Opening and Expanding Self Storage – A Good Business Decision

Posted on May 24 2011 - 6:42am by John Stevens

The self storage industry is a $22 billion dollar business that is thriving in the United States, enjoying economic growth as the country faces an economic recession. Currently, low variable rates and limited day-to-day obligations make self storage a less demanding industry to break into than apartment rentals or running a laundromat. New businesses are opening every day and this industry that is 90 percent owned by entrepreneurs was named one of the best industries for starting a business in 2010 by Inc. magazine.

According to the Self Storage Association (SSA), there are 2.21 billion square feet of self-storage in this country. That means there are more than 7 square feet of storage per U.S. resident. The subprime mortgage crisis caused a wave of foreclosures, meaning families needed places in which to store their possessions. But the industry is far from saturated, thanks to the insatiable appetite of American families for acquiring stuff.

There are three main questions to ask when considering opening or expanding a self storage facility:

• How much competition is within five to ten miles of my facility?
• Is my proposed storage location in a prospering community?
• How will I finance my new self storage company?

Although bank lending is stringent, many self storage owners or prospective owners are turning to the Small Business Administration (SBA) to finance their equipment and construction or expansion needs. Many SBA loans are specifically designed to meet the needs of your small business while reducing the risk to your lender with an SBA guarantee. Celtic Bank is an experienced small business lender that specializes in the self storage industry.

Established leaders in the self storage industry, such as Extra Space Storage, are also opening new facilities and expanding their national footprint. A new Extra Space Storage self storage facility in Carson is celebrating its grand opening on June 9 from 5 p.m. – 7 p.m. with an appearance by the Lakers Girls. The public is invited to enjoy free In N Out burgers, meet and take pictures with the Lakers girls and tour the new facility at 24950 S. Main Street in Carson. The professionally managed Carson facility offers 750 storage units for short- or long-term lease, with units ranging in size from 25 to 300 square feet. The clean and well-lit units are accessible 365 days a year and feature state-of-the-art security, including 24-hour video surveillance.

“We want to throw a ‘get to know us’ party for the neighbors, and by neighbors we mean everyone in the greater Carson area,” said Mark Stanke, Division Vice President of the new Extra Space Storage in Carson. “We’re excited to be here and we’re looking forward to being an asset to the community by providing valuable services to customers and being good neighbors to all.”

Extra Space Storage Inc., headquartered in Salt Lake City, is a fully integrated, self-administered and self-managed real estate investment trust that owns and/or operates 829 self storage properties in 34 states and Washington, D.C. The company’s properties comprise approximately 550,000 units and more than 60 million square feet of rentable storage space offering customers conveniently located and secure storage solutions, including boat storage, RV storage and business storage. Extra Space Storage is the second-largest owner and/or operator of self-storage properties and is the largest self storage management company in the United States.

Sources Used:

Cook, Monty. “Self-Storage Industry Thrives with SBA Loans, Are You Its Next Entrepreneur?” May 18, 2011.

Lagorio, Christine. “Self-Storage Leasing: The Subprime Mortgage Crisis Wasn’t So Hard on the Storage Business.” May 24, 2010.

“Extra Space Storage Holds Grand Opening Celebration at New Self-Storage Facility in Carson, CA.” Yahoo Finance. May 23, 2011.