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26 Aug 2020

Exclusive Radius+ Q&A: Self Storage Development with P.B. Brown


P.B. Brown specializes in self storage construction. The team has extensive experience building multi-family, retail, theme/amusement parks, restaurants, casino/gaming, hotels, and public contracting. P.B. Brown has worked with clients such as Disney, Lego, iStorage, CVWD, Agua Caliente, and Sea Life.

Based out of Winter Garden, FL, P.B. Brown was founded by Paul Brown in 2009. Jano Montoya, President of Operations for P.B. Brown, partnered with Paul two years later. P.B. Brown established itself as the exclusive construction and development partner of iStorage, scaling a network of subcontractors to renovate and build a portfolio of over 4 million square feet of rentable self-storage space. The 66-facility portfolio with over 36,000 storage units sold to National Storage Affiliates (NSA) for $630 million in 2016.

In 2015, Nick Zent, Director of Design & Pre-Construction for P.B. Brown, came aboard and began broadening the scope of work in storage with third-party entities. Nick’s involvement with each and every project sees its way through from start to finish; handling the permit and entitlement process, designing unit mixes, focusing on build optimization, presenting the most efficient and effective build designs. Before joining P.B. Brown, Nick was Lead Designer & Engineer for iStorage. P.B. Brown has now collectively delivered over 10 million square feet of self-storage assets to the market and they do not plan on stopping any time soon. nick-zent

Radius: What sets P.B. Brown apart from other storage developers?

Nick Zent: Two things... experience and technology. We’ve built an unprecedented amount of storage all over the country - remodels, ground-up, competitive bid, design-build, owner-operator, you name it and we have done it. We’ve seen every market condition and commodity influx. We’ve transitioned from single-story fortress facilities to 7-story towers. On top of our years of experience, we are able to leverage technology to build the optimum facility. It sounds cliché but we actually do use algorithms to program our unit mixes based on surrounding demographics, revenues, costs per square feet, travel distances, and several other factors.

Radius: What regions do you focus on?

Nick Zent: Our analytics have defined a number of key areas which are underserved; population greatly outweighs the available storage capacity. These markets are typically built out and sites are at a premium, entitlement is nearly impossible, and construction costs are inflated. Rents, however, are the great justifier. Namely, NY, NJ, CA. It is easy to build in TX and FL but the rents make those areas less attractive.

Radius: What is your process for establishing the proper unit mix for a proposed development, and how might that change from one market to another?

Nick Zent: Assessing the current inventory on the market and what unit sizes are vacant or in high demand is the tried and true way of catering to a specific area, but it is a very static measurement. There’s a solid chance that from the time a unit mix is established to the time it is actually designed, permitted, built, and ready for lease, the demand has changed or other storage companies have flooded the market. We try to keep our unit mixes as fluid as possible to adjust to changing demands. For instance, structural steel, post and beam grids allow unit changes within a building without structural modifications. Plus the added benefit of limited lighting and minor sprinkler re-configurations yield us minimal costs. We do our best to keep the mix as applicable to the market as possible while readily adaptable should the market change.

Radius: What would you say is the biggest pushback you might get when proposing a zoning ordinance change?

Nick Zent: We call it storage stigma. There is a perceived ideology that storage is the sign of a depressed property and neighborhood. False perceptions such as, “storage generates traffic, reduces adjacent property values, lacks job creation, attracts deplorables… I’ve heard all of the contrary arguments. The biggest challenge, even when storage is an approved use, is that “storage structures are ugly.” On numerous occasions, I’ve heard, “you can build storage here, we can’t stop you, but it can’t look anything like a storage facility.” The truth is, storage is listed as one of the least trip generating classifications that DOT has. There are dozens of other approved uses in the commercial or industrial zoning that could have far more negative impacts on property values. They create hundreds of construction jobs, sizable tax revenues, and more long-term jobs than vacant lots. And we work very hard to make our facilities modern, safe, and “non-storage looking.”

Radius: How does data drive your decisions?

Nick Zent: Timely and accurate data is the basis of all key decisions. That’s one of our core values. It’s easy to be influenced by emotion, especially when years of effort go into a project. Our underwriting team assesses the profitably of a project and that’s the final word, regardless of how many sleepless nights the design and development team have spent on a deal. Decisions on structural systems, unit mixes, and countless other items are based on the three following types of data:

Radius: How has COVID-19 affected your existing projects? How has it affected future ones?

Nick Zent: Approvals are slower. Projects requiring public hearings have been stalled because cities don’t know how to maintain social distancing standards and abide by the requirements to hold public meetings. Some have tried, and other cities have just postponed them. We’ve tried very hard to avoid them, simply because of the delays associated with required public hearings. Additionally, review staffing has been minimized and in-person review sessions have completely gone away. Some municipalities have just given up while others have really stepped it up and done a great job of using online portals or other means.

Radius: The pandemic seems to have accelerated the adoption of technologies to ease us into a contact-free environment. Have standard facility designs evolved at all in accordance to facilitating contact-free behavior?

Nick Zent: Our leasing office designs have always been pretty minimal and intentionally configured to limit congregation. Not that we want to be uninviting, but our managers are more effective when not sipping coffee and overly socializing. We’ve implemented kiosks and enhanced our online portal to remove the social element entirely for those who so desire.

Radius: Where do you see P.B. Brown in 12, 24, or 36 months?

Nick Zent: My crystal ball is in the shop, but I think more and more businesses are realizing that a brick and mortar office isn’t a necessity. Zoom meetings with noisy backgrounds are the new status quo. I work out of a barn loft in Big Horn, Wyoming, population 491. I’ve never been more efficient or effective. Businesses will still have inventory or supplies, so I anticipate an increase in commercial storage. Our most recent unit mixes have some larger, more accessible units, not intended for homeowners with lots of stuff, but business owners with inventory. I think there will soon be a very common zoning that will allow us to cater to the small business owner with isolated office facilities and inventory storage.

Author: InSite Property Group, P.B. Brown, and Radius+

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