Considering Climate Control
The self-storage industry has come a long way from its roots of plain metal buildings with roll-up garage doors. Today’s self-storage customer expects self-storage to be cool, literally.
Self-storage in the 21st century not only looks a lot different than it did in the 20th century, for many facilities, it also feels a lot different. Customers expect to unload their items into a safe, well-secured facility, and they want their items climate controlled.
“Customers expect climate control now as part of the storage package,” says Bill Martin, director of commercial programs at Logis-Tech, Inc. “If your facility doesn’t have it, you don’t have a competitive edge.”
Self-storage facilities don’t have to be built with climate control in every situation, but it certainly does give a competitive edge in almost any market.
Determining whether your new facility should be climate controlled involves many factors. Deciding on the system to install also requires a lot of planning.
Climate Control Questions
One of the first issues to consider when deciding if you should have climate control in your new facility is the actual climate in your region, which typically dictates what type of competition you have in that market. There is almost no place in the United States that wouldn’t benefit from climate-controlled self-storage as most areas have either hot, dry weather or extreme cold; customers appreciate having an air conditioned space to move items into during hot and humid weather, which means customers want to protect their items from mold.
Even if you are planning to build a new self-storage facility in a market with older facilities that aren’t climate controlled, you will still most likely benefit from offering climate-controlled features. “If you’re going into a market with older facilities, you create the opportunity to be different from your competition,” says Jim Chiswell, president of Chiswell & Associates.
According to Chiswell, the average added cost to construction for climate control is 20 percent; however, he says that is quickly recovered in the increased rental amounts. Per the Self Storage Association’s “2015 Fact Sheet”, the average rental for a 10-by-10 unit in a non-climate-controlled environment is $118; the average for climate control of the same size is $151.
Chiswell also gives a real-world example of a self-storage facility in Little Rock that is currently charging $41 for a standard 5-by-5 unit and $56 for the same size that is climate controlled, which is a 37 percent increase. Also, the bigger the unit, the large the premium. The 10-by-10 unit had a 54 percent higher rent for climate control and the 10-by-15 had a 70 percent higher rent.
Chiswell points out that utilities will be more expensive in a climate-controlled facility. While those expenses will vary depending on the size and layout of the facility, being able to charge on average from 20 to 70 percent higher rent should still allow owners/operators to recover their costs. “When you get to that break-even point, everything additional goes to the bottom line, and having climate control is a good way to maximize income opportunity,” says Chiswell.
Of course, doing a market analysis is key to knowing if the market will support climate control. If you are building a facility and expect to cater to pharmaceutical representatives or other professionals who need to store their samples, it’s imperative to offer some climate-controlled units. Chiswell says the only time climate control is not a good option is when the facility is built in an area that will not support the increased rents.
Jeff Helgeson, who co-owns 180 Self Storage with Tim Jones, has two facilities in Arizona and one in Texas, mentions that two of his facilities are 100 percent climate controlled and the third facility is 60 percent. “It’s really for the customer’s comfort and convenience,” says Helgeson. “It’s really rare to see any in those parts of the country built today that aren’t climate controlled.”
On average, Helgeson’s facilities are able to charge 20 to 30 percent more for climate control.
Another factor to consider when evaluating climate control is whether you will offer inside access, which means the customer will be doing most of their unloading/loading in the air conditioning or heat during winter months.
Helgeson notes that his facilities have a combination of drive-up and inside access, depending on the size and layout of the build site. “If you can spread out and build on one level, it’s easier and less expensive to build, but we do have a site that we had to go up,” says Helgeson.
Planning For Climate Control
Facilities can always be retrofitted for climate control, but one of the disadvantages of having to retrofit is that it is sometimes more expensive to add insulation and duct work later; ductwork sometimes cannot be hidden and accessing occupied units is tricky.
The best solution is to plan for a climate-control facility from the beginning of the build. There is a lot to consider. For example, what system is right for your facility and who should you hire to install it?
“First of all, you want to hire someone who has done climate control for self-storage before,” says Chiswell. “One of the main things I’ve seen done is that the companies have a tendency to overkill. They don’t zone and they sell too big of systems.”
One of the things Chiswell advises is to make sure you and your contractor don’t overlook the airflow at the entrance where the customer is first walking in the door. “The air flow hitting them at the entrance will give them the perception of what it will be like inside the
]building.”
Another factor to consider when planning a climate-controlled facility is the type of insulation to use and the R-value of your insulation. The R-value is the measure of heat flow resistance given to a material, such as insulation. In theory, the higher the R-value, the greater the resistance. So, if you’re going to have climate control, you should choose an insulation with a high R-value.
If you’re going to build a partially climate-controlled facility, the part that is not climate controlled can have a lower R-value insulation. Helgeson said that his units that are climate controlled have an insulation with an R-30 rating, the non-climate-controlled units have standard space R-11 in the ceiling.
There are different types of insulation that are best for different building materials as well. Bill Lippy, president/CEO of Fi-Foil Company Inc. in Auburndale, Fla., whose company sells reflective insulation and radiant barriers, states that his systems are used mainly on metal, frame, and block buildings.
One of the company’s products, the RetroShield System, is a cost-effective way to add insulation to existing and new buildings. The system incorporates Fi-Foil’s RBI Shield, which features its revolutionary reflective insulation technology and Clip & Pin components. The Clip & Pin components easily attach to the lip of the purlin to secure the reflective insulation. Lippy claims the system is easy to install and costs about 55 cents per square foot. “Fiberglass can also be used to add extra R-value,” Lippy says.
More Than Staying Cool
Climate control is a lot about providing an amenity for the comfort of your customers, but, if you’ve been around the self-storage industry for anytime, you have most likely encountered angry customers who have retrieved moldy items from storage. “Customer really don’t care if their couch or table or chairs are air conditioned; they just care whether or not it’s in the same pristine condition as when they left it,” says Martin. “Some have likened mold as the asbestos of the 21st century.”
Mold has become an issue, even in some climate-controlled facilities, because more studies have proven that mold can be a health hazard. “Insurance companies are adding mold riders to their insurance policies to cover expenses when plaintiffs can prove that mold damage was the result of negligence on the part of the storage facility owner,” says Martin. “The cost of mold remediation to a self-storage building is extraordinary, often in the 10s of thousands of dollars.”
Martin adds that just because you’ve chosen to build a climate-controlled facility doesn’t mean that you’re not going to have mold problems. He cited one facility that added an air conditioning unit to help solve the problem of high humidity (to the point of water running down the walls) on the basement level. The air conditioning use did nothing but ensure that there was cold water then running down the walls.
Martin explains that the Environmental Protection Agency recommends keeping the humidity between 30 and 50 percent, which doesn’t allow mold spores to grow. “The problem with this is that typical air conditioners can only reduce the humidity in high humidity regions to between 60 and 65 percent,” Martin says.
Lowering the thermostat to the 60s may help remove the moisture, as the colder the environment, the lower the humidity, but it still won’t do an efficient job and will also help drive up utility costs and place more wear on the unit faster.
The perfect solution is to install an air conditioning system from the outset that is capable of cooling the air and providing enough dehumidification to get the level to at least 50 percent. Or, you can also install dehumidification systems that augment your air system.
Logis-Tech offers the ESS system for exterior or interior access, as well as single unit systems. Munters, another company known in the self-storage industry, offers its DryCool systems. “It’s a desiccant system and the process it uses is very efficient,” says Denise Salinas, marketing manager for Munters. “It’s an ideal solution, because it combines both into one system and can control the humidity and temperature independently.” Once an owner or contractor contacts the company, a Munters sales engineer will help them select a system that is right for the building.
No matter what system you choose, keeping the humidity at 50 percent or below will help you lower utility costs and help keep your air conditioning unit longer. By having lower humidity, the thermostat can be easily set at 80 degrees rather than in the 60s; and, because the air conditioner is not working as hard, it will last longer.
Kerri Fivecoat-Campbell is a freelance journalist based in the Ozark Mountains. She is a regular contributor to MiniCo’s publications. Her business articles have also appeared in Entrepreneur, Aol.com, MSN.com, and The Kansas City Star.