Those of us who have been around long enough understand the unique nature of the self-storage industry. What began as temporary real estate use has evolved into a thriving customer-oriented service responding to the needs of individuals and businesses around the country (and the world). As the number of facilities has grown and valuations have increased, operators who have benefitted from the financial growth of their operations have, not surprisingly, sought ways to share their success within their local communities, especially with those in need.
What arose specifically within the self-storage lien and auction world was a way for operators to work with their tenants and others in the community to create value from abandoned and donated property. Due to organizations like Charity Storage (www.charitystorage.org) that introduced this concept to the industry and Storage Gives (www.storagegives.org) that has recently joined in the effort, operators now have the opportunity to formally gather property from their tenants, local businesses, neighbors and outside auction companies and include these charity units in their public lien sales. Now, instead of applying the money collected to pay past rent debt, operators can contribute the money raised from these sales to their designated charities.
Unfortunately, not every operator is participating in these types of programs. There is hesitancy to utilize these programs due to concerns that selling a “donation unit” might be cumbersome to manage or may not be specified under the statutory language of their state’s lien law. Guidance and support to join in this movement is only a phone call away. Information about these programs is available at national and state self storage conferences. Operators may be surprised to see the benefits derived from offering such programs to the tenants at their facilities. Tenants who otherwise might trash some of their property (or abandon it at the facility upon move out) may instead choose to add that property to the designated “donation units” at your facility. This change in behavior alone might make joining these programs worth the extra effort that may be needed to run these donation locations.
It is also important to note that when a facility chooses to set aside one or more available rental spaces for the express purpose of collecting donated or abandoned property, it is no different from donating a unit’s use to local law enforcement or a neighboring educational or charitable organization. Further, the choice of the facility to sell the donated property as part of its well-attended public sale program (even a unit not officially in “lien”) is not prohibited by any self- storage statute. In addition, if an operator chooses to participate in one of these programs, they can offer a charitable tax receipt to the donors who contribute their new or slightly used property and the monies received can be allocated to qualified charitable organizations and other worthy causes.
At the end of the day, operators who participate in these charitable endeavors are not only enhancing their own operations by shining a positive light on their businesses, but they are also making a true difference in the lives of those who receive the financial support from the charities served.
This article was originally published in Self Storage Legal Monthly Minute by Scott Zucker, March 2022
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