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260219 Red Door/Metco Meeting Notes

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Red Door-

Thu, Sep 18

On the financials, I noticed that there are almost no expenses shown for our water/sewer bill. Is this getting paid and being recorded somewhere else?

Thu, Sep 18

Also on the financials, one entry for $15.00 merchandise income (?) What is that for and can it be recorded somewhere else? I would rather not have anything "merchandise" that we need to be collecting sales tax on. Have this moved to a fee

@Ryan Dayhoff

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Thu, Sep 18

Did Jeremy get us a bid on concrete repair/replacement? Sent follow up to Jeremy.

Thu, Sep 18

Metco-

Thu, Sep 18

Please remind me what we are recording as business insurance...the change from $370.79 to $54.44 looks good, but just checking.

Thu, Sep 18

Wages- just curious why basically double what the past months have been? Angela is budgeted for 50 hours biweekly. Aug 25 - Sep 7 she worked an additional hours to clean out a trash unit.

Thu, Sep 18

checking on parking

@Joseph McClendon

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Thu, Sep 18

remove SF from parking

@Joseph McClendon

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Thu, Sep 18

Push climate control rates

@Joseph McClendon

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Thu, Sep 18

Add a parking spaces available banner at Red Door

@Joseph McClendon

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Thu, Sep 18

There are no rows in this table

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METCO – 2025 Performance Review

2025 Financial Performance

Total Revenue: $76,757

Rent: $68,778

Fees: $4,633

Tenant Insurance: $3,145

Other: $200

Operating Expenses: $38,723

NOI: $38,033

NOI Margin: 49.6%

What This Means

Metco operates at a lower margin than Red Door and is more sensitive to occupancy swings and delinquency.

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2025 Operational Performance

Total Units: 83

Move-Ins: 49

Move-Outs: 52

Net Rentals: –3 units

Average Occupancy: 79.2%

Year-End Occupancy: 76.0%

Year-End Delinquency (>30 days): 6.35%

Estimated YE Delinquent $: ~$374

Key Issues at Metco in 2025

Move-outs increased significantly.

Ended year with negative net rentals.

Delinquency more than doubled YoY.

More volatile tenant base relative to size.

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METCO – 2026 YTD (Jan–Mid Feb)

Income vs Budget

Total Income (ex bad debt): $13,828

+7.4% to budget

But:

Net Rent: –6.0% to budget

Concessions given YTD: ($1,012)

Bad Debt YTD: ($4,057)

Leasing & Occupancy

Move-Ins: 4 (Budget: 10)

Move-Outs: 12 (Budget: ~6)

Occupancy: 66.3%

Budget Occupancy: 83.5%

Gap: –17.2 points

Overlocked Units: 6

Current Risk at Metco

Metco is materially below occupancy target and has elevated delinquency. This asset requires immediate leasing and collections attention.

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RED DOOR STORAGE – 2025 Performance Review

2025 Financial Performance

Total Revenue: $416,391

Rent: $378,123

Fees: $15,710

Tenant Insurance: $11,750

Other: $10,807

Operating Expenses: $173,136

NOI: $243,254

NOI Margin: 58.4%

What This Means

Red Door is the primary cash-flow driver of the portfolio with strong margins and scale efficiency.

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2025 Operational Performance

Total Units: 369

Move-Ins: 176

Move-Outs: 182

Net Rentals: –6 units

Average Occupancy: 77.6%

Year-End Occupancy: 75.0%

Year-End Delinquency (>30 days): 3.33%

Estimated YE Delinquent $: ~$1,188

Key Issues at Red Door in 2025

Strong overall NOI.

Slightly negative net rentals.

Delinquency increased but remains manageable compared to Metco.

Late-year occupancy softening.

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RED DOOR – 2026 YTD (Jan–Mid Feb)

Income vs Budget

Total Income (ex bad debt): $76,944

+1.2% to budget

But:

Net Rent: –3.1% to budget

Concessions YTD: ($4,742)

Bad Debt YTD: ($7,430)

Leasing & Occupancy

Move-Ins: 10 (Budget: 33)

Move-Outs: 29 (Budget: ~30)

Occupancy: 69.4%

Budget Occupancy: 81.6%

Gap: –12.2 points

Overlocked Units: 2

Current Risk at Red Door

Occupancy is the primary concern. The facility is significantly under budgeted occupied units (~45 units short).

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Summary by Facility

Table 3

Table 3

Metric

Metco

Red Door

2025 NOI

$38,033

$243,254

2025 NOI Margin

49.6%

58.4%

2025 Net Rentals

–3

–6

YE 2025 Occupancy

76.0%

75.0%

YE 2025 Delinquency

6.35%

3.33%

2026 YTD Occupancy

66.3%

69.4%

2026 Budget Occupancy

83.5%

81.6%

2026 YTD Rent Variance

–6.0%

–3.1%

2026 YTD Bad Debt

$4,057

$7,430

There are no rows in this table

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How the 2026 Plan Differs by Asset

Metco Strategy

Immediate occupancy recovery push (small asset = quicker swing)

Aggressive delinquency enforcement

Tight concession control

Local marketing and referral focus

Metco is the higher-risk asset operationally.

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Red Door Strategy

Focus on filling ~45 vacant units to hit budget

Protect rent levels while using surgical promotions

Monitor tax and R&M budget carefully

Continue insurance penetration growth

Here’s where Red Door went over budget (Operating Expenses only, excluding income lines and summary totals):

🔴 Major Overages

1️⃣ Repairs & Maintenance – Building

Actual: $19,021.87

Budget: $600

Over: +$18,421.87

This is the single largest variance driver.

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2️⃣ Property Taxes

Actual: $27,619.04

Budget: $18,803.40

Over: +$8,815.64

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3️⃣ Advertising – PPC

Actual: $14,690.13

Budget: $10,800

Over: +$3,890.13

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4️⃣ Auction Expenses

Actual: $4,714.25

Budget: $1,800

Over: +$2,914.25

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5️⃣ Repairs & Maintenance – Site

Actual: $3,501.98

Budget: $1,200

Over: +$2,301.98

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6️⃣ Electricity

Actual: $11,155.13

Budget: $9,600

Over: +$1,555.13

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7️⃣ Wages

Actual: $19,058.29

Budget: $18,000

Over: +$1,058.29

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8️⃣ Software Expenses (Total)

Actual: $6,601.06

Budget: $5,602.08

Over: +$998.98

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📊 Big Picture

Total Operating Expenses:

Actual: $173,136.41

Budget: $136,171.81

Over: +$36,964.60

Primary Drivers:

Building Repairs (extraordinary spike)

Property Taxes

Advertising spend

Auction activity

Secondary creep: utilities, wages, software

Metco

🔴 Largest Overages

1️⃣ Repair & Maintenance – Gate

Actual: $2,948.37

Budget: $300

Over: +$2,648.37

Largest single variance driver.

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2️⃣ Legal & Professional Fees

Actual: $3,225.16

Budget: $900

Over: +$2,325.16

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3️⃣ Staffing Expense (Total)

Actual: $6,092.13

Budget: $4,200

Over: +$1,892.13

Wages alone were +$1,731.83 over

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4️⃣ Service Charges (Total)

Actual: $2,692.18

Budget: $1,448.97

Over: +$1,243.21

Credit card fees were a major contributor (+$1,098.74)

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5️⃣ Auction Expenses

Actual: $2,122.91

Budget: $900

Over: +$1,222.91

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6️⃣ Advertising (Total)

Actual: $8,408.08

Budget: $7,250

Over: +$1,158.08

Sparefoot specifically: +$799.25

PPC slightly over: +$221.71

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7️⃣ Repairs & Maintenance – Lawn/Snow

Actual: $2,164.79

Budget: $1,200

Over: +$964.79

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8️⃣ Office & Software Creep

Total Office Expenses: +$445.70

Office Supplies/Software & Apps: +$372.28

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📊 Big Picture

Primary expense pressure came from:

Gate repairs

Legal/professional

Labor overages

Credit card fees (likely tied to revenue growth or rate increases)

Auction activity

Marketing channel creep (Sparefoot)

Metco and Red Door Storage Performance Review and 2026 Action Plan

Report date: February 17, 2026 (America/Indiana/Indianapolis)

Executive summary

Where 2025 landed

Metco and Red Door Storage finished 2025 with strong accounting NOI but late-year operating softening (occupancy drift down into year-end and higher delinquency vs 2024). Using the 2025 P&Ls (NOI excluding interest), results were:

Metco: $76,757 total revenue, $38,033 NOI (≈49.6% margin). (Source: “12 2025 Financials Metco.xlsx”, Profit and Loss!N19, N77.)

Red Door Storage: $416,391 total revenue, $243,254 NOI (≈58.4% margin). (Source: “12 2025 Financials Red Door.xlsx”, Profit and Loss!N20, N83.)

Portfolio (Metco + Red Door): $493,147 total revenue, $281,287 NOI (≈57.0% margin). (Computed as the sum of the two P&Ls above.)

Operationally (from the KPI history workbook), move-outs exceeded move-ins at both facilities in 2025 (Metco 49 in / 52 out, Red Door 176 in / 182 out) and year-end delinquency (AR >30) rose sharply vs 2024, particularly at Metco (Dec-2025 6.35% vs Dec-2024 1.51%). (Source: “Red Door Metco.xlsx”, Metco!AL12:AW13 and Metco!AK31/AW31; Red Door!AL12:AW13 and Red Door!AK31/AW31.)

What early 2026 is already telling us (Jan–Feb YTD through Feb 17)

Using the attached Jan–Feb 2026 management summaries, total income is not the issue on the surface—but core rent and leased occupancy are.

Both facilities show:

Net rent under budget YTD (Metco -6.0%, Red Door -3.3%) driven primarily by occupancy and move-in shortfalls, not by pricing alone. (Source: “Management Summary - Consolidated - 2026-02-01 through 2026-02-17.xlsx”, Metco!D26:D37 and Red Door Storage!D26:D37; budgets from “2026 Budget Metco.xlsx”, Budget Overview!B17:C19 and “2026 Budget Red Door.xlsx”, Budget Overview!B18:C21.)

Material occupancy gaps vs February budget:

Metco: 66.3% actual vs 83.5% budget (≈ -17.2 pp) (Management summary Metco!H10 vs budget Metco!C8)

Red Door: 69.4% actual vs 81.6% budget (≈ -12.2 pp) (Red Door Storage!H10 vs budget Red Door!C8)

Bad debt write-offs already sizable YTD: Metco -$4,057, Red Door -$7,430 (memo risk indicator). (Source: Feb management summary Metco!D27 and Red Door Storage!D27.)

Market context (limitation acknowledged)

The facility locations were not provided, so market comps in this report rely on national indicators only. National self-storage reporting indicates demand remains pressured by housing-market softness and supply/demand imbalance, keeping rent growth constrained and making 2026 outcomes meaningfully execution-driven (conversion, retention, collections, unit readiness).