If you are someone looking at starting a good business, opening a steel self-storage building could be a good idea. IbisWorld estimated that the sector was valued at almost $33 billion last year in terms of revenue. This is projected to grow at annual rate of 3.5% over the next five years, thanks to growing American population resorting to renting storage units for an average of 10 months. With this figure, just imagine the swelling net incomes for steel self-storage building operators.
If you have a vacant parcel of land, why not consider turning into a profitable investment by joining this multi-billion industry? All you need is find a reputable manufacturer and purchase mini-storage kits specific to your location. They are generally constructed in just three days without special skills and tools requirement. With just a minimal investment, your self-storage business can be up and running in no time. Not to mention, mini-storage kits can be purchased with expandable walls so there would not be any problem accommodating sizeable storage needs of your customers.
What is a steel self-storage building?
A steel self-storage building is consisting of several individual storage units similar to garages or units. It often has no water, heat or electricity. Customers pay you for storing their merchandise in your facility. Hence, the only major expense you will have for this kind of business is the land parcel. Construction cost is not much a worry since steel buildings are affordable, quick to assemble, and has low insurance and maintenance costs.
Aside from requiring minimal startup and operational costs, your earnings from a steel self-storage building can be improved by providing great size variations of storage rooms to meet all the space requirements of your customers. Moreover, imposing restrictions on how stuff should be stored are unnecessary since steel buildings are resistant to many common risk factors including fire and pests. A major setback in doing this kind of business, however, is the chance of encountering nuisance movers or landlords that just drop off a bundle of abandoned stuff and would not really take the time to pack them properly.
3 things to keep in mind before starting a steel self-storage business
While it is generally easy to start a steel self-storage business, there are a couple of things you need to understand to ensure success.
1. Supply and demand. According to data from the U.S. Census Bureau, there are about 2.63 billion square feet of rentable storage space as at 2014. That means, there’s an ample space for every individual in the U.S. to meet their storage needs.
While it appears there’s a huge supply already, the market remains unsaturated. There is still sufficient demand for self-storage space to accommodate more steel self-storage buildings annually. Income-wise, operators are projecting rental rates to surge further. As of this writing, the monthly average rental cost per square foot (PSF) in the U.S. is $0.97. Meanwhile, a facility operator’s net income has risen nearly 150% since 2014
2. Basic operating knowledge. As with other businesses, it is also important to understand consumers’ behaviors and find ways to attract and keep them. A survey from blog site Sparefoot found that self-storage space renters rank the following as their key concerns:
3. Rental rates. At the operators’ end, price too is their top concern as it determines their value gains from their initial investments.
Below are the monthly average rates in the U.S. by unit size:
|Size||Average Storage Cost (Monthly)||Average Cost Per Square Foot|
Rental rates vary largely based on location. San Francisco, CA has the costliest monthly rate at $157.61 or $2.63 PSF. It is followed by Redwood City, CA at $141.81, or $2.12 PSF. The figures compare to the $51.84 or $0.64 PSF monthly storage unit price in Montgomery which is the cheapest. It is followed by Lubbock, TX at $52.39 per month or $0.67 PSF.
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