Boating, a popular recreational activity, has been enjoying unprecedented growth in recent years. This surge in popularity has led to an increased demand for boat storage solutions. One innovative solution that has gained significant traction is dry stack boat storage.
What is Dry Stack Boat Storage?
Dry stack storage is a relatively new concept in boat storage that involves vertically storing boats in specially designed rack systems. The idea is to stack boats so they can be stored and accessed with the same ease and efficiency as products in a warehouse. Using this method, boats can be stacked from two to six levels high.
Dry stack storage facilities predominantly use large marina forklifts to handle boats. These forklifts can lift boats to impressive heights, making it possible to stack them vertically.
Large Marina Forklifts = Key to Vertical Boat Storage
These facilities are generally located near the waterfront and are used for launching and retrieving boats, as well as for winter storage.
The Driving Factors
There are several factors that have contributed to the growing popularity of dry stack boat storage.
Over the past few decades, boating has become a more accessible form of recreation, attracting a wider demographic of people. This increase in popularity has resulted in a significant demand for water access and boat storage. Factors contributing to the rise in boating popularity include:
- Improved living standards
- Increasing waterfront development
- A focus on quality-of-life issues
- A boom in recreational and vacation alternatives
- The coming of age of the baby-boomer generation
- The willingness of boat manufacturers to cater to varied boating lifestyles
Limited Storage Spaces
Many boat owners live in neighborhoods that prevent the storage of boats on trailers at their homes. Others live in condominiums or townhouses that have no space for boats. Furthermore, there is a limited number of wet slips available. Dry stack storage provides a logical solution to this increased demand.
Decreasing Number of Marinas
As the number of marinas decreases, dry stack storage facilities, even those located off-water, are becoming attractive alternatives for boat owners. These facilities are especially appealing in areas with a high concentration of boats on trailers and multiple bodies of water for boating.
The ROI Potential
Just like any other commercial property, a dry stack facility must provide an attractive return on capital investment (ROI).
The capital investment for a dry stack facility is comparable to that of a typical self-storage operation. The cost to install and erect a dry-stack shed, based on at least 60 boats, usually falls in the range of $2,000 to $2,400 per boat.
Assuming an average storage fee of $130 per month, the annual storage income for a facility with 80% occupancy could be $120,120.
Net Operating Income
Factoring in costs such as staff, administrative expenses, utilities, maintenance, insurance and taxes, the annual net operating income (NOI) could be $55,120, before depreciation and debt service.
Dry Stack Storage Facilities: A Case Study
To illustrate the potential of dry stack storage, let’s consider a hypothetical facility with a building lot measuring 150 feet wide by 160 feet long.
The total investment for constructing two dry-stack sheds with a capacity for 96 boats, including costs for the forklift, commercial property, and miscellaneous costs, is estimated to be $365,000.
At a storage fee of $130 per month, and assuming an occupancy rate of 80%, the annual storage income can be estimated at $120,120.
Taking into account costs for a forklift operator, administrative costs, utilities, maintenance, insurance, and taxes totaling $65,000, we’d have an annual NOI of $55,120.
Dry Stack Storage Rates
Dry stack storage facilities often provide a variety of services and have different rates based on the length of the boat. Here’s a hypothetical rate table for a dry stack storage facility:
|Up to 19′
|$220.00 + $20 w/ tower up
|$2,508 / $2,736 w/ tower up
|20′ to 22′
|$230.00 + $20 w/ tower up
|$2,622 / $2,850 w/ tower up
|27′ – 29′
In addition to dry stack storage, some facilities also provide additional services such as covered wet slips, personal watercraft storage, and trailer storage. These services can add to the facility’s revenue stream.
Dry stack boat storage represents a lucrative investment opportunity for commercial-storage business owners. By capitalizing on the increasing demand for boat storage and the attractive ROI potential, dry stack storage can be a positive investment. As the saying goes, the key to any successful business is “location, location, location”. This is particularly true for dry-stack boat storage facilities. A well-marketed and well-managed facility in a prime location can yield even higher revenues than outlined in the above examples