Climate Control Self Storage Development - Design & Cost

[Joey Stelly]

Looking into ground up development for single story climate control self storage facilities in my market and looking for some general guidance on design & cost rule of thumbs - any help would be greatly appreciated. 

Currently working through some (very) preliminary due diligence with the goal of creating a template for 150 & 250 unit climate control buildouts in order to dial in an acreage size to focus in on for land acquisition, and to try and determine the most cost effective & scalable footprint to build as a "test" that can be scaled. 

Couple of questions & assumptions that I'd really appreciate some critiquing/input on:

Building Layout:

- Right now I'm assuming 1 acre (43,560ft) will yield about 60% (+/- 26,190ft) of climate control NRSF. 

- What is a good rule of thumb yield/acre, and how many sq ft of slab/building should i assume for every 1 ft of climate control NRSF?

Building Cost: 

- I've heard varying estimates $/ft for capex related to building a climate control facility, but what can I expect generally in total $/ft for an assumption when building 150 or 250 unit building. I've heard $50, 35, 40, etc for turnkey rule of thumb - shell, utilities, foundation, M&E, paving, etc, basically everything but land. 

Opex ratio: Is 35% of revenue a solid assumption for operational expenses - insurance, maintenance, etc? 

Right now my cost assumptions look something like this: 

25,000 ft to yield 250 units 

Acreage needed for 250 units = about 1 acre (Depends on local municipality requirements for detention, setbacks etc but for now this is my assumption)

25,000*$50 = total buildout cost less land 

revenue $ *.35 = opex cost 

thanks! 

[Zach Quick]

@Joey Stelly  Your 35% opex is a good estimate.

For drive up self storage the general rule is 15,000 sq. ft. per 1 acre. For essentially one large slab/climate building I think roughly 25,000 sq. ft. is a decent estimate depending on set backs etc. 

Unit size is obviously going to be very local dependent so unit mix/# of units will vary widely.

[Robert Ellis]

Quote from @Joey Stelly:

Looking into ground up development for single story climate control self storage facilities in my market and looking for some general guidance on design & cost rule of thumbs - any help would be greatly appreciated. 

Currently working through some (very) preliminary due diligence with the goal of creating a template for 150 & 250 unit climate control buildouts in order to dial in an acreage size to focus in on for land acquisition, and to try and determine the most cost effective & scalable footprint to build as a "test" that can be scaled. 

Couple of questions & assumptions that I'd really appreciate some critiquing/input on:

Building Layout:

- Right now I'm assuming 1 acre (43,560ft) will yield about 60% (+/- 26,190ft) of climate control NRSF. 

- What is a good rule of thumb yield/acre, and how many sq ft of slab/building should i assume for every 1 ft of climate control NRSF?

Building Cost: 

- I've heard varying estimates $/ft for capex related to building a climate control facility, but what can I expect generally in total $/ft for an assumption when building 150 or 250 unit building. I've heard $50, 35, 40, etc for turnkey rule of thumb - shell, utilities, foundation, M&E, paving, etc, basically everything but land. 

Opex ratio: Is 35% of revenue a solid assumption for operational expenses - insurance, maintenance, etc? 

Right now my cost assumptions look something like this: 

25,000 ft to yield 250 units 

Acreage needed for 250 units = about 1 acre (Depends on local municipality requirements for detention, setbacks etc but for now this is my assumption)

25,000*$50 = total buildout cost less land 

revenue $ *.35 = opex cost 

thanks! 

 I've never seen one story climate control self storage ever. you need to build vertical for economies of scale. most of the ones I've seen are vertical and infill. 

[Joey Stelly]

Appreciate the reply! Thanks @Zach Quick 

[Henry Clark]

OP do you have $600,000 cash on hand?  If you don't, I would start with a smaller Self Storage project.  I would not use any assumptions.  All the info you need you can get and validate.  See below.

Example:

A.  An acre.  Depends on the shape.  Rectangles are better than Squares, Squares are better than triangles/circles/etc.  Lay out on a piece of paper.  Find your setbacks.  We use 50 foot at the front and back for turn arounds even though setbacks can be less.  Sides ???   Lay this out.  Then we use 25 foot driveways.  Lay this out.  Use 10 wide units.  How many do you get?  That is with no Storm retention pond or easements.  How many units did you get?

B.  Don't use 35% or any other factor.  Make a list of expense line items and validate.  Property tax rate you can get.  Insurance you can get.  Electricity if you're doing climate control, temperature control, humidity control, you can get.  Depends on where you're at. Example:  if you want to maintain 78 degrees are you in the north or south?  Average highs of 90 with an average low of 40; versus a location average high of 85 with an average low of 70.

C. You can do both drive up access single story climate control or and enclosed building.  

You need to do a line item business analysis.  Recommend you pick a piece of land in your area and do a line item analysis and post on here.  You will need that anyways for a lender to move forward.  Keep doing about 5 deal analysis to refine your logic and understanding.

[Zach Quick]

Quote from @Robert Ellis:

Quote from @Joey Stelly:

Looking into ground up development for single story climate control self storage facilities in my market and looking for some general guidance on design & cost rule of thumbs - any help would be greatly appreciated. 

Currently working through some (very) preliminary due diligence with the goal of creating a template for 150 & 250 unit climate control buildouts in order to dial in an acreage size to focus in on for land acquisition, and to try and determine the most cost effective & scalable footprint to build as a "test" that can be scaled. 

Couple of questions & assumptions that I'd really appreciate some critiquing/input on:

Building Layout:

- Right now I'm assuming 1 acre (43,560ft) will yield about 60% (+/- 26,190ft) of climate control NRSF. 

- What is a good rule of thumb yield/acre, and how many sq ft of slab/building should i assume for every 1 ft of climate control NRSF?

Building Cost: 

- I've heard varying estimates $/ft for capex related to building a climate control facility, but what can I expect generally in total $/ft for an assumption when building 150 or 250 unit building. I've heard $50, 35, 40, etc for turnkey rule of thumb - shell, utilities, foundation, M&E, paving, etc, basically everything but land. 

Opex ratio: Is 35% of revenue a solid assumption for operational expenses - insurance, maintenance, etc? 

Right now my cost assumptions look something like this: 

25,000 ft to yield 250 units 

Acreage needed for 250 units = about 1 acre (Depends on local municipality requirements for detention, setbacks etc but for now this is my assumption)

25,000*$50 = total buildout cost less land 

revenue $ *.35 = opex cost 

thanks! 

 I've never seen one story climate control self storage ever. you need to build vertical for economies of scale. most of the ones I've seen are vertical and infill. 

There is a bunch in Columbus area, I don't get it ?

[Robert Ellis]

Quote from @Zach Quick:

Quote from @Robert Ellis:

Quote from @Joey Stelly:

Looking into ground up development for single story climate control self storage facilities in my market and looking for some general guidance on design & cost rule of thumbs - any help would be greatly appreciated. 

Currently working through some (very) preliminary due diligence with the goal of creating a template for 150 & 250 unit climate control buildouts in order to dial in an acreage size to focus in on for land acquisition, and to try and determine the most cost effective & scalable footprint to build as a "test" that can be scaled. 

Couple of questions & assumptions that I'd really appreciate some critiquing/input on:

Building Layout:

- Right now I'm assuming 1 acre (43,560ft) will yield about 60% (+/- 26,190ft) of climate control NRSF. 

- What is a good rule of thumb yield/acre, and how many sq ft of slab/building should i assume for every 1 ft of climate control NRSF?

Building Cost: 

- I've heard varying estimates $/ft for capex related to building a climate control facility, but what can I expect generally in total $/ft for an assumption when building 150 or 250 unit building. I've heard $50, 35, 40, etc for turnkey rule of thumb - shell, utilities, foundation, M&E, paving, etc, basically everything but land. 

Opex ratio: Is 35% of revenue a solid assumption for operational expenses - insurance, maintenance, etc? 

Right now my cost assumptions look something like this: 

25,000 ft to yield 250 units 

Acreage needed for 250 units = about 1 acre (Depends on local municipality requirements for detention, setbacks etc but for now this is my assumption)

25,000*$50 = total buildout cost less land 

revenue $ *.35 = opex cost 

thanks! 

 I've never seen one story climate control self storage ever. you need to build vertical for economies of scale. most of the ones I've seen are vertical and infill. 

There is a bunch in Columbus area, I don't get it ?

 One story climate controlled self storage? lol not at all. There's plenty of self storage, not climate controlled. There's been maybe 2 built in 5 years here. they are called Tri village self storage. the climate controlled portions are normally vertical and at least 4-5 stories and normal walk up doors are single story. there is some smaller units but real climate controlled development is vertical not horizontal. 

[Joey Stelly]

Interesting, the majority of the climate control in south Louisiana is single story. Different markets, different perspective I guess.

[Joey Stelly]

Quote from @Henry Clark:

OP do you have $600,000 cash on hand?  If you don't, I would start with a smaller Self Storage project.  I would not use any assumptions.  All the info you need you can get and validate.  See below.

Example:

A.  An acre.  Depends on the shape.  Rectangles are better than Squares, Squares are better than triangles/circles/etc.  Lay out on a piece of paper.  Find your setbacks.  We use 50 foot at the front and back for turn arounds even though setbacks can be less.  Sides ???   Lay this out.  Then we use 25 foot driveways.  Lay this out.  Use 10 wide units.  How many do you get?  That is with no Storm retention pond or easements.  How many units did you get?

B.  Don't use 35% or any other factor.  Make a list of expense line items and validate.  Property tax rate you can get.  Insurance you can get.  Electricity if you're doing climate control, temperature control, humidity control, you can get.  Depends on where you're at. Example:  if you want to maintain 78 degrees are you in the north or south?  Average highs of 90 with an average low of 40; versus a location average high of 85 with an average low of 70.

C. You can do both drive up access single story climate control or and enclosed building.  

You need to do a line item business analysis.  Recommend you pick a piece of land in your area and do a line item analysis and post on here.  You will need that anyways for a lender to move forward.  Keep doing about 5 deal analysis to refine your logic and understanding.

Thanks Henry; working on many of these items. 

why $600k? With an 80% LTC the DP on 25000 square ft @ $50/ft to build out would be more in the $200-300k range right? Land cost included in the loan. 

[Joey Stelly]

Quote from @Robert Ellis:

Quote from @Zach Quick:

Quote from @Robert Ellis:

Quote from @Joey Stelly:

Looking into ground up development for single story climate control self storage facilities in my market and looking for some general guidance on design & cost rule of thumbs - any help would be greatly appreciated. 

Currently working through some (very) preliminary due diligence with the goal of creating a template for 150 & 250 unit climate control buildouts in order to dial in an acreage size to focus in on for land acquisition, and to try and determine the most cost effective & scalable footprint to build as a "test" that can be scaled. 

Couple of questions & assumptions that I'd really appreciate some critiquing/input on:

Building Layout:

- Right now I'm assuming 1 acre (43,560ft) will yield about 60% (+/- 26,190ft) of climate control NRSF. 

- What is a good rule of thumb yield/acre, and how many sq ft of slab/building should i assume for every 1 ft of climate control NRSF?

Building Cost: 

- I've heard varying estimates $/ft for capex related to building a climate control facility, but what can I expect generally in total $/ft for an assumption when building 150 or 250 unit building. I've heard $50, 35, 40, etc for turnkey rule of thumb - shell, utilities, foundation, M&E, paving, etc, basically everything but land. 

Opex ratio: Is 35% of revenue a solid assumption for operational expenses - insurance, maintenance, etc? 

Right now my cost assumptions look something like this: 

25,000 ft to yield 250 units 

Acreage needed for 250 units = about 1 acre (Depends on local municipality requirements for detention, setbacks etc but for now this is my assumption)

25,000*$50 = total buildout cost less land 

revenue $ *.35 = opex cost 

thanks! 

 I've never seen one story climate control self storage ever. you need to build vertical for economies of scale. most of the ones I've seen are vertical and infill. 

There is a bunch in Columbus area, I don't get it ?

 One story climate controlled self storage? lol not at all. There's plenty of self storage, not climate controlled. There's been maybe 2 built in 5 years here. they are called Tri village self storage. the climate controlled portions are normally vertical and at least 4-5 stories and normal walk up doors are single story. there is some smaller units but real climate controlled development is vertical not horizontal. 

 Interesting, the majority of the climate control in south Louisiana is single story. Different markets, different perspective I guess.

[Henry Clark]

Quote from @Joey Stelly:

Quote from @Henry Clark:

OP do you have $600,000 cash on hand?  If you don't, I would start with a smaller Self Storage project.  I would not use any assumptions.  All the info you need you can get and validate.  See below.

Example:

A.  An acre.  Depends on the shape.  Rectangles are better than Squares, Squares are better than triangles/circles/etc.  Lay out on a piece of paper.  Find your setbacks.  We use 50 foot at the front and back for turn arounds even though setbacks can be less.  Sides ???   Lay this out.  Then we use 25 foot driveways.  Lay this out.  Use 10 wide units.  How many do you get?  That is with no Storm retention pond or easements.  How many units did you get?

B.  Don't use 35% or any other factor.  Make a list of expense line items and validate.  Property tax rate you can get.  Insurance you can get.  Electricity if you're doing climate control, temperature control, humidity control, you can get.  Depends on where you're at. Example:  if you want to maintain 78 degrees are you in the north or south?  Average highs of 90 with an average low of 40; versus a location average high of 85 with an average low of 70.

C. You can do both drive up access single story climate control or and enclosed building.  

You need to do a line item business analysis.  Recommend you pick a piece of land in your area and do a line item analysis and post on here.  You will need that anyways for a lender to move forward.  Keep doing about 5 deal analysis to refine your logic and understanding.

Thanks Henry; working on many of these items. 

why $600k? With an 80% LTC the DP on 25000 square ft @ $50/ft to build out would be more in the $200-300k range right? Land cost included in the loan. 

 Validate your  1acre model as far as units and NRSF.

 Assume no storm pond.

Model 1:
We use 50 foot at both ends for turnaround.

25 foot driveways.

Side Setbacks use 25 foot.

Pick a rectangle since that is the most efficient shape.  

With 10 foot wide units.  Use a mixture of 30 and 40 wide units.   How many units did you come up with?

Model 2:

Build a one roof facility. 
No driveways. 
Just setbacks in the 3 sides.

50 foot parking up front.

Single story.  No elevator or stairs.

ADA compliant hall ways and doors.

How many units did you come up with?

Validate your footprint and NRSF first.  Then work on cost.  

[Zach Quick]

Quote from @Robert Ellis:

Quote from @Zach Quick:

Quote from @Robert Ellis:

Quote from @Joey Stelly:

Looking into ground up development for single story climate control self storage facilities in my market and looking for some general guidance on design & cost rule of thumbs - any help would be greatly appreciated. 

Currently working through some (very) preliminary due diligence with the goal of creating a template for 150 & 250 unit climate control buildouts in order to dial in an acreage size to focus in on for land acquisition, and to try and determine the most cost effective & scalable footprint to build as a "test" that can be scaled. 

Couple of questions & assumptions that I'd really appreciate some critiquing/input on:

Building Layout:

- Right now I'm assuming 1 acre (43,560ft) will yield about 60% (+/- 26,190ft) of climate control NRSF. 

- What is a good rule of thumb yield/acre, and how many sq ft of slab/building should i assume for every 1 ft of climate control NRSF?

Building Cost: 

- I've heard varying estimates $/ft for capex related to building a climate control facility, but what can I expect generally in total $/ft for an assumption when building 150 or 250 unit building. I've heard $50, 35, 40, etc for turnkey rule of thumb - shell, utilities, foundation, M&E, paving, etc, basically everything but land. 

Opex ratio: Is 35% of revenue a solid assumption for operational expenses - insurance, maintenance, etc? 

Right now my cost assumptions look something like this: 

25,000 ft to yield 250 units 

Acreage needed for 250 units = about 1 acre (Depends on local municipality requirements for detention, setbacks etc but for now this is my assumption)

25,000*$50 = total buildout cost less land 

revenue $ *.35 = opex cost 

thanks! 

 I've never seen one story climate control self storage ever. you need to build vertical for economies of scale. most of the ones I've seen are vertical and infill. 

There is a bunch in Columbus area, I don't get it ?

 One story climate controlled self storage? lol not at all. There's plenty of self storage, not climate controlled. There's been maybe 2 built in 5 years here. they are called Tri village self storage. the climate controlled portions are normally vertical and at least 4-5 stories and normal walk up doors are single story. there is some smaller units but real climate controlled development is vertical not horizontal. 

I get that most of the new development is multi story but there is still plenty of single story climate in Columbus MSA, don't want OP to think you have to go vertical, because if you can go single story you should. Not every market can support rents for vertcal.

[Henry Clark]

Drive up versus Climate controlled vertical.  We would be glad to have 3 competitors with vertical climate control build next to us.

1.  Free advertising.

2.  They can't compete on a cost or rental rate basis, unless supported by a large corporate office for price reductions.

3.  Drive up versus vertical.  Customers will always prefer to drive up and unload versus buggy in and up an elevator and down a hallway.

4.  Risk- generally speaking you have to build out the vertical spot, whereas a drive up you can add buildings as needed.  Even if you don't buildout all of the floors on a vertical, you still have to put in stronger footings and beams.

5.  Unit sizes- drive up will always compete better on larger size units such as 10 x 20.  Vertical has to go with higher per sq ft rental, so they go towards lower sizes.  Plus less buggy time.

6.  Vertical does optimize roads and driveways better than drive up.  But Vertical uses up more "Covered" space which is more expensive than driveways.  But vertical uses up a lot for walkways, elevators and stairs.

7.  Fire suppression needed for Vertical.

8.  Vertical is better at optimizing both land cost and using smaller spaces in cities.

9.  Risk- Vertical has a lot higher Risk/reward impact than drive up.

10.  Single Story climate control- higher electric costs.  Go for solar power.  Need to insulate the pad, walls, roof, doors.  Decide if you're going for temperature or humidity control.  If you're in Bogalusa, LA you might go for humidity.  Have both an air conditioner and a dehumidifier system.  If you're in Reno, just go with Temperature control and don't worry about humidity.

[Robert Ellis]

Quote from @Zach Quick:

Quote from @Robert Ellis:

Quote from @Zach Quick:

Quote from @Robert Ellis:

Quote from @Joey Stelly:

Looking into ground up development for single story climate control self storage facilities in my market and looking for some general guidance on design & cost rule of thumbs - any help would be greatly appreciated. 

Currently working through some (very) preliminary due diligence with the goal of creating a template for 150 & 250 unit climate control buildouts in order to dial in an acreage size to focus in on for land acquisition, and to try and determine the most cost effective & scalable footprint to build as a "test" that can be scaled. 

Couple of questions & assumptions that I'd really appreciate some critiquing/input on:

Building Layout:

- Right now I'm assuming 1 acre (43,560ft) will yield about 60% (+/- 26,190ft) of climate control NRSF. 

- What is a good rule of thumb yield/acre, and how many sq ft of slab/building should i assume for every 1 ft of climate control NRSF?

Building Cost: 

- I've heard varying estimates $/ft for capex related to building a climate control facility, but what can I expect generally in total $/ft for an assumption when building 150 or 250 unit building. I've heard $50, 35, 40, etc for turnkey rule of thumb - shell, utilities, foundation, M&E, paving, etc, basically everything but land. 

Opex ratio: Is 35% of revenue a solid assumption for operational expenses - insurance, maintenance, etc? 

Right now my cost assumptions look something like this: 

25,000 ft to yield 250 units 

Acreage needed for 250 units = about 1 acre (Depends on local municipality requirements for detention, setbacks etc but for now this is my assumption)

25,000*$50 = total buildout cost less land 

revenue $ *.35 = opex cost 

thanks! 

 I've never seen one story climate control self storage ever. you need to build vertical for economies of scale. most of the ones I've seen are vertical and infill. 

There is a bunch in Columbus area, I don't get it ?

 One story climate controlled self storage? lol not at all. There's plenty of self storage, not climate controlled. There's been maybe 2 built in 5 years here. they are called Tri village self storage. the climate controlled portions are normally vertical and at least 4-5 stories and normal walk up doors are single story. there is some smaller units but real climate controlled development is vertical not horizontal. 

I get that most of the new development is multi story but there is still plenty of single story climate in Columbus MSA, don't want OP to think you have to go vertical, because if you can go single story you should. Not every market can support rents for vertcal.

 Even when I google climate controlled self storage in Louisiana but all the big operators all the images are multiple stories. of course it's possible to build climate control one story, institutional level development is different than individual. I'm just telling him he's underutilizing his site by going one story and if he plans to exit he should plan around what an institutional level self storage purchaser will want. development is about exit or ability to exit and risk. in multifamily we build or try to build at least 150 units. not 40 or 60 or 80 there's no buyers. I have an 18 million dollar 162 unit we are entitling right now and I talked to a South Florida capital markets equity and debt placement broker and his minimum is 50 million. that's insane for columbus and it challenges us to develop larger. I'm not sure your qualifications Zach, if you are a self storage developer if you are I'd love to hear more about the details, if not id stick to your sand box I'm only trying to help him plan for an exit.