Destigmatizing self storage — 4 common misconceptions about what we do
Like most things, people fear what they don’t know. And most institutional real estate investors have spent decades fawning over office, retail, hotels, and multifamily. Only over the last few years has self storage emerged as a darling in the investment world.
At Stuf, we’re going after a huge opportunity to redefine self storage, which currently serves 1 in 10 US households (yes, that’s a lot of people). We partner with commercial landlords, including Jamestown and Hines, to monetize underutilized spaces as tech-enabled self storage. In my many calls and meetings with potential landlord partners, it’s clear there are misconceptions about our space.
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Here are 4 common misconceptions about what we do:
Self storage is sketchy and unsafe. Self storage gets a bad rap for being sketchy or unsafe. More often than not, self storage facilities are located in fringe areas of cities and neighborhoods where you’ll find warehouses and manufacturing zones. Naturally, those areas feel unwelcoming and unsafe because there’s no foot traffic, no cafes, no apartments, and nowhere people want to be.
Consumers and businesses want storage that’s easy to access and convenient (aka close to their homes and workplaces). Nobody wants to drive 30+ minutes away for their storage unit, so we appeal to a segment of the market that puts a premium on proximity and security. Rather than building new, we convert old. We reimagine underutilized basements, garages, and back-of-house storage in neighborhood office and multifamily buildings as tech-enabled storage. Our locations also benefit from the enhanced building experience and security measures that come along with being in those elevated environments.
Access is a free-for-all. How do I know who’s coming in and out? In our world, access and security are our top priorities. It’s the opposite of a free-for-all. We know exactly who’s visiting, when they’re visiting, how often, etc. If you’re behind on rent, your access is automatically disabled.
I’ve worked for commercial landlords before, and I’ve also worked in many office buildings. It feels like most office and residential buildings hand out key cards like candy. No ID required. No vetting. We take a much more advanced approach with multiple lines of offense. We require:
- A driver’s license or passport
- A selfie
- Address verification documentation (i.e. utility bill, lease, bank statement, etc.)
- All of the above is authenticated with a third-party verification platform
All of this happens before you ever set foot in the building. Additionally, we prefer to integrate with the building’s existing access control system (i.e. Brivo, Openpath, Datawatch, etc.) so our landlord partners have visibility too. And soon, our security camera feeds will run through an AI layer that detects unusual activity, such as smoke, leaks, loitering, and more.
How do I know what people are storing? Can’t they store anything? No, they can’t store anything they want. After operating 20+ locations in 3 years, we’ve learned that Stuf members often use storage differently than customers of traditional self storage facilities.
Since proximity is so important to our community, we see many more business users who need their inventory, equipment, samples, and documents nearby. We also have consumers who use their Stuf storage unit as an extra closet, allowing those users to live in a smaller home or apartment and save money without sacrificing quality of life. Treating your storage unit as an extra closet is very different from treating it as a dumping ground for stuff you don’t want to see for months or years.
On the operations side, our rental agreements are very clear with what can and cannot be stored in the storage units. We also closely monitor member move-ins and activity which will only get “smarter” when we launch our AI monitoring system next quarter. I often think about parking garages attached to office and multifamily buildings. How do owners know who’s driving in, what they have in their trunk, and what their intentions are in the building? Most owners have no idea and have far fewer preventative measures in place.
Storage isn’t a needle mover. I recently wrote a blog post about the importance of cash flow for commercial landlords, so when landlords tell us we don’t move the needle enough for them, I’m often amused by their one-dimensional reasoning. We typically generate anywhere from $50,000 to $300,000 in annual revenue for our landlord partners, depending on the size of the space, location of the building, and several other factors. When I put my landlord hat on, this amount of money should be meaningful to most owners, not only for the revenue itself, but for the amenity residents and office tenants now have access to.
Almost all building amenities are cost centers. The fancy gym, conference room, and golf simulator barely get used and only cost owners money. Storage is one of few amenities that actually makes money and is widely desired by people and businesses across the country. We are the low or no effort way for building owners to offer a new amenity while simultaneously generating a new revenue stream.
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Want to learn more?
Reach out to realestate@stufstorage.com to hear more about how we partner with landlords.
Also, please check out our latest announcement about launching in Seattle with Wright Rustad and Rubicon Point Partners.
