Admin fees, insurance, merchandise, late fees, other fees, charges, and add-on services—all of these can add up to quite a lot of income and improve your property’s overall valuation.
Volumize Your Value
Fees As Alternative Revenue Streams BY M. ANNE BALLARD
average the same amounts for each of those fees as do we, for this year through June 30, about eight percent of income; then you are collecting about $80,000 or more in combined additional income from all of the aforementioned fees. At the current average cap rate of 5.5 percent, that $80,000 has brought you an additional $1,454,545 in value to your property. Admin fees, late fees, merchan- dise, and insurance were 10 percent in 2019, pre-COVID, which would equate to $100,000 and $1,818,181 in additional value to the owner.
L Who can give up an additional $1.45
million to $1.81 million in value? All of us seek to have the highest
and best possible income stream from our properties and have customers who appreciate a one-stop shop for boxes, supplies, insurance, and other services. We will take a look at these fees and
et’s assume your property income for the year is $1 million, and that you
revenue sources to see which ones might add additional value to your property and the services you offer. There are lots of ways to improve your bottom line using these tried-and-true products. These sales require proper training and motiva- tion to implement and handle with ease.
In our business, we have expenses
that must be paid, and most are covered by rental income, however there are others that are case specific; for those, we charge fees that are appropriate to the service or action. In all cases, fees must be clearly outlined in the rental agreement the customer signs, whether in person or digitally (as both methods are allowed). Fees cannot be made up or charged unless they are in your agreement; when changes are made, customers must receive 30-day advance notice of the changes for your charges to
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MiniStorageMessenger.com
be valid. Your fees and other lease terms clearly spell out how you will manage the customers’ behaviors and actions. Make sure you have a signed document on all occupied spaces and that you regularly review your lease and fees to keep up with changing laws and statutes.
Admin Fees - To begin, let’s discuss the admin fee, which is a non-refundable fee charged to each new customer to cover the cost of administering the new lease agreement, time, sometimes paper and ink, and software costs. We customarily find these in the range of $15 to $30 per move-in; currently, we are charging at least $20 to 25 at our locations. In prior generations, deposits were taken that
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