Northern Exposure: Jason Koonin Banks On Canadian Self-Storage

“My story is kind of boring,” laughs Jason Koonin, pulling no punches as he sits down for this interview. But for someone who never planned to be in the self-storage industry to become CEO of Canada's Bluebird Self Storage and its American cousin Sunbird, most would probably disagree. To get to this point in his career, however, there would be a series of unexpected turns and one chance encounter.

“Ultimately, you can blame Jamie,” says Koonin, talking about one of the co-founders of Bluebird (Jamie Bennett founded it along with Jennifer Smeeton and Reade DeCurtins, both of whom remain active within the business). When Bennett approached Koonin for a strategic consulting engagement – they’d recently been introduced through a mutual friend – he thought, ‘why not?’ 

This was on March 16, 2020. The two men agreed they’d work together, and what followed was a handshake that would shake things up in self-storage. But, not before a global pandemic shook the world first.

Jason Koonin, Angie Koonin, Reade DeCurtins, Jamie Bennett

Credit Analytics Expert

Koonin carries an economics degree from Princeton University, which is impressive in itself. However, he’s the first to admit that he didn’t get into finance to carry on a family legacy, nor was there any particular incident that guided him in that direction. “Nothing really inspired me, no major seemed to fit,” shrugs Koonin. “By process of elimination, I ended up in Economics. Fortunately, I loved it and never looked back.”

Living in Charlotte, North Carolina, Koonin spent eight years with Wachovia Bank and then Wells Fargo. His early work focused on researching default data and forecasting commercial loan default probabilities. Over time, he grew passionate about credit risk management and had dreams of becoming a Chief Risk Officer. To make that a reality, he set out to the University of Chicago’s Booth School of Business, well-known for its Nobel laureate-filled faculty. There, he concentrated in Analytic Finance, Risk Management, and Entrepreneurship.

After obtaining his MBA he returned to Charlotte. Almost immediately, he found himself in the midst of what would become known as the Great Financial Crisis. “Homeowners in California were starting to default on their mortgages and home prices were actually starting to decline, a rare occurrence,” Koonin recalls.

Koonin and his team went to work studying prior economic episodes related to home prices and recessions, and became convinced the economy was headed for a rough patch. So, they employed a macro credit hedging strategy focused on large corporate and commercial real estate credit derivative index products to offset any potential bad loans made by the bank. The situation escalated quickly, and banks began to fail. But, after the dust had settled, Koonin and company had managed to generate $800 million in trading profits.

A win like that deepened Koonin’s desire to grow his investment management knowledge. He embarked on a multi-year journey to become a Chartered Financial Analyst, one of the highest distinctions in the finance arena.

Armed with his new credentials, Koonin was hired by BB&T in Winston-Salem, NC and worked there for nearly a decade, leading credit portfolio strategy, retail credit products, and commercial credit products. “Not all at once though,” laughs Koonin, adding that in all of these positions, he was in a risk management function and responsible for analyzing credit portfolios and recommending strategies for how to allocate assets across the bank.

After several years playing defense, Koonin saw opportunities to help the bank grow its loan portfolio. He urged the executive management team to improve the bank’s loan products. They eventually agreed, and transferred him to the Community Bank. “They weren’t sure what product management was so they told me to figure it out. I had no experience in this area and was quite nervous at first,” Koonin recollects. 

Appointed Head of Credit Product Management, Koonin worked tirelessly to make loans more attractive to potential customers. He made the application processes easier, provided faster credit decisions, and ultimately helped the bank’s loan portfolio grow more than 10 percent per year, the fastest among large banks at the time. 

Banking Blues

Despite his success, Koonin continued to see resistance from top brass when it came to any sort of creative financing, and it bothered him. Though he loved what he did, he was quickly becoming frustrated with the red tape.

Koonin’s exit from banking was also foreshadowed by a looming merger between BB&T and SunTrust Bank, which would ultimately result in the creation of Truist Financial Corporation in 2019. “I didn’t want to be part of such a large banking organization,” explains Koonin. “The increasing amount of regulation, politics, the excess bureaucracy in a 50,000-person organization… That leaves very little room for innovation.”

Koonin says the idea of remaining in the industry, with the inability to be creative and entrepreneurial, kept him up at night. “I was frustrated and fearful of what the remaining decades of my career would look like staying in an industry or organization where the main goal is to prevent change from occurring.”

With that, Koonin left banking, but he took his expertise with him and launched his own consulting company, Rare Strategies. The company was designed to do things unconventionally, and so when Jamie Bennett came calling, Koonin was ready to pick up the phone.

Bird In The Hand

As soon as Koonin and Bennett decided to work together, the world shut down. “Covid hit,” says Koonin, shaking his head. “We made a deal on a Thursday, and then we were in lockdown the following Monday.”

While it wasn’t an ideal situation, the pandemic did give Koonin plenty of time to learn more about the business. “I could see how to apply everything I knew about finance and banking to self-storage,” explains Koonin. “My experience as a Product Manager was essential because managing products is essentially the same across all industries. Loans and storage units aren’t really that different. Both have features, marketing, customer service, and pricing aspects. But unlike banking, self-storage is innovating as an industry. Many operators are not opposed to change, but rather embracing it. So my desire to do things differently really transferred to self-storage – especially Bluebird.”

For three months, Koonin became a student of self-storage in his basement, poring over industry research, competitor websites, and financial models. “I could see that self-storage presented a huge opportunity for me to apply my skills.”

With that, Koonin put together a business case focused on not just building storage properties, but managing them. Bennett was onboard immediately. Of course, the fact that Bluebird was headquartered in Toronto, Canada – a different country and a city located nearly 1,000 km from Winston-Salem – was not lost on Koonin. “My entrance into self-storage may have been easier if I had stayed closer to home, but Jamie knew the Canadian market intimately and I was ready to learn from him,” he says.

Unique Cliques

Although the archetypes may not be as clearly defined as they are in, say, a John Hughes movie, Koonin maintains that there are definitely some Canadian self-storage cliques. Because of their tight circle, he says newcomers will often be looked at as outsiders.

“There’s going to be cliques in any industry, I get it,” laughs Koonin. “I knew them in banking and if I’m being honest, I probably was part of one. But self-storage in Canada is a smaller marketplace and a little more unique.”

Because there are only about 15 storage companies with 10 facilities or more in Canada, the industry is much more of a club than it is in the United States, explains Koonin. “They’re used to doing things a certain way, many using the same sort of operating principles,” he says. “So, coming into the market as a newbie – and an American to boot – well, perhaps I wasn’t looked at too favorably. And I’m still not.”

Despite this, Koonin understands why they were cautious about him and Bluebird. “There's no question that what we were doing, and continue to do, is disruptive. From our customer care philosophies to our pricing strategies, we tend to go against the grain rather than worry about being part of the in-crowd.”

Koonin doesn’t harbor any hard feelings. “I think there are very few industries that are excited about new entrants. It just made me want to work harder to prove myself and the Bluebird business model.”

Canada Connections

Koonin says that despite Bennett’s Canadian upbringing – the company co-founder was born in Ontario but moved with his family to the United States at an early age – the process of developing storage facilities in the country is significantly more difficult than in most U.S. cities. 

“The zoning and entitlements process generally lasts much longer In Canada,” he reveals. “While each city or municipality has its own process, bigger cities tend to be much much slower. Toronto takes more than two years and Vancouver is taking over four years. It takes a decade to develop and lease up in some of these cities.”

Koonin asserts that if you want to build in Canada, you’d better have some cash on hand, an ecosystem of planners that can work with and persuade city officials, and an experienced development team that's used to building in specific markets. “If you don’t have these things lined up, you’re going to see delay after delay when trying to get city approval. Fortunately, Bluebird has such a seasoned team in place that we’re able to set up shop in places where others may be denied.” Koonin maintains that the Bluebird branding is warm and welcoming, its facilities are architecturally attractive, and it easily integrates into many areas. “We can fit in anywhere – but we’re highly selective on where the Bluebird lands.”

Koonin is excited about the growth potential for Bluebird. “I remember thinking that if one day we could get to 30 properties, that that would be success,” he says before breaking a smile. “Then we got to 30 so I recalibrated that goal to 300.”

A premier Bluebird Storage facility 

Pricing & Passion 

One thing that Koonin has stood firm on since day one is the need for pricing transparency with tenants. He believes that teaser rates, bait and switch, aggressive ECRIs (existing customer rate increases) – whatever you choose to call them – are a really bad look for the industry. “I've said it until I’ve been blue in the face, self-storage isn’t just about maximizing profits, but understanding the needs of people and treating them with respect. I’ve been one of the most outspoken in the industry on this topic. Just because something is legal, doesn’t mean it’s ethical. Tenants are people. We view our tenants as long-term relationships, not transactions. And that’s the difference between Bluebird and much of the industry these days.”

Koonin says that others in the industry need to be careful about putting a stain on everyone. “When someone has a bad experience at that one facility, they tend to paint us all with the same brush, and I think that's a significant risk to the industry,” claims Koonin, though he adds that he feels the tides may be turning. “At the recent Self Storage Association Conference in Las Vegas, I had several people working for large operators tell me they thought it was great that we have price transparency with tenants, that we treat them with respect and don't use teaser rates. That’s huge. When you have employees that work for competitors saying that they're not really comfortable with what their company is doing, I think that means a change is coming.”

Of course, as a shrewd analyst, Koonin also sees the financial impact these pricing games are having on some operators’ financials. “Some of them are starting to crater using these tactics,” he states. “So if they don’t quit the aggressive pricing trend out of the goodness of their heart, I have no doubt they will eventually abandon it in order to please investors and rightsize their bottom line.”

Giving back to the community is also something Koonin is passionate about, which is why he was excited to partner with Shelter Movers, a charity providing free moving and storage services to individuals and families fleeing abuse. “Partnering with Shelter Movers was just a very natural fit for us,” says Koonin. “They have a dire need for space, and if there's one thing storage companies have, it’s space.”

Koonin adds that a lot of shelters have strict limits to what someone can bring with them, and that two trash bags full of belongings tends to be the norm. “Can you imagine having to put everything that matters to you into two trash bags and leave everything else behind?” he asks rhetorically. “By donating roughly 165 units (18,000 sq ft) on a near-permanent basis across Canada, we help people escaping abusive situations keep what matters most to them. This makes it much easier for them to get back on their feet and leave the shelter to restart their life.”

Another charity close to Koonin’s heart is Sleep In Heavenly Peace whose tagline is “No kid sleeps on the floor in our town!” This non-profit rounds up volunteers to build and deliver beds to ensure safe and comfortable sleeping conditions for children in need. “They often don’t have the space to store the material they need to do community bed builds. We provide that space and it’s our pleasure to do so,” says Koonin.

An American In Canada

Although Koonin and company have now built a successful property management company in Canada, the fact that it began as a virtual endeavor in a North Carolina basement during Covid is very impressive. “I’d been to Canada in the past for business and leisure. But working on a Canadian business plan and not being able to get across the border because of the pandemic was…” he rests his chin in his palm for a moment and thinks, before settling on the words “interesting and exciting.”

Now, with the pandemic in the rearview, Koonin says he comes to Canada regularly. “Seeing the fruits of our labor in Canada, after they’d just been a plan on a piece of paper for so long during Covid, is still surreal.”

Adds Koonin, “Plus, I just love the people I meet in Canada! They are friendly, polite, and fun to be around.”

Jason Koonin will be featured on the cover of the winter edition of MSM's print and digital magazine Self-Storage Canada. Click here to subscribe.

Brad Hadfield is the web manager and a news writer for MSM.

Further Reading:

- Bluebird Of Happiness: What Makes This Self-Storage Company Soar

- Self-Storage Pricing: Sunbird Storage Takes The Lead