By Ed Clement
"Your Self Storage Planning - Site Selection - Design-Build" by Marc Goodin
1. Who should consider owning a Storage Authority franchise?
A Storage Authority franchise is right for anyone who wants to combine the best of three investment opportunities – make a solid real estate investment, own your own business, and operate a franchise -- for example:
Professionals (such as doctors, lawyers, and accountants) or owners of an existing business – people who want to continue their career, while operating a second business opportunity
Entrepreneurs -- who are looking for an investment with a solid return both in income and in real estate appreciation, now and for years to come Real estate investors -- who want higher returns than other sectors, including hotels and apartments, without the headaches of typical tenants
Families -- who want a strong income cash flow now, into retirement, and future generations
Couples -- who want to work together in their business Owners of an existing self-storage facility -- who want to take their business to the next level by crushing the local competition and becoming the preeminent hometown self-storage location
The examples go on and on. Let’s discuss your situation and decide how “the Storage Authority difference” can help achieve your financial and career objectives.
2. What are my options for launching a Storage Authority franchise?
There are four ways for you to launch a Storage Authority business and we have the answers you need, regardless of the option – or the combination of options -- that’s right for you:
To build a new facility – on the property you already own or on the property we will help you find
To convert an existing building into a self-storage facility
To re-brand a self-storage facility that you already own
To buy an existing self-storage facility
3. Why should I join the Storage Authority team as a franchisee?
A franchise gives you independence with guidance -- you have the opportunity to run your own business while benefitting from the support of a tested formula for success and an experienced team of skilled professionals.
Typically, our franchise will make the self-storage business much easier for you and reduces your risks. It provides benefits and profits that most people cannot achieve on their own.
Franchising is a popular option in a wide variety of industries, notably restaurants, hotels, health, fitness, beauty, and automotive services. And now self-storage.
Storage Authority is the only self-storage franchise in the United States, and we provide you with important benefits, including but not limited to
• Well-developed business model – reduce your learning curve, regardless of your previous experience in business ownership and management
• Access to proven systems of training, operations, and marketing – rely on a built-in network of support and knowledge
• National image and brand awareness
• Guidance about site selection, design, construction, and/or renovation
• Purchasing power with preferred vendors
• Defined market area of exclusivity
• Easier to get financing – your business plan and financial projections are more credible when they are built on our historic performance success and when a lender sees that we are part of your team
Opening a business is never a piece of cake, but a franchise can significantly reduce your risk and increase your rewards. The internet offers many sources for more franchising information.
4. What steps are involved in becoming a Storage Authority franchisee and getting your doors open?
To become a Storage Authority franchisee and open your facility, you should expect to go through these 10 steps:
One – Investigate Two Basic Questions
Is self-storage right for you? (See Questions #11) Is franchising right for you (see Question #3)
Two – Apply on our website: www.storageauthorityfranchise.com – Apply icon
There is no cost or obligation to apply – and by providing us with some initial background information, we can be better prepared to discuss the specifics of your objectives, your situation, and your options.
Three – We’ll Talk So You Can Learn More
After we review your application, we’ll arrange a phone call or Zoom conference to discuss how the Storage Authority business opportunity can help you meet your financial and career objectives.
You’ll be assigned a Storage Authority Franchise Director to serve as your primary contact throughout the due diligence and discovery process. This enables you to get real answers from a real person. No long waits for service. No transfers to multiple staff people.
Typically, two or three phone conversations with your Franchise Director – in conjunction with your independent homework and research – are enough to learn the Storage Authority basics and to confirm that we’re a good fit together.
Four – Review Our Financial Disclosure Documents (FDD)
After you have been approved, we will send you our “Franchise Disclosure Documents and Qualification Package” which is prepared in compliance with Federal Trade Commission (FTC) guidelines and the required format. It provides thorough information about Storage Authority, our franchise systems, and the franchise agreement.
Read this package in detail so you are ready to review the contents with your Franchise Director.
Five – Continue Our Weekly Conversations
You and your Franchise Director will continue having thorough discussions to assist you with the manager-driven Storage Authority systems – from finding land and gaining approvals to designing, building, and financing your facility, from operations to our premium sales, marketing, and more.
Six – Financial Review
Your Franchise Director will discuss the minimum financial recommendations and requirements for developing a Storage Authority self-storage facility, based on your goals and finances. There are multiple financing options based on the location, type, and size of the development, as well as on the type of loan you plan to use – conventional or SBA.
We can introduce you to lenders who are familiar with self-storage, who understand the value of Storage Authority, and who underwrite both SBA and conventional loans, so you can explore loan options and qualification details.
Seven – Sign Your Franchise Agreement
This is often done as part of a discovery day during which we meet at our offices or at one of our self-storage facilities in Florida to get acquainted in person, but other signing options are possible. Of course, before signing, you may wish to reach out to a few of our existing franchisees – we’ll gladly provide names and contact information.
Eight – Local Site Research and Selection
In close consultation with your Franchise Director, you’ll determine the most suitable location for your facility.
These detailed discussions will go beyond finding land to include building your team, developing facility designs, gaining approvals, and constructing your facility – and how we will assist. Discussions will also continue about all aspects of our manager-driven systems, notably operations, sales, and marketing.
Nine – Participate in the Storage Authority Owner and Manager Training
We offer a combination of classroom, online, and textbook learning in a variety of skills -- such as pre-opening preparations; operations; sales; marketing; accounting; and human resources -- so you are completely prepared to open and t do business effectively day-to-day, starting on Day One.
Ten – Celebrate Your Opening Day
It’s time to put all your energy, enthusiasm, and education to work! We’ll guide you to and through a memorable ribbon-cutting that opens the door to your special version of the American Dream.
How much money do I need to open a Storage Authority facility – and is financing available?
The exact amount of your initial investment will be different based on the various factors associated with how you are proceeding -- buying an existing facility, converting an existing building, or building a new facility.
And if you build a new facility, your investment will depend on factors such as the cost of land; the cost of developing either a single-story or multi-floor facility; and the cost of special features you choose to include.
As further background, it’s important to know about the federal government’s Small Business Administration (SBA) loans. They are a popular financing option for our franchise owners because the SBA 7a loan requires a down payment of as little as 15% -- sometimes in certain situations 10% -- on a loan of up to $5 million.
That is why we suggest that to start the Storage Authority process, you have a minimum of $1,000,000 available in cash – or in suitable cash and equity in the facility property you already own. This will allow you to make a reduced equity investment – meeting the SBA’s requirements of 10% to 15% -- then pursue a loan of up to $5 million for the project construction and carrying cost for a suitably-sized facility in most locations.
Under this scenario, you can build a facility valued at up to $6 million. This represents a substantial self-storage project – one that is not a “hobby business” and one that can be expanded as warranted.
I expect to build a new facility – how much land do I need, and will you help me find the right site?
There are multiple options, but often the least expensive and most profitable is six usable acres that can accommodate at least a phase 1 50,000 sq. ft. one-story facility and possibly an additional 20,000 sf phase 2. A larger parcel of land allows you to offer vehicle storage for recreational vehicles, boats, and cars, plus it will facilitate future expansion, if appropriate.
If you envision a multi-floor building, you typically will require less land – about 1.5 acres or more. Of course, phased expansion is not typical and construction costs will be higher.
We will help you find the location that is “right” for the demands and competition of your market, which includes an evaluation of existing self-storage rates and the available demand for a new facility location. Other factors we will review are the size and shape of a location; basic zoning; traffic patterns; availability of utilities; and convenient entrance/exit.
After your offer for a piece of land is accepted, we will collaborate with you and the appropriate real estate professionals during the due diligence period to evaluate a myriad of details about the location that is essential to your success – details such as easements and setback requirements; zoning, typography and slopes; sight lines; wetland, endangered species, surface coverage, or other environmental restrictions; deed ownership/restrictions; and a third-party feasibility study.
We guide you as you negotiate the purchase and financing of the “right” real estate, and we then work closely with you and your civil engineering / architectural / construction team to develop the optimum site plan and building drawings.
How much will it cost to build a new facility and how long will it take?
Building costs are different in different parts of the country, depending on costs for land; the size of the facility; materials and labor; special features or finishes you choose; and zoning/ordinance requirements, to name a few.
For a detailed estimate of costs, review Item 7 of the Financial Disclosure Documents (FDD) package.
For very basic initial planning purposes – until you have more detailed costs for the location and facility that you envision – use these figures: an initial investment of between $5 million and $6 million for development, land, construction, and carrying costs for a 50,000 sq. ft. single-story facility on six acres of useable land that cost $900,000 or less. Remember that the project can be split into two phases.
The development/construction timeline can be affected by many factors, but a useful initial planning estimate is:
• 2 to 9 months to research and locate land
• 2 to 4 months to prepare civil engineering site plan designs
• 3 to 4 months to prepare architectural building designs
• 2 to 4 months to obtain appropriate government approvals
• 8 to 12 months for construction
Note that some of these timelines may overlap or be longer or shorter depending on a variety of factors.
How much are your fees and royalties?
Part of your initial investment is the one-time Storage Authority franchise fee of $39,000. You have the option of an additional one-time fee of $18,000 for our guidance with development if you are not buying or if you do not own an existing self-storage facility.
There is also a one-time fee of $3,000 for our assistance with preparing a customized Storage Authority website for your location.
There is a monthly 6% royalty fee and 2.5% marketing, sales, technology, and website fee.
How will you help me through the development/construction process?
Storage Authority has developed a proprietary system that carefully guides you step-by-step through the development/construction process -- from finding land through pre-opening. Called the “Dynamic Ease Development Series,” it features seven detailed chapters of information, checklists, and worksheets.
In addition, your Franchise Development Director is available to guide you.
Although the development/construction process is never the same for any two projects, it is always a close collaboration between you, your Storage Authority representatives, and your development team.
You get the guidance and the answers you need, when you need them, so you can make the decisions and initiate the actions necessary to move your business forward.
Here is a simple outline of the “Dynamic Ease Development Series:”
• Chapter 1 – Introduction
Building Your High-Performance Team First 30 Days Development flow charts Worksheets Major Development Milestones Checklist Competition Review Developer Secret Shop Review Partial Designer & Vendor List Vendor Approval Request Form Management Software Interfaces
• Chapter 2 – Land The Basics Of A Good Location Typical Basic Land Requirements Hiring A Quality Broker To Assist You With Finding Land Additional Ways To Find Land (including offline) Initial Land Review before An Offer Or Feasibility Study Making The Offer & Due Diligence Feasibility Study Worksheets Sample letter for contacting landowner Questions for the first meeting with government planner/staff Land parcel info Site drive-by Initial zoning review Land offer •
Chapter 3 - Purchasing an Existing Self-Storage Facility Seven Primary Steps Of A Real Estate Transaction Investigating an Existing Facility
• Chapter 4 – Banking / Lending Loan Options Loan Considerations Often Over-Looked Expenses Worksheets Loan Request Letter & Summary
• Chapter 5 - Design & Regulatory Approvals Finding Design Consultants Site Plan Design Regulatory Meetings Building Design Security Design Video Surveillance Design Worksheets Additional Site Plan Design Items to Consider Additional Building Design Items To Consider Site Details Owner “To Do” During Design Process
• Chapter 6 – Bidding & Construction Finding A Contractor Construction Specifications & Bidding Example of Schedule of Payment Categories Construction Review
• Chapter 7 – Pre-Opening Preparations 120 Days Before Opening 30 Days Before Opening Pre-Opening Marketing Worksheets Pre-Opening Checklist Unit Pricing First Office, Site & Product Order Component Depreciation Contact Flyer Pre-Opening Sessions With Your Franchise Director
What kind of training and support will I receive from Storage Authority – before I open, then on an ongoing basis as I operate?
Our business model includes a combination of classroom and textbook learning that cover your Storage Authority business, from start-up through day-to-day operations.
We have a training center in Florida where training classes are held regularly throughout the year. You and your manager will attend three days of initial training classes at a time that is most convenient for you. You and your manager will also receive online / phone training during the four weeks immediately before opening.
In addition, you will have our unmatched package of easy-to-understand, proprietary manuals for convenient reference at any time. Professional education reminders and updates are ongoing at Storage Authority, using a variety of platforms.
Together, the training classes, the manuals, and your Franchise Development Director provide comprehensive professional education:
How much does a Storage Authority franchise make?
We do not predict sales, costs, or profits for any Storage Authority facility because these figures are impacted by a variety of factors from market to market and from owner to owner.
After you chose a location, you will arrange an independent feasibility study to be conducted during the due diligence period by a qualified independent third party. The results will provide you with a lot of detailed information, including an analysis of demand; construction and start-up costs; break-even projections; and profit estimates.
We urge you to discuss the Storage Authority business opportunity with your trusted financial advisors, notably your attorney and accountant.
How can I learn more about self-storage, including the market demand in my target area?
We recommend that you research two topics -- self-storage and franchising. There is abundant information about both subjects on the internet, and new articles are available regularly with the most up-to-date details.
If you conduct Google searches for “self-storage industry” and for “franchising pros and cons,” you will find a rich inventory of sources from which you can choose your reading.
Information about a specific market is typically available from a variety of local, county, and state agencies, business commissions, or planning groups that deal with economic development. However, acquiring data from government sources can take a lot of time and paperwork.
Online apps are available to deliver market information quickly and easily for a small fee. We can provide links to these services and guide you through using them.
Two other sources of information are:
• The national Self-Storage Association (SSA), which is headquartered in Alexandria, Virginia – www.selfstorage.org
• The self-storage association in your state, for which you can find contact information online.
You should consider joining these two groups for ongoing information and networking.
If you would like additional information a becoming a Storage Authority Franchise, please provide your contact info here: storageauthorityfranchise.com/opportunity1/
For a free copy of Marc's book, "Your Self Storage Planning - Site Selection - Design-Build"
Email me at email@example.com
Ed Clement is a franchise director at Storage Authority. One of his passions and responsibilities is helping franchisees find land by sharing how to find land both online and offline. Ed has a strong background in real estate, investment banking, and management consulting. He is available at Ed@StorageAuthority.com or 727 946 0745 to answer your questions and share the Storage Authority Franchise opportunity.