Self-storage performed extremely well during the Great Recession, and one of the key reasons the industry is so stable, even during economic downturns, is consumer demand stemming from the three Ds: death, divorce and displacement. These relate to stressful, often negative, periods in customers’ lives; so while they may be good for the bottom line, facility operators must act with care and diligence to ensure they provide the best possible service and experience. Let’s take a closer look at these life-changing events and how you can help your tenants through what is surely a difficult time.
When a family member dies and the heirs wish to preserve the person’s belongings, self-storage operators can help in two ways. The first is with understanding and compassion. If you discover that a new tenant has contacted you due to a death in the family, a card offering condolences placed inside the unit prior to move-in can go a long way in showing kindness. A small amount of empathy from your team at move-in or when you see the customer on the property shows you care.
From a legal perspective, it’s important to ensure you have your lease information correct. Who can access the unit? Who can terminate the lease? Make sure all this is specified in the contract. You might also obtain a copy of the power of attorney from the executor of the estate that allows you to clean out the unit upon abandonment. The one thing you don’t want to do is to worsen the family’s grief because you didn’t have the correct documentation in place.
Divorce usually results in the splitting of a household, which frequently requires the use of self-storage. Though there isn’t much you can do to ease the customer’s suffering, you can make sure your processes and procedures protect the tenant. Divorce is fraught with ill feelings and can sometimes lead to one spouse attempting to steal items from the other.
Again, make sure your lease is up-to-date and adheres to state law. If the couple had a unit with both spouses named on the lease, one may try to clear out the space without the other’s consent. Even in the case of a new lease, the spouse may try to enter the unit. In either situation, your duty is to protect the tenant’s belongings. Ensuring you have good contact information for both spouses and solid processes in place will protect everyone involved—your business, too.
The third D—displacement—isn’t always undesirable. In fact, it can be quite positive. Regardless, it’s almost always stressful. When a customer decides to move into a new home, downsize to a smaller residence, get married, head home from college for the summer, etc., he needs a safe, secure place to store belongings.
In these cases, you have the opportunity to create convenience and ease for customers. If you have a retail area, create moving packages, so people can quickly and easily grab items they need to pack and store their stuff. In lieu of offering a move-in discount or special, perhaps include some supplies with the unit rental. If you offer moving trucks, this is a great way to provide convenience, too.
While the 3Ds of self-storage drive unit rentals and provide significant stability to the business, it’s imperative that staff be properly trained and the operation have processes in place to ensure customers going through these stressful events have a good experience. With death, demonstrating compassion can make a tremendous difference. With divorce, you can ensure proper leasing procedures that avoid one spouse stealing from the other. In a displacement, you can make your facility a place of calm and convenience to ease the chaos and burden of moving.
With each of these Ds, there are some lease guidelines and legal angles to consider. Make sure you contact a self-storage attorney, as each state has different laws. You wouldn’t want to undermine your good intentions by making a painful legal mistake.
Be compassionate and do everything you can to ensure you and your self-storage staff are providing the best service and experience possible. When prospective tenants who are under stress visit your facility, they should have all the tools and materials they need to successfully move and store their items right at their fingertips.
Scott Lewis is the co-founder and chief executive officer of Spartan Investment Group LLC (SIG), where he’s responsible for developing business strategies and overseeing all operations and business activities. Scott has led several successful real estate projects ranging from single-family flips to ground-up self-storage developments. He’s also a major in the U.S. Army Reserves and a veteran of Operation Iraqi Freedom. SIG has completed $9 million in development projects, with $70 million underway. For more information, call 866.375.4438; e-mail [email protected]; visit www.spartan-investors.com.