You have an update to make to your self storage rental agreement—what now?
Your self storage facility may have hundreds of tenants, and all of them have already signed your old rental agreement. How do you handle getting all of them to sign the new agreement? What happens if someone refuses to? Do you still need to honor their old rental agreement?
Take a look at what other operators are doing and some ideas for how to make it all go more smoothly.
No document lives forever.
Eventually, you’re going to need to make some updates to your rental agreement.
For self storage owners, those updates might include anything from their rental rates to changes in the rules at your facility.
The question is, how do you go about making these updates? You can open up the document on your computer, type out the new addition, and then save it. But what does that mean for existing tenants?
It means virtually nothing. That content wasn’t in the self storage rental agreement they already signed.
Well, unless you set yourself up for success ahead of time.
All items of this Lease, including but without limitation, the monthly rental rate, conditions of occupancy and other fees and charges are subject to change at the option of the Owner upon thirty (30) days’ prior written notice to the Occupant. If so changed the Occupant may terminate this Lease on the effective date of such change by giving the Owner thirty (30) days’ prior written notice of termination after receiving notice of the change. If the Occupant does not give such notice of termination, the change shall become effective on the date stated in the Owner’s notice and shall thereafter apply to the occupancy hereunder, whether or not Occupant has agreed to the change in writing.
This is a clause in an existing self storage rental agreement.
Let’s put it in plain language real quick: the owner can make virtually any legal change so long as they give thirty days' notice. The tenant may then opt to terminate their rental agreement with proper notice, or else the changes will become a new part of their rental agreement even without a new signature.
To put it even more simply, this clause allows the owner to make changes without having to get a signature from every tenant each time.
This is one way that self storage owners make it easier to update their rental agreements without running into problems with existing tenants. It gives the tenant the option to opt out while giving the owner the ability to make the necessary changes.
Of course, when it comes to any legal agreement, you should always check with a legal expert before making any final decisions.
Does your facility offer month-to-month self storage rental agreements?
Monthly rentals are definitely common, and it would be a pain if the tenant had to sign a new agreement every single month.
Instead, most self storage rental agreements allow for an open-ended rental period where both the tenant and the owner have the option to end the agreement given proper notice.
Depending on your state laws, you may be able to add an auto-renewal clause to your self storage rental agreements. This means that, without action from either party to say otherwise, the agreement will automatically renew at given intervals or points in time.
Combined with the proper clauses like above, this can allow for updates to your rental agreements without worrying about getting new signatures from all of your tenants.
Regardless of the method you use, you are going to want to send notice to your tenants.
This can be a bit of a process. Self storage tenants aren’t always easy to reach. Phone numbers change, addresses change, and even emails change. Your tenants aren’t always going to remember to contact their self storage facility to notify the office of changes, either.
One thing we see some operators do is to include clauses in their rental agreements that address these cases. Some things to include are:
Having to chase down tenants would be a pain and a full-time job.
Instead, consult an attorney or other expert on your state’s self storage laws to see how you can work in clauses like these.
Pug Pro Tip: Once you have the language set in your lease, the next step is execution. Make it easier on yourself by setting up notifications through your self storage software, such as your PMS. Schedule batch emails that include all of your tenants when you make a change to your lease rather than pulling out files and sending each message individually!
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