Amid mounting pressure from regulators, investors and lenders, the self-storage industry is starting to consider more its environmental impacts and seek out ways to reduce its contribution to global climate change.
One such way is being pioneered by Houston-based GreenSpace Self-Storage, which reuses cargo containers to build self-storage facilities.
The self-storage industry’s biggest environmental impact is its use of steel and concrete to build new facilities. Cement production, a necessary component of concrete, is responsible for 8% of global emissions. Steel production is also another energy-intensive process that contributes to planetary warming. By cutting down the amount of these carbon-intensive building materials in the construction process, GreenSpace is able to drastically reduce the carbon footprint of every facility they build.
GreenSpace has four stores it has built in operation, one of which is set to open in White Marsh, MD next month. The firm has seven additional properties in various stage of engineering and construction.
The Storage Beat recently spoke with company co-founder Rick Stockton about the energy and cost saving benefits of their unique construction method, as well as how pending regulation could create greater demand for it in the future.
With the changing economy and continued supply and labor shortages driving up costs, has your appetite for new projects changed at all?
Rick Stockton: We are still pursuing opportunities. Using our technology we reduce construction costs. That allows us to develop where others couldn’t. We’re saving about $15 per gross square foot. The bigger the store the more the savings.
How do you accomplish that exactly?
We’re cutting out material and labor. We don’t have to buy steel studs, we don’t have to buy metal pans and pour concrete in them and we don’t have to pour a concrete floor. The containers provide the floors, walls and ceilings. For our typical store, we can stack all of the containers and have a 130,000 square foot structurally sound facility in four weeks.
How are you managing your portfolio?
Everything we build we give to one of the big REITS. We’ve used Extra Space, CubeSmart and Life Storage, but not Public Storage yet. They’ve looked at the stores.
What are the environmental benefits of your building method?
We are taking containers that are done going up and down the road and keeping them out of the steel recycling pool. We are upcycling them as a building component to build self-storage and putting them in a climate-controlled building where they will never degrade. Since I am upcycling that material I no longer have to buy new steel with studs, and I don’t have to buy all that concrete.
When you manufacture steel and concrete you produce C02 and use a lot of electricity. Just during construction, we save enough electricity to power 600 U.S. homes for a year and eliminate from the environment the emission of 660 tons of CO2 per facility.
New SEC rules are in the works that could require publicly traded companies to provide detailed disclosures on carbon emissions and climate risk. How would that impact the self-storage industry in particular?
That is going to drive construction to more environmentally sustainable, ESG-friendly practices. There is going to be a cascading effect trickling down to not just public and SEC-regulated companies, but probably also requirements from banking and private equity. I think we have a head start on that because of the way we are building.
Are you starting to see any interest now? Are you licensing your technology out to other firms?
Right now we are focused on servicing our investors. The banks and the lenders haven’t forced this ESG on our projects yet, but I don’t doubt that is coming. When that time comes, there will be a bias towards our construction methodology. I don’t know of any other construction type or technique that can offer anywhere close to the power and C02 reduction than ours.
A big company bought one of our stores and a different company is about to close on one of our other stores. We only build multi-story Class A institutional facilities so that it can compete with other stores for sale.
To see more of how their process works, check out this video below of GreenSpace’s facility in White Marsh being built:
