What s in Store! SELF STORAGE ECONOMIC SUMMIT. NYSSA Welcomes SSA in First Ever Co-Sponsored Event in NYC! A publication of the NYSSA

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1 What s in Store! Volume XVIII, No. 1 - May 2014 A publication of the NYSSA SELF STORAGE ECONOMIC SUMMIT NYSSA Welcomes SSA in First Ever Co-Sponsored Event in NYC! On January 14, 2014 the New York Self Storage Association and the Self Storage Association cosponsored a sold-out 2014 Economic Summit at the Le Parker Meridien Hotel in Manhattan. We had national caliber speakers and panelists at our first Economic Summit held in partnership with the SSA. Up-to-the-minute industry topics were discussed by major owners, leading storage lenders and institutional investor executives in a standing room only event overlooking Central Park. NYSSA Board Member Frank Crivello of Storage Deluxe gave the opening remarks and welcome on behalf of the NYSSA. Jim Davies of Talonvest Capital was Summit Emcee and introduced the session panels which included Capital Markets, Private CEO, and Deals of the Year. The Capital Markets Panel was moderated by Tom Sherlock, Pricipal of Talonvest Capital, and was composed of Senior Managing Directors such as Michael May of Cantor Commercial Real Estate and Ed Coco of GE Capital Real Estate. The CEO Panel elaborated on important industry trends from the perspective of top trade decision makers from across the country. This panel was moderated by Mike Burnam, CEO of TKG StorageMart Partners and included Stephen Schwartz of Secure Self Storage and Bill Hobin of StorQuest Self Storage. In closing, our Deals of the Year Panel discussion was lead by leading industry Chief Financial Officers and moderated by CEO Ken Nitzberg of Devon Self Storage as pictured below. His panelist were Phyllis McArthur, CFO of Morningstar Properties; Jeff Anderson, Principal at Stor-All Self Storage; and Scott Stubbs, CFO of Extra Space Storage. After all of the presentations were complete, everyone had ample time to network at the Cocktail Party with self storage industry CEOs/ CFOs, banking & financing community executives, financial analysts and interested self storage investors. NYSSA Board Members Garo Derian, of Glenmont Self Storage; Kelley Redl-Hardisty, of Guardian Self Storage; Amy Bieberdorf, of Manhattan Mini Storage were also on hand to represent the NYSSA along with President Matthew Powers. 1

2 As your state watchdog, the NYSSA maintained a presence in the State Capitol Building as budget discussions unfolded to ensure that a sales tax on the self storage industry was kept off the negotiation table. Now that the budget is in place, we have turned our attention and growing focus on revising our state s antiquated self storage lien law through legislative amendments that would improve our industry s practices. In doing so, Board Members of the NYSSA have been working diligently with the legislature in drafting legislation to improve the current law to allow for more efficient communication between tenant and self storage operations; matching the latest growing trends in the country. Our goal is to enhance the lien notification process by allowing for verified mail and notification of account status. As you may have already known from NYSSA alerts, other legislation has recently been introduced in the NYS Senate to amend the lien law, in relation to self storage auction procedures. The sponsor of the bill, Senator Tony Avella (D-Queens), is seeking to alter certain notice provisions in relation to the lien auction sale. We have met with Senator Avella in his Albany office to present our opposition to the bill. Under New York s lien law, storage owners can collect overdue fees or auction off items of a unit for delinquent tenants. Only after confirmed notification is delivered, are 10 days then given to dispute the debt before an auction is scheduled. Avella s bill seeks to extend that period to 30 days and calls for the owner to make two attempts to contact the occupant and an alternative person. It is NYSSA s position that the additional requirements as proposed in the bill create a problematic legal scenario for owner and occupant alike with regard to rental agreements, property and privacy rights, and unit access. Moving forward, we shall continue to meet and educate legislators in Albany to increase their understanding of what the self storage business is all about and to clear up any misconceptions about the lien law and auction sale process and how it is utilized. Please feel free to contact us if you have any questions or comments on our efforts on your behalf at the State Capitol, NYSSA is always here for you! NYSSA New Member News: CubeSmart CubeSmart, a self-storage real estate investment trust, operates more than 30 facilities in the New York City metro area. CubeSmart owns or manages 539 self-storage facilities across the United States and operates the CubeSmart Network, which consists of more than 800 additional selfstorage facilities. According to the Inside Self-Storage Top-Operators List, the company is the fourth largest operator of self-storage facilities in the United States. According to their website, CubeSmart (NYSE: CUBE) is a selfadministered and self-managed real estate company focused on the ownership, operation, acquisition and development of self storage facilities in the United States. Their self storage facilities are designed to offer affordable, easily accessible storage space for residential and commercial customers. As a national owner and operator, we continually enhance our business by applying our management expertise and best practices to each facility. They received three gold Stevie Awards for Sales & Customer Service during a ceremony on Feb. 21 in Las Vegas. The company was given the top prize for Contact Center of the Year, Customer Service Department of the Year, and Customer Service Training Team of the Year. The annual awards honor achievement in sales, contact centers and customer service. This is the second consecutive year CubeSmart has won three gold awards. Last year, the company won the top prize for Innovation in Customer Service in addition to being named the top contact center and customer-service department. The only other company to win three gold Stevie Awards in consecutive years is Delta Air Lines Inc., CubeSmart officials said in a press release. 2 We were nominated alongside a number of tremendously admired companies and are honored and humbled to have once again received three gold Stevie Awards, said Christopher P. Marr, president and CEO of CubeSmart. We have more than 1,500 CubeSmart teammates who are dedicated to delivering an exceptional customer experience day in and day out through unparalleled service and genuine care. To have these efforts recognized is inspiring for us and further solidifies our differentiated service offering within our industry. CubeSmart is very proud to have recently joined the NYSSA. We have a very strong presence in the greater New York City markets, said Guy Middlebrooks, CubeSmart VP of Third Party Management. We value the legislative work that the NYSSA does each year, as well as the great relationships that we have already forged.

3 Let Us Bring the Financing Market to You! In today s ever-changing financial markets, let CCM Commercial Mortgage do all of the hard work and create competition among lenders for your business. With the CCM team you can always count on: Competitive Quotes The Lowest Rates The Best Terms A Custom Fit to your Specific Needs We have financed more than $1 Billion of self storage properties nationwide since Neal Gussis, Principal Steve Libert, Principal (224) (224) ngussis@ccmcommercialmortgage.com slibert@ccmcommercialmortgage.com 3

4 MARK YOUR CALENDERS! (ISS Developers Conference Details on Page 5) NYSSA NYC Industry Luncheon Wednesday, June 4, 2014 (Day After the ISS Developers Conference) 10am-2pm Jacob Javits Center, NYC (Further Details on Page 7) NYSSA Upstate Industry Luncheon Thursday, August 14, 2014 Longfellows Restaurant 500 Union Ave, Saratoga Springs, NY NYSSA Annual Conference Tuesday, October, 14 Thursday, October, 16 Turning Stone Resort & Casino, Verona, NY 4

5 GET THE KNOW-HOW YOU NEED TO SUCCEED IN THE BUSINESS This special event is brought to you by Inside Self-Storage, the leading critical information source for self-storage developers. After several years of low activity, self-storage development is once again burgeoning, with previously stunted projects coming back on line and new facilities being planned in communities nationwide. If you're interested in building a new project, converting a property from another use, or renovating an existing self-storage facility, this detailed conference is what you need to start strong and end victorious in your journey. The field's leading experts will share insight to ground-up construction, conversion projects and facility renovations, sharing case studies to illustrate specific development strategies. You'll get the know-how you need to succeed in the business or avoid a bad investment! Who Should Attend? Investors or developers interested in the self-storage development and construction process Aspiring self-storage owners who wish to build a new facility or convert an existing building to self-storage Current self-storage owners who wish to add to their portfolio through new builds or conversions Current self-storage owners who want to expand or renovate an existing storage property AGENDA & SESSION DETAILS 8:30 am Opening Remarks, General Development Climate Speaker: RK Kliebenstein, Vice President, Acquisitions, Metro Storage LLC 9:15 am Feasibility Speaker: Jeff Kinder, President, Advantage Advisors LLC 10:00 am Financing Speakers: Shawn Hill, Principal, The BSC Group Devin Huber, Principal, The BSC Group 11:00 am Break 11:15 am New Construction Speakers: Rick Dodge, Vice President, Paramount Metal Systems Frank G. Relf, Principal, Frank G. Relf Architect P.C. Conference Venue Jacob Javits Center 655 West 34th Street New York, NY Phone: Sponsored by: 1:00 pm The Conversion Process Speaker: Jim Ponti, Regional Sales Manager, Janus International 2:15 pm Facility Renovation and Expansion 3:30 pm Break 3:45 pm Boat & RV Storage Speaker: Bob Hayworth, CEO, Baja Construction Co. 4:45 pm Closing Remarks and Q&A Speaker: RK Kliebenstein, Vice President, Acquisitions, Metro Storage LLC REGISTER NOW! Please visit for conference details and registration! If you have any questions, please contact: ISSWorldExpoInfo@vpico.com 5

6 PREMISES LIABILITY Potential Liability for Security Cameras 1 Introduction When an occupant or third party is assaulted or robbed while at a selfstorage facility, they will often attempt to impose liability on the self-storage facility for the assault or robbery based on a negligent security claim. Where the self-storage facility employs security cameras, the occupant/ third party will usually contend that they relied on the cameras for their protection and were lulled into a false sense of security. In order to guard against such claims, it is critical that when utilizing security cameras, the selfstorage facility makes it clear that the security cameras are for the protection of the self-storage facility, not the tenant or third parties, and the cameras are not continuously monitored. A Landowner s Duty to Provide Security 2 A landowner has a duty to exercise reasonable care in maintaining their property in a reasonably safe condition, including undertaking minimal precautions to protect tenants from foreseeable criminal conduct by a third person. i However, this duty only arises when there is an ability and opportunity to control such conduct, and an awareness of the need to do so. ii A landowner may assume a duty to provide security on its premises even when there was no legal obligation in the first instance. iii To impose liability on a landowner for an assumed obligation, such as where the landowner employs security cameras on the premises, a plaintiff must show that the landowner undertook to provide a service; negligently provided the service; and their conduct in undertaking the service somehow placed the plaintiff in a more vulnerable position than they would have been in had the landowner never taken any action at all. iv Thus, a landowner who utilizes security cameras to monitor their property could be liable under an assumed duty theory for an assault or robbery on their premises if the plaintiff can show that they were lulled into a false sense of security by the expectation that the security cameras were monitored, and as a result, took fewer precautions or changed their conduct while on the property. v The following is an example of a potentially viable claim based on an assumed duty theory: The plaintiff is assaulted while at the selfstorage facility by an unknown third party. The tenants have 24 hour access to the facility. The assault occurred at a time when the management office was closed and no facility personnel were present. The plaintiff claims that prior to the assault he was told by an employee at the facility that the security cameras were constantly monitored. Because the facility was constantly monitored, the plaintiff felt safe while at it after the facility personnel went home. When the assault began, instead of attempting to flee the facility, the plaintiff ran to a security camera with the expectation that someone would see the assault occurring and come to his rescue. However, no one saw the assault as the camera was not monitored. In this example, the plaintiff was lulled into the false sense of security because he thought the camera was constantly monitored and instead of attempting to flee the facility he ran to the camera. Practical Suggestions To minimize claims based on security cameras at the self-storage facility, a self-storage operator has to clearly inform the tenants and third parties who come onto the property of the purpose of the cameras so that they have a true understanding of what they are used for and they do not have a false sense of security. Two practical means to accomplish this goal are: (1) placing a conspicuous sign at points of access to the facility advising that that the cameras are not continuously monitored and are for the sole purpose of protecting the facility s property only; or (2) placing a similar conspicuous sign near each security camera. In addition to placing the signs, the facility could also include a provision in the occupancy agreement about the security cameras. By employing such practical means the self-storage facility will reduce potential liability for the security cameras. 1 Joseph Miller is a Partner at Miller & Lee LLP in Westchester, New York. He specializes in the representation of self-storage companies. 2 This article is not a detailed discussion of the law surrounding negligent security claims. i Basso v. Miller, 40 NY2d 233, 241 [1976]; Provenzano v. Roslyn Garden Tenants Corp., 190 AD2d 718, 718 [2d Dept 1993] ii Banner v. New York City Hous. Auth., 94 AD3d 666, 667 [1 st Dept 2012] iii Nallan v. Helmsley-Spear, Inc., 50 NY2d 507, 522 [1980] iv Nallan v. Helmsley-Spear, Inc., 50 NY2d 507, 522 [1980]; see also Benitez v. Whitehall Apts. Co., LLC., 19 Misc.3d 1120(A) [Supreme Court, New York County 2008] v see Benitez v. Whitehall Apts. Co., LLC., 19 Misc.3d 1120 (A) [Supreme Court, New York County 2008] 6

7 NYSSA NYC Industry Luncheon Wednesday, June 4, am-2pm Jacob Javits Center, NYC Topics to be discussed: Cross Cultural Sales & Customer Service Strategies Speaker: Tron Jordheim Director of Operations PhoneSmart Sponsored by: State of the Self Storage Industry Update Speakers: Guy Middlebrooks CubeSmart VP 3 rd Party Management Scott Levy CubeSmart VP Investments Recent Legal Issues in NYC Metro Area Speaker: NYS Self Storage Lawyers Admission: $100 per person ISS Developers Conference Attendees get 50% off! MEMBER SUPPORT Association staff is always available to supply members with research and referral information for specific problems. We can also put you in contact with those considered experts in your area of concern. We are always interested in your Group - New York Self Storage Association What s in Store! May Volume XVIII, No. 1 What s in Store! is produced by the New York Self Storage Assn. (NYSSA) as a service to its members and the self storage industry. It is distributed by NYSSA on a quarterly basis. We welcome all comments and articles of interest. You may contact NYSSA at: 22 Clinton Ave., 3 rd Flr, Albany, NY 12207; Tel: ; info@nyselfstorage.org; Website: 7