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July 1, 2004

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Inside Self-Storage Magazine 07/2004: Remodeling & Conversion Projects

Remodeling & Conversion Projects
Turning old buildings into profitable investments

By Nicholas Jodhan

In spite of the softening of some realestate markets caused by reckless overbuilding, developers are provingself-storage remains a viable investment. Although new construction is still themost common approach, the ever-evolving storage product has found yet anotheravenue: the infill conversion. Similarly, remodeling projects transform olderstorage sites into upscale, state-of-the-art facilities with new amenities andprofit-making options.

Having been tapped by developers in the past, this segment ofthe market is no great secret. However, the opportunity may be broader thanoriginally anticipated. A combination of creative thinking and high-levelexpertise has proven to be successful in rendering a useless building intoa cash-flow producing storage facility. Take a look at the following casestudies that prove the point.

South Florida

This 38,000-square-foot, dock-high building in FortLauderdale, Fla., had approximately 15 feet clear to the roof line, hardlyleaving room for the second floor needed to increase square footage. Among thesolutions discussed was the possibility of raising the roof. In some cases, thisis not cost prohibitive and can be a good solution. In this instance, however, amore thorough examination of the building produced a better answer.

Destructive analysis revealed the original construction to beat ground level, with the columns sitting on column pads. The interior dock-highfloors were actually a retrofit application. This meant removing the interior floor would create moreavailable head height, which would allow for the pouring of a new slab andinsertion of a second floor. The additional 40,000 square feet make the projectwork and the pro forma sing.

Puerto Rico

My partner, John Wilson of Construction ProcessesInternational Inc., requested my attention on this project in Puerto Rico. Anindustrial site with loading docks was being vacated by rental tenants, and itsowners were committed to converting the building to self-storage. As the former tenant was a large distributor, the loadingdocks were a necessary accoutrement to the building. However, the new intendeduse made the dock configuration obsolete. My first thought was to eliminate thedock and dock-high floor, which would lower the first-floor elevation. Thisproved to be impossible because, unlike the Fort Lauderdale project, the dockand building floor were totally integrated. If it were even possible to separate the two, it would beentirely too costly a procedure.

So, the dock had to stay. Given its height from the groundelevation, loading through the dock doors was impractical in a self-storageapplication. The trick was to determine a use for it and integrate it intothe design. We met the challenge by doubling the docks width, adding a coupleof drive ramps, and constructing a building between them. The new structurewould have unit access from the ramp and ground levels. Another of the buildingson site had a clear height of 35 feet, so we immediately added two upper floors,which significantly increased the square footage.

Because the site was very large and we needed to provide asmuch drive-up storage as possible, we designed additional buildings to beintegrated into the overall layout. This project is still under way, but theimages shown here represent the complexity of the project and the creativesolution that took it from 41,700 to 95,700 square feet of profit-producingstorage product.

At first blush, an industrial building with a loading dock mayseem an easy conversion to self-storage because of the frequent use of trucks atthese facilities by tenants. But the reality is dock-height tractor trailers areseldom used. A more common visitor to a storage facility would be a largewheel-base moving truck, which has a much lower floor. If the dock does not havea leveler, it may be an obstacle to the viability of the conversion. Though somedock configurations may be used as is, most will require some type ofmodification.

Being conscious of your market, determining the likelihood of a docks use, and assessing the value of keeping vs. the costs of removing it will help extract as many rentable square feet as possible from a site. A little creative thinking augmented with expert advice and innovative design can produce a handsome return on your investment in this niche of the self-storage market.

Nicholas Jodhan has been involved in the development of self-storage for thepast seven years, designing and developing self-storage facilities in severalmajor cities. He continues to develop creative ways of addressing the newparameters of the modern self-storage industry. He is the owner of Gemini PlusLLC, a full-service consulting company. Mr. Jodhan can be reached at 941.366.9730; e-mail[email protected].

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