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Warding Off Smelly Onions and Bad Eggs by Screening Your Self-Storage Tenants

Some self-storage customers rent units with bad intentions, planning to use them for illegal or other problematic activities. Tenant screening can be used to sidestep potential issues, protect the business from unnecessary risk, and reduce the liability associated with dangerous or unscrupulous renters.

Although we’d love to live and work in a perfect world, the reality is some self-storage customers are involved in illegal or troublesome activities and bring those activities to their storage units. This makes tenant screening a necessary part of running an effective storage business. It can protect you from unnecessary risk and reduce the liability associated with dangerous or unscrupulous renters.

Although most customers are wonderful, pay on time and don’t cause any problems, to avoid unruly tenants, screening should be part of every facility manager’s duties. During the rental consultation, you need to ask routine questions to ascertain which unit size is going to best fit the customer’s needs and collect identification to know who will be renting.

Why They Rent and What They Store

Understanding why someone needs storage is a good first step in the screening process. At my company’s facilities in 2014, 37 percent of tenants indicated they needed to store “excess stuff,” while 34 percent cited moving as their primary reason for needing storage.

Asking customers about what they’ll be storing is also part of screening. Last year, 72 percent of our customers said they were storing furniture and boxes, while 17.5 percent required space for business inventory.

Drilling down to figure out why and what someone is renting will help you avoid some of the many follies storage operators have experienced due to a lack of screening. For example, on one occasion, we were left with a 10-by-20, non-climate-controlled unit full of Georgia’s famous Vidalia onions. They had spoiled, and it was expensive and smelly to clean up. No onions, please! And no fish … We’ve dealt with that, too.

Other no-no’s we’ve experienced include tenants living or having love affairs in their units. During the last two decades, we’ve learned some valuable reasons for screening tenants and their use of our property. Qualify each customer before move-in and let him know you have the right to search everything that enters your premises.

Who’s Renting

The “who” portion of the rental equation requires the collection of identification and taking some simple steps that will deter most shady customers. First, require a valid photo ID. A work or company ID won’t do—you want an unexpired driver’s license, government-issued ID card, military ID or passport.

In addition, take a webcam picture of each customer and drop the image into your facility’s management software, along with a copy of the driver’s license. Keep in mind you can’t copy a military ID. For those customers without a valid picture ID, I recommend using an inkless fingerprint kit. If a criminal is expecting to rent a unit but is confronted with you taking a photo and collecting ID, and sees that you have video cameras in the office and on the site, he’ll likely go elsewhere.

Also get every customer’s Social Security number. You’ll need this if a tenant ever goes into collections status or writes a bad check.

For any customer who’ll be storing a vehicle, including a boat or RV, it’s also important to get a copy of the vehicle registration, insurance and proof of ownership. This can save you countless hours if the tenant becomes delinquent. It also demonstrates your professionalism in tracking and maintaining good customer records. We use several addenda to the rental agreement, including one for parking customers and one for military customers, so we have adequate contact information and can provide exemplary service to them while they’re on active duty.

Screen, Don’t Profile

It’s important to know your legal stance and on what grounds you can deny someone service. The Self Storage Legal Network, operated by industry attorneys Carlos Kaslow and Scott Zucker, offers some good insight on its website. In particular, look for an article titled “Self-Storage and Homeland Security: Are Facilities and Their Tenants Safe?” With regard to tenant screening, the attorneys advise:

Essentially, when it comes to self-storage, the answer is that rather than judging tenants based upon ethnic or racial criteria, operators can certainly have (and should have) a set of requirements that must be met by all prospective tenants before they can rent space. These requirements can include the need for picture IDs, verifiable addresses and Social Security confirmation. It can also include credit and criminal background checks.

Whatever the facility’s policies might be, they should be applied consistently to all tenants so as to avoid discriminatory practices. If a facility has a required procedure for all of its prospective tenants and someone fails to meet a requirement for tenancy, then that person can be denied the use of the facility. Whether or not a facility operator uses stricter identification or credit/criminal verification methods before they sign up their tenants is an operational decision for the facility owner. The bottom line is that if all tenants are treated the same way, then there can be no claim of unfair treatment.

Be diligent in your screening process, but treat all prospective customers equally. Tenant screening is a necessary part of running a successful storage operation. When implemented properly, it can ward off “bad eggs” along with smelly onions, exotic fish and other perils in your units.

M. Anne Ballard is president of training, marketing and developmental services for Universal Storage Group and the founder of Universal Management Co. She is president of the Georgia Self Storage Association and has served on the national Self Storage Association’s board of directors. She has participated in the planning, design and operation of numerous storage facilities. For more information, call 770.801.1888; visit www.universalstoragegroup.com.

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