The beginning of a new self-storage development is exciting! You find your land, start your planning, and then many experts work together in getting your new project off the ground. At my company, we call this process “trees to keys.”
An integral component to success is the construction timeline, and its creation begins long before shovels hit the dirt. It actually starts during the planning phase, with the feasibility study, which should include a complete market analysis to help determine the best unit mix, site layout, amenities and more for your project. From there, you’ll get estimates for design and building costs, so you can see whether all this effort will yield a profitable result. This is why you should get rough construction estimates from a general contractor (GC) for your pro forma.
In this article, we’re going to discuss the self-storage construction timeline, including what it should cover and ways to help to keep it on track.
A Professional Team
There are many reasons why the team you hire to help design and build your self-storage project is critical to success. Experts save us time and money. Their proficiency helps us make more money! For example, the architect takes our sketches and turns them into working drawings. Tradespeople take our ideas and specifications and turn them into reality.
At the center of the all the action is your GC. For everything to come together—from electrical and plumbing to structures and technology to marketing and operation—it takes a well-thought plan with detailed timelines, plus someone to ensure it all happens on schedule and within budget. Easier said than done! Sometimes it’s easy to see when a project will go smoothly and when it might struggle with change orders, added expenses and delays. The important lesson is to work it out on paper first, involve the GC from the start and, most important, stick to a schedule.
That’s not to say problems won’t arise. They will. The question is how quickly you and your team will be able to adjust and move forward. You need to be prepared for anything, from rock on the site and bad weather to material-delivery delays and subcontractors (subs) who don’t perform on time. With a knowledgeable, experienced GC running the show, all these risk are mitigated. Again, it saves you time and money, but also the stress these circumstances create.
One of the amazing construction professionals with whom I work is Will Ross, president of Grant General Contractors in Carlsbad, Calif. Will was kind enough to offer insight on the self-storage construction timeline and why it’s so crucial to successful self-storage development. Following are the items we discussed.
Why is it important to have a construction timeline?
Ross: The construction timeline directly affects interest on debt. It helps the owner/developer figure the carrying costs of the construction loan. Having a solid timeline also allows the owner to see when he can start accruing revenue to offset expenses. When a project is late, it’s a double whammy—no revenue and additional carrying costs. No one likes this situation.
Ballard: These costs are shown in our development estimates and included in the pro forma. We want a complete forecast of when the project will cover its operating costs—typically between months nine and 18 depending on its size—and when it’ll cover its debt service or interest-only period, typically between months 24 and 36, again depending on project size.
What does this timeline typically cover?
Ross: For the GC, it covers mobilization to turnover, which is when the owner can use the facility as intended. If the contractor is involved early, he can provide and guide the consultants to deadlines to meet an overall completion of the entire project. It depends on how much the owner wants the GC involved.
Ballard: At my company, each of the approximately 100 items on a typical timeline are assigned a number of days for completion. This includes each step that must be taken during the construction process. We’ve seen that having the GC involved from inception brings the desired result and often saves money on mistakes he catches.
How do you keep everyone headed in the right direction and on schedule to avoid change orders and mistakes?
Ross: What’s critical is constant coordination and planning. A job may start with a schedule, but things happen where you must adjust and find another way to complete the project on time. We do this through:
- Weekly onsite coordination meetings
- Tracking the schedule and requiring subcontractors who are behind to work overtime and prevent any further slippage
- Ensuring the contracts for subcontractors are issued timely, and the materials required are ordered to be on site when needed
Ballard: We issue a specification book showing samples and sources for all finish materials and requested items. We make four copies, with one given to the GC for ordering and procuring items. If an item isn’t available, then we can supply a new specification and keep the job moving forward. We review this with the owner and, once approved, issue it to the GC.
What events or problems could throw the plan off pace and how do you address it?
Ross: To avoid delays in material deliveries, make sure subcontracts are issued timely and verify that the subs ordered their long-lead items well in advance. You also want to confirm with any subs, before awarding the contract, whether they have the manpower to meet your schedule, which should be attached to the subcontract.
You have to plan on weather interruptions. When you know it’s coming, in most cases, you can address potential issues in advance, so it isn’t so impactful.
Hopefully, most of the earth-shattering challenges you might face during the course of construction are brought forward through the bidding process. There should always be a solid review of the drawings up front by all parties. Have the engineers, architects and contractors do a full review prior to clearing any issues.
Ballard: We’ve seen the design process move forward without any input from the GC or management. With only the architect or building suppliers providing the office layout and unit mix, almost 100 percent of the time, it has to be redrawn. Involving those with actual knowledge of self-storage construction and operation can save everyone stress, time and money.
As much as I admire architects and their unique skills, it’s normal for us to supply them with a scale drawing of what we want. Then they draw up the plan set, and we work through any issues. This saves money on architectural and engineering fees, as we aren’t asking them to redo things; rather, we’re supplying them with exactly what’s needed from inception.
What additional advice do you have for managing a self-storage construction project?
Ross: In today’s market, the storage-specific vendors, such as metal-building contractors and door and partition subs, are maxed out with work. You need a commitment up front regarding the crew size and output you’re going to get from them. It’s astonishing how long these jobs can take, and these two trades can kill a project schedule.
The typical output of a metal-building subcontractor is 3,000 square feet per day—and that’s with a five-man crew. Though standard, this level of output kills the momentum. We like to require two crews for the super structure to keep things going.
It’s also important to note that some elevator companies are horrific to deal with, so getting your elevators ordered early and then staying on them is crucial. Utility companies, at least in California, find every reason why they can’t deliver gas, power or water. Make sure you engage them early to understand their requirements for delivering services.
Ballard: Will has made some great points here and he’s right … Getting special attention to these items can keep a job on schedule and in budget.
Reaching the Goal
The lesson for us all is planning does make perfect, and perfection comes from planning. Let industry professionals guide your process, set forth clear expectations and work out all the details with your entire team prior to inception. This way you can avoid interruptions, make your deadlines and have the self-storage project you’ve dreamed of all along.
Great design, responsiveness to the market, and coordination from a reliable and vetted construction team are all essential to success. Do these things, and your project will be one that leases up ahead of schedule and produces the rate of return you were seeking when you began your development journey.
M. Anne Ballard is president of training, marketing and developmental services for Universal Storage Group and the founder of Universal Management Co. She’s past president of the Georgia Self Storage Association and has served on the national Self Storage Association board of directors. She’s also participated in the planning, design and operation of numerous storage facilities. For more information, call 770.801.1888.