The way that some large players in the industry are currently manipulating storage rates has some operators struggling to keep up.
But should you be worried about more than competing?
The conversation around impending rent control measures has been circling for the last year or two. There have even been a few recent attempts to do just that. Sometimes, all it takes is the wrong person getting slapped with what they feel is an unreasonable rent increase or a dishonest move-in special to see an entire industry under the microscope.
Joe Doherty of the Self Storage Association sat down with Melissa and Tommy to talk about legal updates in self storage. Let's hear what he had to say on rent control!
Question: "Should the storage industry be concerned about rent control?"
Check out the video clip below to hear their answers:
In this Gabfocus Session: 2023 Storage Legal Update, Tommy and Melissa were joined by Joe Doherty of the Self Storage Association. He gave us his legal update for the self storage industry as of the end of 2023, and he even gave us a sneak peek at the legal landscape of 2024.
Check out the full Session to dive deeper!
Don't want to watch the clip? Here's what Joe had to say:
So let me just touch real quickly on the rent control.
That's not a legal challenge necessarily, but it is something I think we all need to be concerned about. And again, these are things that come up by anecdote.
We first saw this in, of all places, Hoboken, New Jersey, probably three or four years ago, and thought, "Oh, it's a one off type of thing. We'll probably never see that again."
And then just this year, both in Texas and in New York City, there were rent control measures, again directed specifically at self storage.
This wasn't something that was at all real estate sectors or anything like that. It was specifically at self storage.
Thanks to the good work of folks like Ginny Sutton down in Texas and the New York association, led by James Coakley, with our assistance there as well in bottling both of those up.
It's scary type of stuff, because we all know, fundamentally, that self storage is a month-to-month relationship. That's what's so great about it for both the owner and the tenant. And if somebody doesn't like the rent that they're being required to pay, they can move to another facility.
They've got other options on a month-to-month basis. You're not talking about somebody who's locked into a long-term lease and they end up getting bumped up midway.
And fortunately, that argument prevailed in both of the states. In both, New York City is not a state, even though it thinks it is, but that prevailed in both New York City and Texas.
And I'm hopeful that that issue will not come up again. But I'm also sufficiently aware to know that we probably have not fought our last rent control battle."
—Joe Doherty
