If you're the owner of a self-storage facility, then you know that non-paying tenants can be a real burden on your business. Not only are you not getting the rent payment, but you've also got a storage unit tied up that you can't rent out.
As an apartment landlord, you can simply evict the tenant, but in the case of self-storage unit, the manager will host an auction to sell off the goods and free up the space. The units are typically sold as a package because the goal isn't so much to get rich from the sale, but to free up the space. Check out the following pages for some tips on hosting your very own self-storage auction.
Know the Law
If you have some deadbeat tenants in your self-storage facility, then you should know the state laws for dealing with their eviction. Each state has different laws concerning what are known as lien auctions and it behooves you to be well acquainted with them.
No matter which state you're in, the tenant is required to be informed of the lien laws before renting the storage space. This is typically outlined in great detail in the rental agreement. Once signed, the tenant gives the right to the self-storage facility to auction the goods because of non-payment.
Hire an Experienced Auctioneer
One way to be sure that your auction will go down without a hitch is to hire an experienced auctioneer. Most self-storage auctioneers work a series of auctions at different facilities on a set day, typically one Saturday per month. Try to hook up with other self-storage facilities in your area to use the same auctioneer. If you're going it alone, you can look online for auctioneer services that provide auction managers to everything from estate and art sales to lien auctions. Hiring an experienced auctioneer will cost you a little money, but you and the bidder will have peace of mind knowing that it will be conducted professionally and according to proper auction protocol.
Post Your Rules
To avoid any misunderstandings with your bidders, make sure you post your auction rules clearly and early enough for everyone to take a look. It's also a good idea to go over the rules verbally before the onset of the auction. Your auctioneer will go over the actual bidding rules, but it's up to you to set rules about the auction process as a whole. Take some time to consider what works best for your business and then outline these rules clearly for the auction participants.
Some rules that you need to consider are whether or not the bidders are allowed inside the unit or if they have to view from the entrance. You also have to decide how long the winning bidder has to get all of the contents from the unit.
Advertise Your Auction
The key to any lien auction, whether it's from a seized estate or a self-storage facility, is to get the word out. The last thing you want after spending money on an auctioneer is a low turnout. Use Web sites like Craigslist to advertise for free. Make fliers and post them at local flea markets and antique shops. Look for online community message boards, along with the old-fashioned kind in local businesses, coffee shops and bars. If your self-storage facility is in a college town, market the auctions to students. While many bidders are professionals looking to resell the items for profit, students looking to furnish an apartment can also get in on the auction action.
Handling Personal Items
While most auctions give the winning bidder the contents of the entire unit, you as self-storage manager still need to be sensitive to the fact that there are often personal documents that should not change hands. Many times, there are boxes filled with financial records that need to be incinerated or shredded.
Most bidders aren't out to steal anyone's identity, but they may not take the time to dispose of the records properly. As a self-storage manager or owner, you don't want to be held liable for their lack of care, so it's up to you to get rid of the documents. Make sure this is outlined in the auction rules so the winning bidder knows to turn in such items.
Hosting a trivia night can spice up a slow bar night or be a great fundraiser. Learn how to host a trivia night to get started.
- "About Storage Auctions." Storageauctions.com. Jan. 22, 2012. http://www.storageauctions.com/3.htm
- "Mini Storage Owners: Why and How to Hold an Auction." Storagelockerauctions.net. Jan. 22, 2012. http://storagelockerauctions.net/mini-storage-owners-why-and-how-to-hold-an-auction/
- "National Auctioneer." Nationalauctioneer.com. Jan. 22, 2012. http://www.nationalauctioneer.com/auctioneer.htm
- "Professional Self Storage Auction Tips." Soragetreasures.com. Jan. 22, 2012. http://www.storagetreasures.com/auction-bidder/how-to-become-a-successful-buyer/professional-self-storage-auction-tips
- "Storage Auction Tips – Profiling Storage Auction – Units The Good The Ugly." Storageauctionguru.com. Jan. 22, 2012. http://storageauctionguru.com/storage-auction-tips-profiling-storage-auction-units-the-good-the-ugly/