House Small Business Development Committee, February 3, 2026

Transcript

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1. 0:17:23

   All right, here we go. All right. Good morning. Good morning. And we're gonna go ahead and start our, uh, small business development committee meeting, uh, this morning, and we're glad that, uh, we have, uh, the folks from, uh, the, um, in, uh, Self Storage Association come here presenting. We've also got an audience in, zooming in somehow. So, uh, but anyway, um, with that being said, we will go ahead and get started, and, uh, Representative Chastain, I would open us in prayer.

2. 0:17:55

   Be glad to.

3. 0:17:57

   Thank you.

4. 0:17:59

   Thank you, Mr. Chairman. Dear Heavenly Father, we thank you, Lord, for this day. We thank you for the many blessings that you give each and every one of us. We never want to forget that, and just, and just thank you for that. We ask you to be with us, uh, every one of us in this room, uh, this morning. We just ask you that you be with us all day today as we conduct the, uh, the s- the business of this great state of Georgia, and ask that you lead and guide us and direct us in all things that we do. In Christ's name we pray, amen.

5. 0:18:25

   Amen. There we go. Thank you. All right, we'll go ahead and get started. Um, let me think. On the agenda, it looks like Jane is gonna be up first. Do y'all all want to come to the, to the table up there and talk? How do y'all wanna do this? We wanna hear about your industry.

6. 0:18:47

   You got it.

7. 0:18:48

   I'm actually gonna go last.

8. 0:18:50

   Okay. That's fine.

9. 0:18:56

   Good morning.

10. 0:18:57

    Good morning.

11. 0:18:58

    I did just get a text from Tyler Paul, and he's pulling the, um, "My whole house has the stomach virus-"

12. 0:19:05

    Oh, really?

13. 0:19:05

    "... thing this morning," so he's... You know, y'all may not be expecting him quite on time. But just know he's not coming.

14. 0:19:12

    Oh, Tyler Paul isn't?

15. 0:19:13

    No.

16. 0:19:13

    Okay.

17. 0:19:14

    No, sir. He said that the whole house is wohlled with a stomach virus.

18. 0:19:17

    Oh, my Lord.

19. 0:19:18

    Does he have it, too?

20. 0:19:20

    Ev- evidently so.

21. 0:19:22

    Ooh.

22. 0:19:26

    Well, he's my suite mate across at the Capitol.

23. 0:19:30

    Okay.

24. 0:19:30

    So we see each other often. So it's all good. But anyway, go ahead and introduce yourselves. And, um, s- let's start with, uh, you know, the presentation. Thank you.

25. 0:19:44

    Well, good morning.

26. 0:19:45

    Good morning.

27. 0:19:46

    Um, my name's Megan. I am, uh, the proud owner of A&G Storage. We are in Blue Ridge, and we are in Calhoun, Georgia. Um, I am also, um, the president elect over here at GASA. So next year I will be taking Cliff's role. Um, we are so excited to be here. Um, just to start y'all, we're gonna throw some numbers at you bright and early first thing in the morning. Um, okay, so we really are a small business, right? But the first thing a lot of people think of when you think of storage is you think of the REITs. U-Haul, Public Storage-

28. 0:20:16

    Mm

29. 0:20:16

    ... Extra Space, right? We've all heard of them. CubeSmart. But in reality, 70% of us are small mom and pop just like us.

30. 0:20:23

    Mm.

31. 0:20:23

    And when I say mom and pop, it's me and my husband, and A&G is named after my children, Adam and Grace. It really is mom and pop. Um, my son has been... We've owned the facility for s- several years. He's f- about to be 15. He does overlocks on his own, and he does... My daughter has been putting locks on the units since she was three. We really are a family business, and a lot of us are. A lot of us are multi-generational. Um, you know, when you look at the Sauls Group, I'm not gonna say who that is, but she is at the table. Um, at the Sauls Group, they're multi-generational.

32. 0:20:56

    Um, first time I t- I saw Luke, I said, "Wow, you guys have the same last name." He said, "Yeah, that's my mom." We're... We are, we really are small, right? But, um, so just keep that in mind. Um,

33. 0:21:11

    okay. And who we serve. So the most four common reasons of getting storage are never good. Never, right? You never wake up on a c- on a day and it's the weekend, you go, "Oh, my goodness, the sun is shining. I have nothing to do. I'm gonna get a storage unit." That doesn't happen, right?

34. 0:21:27

    Right.

35. 0:21:28

    So the four... The most common are we have death. There's been a death in the family, and we need to clean out our loved one's home. A lot of times the cremated human remains do end up in the unit. Um, so death. We have divorce. You've split up. You have to put, you know, everything from your life. You're gonna have to move to an apartment or a smaller home, right? Downsizing. Yes, divorce is downsizing, but downsizing in itself, you go from, you know, 4,000 square feet to 1,100 square feet.

36. 0:21:58

    Chances are you didn't throw as much away as you thought you would, or given it to Goodwill. Or actually, has anyone else had Goodwill tell you to stop showing up? Because that's happened to me. Okay. So we also have displacement. So a lot of our tenants, and it's, it's coming a lot in today's market, is they have lost their home, right? They have been evicted. They have been, uh, foreclosed upon. But now they have to go and live in someone's basement, or they have to go live on the couch. But everything they own, maybe they can't afford, you know, 1,100, 2,600 or whatever their mortgage or whatever that's gonna cost.

37. 0:22:34

    They can't afford that. But they can afford $100 a month. So it's gonna go into storage until they can get back on their feet, right? We have a few more, though. So we have disasters. Uh, did anyone ever hear of that big thing, Hurricane Helene? Anybody ever heard of that?

38. 0:22:46

    Yeah, boy.

39. 0:22:47

    Right? Um, our past president this past year, we kind of joke with him. I'd call him and say, "Max, how's your beaver dam looking?" Because his house looks like a beaver dam, right? Um, tornadoes. Um, fire, water. One of my tenants had one of the 40s and turned it into a different one, and he called me, he's like, "Look, Megan, I know I said I'm moving out, but, um, I had a pipe burst the day after closing. I need to stay." So we just canceled the move out. Not a big deal. He's still there. Poor guy . Right? But we also have a couple other things that we need to serve.

40. 0:23:18

    So when folks are in bankruptcy, they've called us and said, "Look, I'm sorry, I can't pay your rent anymore." We're gonna work with them, right? I don't care if you owe me money. If you need to move out, we'll just, we'll just let you move out. Am I gonna collect anything? Probably not, but I'm also not sending you to auction, and the unit's not gonna sit forever. And you're not losing your things. Things... Bankruptcy is not a good thing, right? We also have deployment. Um, has anyone else ever served in the armed services? Yeah, you too? Okay. So we have TDY, right? Temporary duty. The armed services...

41. 0:23:48

    I'm an Air Force veteran. Armed services is sending you somewhere else.

42. 0:23:52

    One.

43. 0:23:53

    You may take your things. It's not uncommon for your spouse to take your items, put it in storage, and they go home for however long you're gone, right?

44. 0:24:00

    Yeah.

45. 0:24:00

    So there's all sorts of reasons that we're in storage, but remember, none of them are good. And... Well, some of them are, but it's very rare . None of them are good, but that's what we're here to do. We're here to work with you on sometimes the worst times of your life.

46. 0:24:17

    Okay. So I just wanna bring another statistic up. So in 2005, about 8.95% of our population used storage, and in 2024, it jumped to 12.6. That's a lot. Why is that? Minimalism, right? No one wants things on the counter anymore. No one wants your little tchotchke little things. Um, has anyone ever heard of the term work from home? That wasn't so much a thing in 2005, but in 2024, it is, right?

47. 0:24:49

    That's part of why we saw such a surge in storage, is we had people that were having to... You know that one room that has too much stuff in it? They moved that room and turned it into an office in their homes. So that's why you're starting to see... That's just some of it, right? But we've also seen home sizes increase, but we've seen apartment sizes decrease. Well, when the apartment sizes are decreasing, that doesn't mean you have less stuff. It doesn't just magically go away. That would be fantastic if it did, 'cause I don't know about your house, but I have clutter. That would be fantastic if we got rid of that.

48. 0:25:19

    But it didn't. And so instead of having a yard sale, or maybe it's cherished family heirlooms, maybe it's cremated human... It, it happens a lot. Cremated human remains, something like that, they're just gonna put it into storage, close the door, and it's out of sight, out of mind. The number two things that we see in our units is a mattress and Christmas decorations. So around October, my facility gets really pretty 'cause there's glitter everywhere. So... All right, Mr. Cliff.

49. 0:25:47

    Good morning. Um, my name's Cliff Hite. I'm with a group called Space Shop Self Storage. I'm president of that group. I'm also a partner at a, um, development company called Stein Investment Group. Over the past, um, 15 years in the state of Georgia, we have developed 60 storage properties. Um, currently we have, um, 70 open and running in the state of Georgia, and we employ roughly... I think I hired another one yesterday, about 150 people, um, within the state of Georgia.

50. 0:26:17

    We're, um... We kind of lucked into storage. We, we bought a non-performing bank note down in McDonough, Georgia. And, and prior to that, we were in multifamily. Um, and we said, "Wow, this is really providing a need to a community that, that doesn't have... that, that didn't have it at the time." Um, and I, I actually fell into the business from multi-unit retail management and, um, and really found a passion, as weird as it sounds, for storage.

51. 0:26:49

    Um- So, so this year I'm fortunate enough to be president of the Georgia Self Storage Association, and I wanna, I wanna talk about, a little bit about how we serve as operators and as owners. Um, you know, we play more of an important part in the community than I think you would realize. Um, we are stewards of the community. We are locally involved. Because our customer base is typically within three to five miles of the facility, we are hyperactive in sponsorship of local football teams, of tennis leagues, of elementary schools, um, especially the one my wife is PTA president of.

52. 0:27:27

    Um, we have local employment with, um, really flexible work hours. It's, it's a retail job without the retail hours. And so our property managers can put their kids on the bus and then come to the office at 9:30 and then leave at 5:00 to get their kids out of any after-school program. And so we have found that the local employment where we're, we're able to take these individuals and get them started in a management position with some real stable upward mobility.

53. 0:27:59

    Some of our best district managers we have promoted from an assistant property manager position where they were making $13 an hour, they're n- now making over $100,000 a year. And so being able to add that to the local communities has been huge for us. We support local, um, other small businesses on our development side. We use local contractors in the state of Georgia. A big part of our storage industry is these roll-up doors that you see. One of the largest providers of those roll-up doors is based out of Atlanta here.

54. 0:28:30

    We use local landscapers. We use local plumbers. We, we really utilize the local vendors for the area to maintain self, um, safe, well-maintained properties, um, and, and reducing blight. Some of our developments that we have done, we have taken old office buildings that have been vacant for 15 years and repurposed them to self-storage. We have taken a old bowling alley that closed down and repurposed it for self-storage. We took an old movie theater that closed down, and in zoning it got shot down to become an Aldi because of the traffic, um, that it would add to that intersection, and we came in and we were able to do a storage facility that is nice and high-end instead of having a rundown movie theater in our community.

55. 0:29:17

    Um, so we're, we're able to get into these transitional places and communities that might not work for any other developments and create jobs with really light infrastructure usage. Um, you know, we're, we're not adding to the school district needs. We're not adding much to the infrastructure needs. Um, and then we give back through charity. Um, part of GASO, what we do is every year we have several fundraisers through other local owners and operators and vendors and raise money for many, many different events, and we'll get to that on another...

56. 0:29:51

    Um, so- We are a neighborhood asset that centers on people. Um, our, our customers are in need, as, as she mentioned. We're community-based by design. The majority of our customers, they s- they, um... I've been to many zoning meetings where we have been fought by the community because they didn't want storage in their backyard. And then we, we get them on board and we make some concessions, and they are our first customers because they then realize that, man, it's actually really nice having this close to home and not seven miles away.

57. 0:30:27

    Um, we have long-term community presence. A storage facility isn't a restaurant that's going to come in and be great for a year and then close. Um, these are really long-term individuals, um, at times, that are using the storage, and it, it really creates for just a, a great long-term asset. Um, through Georgia GASA, uh, the Georgia Self Storage organization, we provide, um, self-regulation and compliance to other owners and operators.

58. 0:30:57

    There are a lot of people that get into the business and, and don't truly know and understand the business. And so we give them a resource so that they can be sure that they are running the best business that they can from both a legal compliance standpoint with the laws that are already on the books, and then from a human standpoint, right? We're dealing with people's things, as, as Megan said. We... The last thing we ever wanna do is, is, you know, dispose of anybody's belongings. We, we want to provide a service for them. We give education focused on Georgia law. We, um, and we have a strong growing member base.

59. 0:31:30

    Um, and through GASA, we're able to... We raised $11,000 for the Sparrow Foundation at our holiday event this year. Um, and we continue to push and raise more and try to give back to the community while running the best business that we can that I, I truly believe is a good asset to the community. On to Jane.

60. 0:31:53

    Which one, which one are you picking?

61. 0:31:54

    That one.

62. 0:31:55

    Oh, very good.

63. 0:31:56

    Hold on one second. And Johnny, is that your light that's on? Yeah, I can wait. Well, I know, but you have to leave at 8:30, right? I know. Okay. All right. Good. We've got some questions, but we wanted to let y'all make the presentation. But we've got some other stuff going on.

64. 0:32:13

    Ve- very good.

65. 0:32:14

    No, you go right ahead.

66. 0:32:15

    I'm gon- I'm gonna make mine short and sweet then, so we can get to the good stuff. How about that? So I'm Jane Sauls. Um, as Megan referred to, I'm an o- owner/operator of a facility, Little Vine Storage, out in the Hewlett community, um, in Carroll County. I'm right there on Highway 166 on the Douglas/Carroll County line. That just so happens to be the exact same community that I grew up in a few miles down the road on a farm. So farmed for a living, so I know small business. We had a little over 3,000 hogs, 40-something thousand broiler chickens, a few hundred head of cattle, and, and then we did a few hundred acres as well in hay.

67. 0:32:53

    So I understand small business from several different perspectives, and now I'm on the opposite kind of end of that in commercial real estate, but all the same, it is serving people, right? Um, I also have a brokerage that my son and I have where, um, I'm actually licensed in seven states in the Southeast. So we spend our days crunching numbers and, you know, calculating returns and investments and things of that sort. So what I wanna talk to you about is what we do to strengthen...

68. 0:33:26

    And when I say we, I mean self-storage as a whole. And I think we're a little cornily... K- it's kind of corny to say how passionate we are about that, but when you understand that, um, self-storage is an industry that truly allows people to move up in it and excel, that's the part that really gets you excited. So how we strengthen Georgia... And I'm sorry, we can't see that slide too good, so maybe I'll print... We'll print it off and actually s- you know, share it with you a little bit closer.

69. 0:33:59

    Because what's important that you know is that we as a storage industry, we are not just chain link fence and sheds any longer. And so from an a- asset class perspective, like the all property is at the very top, and this is just the, um, Green Street... Tongue-tied this morning. Um, Green Street Commercial Property Price Index. And you will see there at the bottom, self-storage is about the number two asset on that list. And then during COVID, that's when, that's when we got, um, very popular, right?

70. 0:34:34

    And that's when our asset class truly kind of become well-known. We increased in value by 69%, whereas just over the past few years since that peak, we have dropped roughly 22%. But we are definitely so much more than just those chain link fence. We are a solid investment asset that is attracting the attention of a lot of investors.

71. 0:35:01

    To give you an idea of exactly how big we are as an industry, and then, you know, not just as an industry, but in Georgia, you see that we've got 2.4 billion square feet in the US with a little over 66,000 actual stores. I know we were just talking earlier, you, you actually have a store as well. So the owners sometimes look like the folks sitting right next to you oftentimes. In Georgia, we've got over 2,300 facilities.

72. 0:35:32

    And I wanted to share the average street rate because that was very important in the sense of getting our mind wrapped around exactly where our strength is and what's important to us. So nationwide, you're looking at $1.39 rent per square foot per month. And then in Georgia, and this, this would include the small facilities and those in town as well, you're at $1.09. So we are a little bit behind the national average, but still s- considered strong

73. 0:36:08

    So we wanted to talk a little bit about what our pain points are. After sharing the revenue with you, you know, the flip side of that is, uh, obviously the expenses. So just know that the taxes and insurance account for nearly twenty-five percent of our total expenses, and we're just a... I think the US percentage for that is, like, at twenty-seven percent. So those, those numbers aren't bragging points in the sense of our expense ratios, um, 'cause taxes and insurance is one of our biggest line items.

74. 0:36:42

    We have, this past two years, I guess, really battled with the slow rental season, just because of the limited residential transactions happening. I think everybody's well aware of what's been going on with, with interest rates and the residential market. So that definitely... Megan mentioned a whole line of things that we do serve those customers for, but at the same time, oftentimes you hit pause when you can't make the math work or it doesn't make sense to leave your two percent mortgage, right?

75. 0:37:13

    So the other thing that is a pain point for us is the cost of construction and the entitlement timetable. I know at... when we did Little Vine, the first phase, I think I went from the actual slab to the doors open, and the slab was... Building was set on the gla- ground in October, and I had the doors open in December. It was a relatively small building, but still that was substantially doable back in 2017. Um, this past week I got an LDP that involved having to get a DOT drive after about 12 months of effort.

76. 0:37:50

    So the, the pain points there are real, and not to mention the cost of construction. So that $1.09 rent per square foot oftentimes doesn't pencil for what the cost of construction is these days.

77. 0:38:08

    Now, of course, we're gonna, like, wanna be sure we're clear on how y'all can help us, right? Um, absolutely. So we did want to, you know, first off, appreciate everything that y'all do. And really, and I put common sense legislation, just because we are small business and everyday people, and it truly does impact us what it is that y'all do. The specific thing I would like for it to kind of come on y'all's radar as we move forward is the actual self-storage real estate property or ad valorem tax.

78. 0:38:44

    That is, um... In underwriting properties, sometimes that's seriously considered a wildcard 'cause you're not sure what that municipality is even going to do or change because they're, they're desperately seeking to reconcile budgets at this point, right? So what we will be asking you all to consider now and going forward is to not use the valuation method on the income stream and to only use the actual building cost and less the depreciation.

79. 0:39:18

    And if you think about that, it really only makes sense. We're already paying federal income tax, we're already paying state income tax on that, and then we also pay the occupational tax certificate, your business license, and that number is based off of your gross receipts, right? And so we're already paying tax from an income stream perspective, period. And so the problem when, when they want to value it is several different things.

80. 0:39:49

    The person in the county office, y- you know, they're not qualified. They, they don't understand ca- They think that's all they need to look in a book to figure out what the cap rate is. This is not like a replacement cost on an insurance, you know, chart that you can just look up. Cap rates swing, you know? And not only that, underwriting today, you have to understand that that cap rate is about one page out of the entire book. And so we look at internal rates of return, and you also have to always keep up with what your lenders are doing from an annual debt service perspective.

81. 0:40:26

    So they don't have the qualifications 'cause they're not in the industry or have the underwriting wherewithal. So that would be our ask.

82. 0:40:37

    And then of course, we wanted to really tell you how much we appreciate the support that we have had from you all this past year. We were excited. Um, and again, I know it sounds kinda corny to talk about that we're excited that the newspaper ad is no longer part of our lien process in that sense, um, for numerous different reasons. That's a big deal from an operations perspective of just handling that. Um, so we are grateful for that. And then the year before that, um, House Bill 934, that had several different, um, little line items in it, including that we can now officially do an electronic signature on our lease, and if you take the unit or move your stuff in, even if you've not signed your lease, you're in agreement to our lease terms.

83. 0:41:25

    So I did want to mention one other thing on the property tax ask. Um, if you look up Indiana section, Indiana Code Section 6-1.1-4-46, they have actually done that where they, um, eliminated the valuation meth- the capitalization valuation method. Um, and they were doing that specifically for self-storage, but they piggybacked off of a multifamily, mm, property as well.

84. 0:41:57

    You all are, I'm sure, are already familiar with that. I also did want to mention that a kudos to Georgia because we are the top state in quarter- Um, third quarter for 25 for non-REIT transactions. And so that's a big deal because folks want to be here. And so as opposed to being one of the main exit states, we, we've got folks wanting to be in Georgia, and that's largely starts at the top with you all.

85. 0:42:29

    So thank you all. I know we got questions, so-

86. 0:42:32

    Yeah, we do have some questions, and we got some time, so.

87. 0:42:36

    Johnny, I'm gonna-

88. 0:42:37

    Okay

89. 0:42:37

    ... go right ahead.

90. 0:42:39

    All right. We on? Let's test this. Hello. No? Okay. Test. Yes, there we go. Thank you, Mr. Chairman. Uh, appreciate you guys being here this morning. Great presentations. Um, I ge- I do get excited when I hear small business, um, how involved they are in the communities 'cause that's, that's a big thing. Um, I've worked in a community bank for the past 32 years, and it's just, I love to see the involvement in the local community, uh, as well from all of our small businesses, so great, great job there. I do wanna ask, uh, Ms.

91. 0:43:10

    Armstrong, so you're, you're in Blue Ridge?

92. 0:43:13

    Yes, sir.

93. 0:43:13

    That's my hometown, so I thought I knew everybody in Blue Ridge. So I'm s- I, I apologize.

94. 0:43:19

    I don't live there. Don't tell my tenants that.

95. 0:43:20

    Okay. All righty. But could y'all, could you share a little bit about just a couple things like the occupancy rate, what, what kind of occupancy rate you think you're seeing in Georgia or in, and, um, also, uh, we financed some of these. I've, I've financed several of these up in north Georgia over the last few years, but, uh, do you think there's room, is there room for more, for new storage buildings? And also talk a little bit about the difference between the climate control.

96. 0:43:52

    Is there s- Is there still a big need? Is, is, does folks want climate control more than the regular storage buildings or not? Just if you could touch on...

97. 0:44:00

    I can answer.

98. 0:44:01

    You want me to?

99. 0:44:02

    Yeah, sure.

100. 0:44:02

     Yeah. Um, across the state, across our, our sites and across our friend sites, and I tell you, storage is such a unique industry in that everybody knows each other in this industry, and everybody's willing and happy to share information because the last thing that we ever want as owners is overdevelopment-

101. 0:44:19

     Right

102. 0:44:19

     ... because that just hurts everybody. And so there's, there's pockets within the state that, um, when you, when you look at population loss that will struggle with occupancy. You look at the Macon, Georgias, and a struggling occupancy there might be in the, in the low 80%. Um, and then you get into high growth areas, and we're seeing occupancy in the mid 90s. Um, and we've had a few properties, and a few friends have properties that are 100% full. And so, you know, it, it's, we as, on our development side, have to be very strategic about where we go in on any new development because we are, we're chasing the population growth.

103. 0:45:01

     And so you, you look at, um, you, you look at how we look at things is we look at that square foot per capita, as Megan said, is up to 11 square foot, um, per capita, so 11% of households are uti- utilizing storage. And we have some tools that we can look and see that, um, in this market, there only might be six square feet per capita, and it's causing people to have to drive further from their homes to utilize a product that's further away. And so that's how we, um, look to prevent any sort of overdevelopment.

104. 0:45:35

     And then do you wanna speak on the climate control versus non-climate?

105. 0:45:38

     Sure. So that definitely is the good old "It depends." And so now I know in 2006 when on my first development project, when we got those doors open, we had to explain c- climate control to everybody. They did not even know what it was out in Carrollton or why they needed it. And now it's a, I'd say it's a mixed bag. Like, the property there that's in a rural location right there at the back door of Fairfield that we have Little Vine, I have probably 75% of that climate, and the rest of that is non-climate, and that's normally what I see out in more of that secondary market.

106. 0:46:17

     Um, the n- the understanding of what climate does and the importance of it is accepted now, and they also seem, from a customer perspective, seem to be accepting of the fact that they're going to have to go in a door and walk down a hallway. I still see people that aren't too crazy about that third floor, and, you know, those rates are usually gonna be discounted, kind of like on a back 40 type of real estate perspective. But the need for climate is definitely better understood in just protecting your belongings and making sure that, you know, they stay safe while they're in st- 'cause what we do know is that they're gonna stay longer than what they think they are.

107. 0:46:57

     Thank you. K- who's next?

108. 0:47:02

     Oh, Representative Schofield. Okay. Good.

109. 0:47:05

     Good morning. Uh, thank you, Mr. Chair. Thank you for being here. What I really liked, um, is about the, uh, why people use self-storage or Ds. I love that. Uh, death, downsizing, displacement, disasters, and employment. Thank you. I love those. Um, just a couple of questions. So my first one was about the usage growth, and I see we have numbers or data here from, uh, '24. Do you have anything from '25?

110. 0:47:33

     No, that is, um-

111. 0:47:35

     I guess-

112. 0:47:36

     ... that is the latest. We're usually, like as far as those calculating it for our industry, that'll be the 2025-

113. 0:47:42

     '26? Okay

114. 0:47:42

     ... Self Storage Almanac.

115. 0:47:44

     Okay.

116. 0:47:44

     Is, so that comes out now for Self Storage 2025 Almanac, and that's put out by the Self Storage Association, the national association. It's not yet been released, but TrackIQ is the one who helps provort- support and provide those numbers, so he shared those.

117. 0:47:59

     Okay. Let me follow up. Um, just how many members, this is to Cliff, how many members are in your association?

118. 0:48:06

     Gosh. You might know more, Megan.

119. 0:48:09

     400 and f- I believe it's around 450.

120. 0:48:11

     Yeah, it's, it's, um, it, it continues to grow every year, but I believe we're at, yeah, 450.

121. 0:48:17

     450.

122. 0:48:18

     All right, just a couple other questions. D- um, do you have any dead data by zip codes as to how many s- units are in, uh, are dis- zip codes?

123. 0:48:28

     W- we can pull data in about any and every which way you want to. I wanna say seven ways to Sunday, um, now is available, uh, whereas just a few years ago, it wasn't. Um, everything all the way down to if you've got a CMBS loan, um, where you have to do pub- y- basically public reporting, um, we can pull those financials as well on those facilities.

124. 0:48:52

     Yeah.

125. 0:48:52

     So we are very nitty-gritty on pulling exactly how many square feet and where you are. Um, to that point, let me just add that, um, as, as... not... we're not just here to h- to tell y'all how we want y'all to help us, but from a sense of if we can help y'all. We are commercial real estate property owners, which normally means our properties have visibility, and it means we are business leaders in our community. So if you are struggling in a district, we would gladly introduce you to other self-storage owners.

126. 0:49:25

     And now, what, what y'all work out on y'all's own about who gets along with who, but we welcome the opportunity to introduce y'all if you have a community that you're needing to connect with more so.

127. 0:49:38

     Okay. I'd like one for my district. I can't speak for everything else, but I think it would be helpful for all of us to know who's in there. Just two more quick questions, Mr. Chair. How many feet do, uh... or what's the distance between... Because I mean, I may ride on one corner and have one self-storage, and then before I get to the next one, I've got another one at the light. Is there a certain capacity that we can have in as a district-

128. 0:49:59

     So-

129. 0:49:59

     ... or a zone?

130. 0:49:59

     ... um, you know, it's a great question, right? And, and I, I definitely get the concern of having one corner with two storage facilities on it, right? It's not, um... it's not as appealing as having the Chick-fil-A and the Raising Canes and, you know, some, some other stuff. As, as to a capacity, it's really market dependent and population dependent. Um, and so if there are only so many developable parcels, um, that are within a community that, that is, um, you know, our ideal parcel, and I can't speak for every, um, everybody that's building storage, but our ideal parcel is what we call a transitional parcel, creating a buffer between a heavy retail area or industrial area and a residential area because we're light traffic users.

131. 0:50:44

     We're a quiet user, and it's, it's just been found to be a good buffer. And so if we have a couple of facilities on that buffer corridor, we will still continue to pursue and look at that because if the, if the market is there, then the community has the need. Um, and so you might have three storage facilities right next door to each other that are serving the same three-mile trade area, and they still be underserved because there might only be four square foot per capita in that market.

132. 0:51:14

     And so it's really not about the driving distance between the, the two properties.

133. 0:51:19

     Two-

134. 0:51:19

     It's about the total amount of square footage within that market.

135. 0:51:22

     Yeah. 'Cause in my community, I, I notice that if they're building an apartment complex, I can guarantee you within a certain miles there's gonna be a s- a storage unit.

136. 0:51:33

     Yep.

137. 0:51:33

     And I have some concerns about that.

138. 0:51:35

     Yeah. And, and it's, it's that result of population growth. It's, it's a great problem that the population is growing, but with that growth comes the need for some services.

139. 0:51:46

     Okay. Last question. Last question, but please just a minute. Just one more. Just so... I, uh... and I'm just trying to educate myself. What happens when people's property is, um, displaced? Is there, like in w- if they lose their... they can't pay and they're foreclosed on or whatever, what happens to their property? Is there a vendor that you contract with or what?

140. 0:52:06

     Okay.

141. 0:52:06

     I'm not sure, other than that show that I've, that I've seen.

142. 0:52:09

     That show's terrible.

143. 0:52:11

     That show is about as real as WWE. Um, so, okay, so the first thing we try really, really, really hard to do is work with you. Can you give me some... I've let units go for $20 before. It doesn't matter what they owe. Please get your items. Please get your items. Please don't make me sell. Please don't make me sell. I almost beg them. Um, probably shouldn't say that, but that, that's the reality, right? Um, but by this point, I'm so aggressive with my, um, with my collections. You're gonna get a call. You're gonna get a text. You're gonna get an email. I'm gonna try on a Monday. I'm gonna try it on a Friday.

144. 0:52:41

     I'm gonna try it on the 1st. I'm gonna try it on the 15th. When are you getting paid? When can you talk to me? Please, something. Um, so if we can't settle, unfortunately it does go into auction. Um, I will say auctions are incredibly rare. I have about 230 units.

145. 0:53:01

     I do maybe five auctions a year. So they... we really try very, very aggressively because I, I go to church with these people.

146. 0:53:09

     Yeah.

147. 0:53:09

     You know?

148. 0:53:10

     Yeah.

149. 0:53:10

     Um, now I will raise your rates and sit next to you in church and give you a hug, but- ... I don't want to sell your unit.

150. 0:53:16

     Business.

151. 0:53:17

     Right.

152. 0:53:17

     That's what we came to.

153. 0:53:19

     Yeah.

154. 0:53:20

     Probably.

155. 0:53:20

     I don't wanna sell it if I can.

156. 0:53:22

     Yeah.

157. 0:53:22

     I think to add to that, the most important part that we can make sure that's understood is we don't make any money off the auction, 'cause I know TV would have you think otherwise. And what is a need to us is that we get that unit back so that we can make money. That's, that's the whole thing. So that's why when Megan says you can come get it if you get it out today and just be gone, because the whole thing is that time is money, and that's where the cost is.

158. 0:53:48

     Yeah. And, and just an additional stat across, you know, our thousands of units across the state of Georgia, what go to auction is less than half of a percent of units. Um, and at, at that point, our, our managers are incentivized to work with the, um, with the individual. Look, they made the choice to come in and to store their belongings. Those belongings mean way more than them, way more to them than they mean to us. And so we, we are going to cut a deal with them to let them keep their belongings.

159. 0:54:19

     Um, and if they don't have the ability to take them all, we'll cut a deal where they can come take what's important to them, and they can walk away and it, it not be on a credit, credit report or anything like that because these people are... they're already struggling, and we're not here to be a, we're not here to be a burden. We're here to provide a service and have them be able to gracefully exit a service that they might not be able to afford anymore.

160. 0:54:42

     Good. Thank you. All right. Uh, Ray, you've been waiting patiently.

161. 0:54:47

     That's fine. I just got one... I just got one question. Um, what is the, uh, average time of somebody holding that unit? You know, is it, is the turnover rate for that unit pretty constant? Is it weeks, months, years? What's the average time?

162. 0:55:04

     Yeah. The, um, the average length of stay across the industry tends to average about 14 to 16 months. Um, now at, at some properties, you definitely have some longer term users. We have a, um, we have a property right over off 14th Street where we have an average length of stay of two and a half years, um, where those individuals live in the city and they live in small spaces, and they use this as an extension of their homes. And then we have other areas where people have larger homes, and they're not as, um, transitional areas and more in the suburbs, where we see an average length of stay of 12 months.

163. 0:55:40

     Um, the majority of customers when they come in, um, we ask, "How long do you think you're gonna be here?" They answer two to three months. Um, and so it's, it's-

164. 0:55:49

     Every time

165. 0:55:49

     ... every time. It's a, a bit of a disconnect, but, um, that's the, that's the average length of stay.

166. 0:55:56

     Thank you.

167. 0:55:56

     Good. Thank you. All right. Uh, uh, Chairman Yearta, you had-

168. 0:56:00

     Uh, actually, Mr. Chairman, thank you. That was my exact question, the, the ti- length of stay, you know, that, that folks use the facilities. Appreciate what y'all do and the service you provide to the state of Georgia. You... One other q- question, though. Uh, you mentioned $1.09 is the average per square foot in Georgia, which is lower than the national average. Uh, and I assume that's, uh, climate controlled and non-climate together.

169. 0:56:28

     Y- yes, sir.

170. 0:56:28

     What-

171. 0:56:28

     And that's south Georgia and Atlanta.

172. 0:56:30

     Okay.

173. 0:56:30

     So it's, it's skewed in a sense, but it is the good old, grand old average of everything.

174. 0:56:36

     Okay. What is the difference in climate controlled and, and, and non-climate controlled per square foot?

175. 0:56:44

     I... It definitely depends on the market and then what your unit mix is. We mentioned earlier that, like, at Little Vine, I have less non-climate. So oftentimes I don't have a lot of non-climate available.

176. 0:56:58

     Okay.

177. 0:56:58

     So my non-climate is knocking on the door of my climate rates-

178. 0:57:03

     Right

179. 0:57:03

     ... because I have more of those.

180. 0:57:04

     Sure.

181. 0:57:04

     So sometimes when you look at the actual unit mix pricing, to you it may not make sense, but it's basically based off of my supply in that moment. But roughly, I would say that climate's, what, like, 20% more than a-

182. 0:57:18

     Yeah, 15 to, 15 to 20%. But it can also go the inverse in high density markets where the non-climate becomes a premium unit for the landscaper that wants to be able to just drive up and not store 10 miles away.

183. 0:57:33

     Mm-hmm.

184. 0:57:33

     And, and so it's really, it's really just dependent on the supply and demand.

185. 0:57:37

     Because the facilities that he's referring to, oftentimes, you know, the municipalities don't wanna see a roll-up door, and so those are kind of c- harder to come by, is the reason they're having that premium.

186. 0:57:49

     Okay. Thank you.

187. 0:57:51

     Mm-hmm.

188. 0:57:51

     Cool. Well, great. Uh, looks like you've exhausted all the questions. Thank you. Thank you very much. Y'all did a great job, and I encourage the members to, uh, network with you guys. I wanna hear more about your proposal, uh, as far as taking the, um, the income and determining the valuation for, for local property taxes.

189. 0:58:17

     Mm-hmm.

190. 0:58:17

     Um, I had to change insurance companies this past year, and instead of doing replacement cost, they looked at income and based my premiums on that. So it was, uh, it was interesting. Uh, so... And of course it went up something almost 50%, so it's all good. Have we got another question?

191. 0:58:39

     Yes.

192. 0:58:39

     You make so much money, Mr. Chairman.

193. 0:58:41

     Yeah. All right. We got one more question before we m- let y'all go. Representative Carter?

194. 0:58:49

     Thank you, Chairman. Good morning.

195. 0:58:51

     Good morning.

196. 0:58:51

     Uh, this was, um, good information. My question as I was understand- or trying to understand your business model, um, are there opportunities where you have a owner that may wanna get out the business? How does... H- how, how does that work? Do, do those units come on the market for someone to purchase them, or they go into some type of network or something? Or say there's a unit.

197. 0:59:22

     Let's say this person's like, "I'm retiring. I'm tired of this business. How do I get out of it?" Or, "I'm interested. How do I get into it?"

198. 0:59:32

     That's a great question to ask a broker.

199. 0:59:37

     So, so yes, that's... We list self-storage properties just like residential agents list homes. And so as far as how we market those and list those, we value them based off of the income stream and the returns and all of the, the appetites that we talked about earlier. And so we list those just like you would a house, for the simplest way of putting that, and then we meet with buyers and vet them out.

200. 1:00:08

     And, like, when... If you want into the industry, the conversation we have is, you know, "How are you going to manage it? You know, what's your, what's your time involvement?" We got to figure that out. And then the other one is, um, "How much money do you have access to?" Um, and then once we have those two things, we can kind of help them f- figure out exactly what it is that's a good fit for them, um, because some risk tolerances are different than others, of course. So basically, that's what we do day in, day out, is work with the buy and the sell side of folks who want to get in or out of the self-storage business.

201. 1:00:48

     Thank you.

202. 1:00:48

     Cool. Well, again, thank you very, very much for being here. I appreciate your presentation. And if y'all stay a few minutes, I'm gonna come pick your brains.

203. 1:00:55

     Thank you all.

204. 1:01:47

     Thank you.

205. 1:01:47

     Thank you.

206. 1:01:49

     Thank you.

207. 1:01:50

     Thank you.