Participating in Project Success: Guidance for Self-Storage Owners/Developers on Site Layout and Unit Mix

Wow! You’ve picked the perfect site for a fantastic self-storage facility! All the boxes are checked for zoning, equity partners and financing, and there’s very little competition in the area. Now, what’s your dream project going to look like?

The planning stage is an exciting part of development. It’s the time to get your ideas on paper. This step can be omitted if you trust your architect, contractor and engineers; however, it’s your money at risk, not theirs. It’s better to be a knowledgeable participant and express how you want your facility to be built. You can and should hire industry consultants, but you’re the one responsible for the financial success or failure of the project.

It all begins with a clear outline of your site layout and unit mix. Following is my guidance for creating the best plan. After 40 years in the self-storage business, 30 of which have been spent developing facilities, I’ve made plenty of errors. I still make mistakes from time to time, but now I do my best to limit their frequency and magnitude. Perhaps I can help you do the same.

Think About Property Users

Before sketching out your self-storage design, think about the people who’ll be using the facility. Your layout and unit mix must meet the needs of customers and employees alike, so ask yourself:

Create a Rough Sketch

Now on to the fun stuff. To create your self-storage layout, you first need a copy of the site survey. It should clearly show the property boundaries along with drainage, roadways and all utilities. You also need to know the answers to the following questions:

Next, grab a roll of tracing paper, lay it over your survey, and create a sketch of your building. What’s going to be your net rentable size? The industry average is 65,000 to 80,000 square feet. This is smart, as it isn’t too large and shouldn’t contribute to market saturation. If you absolutely have a “home run” location, you can plan for a second phase. This will add to your overall cost per square foot, but you’ll limit your financial risk. Bankers will appreciate this conservative approach.

Unless you’re in an urban area where it makes sense to build a single multi-story building with a smaller footprint, your layout should be a combination of single- and multi-story buildings, with a mixture of traditional and climate-controlled units. Though smaller units in a multi-story project will create a better pro forma, customers like to rent traditional drive-up units in most regions. These will generally be larger than 10-by-10.

You’ll also want to consider your drive aisles. The industry standard is 25 to 30 feet wide, which will allow tenants with large trucks or vans to maneuver around safely. Provide turnaround space, too. Finally, check with the fire marshal about any requirements for first responders. Note: If you’re adding vehicle storage, your drive aisles will need to be wider to accommodate RVs, boats and trailers.

Climate is another important factor. If you’re in an area that gets snow and ice, like Colorado, consider situating your buildings north and south so they get optimal sun in the winter months. You’ll also need to determine where to put plowed snow. Allowing for adequate snow storage may limit the number of units you can build, but it’s sometimes necessary. At my latest development, I added large swing gates onto the snow-detention areas. If I hadn’t, I would’ve had to spend thousands of dollars to have a skid steer remove snow from the site.

Create a Good Unit Mix

Developing the correct unit mix for your self-storage facility is an art, not a science. If ever you think you’ve got it perfect, you’re probably wrong. Remember, the “right” mix could change over time as the needs of your customers shift.

Start by considering your neighborhood type. Is it urban, suburban, rural, etc.? Also, who are your customers? Do they live in apartments, single-family homes, senior facilities, etc.? A feasibility study can help you answer these questions and more, which will ultimately assist in determining the best unit sizes for your market.

Most self-storage facilities offer a variety of sizes, from 5-by-5 to 10-by-30. You’ll likely have some odd sizes, but try to keep them to a minimum. It’s difficult to rent a 6-by-9 or 13-by-7 unit because it’s hard for potential customers to visualize.

Smaller units can do well, but it really depends on the market. I’ve had some success with 3-by-3-by-4 units. Realizing that 100 of these may only represent less than 1% of your total square footage, these should be used minimally. I wish someone had told me this before I built 200 of them. We had to move stairway to provide access to these spaces at an additional cost of $60,000. Though we’re receiving a good return on these units, we work too hard for the few extra dollars we make on them.

Even after your self-storage facility is built, you may be able to change unit sizes with proper planning. For example, a building with back-to-back 10-by-20 units could be renovated to instead offer a 10-by-25 on one side and a 10-by-15 on the other. Just consult with an engineer before you move any walls to ensure they aren’t load-bearing.

Ultimately, your self-storage unit sizes will be determined by your neighborhood. When I develop in mature and urban areas, our units range from 82 to 121 square feet. Remember, this isn’t hard science, but an art.

Creating the site layout and unit mix for a new self-storage facility requires careful planning. Consider the market demands, how your customers and management will move around the facility, and your own goals for the business. All these factors will contribute to the project’s long-term success.

Hank Saipe is the owner of 303 Self Storage. He began his commercial real estate career in 1981 as a broker who specialized in finding sites for Public Storage Inc. and other developers. Today, he owns multiple self-storage facilities comprising more than 4,000 units in the Denver metropolitan area. In his career, he’s been involved in site selection, financing and third-party managed properties. To reach him, call 303.888.1260; email [email protected].