While you may think renovating your self-storage facility is too big of a financial burden, or that you could get by for a few more years without upgrading your building or security, we’re here to tell you that’s far from true. Providing a safe and secure environment for your customers is your number one role as an owner operator, and if injury or damage occurs to your tenants or their property because of an outdated facility, it can be much more costly than the price of restoring your facility as it needs it.
Renovating your self-storage facility comes with financial benefits that make it an attractive solution rather than a financial burden - It’s one of the top ways to increase property value and make more money. That’s why we’re diving into the many benefits of renovating your outdated facility, including how it will increase revenue, property value and safety.
Benefits of Renovating Your Old Facility
The three major benefits of renovating your self-storage facility are: increased property value, more rental revenue and better safety. When you invest in your self-storage facility’s building and security, you’re making sure it’s equipment, components and features are up-to-date to deliver the best customer experience possible to your tenants. This investment increases your property value and allows you to charge higher rental rates for premium storage units and experiences. Here’s a closer look into those three benefits:
Increased Property Value
The more you invest into your self-storage property the more that property is worth. If you ever decide to sell your investment, you’ll be able to get more profit if you’ve spent your time wisely investing into the property and its security.
More Rental Revenue
When you regularly assess and upgrade your facility’s building and security, you can continue increasing your tenant’s rental rates overtime by improving their offerings. Things like total access control and Bluetooth electronic smart locks are great tools for leveraging premium units, charging higher rental rates and generating more rental revenue.
By continuously evaluating and assessing your facility, you’ll be able to catch things that need to be replaced before they turn into larger problems. This helps you keep doors operating optimally, your site secure and your customer’s experience safe during each visit.
Is Self-Storage Renovation Worth the Cost?
While there are costs associated with self-storage renovation projects, it’s important to make a note of the significant cost segregation and insurance discounts you’ll likely be eligible for.
In short, cost segregation is a strategic tax planning tool that owners can use to increase their cash flow by depreciating certain types of building components and improvements over a shorter depreciation recovery period. According to an article published on Inside Self Storage, a typical self-storage facility of 45,000 square feet will see a savings between $50,000 and $75,000.
By investing back into your aging facility, you can take advantage of a variety of benefits as well as cost segregation and insurance discounts too. Want to learn more about cost savings and benefits with Janus’s R3 Program?