In Colliers last newsletter, we discussed how portable self storage units can be treated as either Real Estate or Personal Property and how owners are utilizing these portable units to maximize profits and value in their properties.
In an effort to increase revenue, self storage facilities are looking to utilize portable self storage units to increase their net rentable area by fitting out unutilized space.
This potential space exists due to irregular shaped lots, poor configuration of existing structures, unused interior areas or as an alternative in areas which are unable to be developed with permanent structures due to easements, leased ground or required setbacks. Additionally, some facility owners order units to test the market for absorption rates before a major conversion or expansion.
Portable units are becoming more attractive, as the cost per square foot is significantly less when compared to permanent self storage units, they don’t demand the added time and expense of attaining building approvals and permits required for permanent construction and because the owner can take advantage of accelerated depreciation by utilizing either a 7-year write-off of personal property or a 100% write off in the first year vs a 30-year write-off for permanent structures.
Lisa Maloney is the Strategic Account Manager for Boxwell, the industry-leading supplier of custom, quick-assembly portable storage containers. Boxwell offers a number of preconfigured portable storage containers with custom sizes and business branding available. Containers are 100% weather resistant; roofs are corrugated to allow for optimal durability and water runoff, and floors are coated to provide a waterproof, non-slip, non-toxic, non-flammable surface. Lisa reported that as owners have become more aware of the advancement, customization, timing and cost of these portable units, the demand has increased. Boxwell has worked to streamline the buying process and currently the typical time-frame from ordering to installation on-site runs from 8-12 weeks. Based on customization, the units can be significantly less than building, which includes delivery and installation on the required flat gravel, cement or paved site. A typical unit is 8 x 20. This unit can be broken down into multiple configurations including (2) 8x10 spaces, (4) 5x8 spaces or (8) 4x5 spaces. Based on the configuration, the unit is fit out with partitions and doors (swing or rollup). The units can be permanently affixed to the ground or to each other with brackets. Additionally, these units can be stacked 3 high to conserve footprint space.
Portable self storage units are not going to replace permanent structures, but they are filling a niche as experienced operators are finding ways to maximize profits from their facilities.