Long Road Ahead For Florida Operators

Posted by Christina Alvino on Nov 1, 2022 12:00:00 AM

Self-storage operators in the Sunshine State faced many challenges after Hurricane Ian made landfall on Sept. 28 in Southwest Florida. With maximum sustained winds of 155 mph and a storm surge of 12 to 18 feet, the devastation was far-reaching for Florida residents and businesses as well as many in Georgia, South Carolina, and North Carolina. 

For storage owners who planned ahead, preparation paid off. “We’ve been through this drill before,” says Marc Smith, president of Orlando, Fla.-based Personal Mini Storage. Smith is a past chairman of the national Self Storage Association and was inducted into the SSA Hall of Fame in 2021. Personal Mini Storage has 41 facilities in the Greater Orlando area, and all but five were in Ian’s path. Smith says executing a predetermined plan prevented these stores from suffering major damage.

Preparing For Ian 

“We did a lot of prep, and it paid a lot of dividends,” he says. “We’ve been very fortunate.” Personal Mini Storage follows established hurricane preparation procedures that include tying down signs with heavy fishing line, bolting the stores shut with chains, and lifting office equipment off the floor. “The difference between a tornado and hurricane is that you do have some time to prep,” Smith says. “We divided up our assets and had three crews go out to prepare.”

Following these procedures paid off. In 2004, when Hurricane Charley made landfall in Southwest Florida with winds over 150 mph, Personal Mini Storage stores lost approximately 20 signs. In the recent storm, only two signs were damaged. Smith notes that two other stores had minor flooding a few weeks before Ian hit, but these issues had already been addressed. “If you have a minor problem, you need to get ahead of it before a hurricane,” he says.

Paul Feikema, president of Bradenton, Fla.-based Hide-Away Storage, says his company also embraces a predetermined plan when a hurricane is approaching. Hide-Away Storage has 26 locations in Southwest Florida. 

First on their list is the well-being of their employees. “In the days before hurricane Ian’s impact, as we saw it becoming a threat, we contacted all team members to make sure that they had a plan in place for their safety,” Feikema says. “We stressed that they should first attend to their families and securing their personal property before returning to work.” 

The next step was preparing the facilities for the storm. “As landfall looked more likely, we prepped our stores with hurricane shutters, secured items outside, and also moved or raised items in the office,” Feikema says.

Damage Report

David Cooper, director of operations for Southeast Markets at New York City-based Storage King USA, also feels that preparation is key. Though the damage around them was severe, it was debris from a neighboring mobile home park that most affected their facility in Englewood. 

“The mobile homes were absolutely destroyed and were launched onto our property,” Cooper says. Cleanup will be the biggest issue for that property, which sustained only minor damage. “A couple of doors blew in and we lost our office roof, but surprisingly, we fared very well.”

Other operators weren’t as fortunate. Cooper’s sister-in-law manages an Extra Space facility in Punta Gorda that was essentially destroyed. “It was devastated,” he says. “The majority of the facility had to be vacated. They lost their entire roof.” 

David Romano, national general adjuster for Atlanta-based Crawford & Company, a claims management firm, toured the worst-hit areas in October. He says the damage to commercial buildings he saw was unprecedented. “I saw entire metal structures collapse, membrane roofs ripped off of condos, and interior water damage that required the total removal of interior items,” Romano says. “In some of the buildings in Ft. Myers, overhead doors were blown in and completely ripped off the steel frames.” 

“This was probably the worst damage I’ve seen as far as construction,” he says. “However, the one thing that’s remarkable is that with the new building code requirements the state has implemented, those newer structures held up extremely well. The structures built in the 80s and earlier just weren’t able to handle that type of wind damage and storm surge.” 

Fortunately, there was no flood damage at Hide-Away Storage’s facilities, although 20 locations sustained damage from the high winds. This involved downed trees as well as gates and fences that fell over. One facility had a pole sign that toppled. “We had very limited building damage, which allowed us to reopen quickly,” Feikema says, “but in some locations we waited two weeks for electricity to be fully restored.” 

Although no Hide-Away Storage team members or their families were injured in the storm, some had significant damage to their homes. “Where we could, we assisted by delivering essentials such as gasoline, propane, water, and food to them,” Feikema says, adding that experiencing a category four hurricane is a traumatic, emotional event and some employees just needed to talk about their experiences. “Our company chaplains were invaluable not only in spearheading the deliveries of the essential supplies but also in being compassionate listeners to those who needed to describe what they had been through.”

Team members who were willing to travel from less impacted areas began assessing the damage and conditions at impacted stores and began the process of clearing debris—mostly vegetation—and making rudimentary repairs to allow the stores to reopen safely.

“I could not be prouder of how they cared for one another and worked tirelessly to quickly reopen stores,” Feikema says. “We were able to serve customers long before reliable power, internet, and water was restored to the most impacted locations.”

Andy Benson, owner of Cape Coral, Fla.-based Master Tex, a company that specializes in self-storage security, says he saw significant damage to facilities in the area. “Everything from flooding to gates being completely ripped off to fencing being demolished,” he says. 

Benson, who lives in the Cape Coral area, rode the storm out in his home. “It wasn’t the brightest thing I’ve ever done,” he says. “I didn’t pay close enough attention because Ian was supposed to go up toward Tampa, but it took a hard right.” The home’s shingles were ripped off as the area sustained hurricane-force winds for six hours. 

“It’s like listening to a freight train going through your living room,” Benson says. “When you get 150 mph gusts, things move that shouldn’t move. Trees get ripped down. Lanais get torn apart. Terrifying is probably the best word I can come up with.” 

Water was also a problem as it came into his garage and he lost some tools, but he feels fortunate. “People lost a heck of a lot more,” Benson says. “That storm surge is nothing to joke about. Some areas were completely washed out.” 

At Personal Mini Storage locations, the storm exposed hidden problems that already existed. “For example,” Smith says, “we had a roof that had been leaking that we didn’t know about. Because of the storm, it manifested into an obvious problem.”

They also discovered that a sign blew over because the steel columns the sign rested on had rusted to the point that its structural integrity was compromised. “If there hadn’t been a storm, it probably would have been a bigger problem because no one would have been there,” Smith says. “It’s at a low point and the sprinklers must have been spraying on it for several years. We are now going to examine all of our signs.” 

All of Smith’s stores were closed for two days, although some went without power for four days. “We don’t let people in until we’ve checked that it’s safe,” he says. “We have a daily online checklist all of our managers provide: yes, we’re open or no, we’re not; we have power, or we don’t have power; we have damage, or we don’t have damage. We also ask if there is customer damage and if managers need assistance.” 

As of mid-October, Travis Lawhorne with Temple, Ga.-based Janus International says few owners had yet reached out with repair requests. Lawhorne is senior R3 sales manager with Janus’ Southeast region. “It’s a little odd to me,” he says. “Hurricane Charlie went through almost the same spot, and we had several facilities that were severely damaged. That was traumatic.”

A facility in Cape Coral and one in Pine Island he worked with each had 15 or 20 doors that needed to be replaced but reported no roof or gutter damage. “For the storage facilities that were devastated, I don’t think there’s been enough time yet,” Lawhorne says. “If it’s been severely damaged or a complete loss, they are still working with their insurance companies.

Insurance Issues

Undoubtedly, there will be many self-storage owners in Ian’s path who will have insurance claims to process. Ella Tayrien, vice president of claims for Phoenix-based MiniCo, Inc., cautions owners and operators to be wary about unscrupulous third-party companies that offer to handle claims on your behalf. She says these companies will go to any area where the storm had impact, potentially preying on owners who feel they don’t have the time or expertise to deal with insurance issues. 

“They use a tool called an Assignment of Benefits (AOB), which is a contract between the insured and the contractor or adjuster,” Tayrien says. “The problem is that the AOB allows the adjuster to be placed in the shoes of the insured and gives them full power of the insurance contract to include the ability to sue the insurance company.” Signing such an agreement requires the insurance company to make disbursements payable directly to the adjuster or contractor. 

“There’s a lot of corruption,” Tayrien cautions. “The insured may or may not ever see a contract and may not ever get paid.” Fortunately, Florida has passed new statutes to remediate the effects of a binding contract that can be helpful in this situation. “Be careful about signing any contract with any contractor or adjuster without thoroughly reading through it,” she advises.

In an area where hurricanes and flooding are likely events, some policies exclude wind damage, and many businesses elect high deductibles in order to make the policies affordable. Tayrien says MiniCo offers a deductible buyback policy that can help offset the expense of a disaster. She also notes that disaster relief loans may be available through FEMA, and flood insurance can be purchased through the National Flood Insurance Program. 

Dealing With Demand

As Florida residents displaced by Ian look for places to store the items they were able to salvage, self-storage facilities in affected areas are seeing high demand. Smith says operators in southwest Florida have been exceptionally busy. “For them, it is very stressful because a lot of people will need a lot of help in a very short window,” he says. “We’ve done it before, and I know how stressful it can be.” Storage managers often hear stories about people’s losses, which are sometimes heartbreaking. 

Feikema says their stores that are located in the most impacted areas saw immediate high demand when they reopened. “We were proud to be able to provide an essential service to these communities in their time of need,” he says. In the days following the storm, Hide-Away Storage left rates unchanged and expanded the use of 50 percent off first month’s rent offers.

“Generally, our industry benefits during natural disasters,” Smith says. However, he believes raising rates to commensurate with demand is not a good idea in this situation. In fact, it could be deemed unlawful. The Florida Self Storage Association warned on Oct. 3 that the state of emergency declaration in Florida had triggered price gouging laws that may impose limitations on rent increases. Georgia, North Carolina, and South Carolina also declared emergency status.

Aside from these laws, Smith feels significant rate increases could damage the reputation of the self-storage business and the industry as a whole. “When we were in that situation, we actually turned off our yield management system,” he says. “You don’t want to invite problems, and you don’t want to be lumped into a group of people who take advantage of the situation.” 

For many people displaced by Ian, FEMA will provide financial assistance to help cover moving and/or storage expenses. To qualify, their home must be damaged or unlivable, must be a primary residence, and the goods stored must be essential personal property or household goods, including appliances and furniture. 

There is no maximum amount for moving and storage expenses as long as the costs don’t exceed the maximum amount. Individuals can make a claim for the costs of commercial moving labor, moving truck rental fees, fuel for the rental vehicle, self-storage unit fees, associated sales taxes, and even the costs of tape and boxes.

Feikema says that since the storm passed, the company has been documenting lessons learned from Ian to be even better prepared next time, adding that each new incident reveals new lessons.

Most facilities in the path of Hurricane Ian sustained some damage and some will need to be completely rebuilt; however, increased demand will benefit the Florida industry in the months to come. “A lot of people lost a lot of things,” Benson says, “but the storage industry held up pretty well.” Tammy LeRoy is a freelance writer based in Indianapolis, Indiana, and is a long-time contributor to Mini-Storage Messenger.