Smitty is my partner in a self-storage company designed to take the small investor through the entitlement process for self-storage projects in an affordable way and then bid on the construction of the project in a competitive environment, ensuring clients get the best value possible.
We feel this is a powerful way, in today’s high-cost environment, to give smaller players a competitive edge and help bring projects online that may otherwise not happen.
Yardi just released Q4 data on the self-storage industry, and development projects are being abandoned at a high rate today.
Smitty thinks Resolve can have an impact on that.
We are excited about our new company, and perhaps this could help you or others in our community.
Here is an interview I recently had with him.
Mark Helm
So, everybody welcome Smitty. Thank you for being willing to do this interview. And my goal today is to talk about our new construction company and your take on the storage industry.
But first, tell us a little bit about yourself.
Where are you from, and how did you end up in an interview with me talking about self-storage?
Smith
Yeah, absolutely, Mark. Excited to talk about our new company. And let’s see, I moved to Louisville in 2005. I almost immediately began work in construction in different ways, managed a couple of facilities for a local church here, oversaw a lot of projects there with the capital improvements to the buildings, and helped them go from one campus to four or five.
Then from there I was a real estate agent at one point in time. I’m a business owner. I’ve opened two restaurants in my short history and I have been in construction in the residential and commercial side as a construction manager and project manager.
Most recently, I worked as a construction manager in the hospitality industry, horse racing, and casino work, and I spent about a year in Ashley, Kentucky, working on a casino that opened last fall.
So various experience. What we’re doing with Resolve is exciting to me and kind of gives me an outlet to continue on in my experience and construction.
Mark Helm
Well, I was a little concerned whether you actually work with me or not because with your building casinos and some of the projects you’re doing, I mean, you’re at $300 to $500 a square foot kind of projects, and then I started talking to you about $75 to $130 square foot projects. My fear was that you were like a sledgehammer hitting a finishing nail, and I was really excited to hear you getting excited about niching down in the storage space. It is kind of a unique market.
In fact, sometimes the lower low cost per square foot creates unique challenges that most other asset classes don’t necessarily have.
Smitty Smith
Yeah, absolutely. I think one of the things when we started talking about self-storage is, you know, I like working for individuals who have a goal and they have a mission that they’re on, and they’re looking to build their first self-storage facility or expand an existing location or convert a building that they have into self-storage. So far, of the people I have been able to meet in this line of work, they are very personable. They’re pursuing a dream of theirs to get into self-storage, and so I like working directly with the owner, the smaller investor, and the person trying to establish their dream. There are unique challenges to self-storage.
There are unique challenges to storage construction. States differ, from Kentucky to Florida, to the Carolinas, and wherever you are, there are going to be local challenges unique to that location.
There’s a lot in the pre-construction side that excites me, and I like to jump into those development challenges that you can run into.
I enjoy that kind of work.
Mark Helm
Well, I think you created a very unique way of interacting and engaging with clients. Tell us a little bit about what phase one and the phase two is in a relationship with a client.
Smitty Smith
Resolve is a general contracting company, and we are general contractors. We handle construction, which, as Mark said, is phase two.
However, one of our main services is what we call owner representative phase one.
It’s the pre-construction work. It has everything to do with the feasibility and the performance of a project before you’re committed to design.
We’ve found that when a project is in the early stages, and it’s a smaller project, say 40,000 to 60,000 square feet, one-story, two-story, or three-story self-storage, the design fees associated with that can be out of proportion to what is necessary for the project.
A lot of people in that early stage don’t necessarily know what the first steps to take are.
So, what they’ll do is reach out to an architectural firm or an engineer.
And before you know it, there are thousands and thousands of dollars committed to preliminary design costs. And so, what we’ve seen is that we can help steer those first early steps to save money.
It’s not that we don’t work with architects and engineers. We want to control that process to eliminate some of the excess expenses that can be brought on in the early stages of design.
That’s part of the owner’s representative phase one work that we do. It’s not limited to that, but that’s a big part of it.
Establishing what the cost of the project needs to be. What is a healthy budget for it, and is that budget obtainable?
Is that feasible? Are we able to build it for what really works given income numbers of the project.
The second part of phase one is that getting an approval for a site after you go through preliminary design. It can take months, sometimes year. Sometimes there’s rezoning involved. Sometimes there’s a very lengthy process with the local county authorities to get an approval to move to construction.
Before you ever get to the permitting stage, there can be hours and months dedicated to just satisfying the requirements that you need to prior to getting to construction.
So, the pre-construction services that we offer, phase one “Owners Representative,“ it’s a strategic partnership. We are an advisor as well as the boots on the groundwork and legwork to free up the time of the owner.
Maybe they’re busy running their own storage company already, or they have a full-time job. A lot of times, we’ll see people who are already full-time committed to something else, and they are trying to do this on the side. I think we can be a huge resource in the early days of getting prior to construction.
To speak to phase one, our goal is to set up the project for construction. So, what we do is the design work, the development service work, and then we do a lot of the pre-bidding so that when the project is ready for phase two is the general contractor, you have all of your contracts in place.
A big area that people get in trouble is that their contracts aren’t flushed out. They have verbal agreements or loose agreements and an understanding of what the subcontractor is going to do or the targets are going to perform.
We’re trying to eliminate the liability and the risk of the uncertainties and contract documents are a big way to do that.
We want to make sure that we have everything in place prior to construction that is setting the project up from day one for success. Eliminating big time gaps in construction causing delays and unknowns costs that are surprises on the back end.
And so that’s what we do in Phase 1 is get you ready for construction, ready to go, ready to execute the plan of construction.
And then in Phase 2,if we are your general contractor, we’re on-site project management, we’re also daily progress reporting, and we use a program that you can log into and have access to all of the documents, the schedule, the budgets – full transparency.
If we are your general contractor, we’re there to manage the project and manage those subcontractors that we’re working with in place.
Mark Helm
Well, what I thought was unique that you created was how Resolve is compensated in the Phase 1 portion of the relationship, with the whole goal of Phase 1 being to get to contract documents.
Smitty Smith
Resolve will just be one of the GCs that bid to do the construction.
Mark Helm
Once the construction documents are in place, we will be just one of the companies bidding on the job. We encourage people to get multiple bids from multiple contractors.
So, talk about how Resolve’s compensated phase one and why you feel like we will win the majority of the construction bids in the phase two.
Smitty Smith
Phase one is basically an hourly, not-to-exceed proposal. Basically, what we’re going to do is sit down, and determine kind of our level of involvement on a weekly basis over a certain number of months or whatever the term is that we think it’s going to take to get to biddable documents.
So, it’s an hourly commitment that is not to exceed. For example, if we think we’re going to work 10 hours a week on it over the course of four months, we’ll put together that.
And we bill on a two-week cycle. We create an hourly report at the end of two weeks justifying what we spent our time on and the amount of time that we worked on certain items.
And you can see the hours spent on your behalf and what was done. One of the things that I’m excited about is that in phase one, we’re trying to earn and establish that relationship with you prior to construction and phase two. Earn the right to handle your construction.
One of the perks that we offer is that your phase one cost is completely reimbursable if Resolve is awarded the contract for construction.
You’re going to get multiple bids from general contractors. We encourage that.
And I’ll say that the reason why we feel good about having other general contractors come in is that this is a niche for us.
This is our focus. This is our primary lane as a general contractor and so in self-storage construction we’re able to control our cost. This helps you as the owner to pick up a couple percentage points typically on a construction fee as a general contractor. Our fee will be less.
Mark Helm
That’s good. And what projects would be ones that Resolve could add a lot of benefit to, and which projects do you think are not in our lane of doing business?
Smitty Smith
Yeah, I think the complexity of every project is definitely something that we would consider and make sure it makes sense.
There are general contractors that specialize in a hundred thousand square foot plus facilities. They have several years of engineering and design work, and I would say that’s probably not our lane.
We are definitely specialized and focused on the smaller investor the smaller developer. The first-time developer or second time developer that’s looking to grow. They may have another location or whatever but we really support the smaller guy. We want to focus on and help support them, and I think and we bring we bring value to them.
You’re going to have larger projects that are super complex and need the engineering and architectural services that we don’t provide, But there are several types of projects out there that don’t work for you.
It’s too robust. It’s too involved and it’s too expensive for what we’re trying to accomplish. We are in the niche market for the smaller storage investors.
I think that’s where Resolve can really shine.
Mark Helm
I think it’s interesting. We’ve seen some smaller projects, or first-time people getting in doing 50,000 square feet or fewer projects, end up spending architectural and engineering fees that would be comparable to a 130,000 square foot multi-story building.
We’ve seen some where it’s in excess of $100,000 in architectural and engineering for 40,000 to 55,000 square feet and I would guess that the average we’ve seen so far is about $60,000.
I’ve done a number of projects, 55,000 square feet or less, and I’ve never spent $60,000 on architectural and engineering combined.
So that alone is one example in phase one where we think we can save a lot of money.
Smitty Smith
Yeah, and I think it takes the experience that you have in storage and that I have in construction. It’s not that we’re special or unique, but we’ve gone through the trial in the errors of overcommitting and overspending on projects and learning that maybe there’s a better way to get this accomplished.
We’re not just making it up as we go. We would like to manage that process so that we can save the hours and design time until it’s time.
There’s a certain point where we cut the architect loose, but there’s a lot of preliminary work that we’re going to do before making that large commitment to the design.
Mark Helm
Great. So, who is Resolve’s ideal customer?
Smitty Smith
The smaller investor, the first-time developer, the anywhere 60,000 square feet or less.
Mark Helm
And what type of storage projects do you do? New construction?
Smitty Smith
All of the above. New construction ground up, and then we do expansions where you’re looking to add another building on an existing site.
We can also do conversions as well, taking an existing building and putting storage in it. The conversions are just as much complex as a new build sometimes because you’re working within an existing building structure and systems that are in place that you’re either trying to modify or add to.
A lot of new construction we can do from a desk. Sometimes conversions require us to come out to the site and gather more information on the building.
Mark Helm
Is there anything else you would like to tell people who are getting into the self-storage business or growing their self-storage business about Resolve?
Smitty Smith
I definitely think that there are benefits to using us. Humbly, I think that we have a lot of experience and value to offer to someone that is new to storage.
I’m going to save you some of the headaches that we’ve experienced and our previous experiences. I’m very excited about what we’re doing at Resolve.
I would say I’m very excited because what we’re doing at Resolve mainly a relationship driven type thing.
We want to work with people who need help, who are excited about the business, and whom we think we can add value. Is there anything else you would like to tell people who are getting into the self-storage business or growing their self-storage business about Resolve?
Mark Helm
And you’re a general contractor that can be licensed where?
Smitty Smith
On the licensing front, we are not licensed in all states, but we obtain our general contractors’ license on a project basis.
So, if there’s a project in phase one that’s moving toward construction, we will establish our general contractors license in that state.
There are several states that we are licensed in.
Mark Helm
Great, great. How can somebody reach out and get more information if there and when should they reach out to Resolve?
Smitty Smith
Yeah, I would say when to reach out to Resolve is anytime.
If you’re considering a self-storage project, we’d love to hear from you.
We offer a free conversation just to see if this makes sense. Obviously, we would say that earlier, the better, prior to making any kind of big commitments with design or getting too far down the process. We would love to speak you and see if we can help you out.
The best way to get in touch with this right now is by email, as we’re working on establishing our website, but our website is ResolveSelf-Storage.com and it should be coming online in next couple of weeks.
You can reach me by email at smitty-hsgc@gmail.com.
Mark Helm
You can always reach out to mark@helmproperties.com
And where are you currently doing projects?
Smitty Smith
We’re working in Salt Lake City, Utah. We’ve got a project right outside of Tampa, Florida. It’s a three-story facility there.
We are working on a boat and RV facility in South Carolina.
And a self-storage project in Louisville, KY.
Mark Helm
Smitty, I’d like to thank you for taking the time and allowing me to introduce you to the community I traffic in. I appreciate you.
I’m really enjoying working with you and you’ve added already a lot of value to the people that we’re currently working with. I really do appreciate that because I take the relationships that I’ve created over the last decade very seriously. I appreciate what you add to them.
Smitty Smith
Yeah, thanks for having me on Thanks for giving me a chance to talk about Resolve and if we can do anything to help come hesitate to reach out.
