Talking ’bout Canadian Storage ...
What a long strange trip it’s been, eh?

By Jeff Kinder

It’s been a few years since my partners and I sold our Canadian portfolio, and each time I return to help an entrepreneur or company with their self-storage endeavors, I find the industry growing in leaps and bounds. At the Inside Self-Storage Expo in Las Vegas this year, I ran into Joe Kormos, perhaps the most venerable self-storage name in Canada. It was not only great to spend a few minutes with Joe, it was a powerful shot of nostalgia and a new perspective for me.

I lived in Toronto in the early ’90s, serving as vice president of operations for Canadian Mini-Warehouse Properties, Public Storage’s Canadian corporate entity. At that time, Public Storage and Joe’s company, Canadian Storage Centres, controlled almost 80 percent of the Greater Toronto self-storage market. That sounds impressive, except there were only about 30 stores.

Everybody knew everybody. Joe guaranteed his market edge by opening what was probably the first cooperative self-storage call center. Allan Barkin always lobbied hard to keep his Jiffy location, named as Toronto Life’s Best Storage Company. I think he’s added Consumer’s Choice to his list of accolades.

The Migson Public Storage guys dug in their heels and fought my alma mater, the big orange door guys from Glendale, Calif., to a draw on the trademark of Public Storage. Brian Atkins and Tak Tanaka did the architecture and engineering on everybody’s projects. I heard they finally got smart, did a couple of stores with Joe for themselves, and retired. You can still find his son, John, who has his own self-storage history going back to the late 1970s, carrying on the tradition.

Name the Players

At the convention Joe commented, “I used to touch almost every deal in Ontario. It’s been growing so fast the past few years I don’t even know who half of the new players are.” In 1997, I left Public Storage and teamed up with a Canadian partner to purchase 2.5 locations and develop 3.5 others. At about the same time, another guy from down South, Hal Spradlin, also teamed up with a Canadian to open four others. Hal was smart and hid his cowboy boots and southern drawl behind the All Canadian Self Storage name and developed a strong pick-up and delivery business. I stuck with my Advantage Self Storage name.

The Everest Company, whose principals include Public Storage alumni Bob Kohorst and Carl Beckmann, bought four of the Ontario Advantage Self Storage locations and developed another one.

Shurgard made a foray into Canada in the ’80s, but like many other American brand names, they fizzled in the Canadian markets and now the locations are locally owned. U-Haul bought a group of properties from Canada’s Sentinel Self Storage, which created a core group that grew to more than 75 locations from PEI to the Northwest Territories.

Public Storage has reorganized its Canadian corporate structure and, in conjunction with the Hughes family, continues to add to its market share as a major player in the Canadian self-storage industry.

Canadian Sophistication

As exemplified by Joe, however, it’s the Canadians who are truly driving the growth and sophistication of self-storage in Canada. As in the United States, local and regional players have added the lion’s share of product; the fewer than 500 facilities in the late ’90s has grown to nearly 2,800, according to the Canadian Self Storage Association.

Based in Alberta, Sentinel Self Storage remains a major player, even after selling some sites to U-Haul, with 16 stores in Alberta, Manitoba and Ontario. Also in the West, Stor Edge has put its clever logo on seven locations. Advanced Storage Centres has brought three locations in Vancouver. Aaaaaah So Easy (How many A’s does it take to get the first ad in the Yellow Pages?) has joined several other Canadian players in bringing pick-up and delivery services to Vancouver.

Back in Toronto, Giant Storage and Storage Stadium are also gaining market share as they compete with All Canadian in the niche. Apple Self Storage opened nine locations in Ontario and Quebec. Storage Now spent the big bucks to develop its prestigious Leaside flagship location and three other GTA locations. Gerry Gotfrit and Robert Daniels at StorageMaxx began their ambitious plan in 2002 and have rolled out seven locations with more in the pipeline.

For the large Francophone populations in Quebec, Manitoba and other regions of the Maritimes, mini-entreposage, (or as Depotium’s Turan Kalfa calls it, “self stockage”) has made the cultural leap. Depotium started building lockers in a leased industrial building under the railroad bridges in 1996, when Public Storage and Hal Spradlin were beating their heads against the wall, trying to find the right words to introduce the self-storage product to French-speaking Quebec. A familiarity with the territory obviously had its advantages: Depotium now has 12 locations across Quebec, and Montreal counts more than 60 local self-storage companies.

Maybe some of the typical statistics don’t match up to the United States yet—such as 2.5 to 3.5 square feet of storage per person in Canada (depending on who you talk to) vs. 4.5 to 5.5 square feet (depending on who you talk to) in the States. Nevertheless, it’s clear the self-storage industry in Canada is every bit as mature. As in numerous U.S. markets, solid development opportunities persist, and the vast majority will be developed by Canada’s many good developers and operators.

Jeff Kinder is the managing member and president of Advantage Advisors LLC, which provides private investment opportunities in self-storage while limiting risk through a professionally managed portfolio with Institutional Quality & Entrepreneurial Drive. Based in Maryland, the company also provides business and property management services to self-storage owners as well as acquisition and development feasibility analyses and joint venture opportunities. For more information, call 301.774.0243; e-mail jeff@advantagestorage.com.


Copyright © 2007 by Virgo Publishing.

Source: http://www.issinternational.com/canada/articles/651talking.html#