Do you want to start a self storage business? If YES, here is an estimate of the size of land you need to build a storage unit in 2023. Self storage facilities in the United States tend to range from 10,000 square feet to 100,000 square feet or more. The average self-storage facility typically covers 2.5 to 5 acres and encompasses 46,000 net rentable square feet (the amount of money-generating space that can be rented by tenants).
As a rule of thumb, you can expect to spend anywhere from $25 to $75 per square foot on new construction. However, that is merely an approximate range and the location of the facility, including the cost of the land will dictate the price tag for construction.
In many regions of the country, a typical self-storage site is about four acres or more. This gives the owner a good-sized facility through which to generate revenue. However, once you move into cities, those nice big platforms disappear. It becomes very hard if not impossible to find a tract of land big enough to build a storage facility that’ll offer a good return on investment. Instead, you might find a suitable site, but it is on an acre or less.
Smaller-sized lots can without doubts be great self-storage development opportunities. You can save on the overall construction costs and offer an opportunity to charge higher rental rates due to less competition in urban areas. A smaller storage facility just at the right spot can be a great investment.
Urban areas often have less competition, so you can charge more per square foot. Plus, there’s typically a huge need for self-storage in these areas. By leveraging a site that’s about an acre in size, you can still build a nice-sized facility that’s large enough to turn a profit.
The cost of a site in an urban setting is higher than one in the suburbs—if it is the same size. But lots in the suburbs are generally bigger, so the costs start to match. Then there are the construction costs. Since you won’t be building as big a structure in an urban area, your price per square foot for construction will be more, but it’ll cost you less to build the facility, since it is smaller.
Note that most jurisdictions now require storage buildings to look more like office buildings or retail and even to match other properties in the area. This could entail decorative windows and façades, specialty materials and even vibrant colours. Smaller buildings will cost less to dress up than larger ones.
The number of floors you can add to your self storage project will depend or dictated by building codes and zoning requirements. In most places, you will be limited to four floors. If you can go higher, remember your construction costs will go up substantially, since you will have to implement a higher grade of construction.
Another factor to consider is how many parking spaces will be needed. Note that when building additional floors, the number of parking spaces and even elevators you need could change.
5 Crucial Factors to Consider When Designing a Self Storage Building Project
Designing a self-storage site to maximize land use requires a balance between rentable space and operational efficiency. Nonetheless, here are crucial options to optimize a facility for profit while ensuring convenient customer access and easy maintenance.
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Before you start, it is necessary you become conversant with local regulations, including zoning, setbacks, easements, green-space restrictions, parking requirements and coverage constraints. Note that these things will all influence your layout.
Right before you attempt to create a building layout, work with your local civil engineer to determine if a retention pond is required, what size it needs to be, and where on the property it should be positioned. If a pond is necessary, consider making it deeper to reduce its surface size.
You will also want to understand the fire code for your area. Most counties in the United States have allowed fire areas (space of a single building or between firewalls) of up to 12,000 square feet in an un-sprinklered building. Howbeit, a change in the 2012 International Building Code has reduced that space to 2,500 square feet in states that have adopted the new code. The cost can be significant and may influence your decisions, especially if there isn’t already adequate water service on the property.
One wonderful and lucrative way to increase rentable space is by using wider buildings with halls. Traditionally, basic self-storage facilities consist of 30- or 40-foot wide buildings. These are efficient to build, and with doors on all sides, they tend to offer an attractive unit mix.
However, these drive-up units are convenient and easy to rent, it is becoming increasingly common to see wider buildings (100 feet wide or more) with interior hallways. Have it in mind that most clients don’t object to the interior units as long as carts are provided for easy access. Therefore, you will spend less on driveways, and the wider buildings tend to cost a little less per square foot.
Building Types and Uses
Note that when land is scarce or costly, it can make sense to build multiple stories. Sometime ago, new multi-story properties would often include a freight-only “lift” instead of a passenger elevator. But in this age, multi-story construction normally includes an elevator.
If you commit to an elevator, consider going to three stories instead of two, since the incremental cost makes it worthwhile if you anticipate having demand for the space. Multi-story buildings more or less take longer to plan and develop. They also take longer to break even financially since a larger amount of storage is built all at once.
In the United States, self storage operators receive requests for large units to store boats and RVs. Owing to larger driveway requirements and lower income per square foot, these units are usually not profitable. However, it can be a wonderful idea to incorporate a few larger units at driveway ends or intersections if there is adequate room for a customer to back his vehicle into the unit.
With only a small number of these coveted units available, they can command a higher rent and be well worth the effort—especially if they use a driveway location that was already planned. If a site has a large amount of affordable land and demand for traditional units has been exhausted, there may be a strong business case to install large RV units.
Also have it in mind that your management style will also affect site layout. Not every facility will have an office and gate, but if your site has both, provide parking and access to the office from outside the gate. Automating management works through rental kiosks may also be an option.
If market conditions suit with this choice, removing the office entirely will reduce construction costs and increase land coverage. Sites operated via a kiosk are becoming more common and can reduce operating costs compared to employing a full-time manager.
However, if you go this route, bright lighting and conspicuous security cameras will help increase customer comfort and confidence. Sites with kiosks should be designed with parking and kiosk access outside the gate. Consider positioning the keypads so customers with trucks and trailers will be completely off the street while waiting for the gate to open. Installing a second keypad for exiting the facility will help you track when people come and go.
Form vs. Function
Maximizing site revenue has more to than just looking good in a financial forecast. Small units may earn more revenue per square foot, but only if you can rent them. It is very imperative that you consider the function and maintenance of the site during the design process. Security can be boosted by aligning buildings so you can see between them from the main road.
In cold climates, limit ice build-up by aligning buildings or adjusting roof pitch to avoid shedding water on northern exposures. Also be careful and avoid creating dead ends, as these will cause tenants to be more likely to hit a building when backing up a rental truck or trailer.
Developers sometimes create buildings with jogs to best maximize space and boost revenue. Nonetheless, these design features drive up construction costs and can create extra spots where snow can build up without being easily accessible with a snowplough.
If you are considering jogs, consider the potential negatives against the benefit of increased revenue. In terms of snow, if you are in an area that receives heavy snowfall, you will need to plan for where the plough will push the snow. Ideally, this should be toward the pond if one exists.
In many regions of the country, a typical self-storage site is about four acres or more. To simplify the process, think in terms of cost and revenue per square foot rather than trying to get detailed quotes on each possible arrangement.
Your building manufacturer should be able to give you ballpark numbers for different types of buildings. Correctly planning a site for the initial and future phases of your business is a major undertaking that will affect site operation for decades and impact resale value.