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251028 Harte Storage Meeting Notes

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📊 Harte Storage Quarterly Performance Update

Q2 vs. Q3 2025 (Calendar Year)

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🧩 Key Operational Metrics Comparison

Table 1

Table 1

Metric

Q2 2025 (Apr–Jun)

Q3 2025 (Jul–Sep)

Leads Generated

Move-Ins

Move-Outs

Net Rentals

–8 (net loss)

+21 (net gain)

Square Foot Occupancy

~84% (end of June)

~90% (end of September)

Total Revenue

$169,564

$177,472

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🔍 Highlights:

Leads increased 33% from Q2 to Q3, pointing to greater interest or improved marketing performance.

Move-ins exceeded move-outs by 21 units in Q3, reversing the net loss seen in Q2.

Square foot occupancy rose ~6 points to reach 90% at quarter end.

Revenue increased by ~$8,000 (about 4.7%), reflecting stronger occupancy.

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📈 Revenue Insights

Q2 Revenue Total: $169,564

Q3 Revenue Total: $177,472

Quarter-over-Quarter Growth: +$7,908 (+4.7%)

This revenue growth occurred without any rent increases, indicating strong leasing activity and operational gains.

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✅ Scheduled Rate Increases (as of October 28, 2025)

Table 2

Table 2

Metric

Value

Total Scheduled Increases

93 units

Total Dollar Increase

$1,969.00

Average % Increase

16.16%

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📌 Summary

Harte Storage posted a strong operational turnaround in Q3 2025:

More leads → More move-ins

Positive net rentals → Higher occupancy

Higher occupancy → Higher revenue

No rent increases → Growth was volume-driven, not rate-driven

The site is positioned well heading into Q4, and there may be additional upside potential through future pricing adjustments.

🧾 YTD Performance vs. Budget (Jan–Sep 2025)

📌 Summary Table (Key Revenue Lines)

Table 3

Table 3

📊 Insights

Total rent income is performing at ~98% of budget, with a shortfall of just $10.3K.

Administration fees are over-performing at 146% of budget, likely driven by more frequent or higher fee collections.

Convenience fees and merchandise sales are significantly underperforming, delivering less than 2% and 50% of budget, respectively.

Late fees and total fee income are slightly below budget but not substantially off target.

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🔍 Overall Takeaway:

Harte Storage is performing close to budget YTD on its primary revenue driver—rent income, reaching nearly 98%. However, ancillary revenue streams (fees and merchandise) show a mixed picture, with some overperformance (admin fees) and others significantly under budget (convenience fees, merchandise).

Here’s the expense and Net Operating Income (NOI) update for Harte Storage Year-to-Date (Jan–Sep 2025):

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💰 Expense & NOI Summary

Table 4

Table 4

Metric

Actual YTD

Budget YTD

Variance

% of Budget

Total Expenses

$111,056.45

$135,567.43

–$24,510.98

81.9%

Net Operating Income

$401,634.69

$385,765.92

+$15,868.77

104.1%

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🧾 Key Takeaways

Expenses are well-managed, coming in 18% under budget, saving over $24.5K.

As a result, NOI has exceeded expectations, delivering a +4.1% surplus above budget—roughly $15.9K more than projected.

This means the site is not only keeping costs in check but also converting income into profit more efficiently than planned.

Here’s a breakdown of move-in activity by day of the week for Harte Storage (Oct 2024–Oct 2025):

Move in Activity

Move in Activity

Day

Move-Ins

Monday

Tuesday

Wednesday

Thursday

Friday

Saturday

Sunday

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📅 Move-Ins by Day vs Proposed Schedule

Table 5

Table 5

Day

Move-Ins

Included in Schedule?

Notes

Monday

❌ No

Low volume, minimal impact if excluded

Tuesday

✅ Yes

Strong midweek move-in activity

Wednesday

✅ Yes

Solid support day

Thursday

✅ Yes

Lower activity but still included

Friday

✅ Yes

Peak day – critical to keep in schedule

Saturday

✅ Yes

Another peak day – critical to keep

Sunday

❌ No

Low impact, typical for limited operations

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⏰ Evaluation of 10 AM – 3 PM, Tue–Sat Schedule

✅ Pros

Covers 5 busiest days for move-ins, especially Friday and Saturday.

Efficient staffing and cost control with reduced hours.

Minimal missed opportunity: Monday and Sunday have the lowest traffic.

⚠️ Considerations

5-hour window (10–3) may miss early birds or after-work customers.

If feasible, extending Friday/Saturday hours slightly (e.g., to 4 PM) would better capture peak demand.

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👍 Verdict

Your proposed hours of Tuesday through Saturday, 10 AM – 3 PM, are well-aligned with actual move-in behavior. You’d cover 90%+ of customer activity while maintaining a lean schedule. For an added competitive edge, consider:

Offering appointments or call-ahead options for customers needing access outside those hours.

Tracking any missed sales or customer feedback during off-hours for ongoing adjustment.

Move Out

Don't need storage anymore – 32 move-outs

Moving – 11 move-outs

Price is too high – 2 move-outs

Transferring – 2 move-outs

Other – 1 move-out

📈 Revenue Growth Potential – 2026

1. Occupancy Optimization

You're currently at ~90% occupancy, up from ~84% in Q2.

With limited units left, increasing rates will become the key revenue driver rather than pure volume.

✅ Strategy:

Phase in rate increases for long-term tenants below market. (93 increases already scheduled—expand on this.)

Implement dynamic pricing for new move-ins using demand triggers (e.g. for weekends or climate units).

2. Rent Rate Adjustments

2025 YTD rent income: $492,523, slightly under budget.

Avg. scheduled increase: 16.2% — this alone could add ~$70–80K annualized if applied across remaining tenants.

✅ Projection: With full implementation of modest increases and current leasing pace, rent income could increase 6–10% in 2026, assuming stable demand.

3. Ancillary Revenue Growth

Admin fees already exceeded budget by 46% — leverage this by:

Charging premium for prime units or same-day move-ins.

Adding online convenience features with optional paid tiers.

✅ Projection: Ancillary income could grow 10–15% with minimal operational changes.

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💸 Expense Management Outlook – 2026

1. Current Expense Control

2025 YTD expenses: $111,056 vs. budgeted $135,567 (18% below).

Strong evidence of controlled overhead and operational efficiency.

✅ Strategy:

Maintain tight staffing and vendor management.

Use automation for payments, access, and customer service where feasible.

2. Inflation & Maintenance Forecast

Plan for 3–5% increase due to inflation, utilities, and possible repairs.

If occupancy remains high, slightly higher costs may be incurred in cleaning, utilities, and customer service.

✅ Projection: Expect 4–6% expense increase in 2026, or ~$116K–$118K total, if growth is kept lean.

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💹 NOI Growth Potential – 2026

Table 6

Table 6

Metric

2025 YTD

2026 Estimate

Growth

Revenue

$492,523

~$530,000–$550,000

↑ ~7–11%

Expenses

$111,056

~$116,000

↑ ~5%

NOI

$401,635

~$415K–$435K

↑ ~4–8%

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✅ NOI Outlook: Growth hinges on continued occupancy strength and full execution of rate increases already being scheduled. Strong control over discretionary expenses could make Harte Storage outperform again in 2026.

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