259. Turning Apartment Storage Lockers into Full-Blown “Micro” Storage Facilities w/Alex Harman and Peter Smyth

Self Storage Income

AJ Osborne

Entrepreneurship, Education, Investing, Business, How To

4.9 • 591 Ratings

🗓️ 27 August 2024

⏱️ 47 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

These two business school graduates may have cracked the code for self storage in big cities. By converting apartment tenant storage lockers into full-blown “micro” self storage facilities, tenants renting tiny units can easily walk a couple of blocks to store their bulkier items, WITHOUT paying the premium of storing at one of the big REITs much farther away. This duo has been so successful that they’ve scaled to sixty locations fast, and they’re not stopping anytime soon.

Alex Harman and Peter Smyth, founders of Local Locker and White Label Storage, realized how profitable self storage could be when they were in business school. The problem? Like most students, they had very little money to go out and buy a self storage facility. After struggling to find convenient storage in their own market (New York City), they wondered if they could turn apartment basements into “micro” facilities for tenants like them. They threw together a rough and ready prototype facility, and…it worked!

Now, with sixty facilities under the Local Locker brand and another sixty or so being managed by their team, they’ve tapped into the true success of small self storage. Today, I’m talking to them about how they started, the tech stack they use to run these “micro” facilities,” the operational problems they’ve had to solve, and why tiny storage units are crucial for dense cities.

What you’ll learn in today’s show:

How “micro” self storage could be taking over dense cities with limited space
Scaling your self storage portfolio fast and why having the right tech is crucial
Systematizing your self storage operations, even if you’re a small facility
Why running a self storage facility yourself is rarely a good idea
Self storage “rules” you must follow to avoid troublesome tenants
Why many apartment tenants DON’T want to rent a unit from a REIT

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Local Locker

White Label Storage

Transcript

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0:00.0	Man, there's these chicken wire cages in the basements of apartment buildings are getting very high rents per foot, often more than the apartments themselves. And, you know, you survey the asset, talk to the property manager when you do a diligence or property. Often the response is when you say, like, what would you change about this building? It's like, there's just not a little space. It's not. There's, you know, the tenants don't have enough space. Just real quick, how many locations do you have now? We have about 60 local locker locations and then we manage under our white level brand as well.
0:32.9	Welcome everybody to self storage income.
0:35.3	And today I have Alex Hartman and Peter Smith.
0:41.3	And I'm very excited to talk to you guys and learn a lot more about what you guys have got going on and hear what you guys are doing with a local locker. So first and foremost,
0:56.3	why don't we introduce the audience to you guys and let them know who you are, what you guys are
1:04.8	currently doing before we dive deep. Yeah, sure. And AJ, thank you for having us where we're
1:10.7	very lucky to be here. So this is
1:12.9	Alex speaking. My co-founder, Pete, is sitting next to me. So I'll give you just a quick rundown of
1:19.0	sort of what we do and how we're involved in the self-storage industry. Six years ago, we
1:23.6	graduated at business school at times sort of flying on us while in business school we decided
1:28.4	to start a company called local locker local locker what we do is we find underutilized space
1:35.0	in dense cities and convert it to self storage really small locations 50 to 200 units we managed all
1:43.3	these remotely and we really are laser focus on
1:47.4	customer service marketing these locations that are otherwise hard to find. Along the way there,
1:53.4	we realized, hey, we can manage facilities remotely and we can do it for other people. With that,
1:58.8	we launched White Label Storage, which is just a third-party
2:02.6	management company focused on remote locations. So that's sort of at a high level what we do.
2:07.9	We started off as just classmates and buddies at Harvard Business School. We were in the first,
2:13.1	the same section first year. You take all your classes with 90 people. I sort of came into school
2:17.0	with the idea.
2:18.5	I didn't want to work for someone after school.
2:20.7	That was the one goal.
	...

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