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Media inquiries and requests for interviews with team members should be directed to our public relations counsel:
Steve Rudner
The Last Word
These days, it’s tough to turn on CNN or Bloomberg or
even the local news and not find yourself bombarded
with data about declining real estate values, increasing
interest rates, economic pressures, record-high oil prices, or a
recession. While it’s difficult to not get drawn into the negativity,
the key is to absorb the data in the context of what it means
to you.
A View from the Street...Success in Real Estate Storage: It's Who You Know"
Whether it’s self-storage or another commercial asset, a property’s location is a key foundation for success, followed closely by well-managed operations and maintenance. In addition, there’s a famous saying that applies particularly to any real estate-based business: "It’s not what you know, but who you know."
Whether you’re buying or developing a storage property, its location is a variable that typically takes time to establish. On the other hand, your networks and contacts are factors you can manipulate and capitalize on immediately. "Who you know" is especially valuable in today’s market given the capital market volatility that has altered the self-storage real estate playing field.
A View From the Street: Keeping Your Balance on the New Playing Field
We all know the business adage about how a level playing field allows for fair competition. Given 2007’s financial turmoil, the turf for self-storage real estate financing and property transactions is still level, but at a dramatically different point of balance than what many owners became accustomed to in recent years.
With this new game, we’re all confronted with the same difficult market conditions, so it’s not a question of whether anyone has an unfair advantage, but rather how each of us copes with the current environment. Thriving on this redefined field will require property owners to readjust their points of equilibrium and gain their balance as market shifts continue to redefine how we conduct real estate-related transactions.
Capital Market Correction: Can Mean Good Days
Ahead
During the last several years, one of the most
prevalent themes within the self-storage industry has been the
unprecedented attention from the institutional community.
Institutional lenders have become very familiar with the industry
and the product type and they have been a major source of new
capital flow into the industry; and the market capitalization of the
public companies within the industry has grown at a staggering pace.
View From the Street: The Bumpy Ride Is Not
Over Yet
For the past year, this bi-monthly column has
provided readers with an outlook on real estate and financing
developments and how they can affect the self-storage business. Now
that it’s a new year, let’s look ahead to see what 2008 may bring
for our industry.
A View From the Street: 10 Tricks to Achieve
Staying Power
Like it or not, as with any real estate class,
there’s no such thing as a sure thing in self-storage. Sure, you can
lock in short-term guarantees on some things, but when you truly
examine your storage business for the long haul, there’s bound to be
plenty of uncertainty. Whether it’s new or more challenging
competitive forces, shifting financial markets, fluctuating cap
rates, undulating real estate values, unpredictable weather-related
occurrences or changes in your facility operation, none of us has a
foolproof crystal ball guiding us to a certain future.
South Florida Market: Keeping a Close Watch on
Turning Tides
The West Palm Beach and Miami self-storage markets
are perfect illustrations of the classic industry adage: “All real
estate is local.” With distinct demographic and economic
characteristics, these growing cities have textures all their own
and self-storage markets to reflect this.
Everything's Bigger in Texas: Opportunities in
the Dallas-Fort Worth Market
The Dallas-Fort Worth (DFW) area has always been a
part of the country that marches to the beat of its own drummer.
Perhaps its independent spirit derives from the area’s early
heritage as a community where cowboys reigned with a strong sense of
frontier ambition.
A View from the Street: Screenplay for Storage
Success
The “build it and they will come” philosophy only
works when written into a movie with Kevin Costner luring scores of
fans to his “field of dreams.” But the days of constructing a
successful self-storage facility on some unused portion of Uncle
Joe’s land are over. If you still hold on to this outdated ideal,
your dream of building a storage facility could well turn into a
nightmare.
The Math Behind the Self-Storage Makeover
Many consumers in recent years have tapped into their mortgage
equity to go on home-makeover sprees. Drive through residential
neighborhoods and, chances are, you’ll see trucks for remodelers,
kitchen and bath firms, and construction companies dotting the
streets. Homeowners make these renovations not only to enjoy their
spacious new media rooms and gourmet kitchens, but to increase their
home’s worth.
Stay the Course: A Look at the
Self Storage Industry
Like the rest of the investment real estate market,
the self storage sector is feeling the short-term effects of the
challenges in the capital markets. To augment the focus, the
publicly traded self storage sector of the REIT industry posted
first quarter numbers below most analysts' estimates so the
subsequent firestorm of scrutiny drew even more negative focus to an
industry with underlying fundamentals grounded in a very firm
foundation.
A New York State of Mind: Self
Storage in The Big Apple
New York City seemingly never closes. Indeed, it is
bustling with activity 24 hours a day. Moreover, with high
population density and housing that features little on-site storage
capacity in many areas, it has been on the minds of self-storage
owners and investors for years. While local markets have changed in
recent years, particularly with the expansion of suburban
residential and commercial developments further from the city’s core
boroughs, New York City still offers significant self-storage
investment potential.
A View from the Street: 'Tis the Seasons:
Calendar affects storage income!
It’s hard to find a person without a favorite time of
the year. Ski and snow sports buffs can’t wait for winter. Some
favor springtime for its sense of renewal. The summer entices us
with warm weather, vacations and outdoor activities. Others prefer
the fall season with the charm of changing leaves and football
games.
Is the Market Still Hot in the
Golden State's Southern Region?
Like the weather in this part of the country, the
Southern California self-storage market has been quite hot in recent
years. Not only have we seen growth in the overall number of
facilities, but street rates for unit rentals from Santa Barbara to
San Diego have been on the upswing as well.
Winds of Change: Storms Leave
Insurance Woes In Their Wake
The hurricanes of 2004 and 2005 have long blown past the Florida
panhandle and the Gulf Coast areas of Mississippi, Louisiana, Texas,
and Alabama. And thankfully, the 2006 hurricane
season was very mild. But the devastation left in the wake of storms
from the past two years continues to affect Gulf Coast and Florida
businesses, including self-storage property owners.
They say things
are always bigger in Texas. Big cowboy hats, big ranches, and big
houses. Setting stereotypes aside, though, there is something big
occurring statewide, and particularly in the Houston market:
Business in the area is so big right now, you might even call it
colossal.
Move one letter over in the
alphabet and the acronym of IRR (Internal Rate of Return) becomes
the tax collection agency known as the IRS—an entity that most of us
avoid at all costs. When it comes to IRR however, rather than dread
it, self-storage owners should familiarize themselves with Internal
Rate of Return. Moreover, they should understand how investors use
it to value self-storage facilities.
Interest Rates
Never before have the actions and
behaviors of the Federal Reserve been so closely watched by such a
broad spectrum of business and personal interests. A great deal of
weight is placed on the assumed affect the monetary policy has on
all facets of business and on the U.S. Economy. Not to suggest that
the Federal Reserve
The Role of Real Estate Advisor
Deciding to sell a real estate asset
is difficult in itself. The next question is even more challenging:
How do you expose your investment to the market while meeting
pricing goals, maintaining confidentiality and minimizing disruption
to the business?
What the Future Has in Stor(age)
Today, the self-storage
industry looks much different than it did 10 years ago. Just reflect
for a moment upon the
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