ample space for haulers to maneuver into their spaces. There are two methods of construction for these structures:
- Cold-formed steel tends to be more cost-effective, as it uses light-gauge metal. Box columns will “tee” at the bottom of the canopy. The number of columns required depends on total canopy dimensions, snow load, wind load and other environmental factors.
- Pre-engineered metal buildings use hot-rolled steel that provides an “open span” for boats and RVs. This product is more expensive, but you can forego support columns.
Tee-design canopy at Northwest Self Storage in Salem, Oregon
As with any investment, the ultimate goal with a self-storage development is to be profitable. Determining the type of buildings and units you’ll build is directly influenced by the product demand in the immediate market. Before you make a land acquisition, obtain a feasibility study. This’ll provide key data for the area within a certain radius of the property. The information should include but is not limited to customer demographics, competitor rates, incoming developments, demand trends, proposed unit mix, etc.
Open-span canopy at Republic Storage in Star, Idaho
Once you have a clear picture of self-storage demand in your proposed the market (if any), you can start determining the buildings that’ll yield the optimum NRSF and the unit sizes and types that are most likely to rent. To design your site layout, you’ll need the following information at a minimum.
- Parcel map or land survey
- Current and potential future zoning requirements
- Setbacks as determined by the municipality
- Known easements
- Identified protected wetlands, if applicable
- Identified water-retention ponds, if applicable
- Fire-suppression requirements
- Design elements that may be required by the city or county
When building self-storage, there’s no one-size-fits-all scenario. Investors and owners must take many key data points and crunch all the numbers to determine if developing on a particular site makes sense. Sometimes it doesn’t; but if you’re savvy, you’ll explore all building options and creative solutions. When in doubt, lean on those who’ve gone down the road before you and have experiences from which you can learn.
Melissa Anderson is an account manager for Forge Building Co., which specializes in pre-engineered metal buildings for industrial and commercial applications. She has more than 20 years of experience in the construction industry. With an astute understanding of self-storage, she helps seasoned investors as well as those who are just beginning their journey with the construction of their first project. For more information, call 208.470.5368 or email [email protected].