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The Market Monitor is an informative online newsletter published by the Argus Self Storage Sales Network.
II 2012	It’s Time to Get Your Marketing Plan Tuned Up! As we close out February, we are starting to receive positive year-end data from 2011. While the last few years have been difficult for most of the commercial real estate market, self storage proved to be very resilient. All four of the self storage REITS reported same-store gains in Net Operating Income (NOI) from Q3 2010 to Q3 2011 (PSA +9.8%, EXR +7.3%, CUBE +7.9%, SSS +7.9%). The question is, did you enjoy the same increase in your NOI? ... Read Full Article
I 2012	New Year, New Goals, New Investment Market As the New Year begins, we are seeing the transaction market show signs of equilibrium which have not happened in the last few years. It appears that buyers have regained confidence; they are being more disciplined with their assumptions...... Read Full Article
XII 2011	Wrap It Up! The last few months of 2011 were markedly different than the first 6 or 7 months of the year, especially for the real estate business and self-storage properties. Liquidity in the real estate debt market slowed in the third and fourth quarters of 2011, led by the CMBS market mid-year, and in general, banks lived up to their "scrooge" reputation by dragging their feet on making new loans.... Read Full Article
XI 2011	Past Due Rent: The Real Estate Implications "I wish buying and selling real estate was easier" is a common sentiment I hear from my clients as they engage in the transaction process to buy or sell a storage facility. Consummating a real estate deal is tough. Besides agreeing on the most salient transaction terms such as price, earnest money, and financing, there are less prominent details that have to be sorted out. One of these items is past due rent - who gets to keep it, the Buyer or the Seller?... Read Full Article
X 2011	Opportunities in the Market Today In my recent conversations with self-storage owners, I have noticed that the majority are enjoying stabilizing revenues, and in some cases they are also enjoying an increase in revenue over the last 6 to 12 months. Interestingly, most owners don't realize that they have made or lost money because they are in the real estate business and not the self-storage business. While the increase in revenue is creating more cash flow for owners, today the real opportunity lies in the arbitrage that a real estate investor can capitalize on between cap rates and interest rates.... Read Full Article
IX 2011	Winding Down 2011 If you read the last issue of the Market Monitor, it is apparent that the fundamentals of the self-storage business are sound. With all four of the major self-storage REITs posting positive growth numbers over the same quarter last year it is clear that the industry is poised to move forward. ... Read Full Article
VIII 2011	What's Next for Self-Storage? The economic and political roller coaster of the last month has been devastating not only to the stock market but also to the overall investment market, including commercial real estate. The fear and greed that motivates investors to take positions either to protect their investments in uncertain times or capitalize on what they perceive as opportunity has been frozen by the overall volatility in the market over the last month.... Read Full Article
VII 2011	Capital Markets Update The availability of commercial real estate capital continues its expansion across all sectors with the CMBS market seemingly running at full steam (although nowhere near the peak in 2007) and life insurance companies already exceeding annual loan volumes year to date compared to recent years. Loan pricing competition is fierce for low leverage (sub-60% loan to value) transactions across all property sectors and higher leverage (75%+ loan to value) loans are generally available for multi-family properties in strong markets, as well as dominant grocery anchored centers and institutional quality multi-tenant bulk warehouse properties. Self-storage and hotels are receiving more attention from conventional lenders, although recent operating history is critical to the underwriting process.... Read Full Article
VI 2011	The Greatest Risks to Your Value and How to Overcome Them Forecasting economic trends, particularly in real estate, is risky business. However, not paying attention to economic trends such as interest rates, cap rates and overall real estate investor confidence is even riskier. I believe that self storage owners have made or lost more money because they are in the real estate business not the self storage business; even though your self storage business is an extremely reliable income stream.... Read Full Article
V 2011	Staying on Top of the Marketing Game While the last few years have been very difficult for the self-storage industry, the most positive and productive result of the contracting economy and challenging real estate market was that self-storage operators had to take a very hard look at their operating expenses. This has forced many operators to change their marketing campaigns and go outside their comfort zones to move into the next generation of self-storage marketing.... Read Full Article
IV 2011	Extraordinary Times - How Long Will They Last? During the relatively brief history of the self-storage business (35 to 40 years) the perception about the industry has changed dramatically. Wall Street has now embraced the industry and life insurance companies and conduit lenders have come back to the market, enamored once again with lending on self-storage properties with terms similar to core asset classes such as office, retail and industrial. Along with the respect that the self-storage industry has earned over the years comes an increase in competition. Operators are now realizing that sophisticated operations and economies of scale are imperative to survival in the business. ... Read Full Article
III 2011	Improving NOI Through Auctions There are many ways to enhance your self-storage facility's Net Operating Income (NOI) including raising prices or lowering expenses by using cheaper service providers. With the recent introduction of reality TV shows like Storage Wars, self-storage operators are rediscovering a tool to improve their NOI by recapturing lost revenue from non-paying tenants. ... Read Full Article
II 2011	Are We Back at the Top Yet? As we settle in to 2011, it is clear that self-storage values are rebounding along with the values of all other commercial real estate. In 2010, large MSAs like New York, Boston, Los Angeles, Chicago, San Francisco, Houston, and Washington saw the beginning of a rapid recovery in commercial real estate values, much to my surprise. A combination of big portfolio sales and solid returns during the downturn has led both small and large investors back to self-storage as a preferred investment.... Read Full Article
I 2011	2011 Outlook: Self Storage Investment and Financing Management Since the onset of the recession in 2008, millions of Americans have had to adjust to lower personal incomes, family members losing jobs, decreased asset valuations and shrinking investment portfolios. Simultaneously, commercial real estate values have plummeted by as much as 40 percent from their 2007 benchmark highs. With such financial difficulties, many people have simply tried to hang on until better days. We think those better days may be coming in 2011 given recent encouraging signs of economic improvement: ... Read Full Article
XII 2010	A Decade in Review: How We Got Here and Where We're Going Cautious optimism is certainly present in today's real estate market, including self storage. Self storage owners have seen their values start to rebound and buyers today are disciplined and patient as they find opportunities that fit their criteria. The availability of self storage properties appears to be due primarily to life events that some owners are dealing with, as very few owners are making the decision to sell in order to capitalize on the improving market.... Read Full Article
XI 2010	Online Directories: What is Right for Your Business? If your facility does not have an online marketing strategy, there's a good chance you are already behind. At this point, most storage operators have some sort of web presence. Many storage companies have a website for their facilities, use pay per click advertising, and are listed on a few storage directories.... Read Full Article
X 2010	5 Things to Consider When Selling Your Property It has been a long time coming, but we are beginning to see transaction volume increase as the overall value of self storage properties has returned to a respectful level where both buyers and sellers are agreeing on a fair price. As the market continues to improve, the prospect of selling your facility may become a more feasible option and it is important to make sure you are fully prepared.... Read Full Article
IX 2010	The Changing of the Seasons...and the Real Estate Market? In the last issue of the Market Monitor I described what I believe to be an improved real estate investment market for self storage properties. You might recall that we are seeing a substantial bifurcation in the market, where large properties and portfolios are demanding a premium to smaller, one-off self storage properties. There are some very good opportunities that have been popping up over the last 6 months but I am here to tell you that these favorable conditions won't last.... Read Full Article
VIII 2010	Self Storage Real Estate: A Mid-Year Review Looking back at the first six months of 2010, there is no doubt that real estate transaction volume has improved significantly compared to most of 2009. This is largely due to an adjustment in the two most critical factors that affect confidence; fear and greed. Over the last six months we have seen a much improved attitude toward acquisitions and most self storage professionals are feeling more confident in their ability to perform as the shock of the GREAT RECESSION is starting to wear off. ... Read Full Article
VII 2010	Marketing to the Next Generation They are referred to as "Millennials," "Generation Y," and "Echo Boomers" and they make up the second largest generation in US history. These children of the Baby Boomers, born from the mid-1970s to the mid-1990s, are over 70 million strong and will soon replace their parents as the nation’s most influential group of consumers; a group that interacts with the world in a very different way than past generations.... Read Full Article
VI 2010	It's Time to Understand Your Objectives Self storage is no longer a sleepy little industry that goes unnoticed. Therefore, it is important that you manage your objectives and understand how to execute them in order to maximize your investment. Below I have outlined three possible situations that you might find yourself in and some things to consider as you start to understand your objectives. ... Read Full Article
V 2010	Commercial Real Estate Capital Update The availability of commercial real estate debt has increased significantly in 2010 compared to 2009 and this trend will continue through the year. Most life companies, having spent the better part of last year focusing on asset management and potential loss reserves, have allocated more funds to commercial mortgage origination due to attractive debt yields. Although a few large life companies are still on the sidelines, most will return to new lending activities by year end and will be a good source of financing.... Read Full Article
IV 2010	The Value of Professional Guidance Over the last two years, we have seen real estate transactions become increasingly complex and difficult to complete due to the cautious nature of buyers and, more importantly, the exceptionally cautious nature of the lending institutions. In that light, I thought that it would be helpful to explain what a real estate broker does and why we get paid to help our clients buy and sell self storage facilities. ... Read Full Article
III 2010	Third Party Management - Is It Right For Your Facility? Spring is here and what better time to review the operations of your facility, make that capital improvement you have been putting off or overhaul the marketing plan that has been in place for the last few years? I have recently been reviewing monthly management reports and rolling 12 month operating statements and it has occurred to me that several large operators and other self storage professionals are now clamoring for management business due to the tightening economy.... Read Full Article
II 2010	A 2010 Facility Checkup May Be the Most Important in Years! With the flow of both equity and debt having dramatically decreased in recent years and self storage continuing to perform respectfully, watching your pennies will truly make you dollars in today's market!... Read Full Article
I 2010	Oh, How Times Have Changed! Over the last 12 months, the blues have certainly been present in the real estate market, and this includes self storage. Many self storage owners have seen occupancies and revenues decline, and in some cases, the value of their facility has declined by as much as 30% to 40%. This has largely been caused by the overwhelming breakdown of the credit markets and investor confidence... Read Full Article
X 2009	It's Time to Take a Deep Breath The holidays are upon us and as we get ready to close the books on another year, self storage owners and operators should all take a deep breath. The self storage industry has been the shining star in commercial real estate and we are starting to see signs of improvement in the overall economy.... Read Full Article
IX 2009	Self Storage Owners Have A Lot to be Thankful For It has no doubt been a terrible year for commercial real estate, but as a wise man once said "there must be a pony in here somewhere." Sure enough, there is a pony in there and it is self storage properties. While self storage has not been entirely immune from the effects of the recession, the colossal devastation that has visited other types of real estate has been less damaging for self storage properties. This isn’t because of luck; it is because of natural, positive differences in the way that self storage works as a business.... Read Full Article
VIII 2009	Want to Borrow Money from the Government Cheaper than Goldman Sachs? As we get ready to close the book on another year, self storage owners may want to consider some of the tax advantages that can be realized using cost segregation and the recent changes to the regulations allowing net operating losses to be carried for up to five years. Under the new regulations, if you have paid taxes over the last few years and are now in a situation of operating at a net loss you can apply this year’s losses back five years. You may also want to consider using cost segregation to increase net operating loss and gain the tax advantage ... Read Full Article
VII 2009	It's the 21st Century! In the past, the marketing strategy for the self-storage industry has consisted of a sign, a listing in the Yellow Pages and a friendly, yet often lonely, manager behind the desk. This strategy worked just fine for a long time. In fact, there is an entire industry to prove that it worked just fine until bam! It all changed!... Read Full Article
VI 2009	Summer is Almost Over...But What About the Recession? Though it seems like the state of the economy is improving slowly, the same thing cannot be said about the state of commercial real estate (CRE). In this article, Mike McCune discusses the issues surrounding CRE but sheds some positive light on where self-storage owners stand amid the gloom.... Read Full Article
V 2009	A Look In the Mirror B, O, S Given the obvious gravity of today's real estate circumstances, I thought it might be useful to revisit a theme in a previous Market Monitor we explored in early 2008. At that time, I introduced two very helpful tools; one to estimate the current value of your property and the other to help evaluate the competitiveness of your property.... Read Full Article
IV 2009	Now That We Have After reviewing the 2008 and first quarter 2009 reports for the self storage REITs as well as a survey of many of our clients, the basic self storage business of renting units is, in my estimation, doing pretty well considering the draconian economic climate! Most of the REITs were very close to, or even in some cases, a little ahead of the game as to both revenue and NOI for the first quarter of 2009.... Read Full Article
III 2009	Is Now the Time? Now more than ever may be the best time to capitalize on this turbulent real estate market! Don't miss Mike McCune's latest article where he explains the steps you can take to be a successful buyer!... Read Full Article
II 2009	An Open Letter: This is Different! Does the current economic crisis have you wondering about your options as a self storage owner? You won't want to miss this article as it explains steps that you can take to evaluate your position and weather the turmoil. Taking thoughtful action now can help put you in a proactive, rather than reactive, position! ... Read Full Article
I 2009	A Look at the New Year! As 2009 begins, we try to gain a little perspective on the previous year and the current state of the market. While things may seem dismal, there is some optimism that can be found in the self storage industry. Read the full article to find out! ... Read Full Article
VIII 2008	Predator, Prey or Unaware? The economic environment of the last several months has been devastating not only to the stock market but also to the commercial real estate market. In fact, the problem is even more intensified in the real estate world because not only have prices dramatically fallen, but there are virtually no economically viable loans available to owners who want to refinance or for purchasers of properties.... Read Full Article
VII 2008	A New Reality Like many of you, I have been watching the stock market closely in recent weeks as uncertainty surrounds the new financial "bailout" legislation. I’m still not sure if it is a good idea or a bad idea, but I am concerned about the stock market and that loans are as tough to find as ice cubes in the dessert. After thirty seven years in the real estate business I thought I had seen everything that a market could throw at us, but this time they have thrown everything at once!... Read Full Article
VI 2008	Inflation: Friend or Foe? Many of you have seen the latest reports on increasing inflation in today's economy. Inflation is the scourge of savers, diminishing the value of nest eggs and retirement accounts. Among other things, inflation is the result of a "cheap money" policy (very low interest rates) through the political inducement of major investment banks to keep those rates low so their extreme leverage will be inexpensive and they can magnify their profits. Whatever the causes of inflation, the results are devastating for most Americans, as it is difficult to find a way to protect oneself against inflation's ravages.... Read Full Article
V 2008	Are These Good Times? - Maybe, If You Are a Buyer! Cap rates are up, prices are down, interest rates are just a little higher, competition is down and best of all, Cash on Cash returns - the Holy Grail of investing, are up!... Read Full Article
IV 2008	Just the Doldrums? Time to Get Your Compass Out! The doldrums are certainly present in today's real estate markets, including self storage. The winds are quiet. Sellers are hoping to get yesterday's prices and most of the very aggressive buyers of a year ago are long gone.... Read Full Article
III 2008	A Checkup You Can't Afford to Miss Do you want to assess the current health of you self storage facility? Looking for and evaluating certain symptoms now will help you take the actions needed to prevent problems down the road. ... Read Full Article
II 2008	The Times Have Changed It is now abundantly clear that the so-called sub-prime mortgage debacle may be just the tip of the iceberg of the problems in the modern finance markets. Easy to obtain, cheap credit is the great lubricant that makes the engines of commerce really hum. Unfortunately the "easy to obtain" and "cheap" characteristics are the part of the formula that ultimately cause the credit system to break down.... Read Full Article
I 2008	Self Storage Real Estate: A View From My Perch The first month of 2008 has been beset by significant financial and political "rock and roll." If you are like me, much of it doesn't seem to fit into a neat package that helps to clarify what the rest of the year will bring. However, if you will indulge me, I will give you two thoughts on the self storage real estate market that will hopefully provide some perspective for you to consider.... Read Full Article
IX 2007	Investor Demand - Desire to Acquire and Ability to Pay Ray Wilson of Integra Realty Resources-Metro, the nation's largest national valuation and consulting firm, contributed his insight to this issue of the Market Monitor. Check out his article on the Impact of Class Distinction, Operating Performance and the Capital Markets.... Read Full Article
VIII 2007	Time to Let Our Clients Brag Argus is a confederation of well over seventy five people engaged in helping self storage owners sell and buy self storage properties across America, from Missoula, Montana to Miami Florida. It is time to recognize the achievements of our Broker Affiliates and their respective staffs.... Read Full Article
VII 2007	Have You Found Your Chair Yet? For the last several months we have been talking about the uncertainty in the real estate markets. In this high-stakes game of musical chairs, NOW is the time to find a chair before the music stops, bringing to an end high real estate prices and easy financing.... Read Full Article
VI 2007	A Tale of Two Markets - The REITS and the Rest of Us Here is some insight and perspective on what has happened with the major Self Storage REITs over the past several months.... Read Full Article
V 2007	Change Is In The Air Steve Clifford, Assistant Vice President and Steve Bye, Executive Vice President/Senior Managing Director of Northmarq Capital provide in this article a summary of recent changes in the commercial real estate lending market... Read Full Article
IV 2007	Watching Your Pennies Will Make You Dollars Ben Vestal, Executive Vice President of Argus, discusses how you can increase the value of your asset by controlling your facility's operating expenses.... Read Full Article
III 2007	The Art of Self Storage Arbitrage The term arbitrage means that an investor can take advantage of some pricing or other discrepancies in the marketplace. For example, if a stock were selling on the London Exchange for $50 and on the New York Exchange for $55 it would become clear that you should buy in London and sell at the same time in New York. Do it once and you are entitled to call yourself an Arbitrageur (even though it sounds French, don't let it go to your head). Now that you are a certified Arbitrageur, how can we make arbitrage work for us in the self storage markets?... Read Full Article
II 2007	Why in the World Would You Pay Somebody to Sell Your Facility? It is clear that many experienced and inexperienced buyers use brokers when selling their properties, but we feel that it is important for you to know how an Argus broker can help you in buying or selling a property.... Read Full Article
I 2007	Self Storage 2007: A Market Overview ... Read Full Article
VI 2006	The Marketing Solution You've Been Waiting For! Learn about the benefits of listing your facility on the industry's leading self storage real estate website, SelfStorage.com... Read Full Article
V 2006	New Jersey Carries the Water on Sales Taxes Find out what a sales tax on your facility does for you and your business... Read Full Article
IV 2006	Self Storage Finally Gets Some Respect Over the years, the perceptions about self storage have changed. In this article, Mike McCune discusses why self storage may just be the best real estate investment around!... Read Full Article
III 2006	Overbuilding - Is It Happening to You? Overbuilding is a critical issue facing the self storage industry. We hope this article will help you recognize the potential consequences of overbuilding in your market and the steps you can take to protect your business.... Read Full Article
II 2006	Welcome to the "Argus University of Value" ... Read Full Article
I 2006	Should You Be a Seller? Are You a Seller? With almost 40,000 self storage facilities around the country, there is bound to be an owner who is contemplating parting with their beloved facility each and every day. However, we have found that there is a material difference in "thinking about selling" and becoming an actual seller. Read on to find out if you're a seller!... Read Full Article
VI 2005	Second Thoughts about Tax Deferred Exchanges Is a tax deferred exchange a smart move? After you read Mike McCune's analysis and comments regarding 1031 exchanges, you may have second thoughts about the value of 1031 exchanges.... Read Full Article
V 2005	A Real Estate Paradox - Everyone is Happy, for Now! Never before have prices been higher for self storage properties - either in absolute dollars or in relation to the income they produce. This is almost exclusively the result of the lowest interest rates in 45 years.... Read Full Article
IV 2005	The Two Telling Tools: An Insight to Feasibility Studies In this article, Mike McCune discusses the value and nature of RCFA's (Rational and Critical Feasibility Analysis)... Read Full Article
III 2005	Sales Tax Revisited- Is it Still a Double Demon? There are many states in the nation where sales tax is being charged on self storage. In this article Mike McCune revisits the topic of sales tax and renews his 'call to arms' by the National Self Storage Associations to fight this issue.... Read Full Article
II 2005	While You Were Napping...You may not have noticed the best three years in the self storage industry! You may not have noticed the best three years in the self storage business! You didn't have to raise any rents, lower any expenses or even increase your occupancy - and you made a lot of money over the last three years or so. Read more!... Read Full Article
I 2005	The End of an Era-Very Serious Business! (Cap Rates & Interest Rates) The era of low interest rates is at an end. Find out what this means for self storage... Read Full Article
November 2004	Think You Can Outrun the Technology Wave? Think Again. This article discussing how you can utilize the internet to boost your business!!!... Read Full Article
October 2004	What Would You Do With $86,000 Of Additional Cash Flow? (A Cost Segregation Case Study) We are always pleased to pass along good ideas for helping owners keep more of their hard-earned money by taking advantage of the new tax laws. We first visited with Mark de Stefanis a couple of years ago and thought we should take another look to see what is happening in this area of tax savings. Mark has consented to write this fine, clear overview and example. Read More!... Read Full Article
July 2004	Cap Rate Trends and Interest Rates In this article, Chris Sonne, MAI offers up more information on understanding the relationship between cap rates and interest rates.... Read Full Article
May 2004	The Tipping Point (Self Storage Market/ Overbuilding) In this article, Mike McCune discusses what can happen to a market in which the unlimited demand for self storage facilities comes to an end... Read Full Article
April 2004	These Extraordinary Times (Time to sell, buy, refinance) ... Read Full Article
January 2004	What You Don't Know Can Hurt You! What does overbuilding do to your market? Read on!... Read Full Article
November 2003	Fractional Interest 1031 Tax-Deferred Exchanges Do 1031 exchanges make selling real estate property more attractive?... Read Full Article
October 2003	A Small Problem for the Industry Might Be a Big Problem for You! ... Read Full Article
September 2003	The Worm Has Turned-Let's Just Hope It Is Slow This is an article dedicated to interest rates..... Read Full Article
July 2003	The New Tax Laws-A Time to Sell? (Only if you are a seller!) ... Read Full Article
May 2003	An Accountant + An Engineer = More Cash Flow! ... Read Full Article
April 2003	Overbuilding...Too Much of a Good Thing? ... Read Full Article
March 2003	The Double Whammy! Your competition just raised your taxes and reduced your facility's value. Read more about property taxes and valuation... Read Full Article
February 2003	Sales Tax: A Double Demon This is an article about the impact of sales tax on self storage rentals... Read Full Article
January 2003	The Anatomy of a Deal Read more about the inner workings of getting a real estate deal completed... Read Full Article
December 2002	Valuation of Self Storage Facilities ... Read Full Article
October 2002	The Greatest Financing in Forty Years This article discusses how you can develop a smart and effective financing strategy... Read Full Article
September 2002	The Taxman Cometh This article discusses a few ways to defer or moderate your taxes... Read Full Article
June 2002	The Internet as a Marketing Tool for Self Storage ... Read Full Article
April 2002	It is the best of Times and the Best of Times A note to buyers and sellers. Is it a good time to buy or sell?... Read Full Article
February 2002	Cross Checking Values and Replacement Costs ... Read Full Article
November 2001	Quality Counts! ... Read Full Article
September 2001	A Few More Thoughts on Selling a Property ... Read Full Article
July 2001	A Few Thoughts on Selling a Property ... Read Full Article
May 2001	The Lowdown on Recession and Self Storage ... Read Full Article