Being a logical thinker, I have always been fascinated by the future. Since the start of the pandemic in 2020, we have seen many changes in social behavior and the workplace we once loved so much.
The office culture that had been prevalent for the past 100 years was torn to shreds, and people were forced from their comfort zones to work remotely from home. Having realized that I cannot work from a single function space since 2012, I have personally been working toward this paradigm shift. It has taken me a long time to locate creative spaces where I can run my business and follow other passions while waiting for people to respond and fulfill the functions that they perform daily. In no way do I feel like I am alone in this, a lot of the people I've spoken to feel similarly restricted by the old school single-function office or workspace.
In a fast-paced, dynamic new world, we need offices to hold various functions such as training, team building, and creativity from our employees. The main difference is that the office we use for a meeting and analysis is not the same office we need to discuss and formulate marketing strategies for the company or industry we belong to. In addition, it would require a different environment where new team members could learn about what is already being done for them to be productive and develop the new mindset necessary to become multi-skilled team players. The days of a singular function and a singular trajectory for the next two decades are over.
Looking back over my work experience for the last 35 years, I have been a store manager, an environmental officer at Anglo American, and ran hardware shops that supplied my construction and property maintenance companies. Due to the 1995 economic decline, I closed all of them and took on other jobs, including micro money lending for banks, restaurateur, handyman, and more. All the time I am studying and growing my knowledge of various industries in and around South Africa. I felt most comfortable with the ever-changing horizon of business. So when I discovered self-storage some 17 years ago, I was delighted. A service like this could grow and be marketable with the added incentive of generating a passive income that would keep up with inflation regardless of the economic climate.
The storage industry was ready and waiting to assist with the transition when the pandemic hit and everyone was running around like headless chickens. In order to manage their many storage sites, successful storage companies use online software, which complies with the POPI act, gives management access to relevant information instantly and allows customers to book online to reduce physical contact, as well.
In addition to the vacuum left in the property market in the office space, it will have devastating effects on the South African property RIET. With their massive infrastructures and prime locations, these buildings offer great potential for redevelopment into dedicated self-storage facilities. As the property will no longer be a multiuse property, it will have fantastic long-term income potential, albeit at a reduced level of income by 20% on average, so costs will be reduced accordingly because it is no longer a multiuse property. On average, you may be able to break even with the old income-generating clients, the advantage will be that as you own the building and manage it. Value calculations will be extended to a 20-year valuation that grows on average by 6%. As the market adjusts to the new norm, this constant cash flow will prove to be the backbone of many new ventures.
According to the saying, fortune favors the brave and property owners who do not act early will miss the opportunity to rearrange their portfolio to smooth out their income stream for the next 20 years. Other opportunities will arise during this transition, but few are as tried and trusted as the self-storage industry worldwide.