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Today I traveled to a meeting of the affiliated state associations of the self storage association in Northern Virginia. I figure that the development of the associations is important to me, our company and our clients. So here I am to see what happens and what develops. The national self storage association is trying to collect all the state associations under one umbrella group. The idea makes a lot of sense. Pooling resources, helping each other with projects and sharing notes on issues of importance have to be good for everyone.

There were about two dozen people from all around the country at the meet and greet tonight. I got to catch up with several people I knew and got to meet some new people, too. I didn’t hear any particular theme tonight, although everyone seemed eager to work together.

I’ll tell you more tomorrow.

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Today’s self storage blog entry comes from Mike Scanlon of the Self Storage Association. Take a close look at it. It could impact your business.

Informational Bulletin: Building Self Storage Facilities on Military Bases

On Tuesday, December 6th, the Self Storage Association (SSA) Task Force on Self Storage on Military Bases met with representatives of the Army-Air Force Exchange Service (AAFES), The Naval Exchange Service (NEX) and the Marine Corps Community Services (MCCS) to discuss their continuing interest in having private companies build self storage facilities on bases. After some 2 hours of discussion it was apparent to SSA representatives that no agreement could be reached.

The military branches insist that today there are about a dozen or more U.S. military installations where they feel there is sufficient hidden “demand” to build a successful self storage facility “on base.” However, The SSA Task Force never did get them to exactly reveal how they estimate such “hidden” or “untapped” demand. After much talk, it seems as though the military exchange services simply go through the local yellow pages near each installation and look for the number of self storage ads — and that seems to satisfy them that there is sufficient demand to build a facility on-base. This notion left us with our heads shaking…later, when we went on-line via SSA’s new ODESSA program and showed them 50 self storage facilities that are situated just outside the gate of one military base, the military people stated that it only proved to them that there is ample demand (and perhaps an on-base facility should be considered at that base).

They did not seem to understand that their bidding process for construction of self storage on-base selects just one self storage owner-operator as their exclusive partner to the financial detriment of all other owner-operators who have invested in facilities in the general area of each base. We explained (as an association) that in our view, rewarding just one operator (who is willing to build a facility on a military base with only a five-year lease deal) over many other competitors (and SSA members) was not a brilliant way to do business and that SSA could not support that type of activity because it created an on-base monopoly and an unfair advantage over the other competitors.

The meeting ended without any agreement as to how to proceed further or how to formally estimate “hidden” demand on base; however, the 4 military branches seemed willing to tell us at which locations they feel on-base facilities would be a “hit.” The SSA, in turn, said we would take such information and pass it along to: (1.) our members, and (2.) affiliated associations and others in the industry that might be directly affected. This information which we expect in the next week or two would consist of which bases are considering setting up a bid process for on-base self storage construction and the bidding process. We will forward the information to this same list when it arrives.

The SSA reserves the right to fight any initiative to build a self storage facility on a military base before the U.S. Congress; however, we acknowledged that we support our troops and that from time-to-time there may be remote military bases where there were no private sector operators with the capacity to build on-base. By passing along such information, SSA does not want to encourage such efforts, but simply to inform potential competitors of what the military is up to and to allow owner-operators ample time to either enter the bidding process or to call or write their Congress person to object to such consideration.

The Affiliated Association Council (AAC) meeting on January 11-12 in Alexandria, VA will take up this topic as will the full SSA Board will consider this issue in great detail at its January meeting. The national SSA is prepared to invest in advocacy and lobbying efforts to restrict self storage construction on-base where: (1.) there is ample self storage inventory in the vicinity of the base.; (2.) our members and local self storage owner-operators are opposed to the idea; and (3.) where an affiliated state association objects to the project.

This is prime example of why the national Self Storage Association and the many state associations need to work closely together in 2006 and beyond. Keep in mind that any state association may send a representative to the January Affiliated Associations Council meeting (even if they have not yet formally affiliated) where this topic will be addressed. (Agenda attached.)

This is an informational memo – no action required at this time.

Best regards,

Michael T. Scanlon, Jr.

President & CEO

Self Storage Association

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