The recent opening of a new self-storage facility in Denver marks a significant development in the industry, which has been facing significant challenges in recent years. The facility, which is located at 2425 S. Colorado Blvd., is the result of a significant investment by Denver-based VanWest Partners, a company that specializes in self-storage facilities.
Background on the Project
The facility, which spans 93,000 square feet, was built with a budget of approximately $25 million. The project was undertaken by a team led by Jacob Vanderslice, the founder and CEO of VanWest Partners. Vanderslice stated that the company spent a significant amount of time and resources into ensuring that the facility met the highest standards of quality and design.
Challenges Facing the Industry
Despite the positive development of the new facility, the self-storage industry as a whole has been struggling in recent years. According to Vanderslice, the industry is facing a number of challenges, including:
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- Softening job market and slowing population growth
- Slowing residential transaction velocity
- Lack of physical occupancy
These factors have resulted in a decrease in demand for self-storage services, which has had a negative impact on the industry as a whole.
Contrast with the Market
However, the Colorado Boulevard facility is a notable exception to the trend. The facility has already seen significant interest and has over 100 units leased, despite the fact that some of these leases are at deeply discounted rates. The facility’s pricing is also significantly lower than market rates, with a 100-square-foot unit costing $42 a month and a 300-square-foot unit costing $106 monthly.
Management and Operations
The facility will be managed by ClearHome Self Storage, a wholly owned subsidiary of VanWest Partners. The company will oversee the day-to-day operations of the facility, including leasing, maintenance, and customer service.
Financing and Development
The facility was financed through a construction loan provided by Wintrust Financial, with a total loan amount of $13.7 million. The company also acquired the land for the facility in April 2023 for $4.25 million.
Vanderslice stated that VanWest Partners plans to keep the facility for a period of five to six years, during which time the company will continue to monitor the market and adjust its pricing and operations accordingly.
The self-storage industry is expected to continue to face challenges in the short term, but Vanderslice believes that the Colorado Boulevard facility is a positive development for the industry. He stated that self-storage is a “five-mile business,” meaning that the industry is highly competitive and that companies must constantly adapt to changes in the market.
The opening of the Colorado Boulevard self-storage facility marks a significant development in the industry, and provides a glimmer of hope for the future. Despite the challenges facing the industry, Vanderslice believes that the facility is a positive step forward and that the company will continue to monitor the market and make adjustments as necessary. The facility’s success is a testament to the hard work and dedication of the team involved in its development, and provides a positive example of what can be achieved with the right combination of investment, planning, and execution.
Key Statistics
| Feature | Value |
|---|---|
| Facility Size | 93,000 square feet |
| Budget | $25 million |
| Units Leased | Over 100 units |
| Pricing (100 sqft unit) | $42 a month |
| Pricing (300 sqft unit) | $106 a month |
Definitions
- Self-Storage Facility
- A facility that provides temporary storage for personal or commercial goods.
- Physical Occupancy
- The percentage of available storage units that are actually occupied by customers.
- Economic Occupancy
- The percentage of available storage units that are occupied by customers at a rate that is sufficient to cover the costs of the facility.
Sources
“Self-storage is a five-mile business. … Denver has not yet recovered from the supply shock that we saw back between 2016-2020.
