With the last recession in the rearview, some developers who sat out the last few years are getting back into self-storage again.
Take Beverly Hills, CA based Michael Wiener, who just closed on a vacant industrial building in Waipahu, HI on Oahu, which he plans to convert into a 45,000-square-foot rentable storage facility with 600+ units.
“It will be almost all fully climate-controlled,” Wiener said. “I hadn’t traveled a lot to Hawaii. I got there a couple weeks ago and experienced the humidity.”
Wiener said he was surprised by the lack of climate-controlled facilities in the area.
“There seems to be a need for it,” Wiener said.
Wiener’s has owned his own real estate company since 2000 doing development and shopping center management. Between 2000-2006 Wiener developed half a million square feet of self-storage space in the Inland Empire region of California. Wiener managed the facilities under the name America’s Storage.
“We ultimately sold it all by 2006,” Wiener said.
Wiener didn’t do any self-storage development during the recession, but stayed active in retail and residential development.
“My intention was work slowly during that period, my kids were then in high school and wanted to focus on them,” Wiener said.
In 2014, as a new self-storage development cycle slowly started to ramp up, Wiener said he got a call from broker Stephen Grossman, who he had worked with during the early 2000s.
“He asked me if I was interested in working in the self-storage space again and he had identified what he thought as an opportunity,” Wiener said.
Wiener, under the name M4 Management, returned to self-storage development—starting with a new 60,000-square-foot facility at 3055 Del Sol Boulevard in Otay Mesa, CA. The project was sold at C of O to Extra Space Storage for $9.5 million during the fourth quarter of 2015.
Then and now
Wiener said the Hawaii project at 94-130 Leokane Street will be managed by StorQuest when completed.
While Wiener used to manage his previous facilities in the early 2000s, he said that times have changed.
“My sense is that the storage industry between then and today has moved to the point where you are at a competitive disadvantage unless you are working with a management company that has the same resources as some of the bigger name brands.”
Wiener said he is actively looking for his next storage project but admits that finding the perfect site is a big challenge.
“There are so many people looking for an opportunity,” Wiener said, “There is so much money out there are a lot of the companies I compete with are using investor funds.”