Converting an Existing Building to Self Storage in Ontario

Converting an existing building is often the quickest way into the self storage market. The building is already standing, usually already serviced, and often in a location with the road visibility storage depends on. Former big-box retail stores, older warehouses and light industrial buildings are the common candidates. The risk is in what the existing building turns out to be, which is why the assessment comes before the purchase.

What makes a building a good candidate

• Clear height: a building tall enough to add a mezzanine storage level doubles its rentable area on the same footprint
• Open floor plate with widely spaced columns, so the partition layout is not fighting the structure
• A slab and foundation able to carry the new loads, or able to be reinforced where the mezzanine columns land
• Existing loading doors or space to add a covered loading area
• Parking and access for tenants with vehicles and trailers
• Zoning that permits storage, or a realistic route to permitting it
• Road visibility and signage opportunity

Assess the building before you buy it

A conversion budget is only as good as the building survey behind it. The items to investigate are the ones a listing never describes:

• Structural review of the roof, frame and slab, with the original drawings if they exist and site measurement if they do not
• Slab condition and thickness, with cores where mezzanine columns will land
• Existing sprinkler system, its design basis and water supply
• Roof and envelope condition and remaining life
• Mechanical and electrical systems, and what is worth keeping
• Designated substances such as asbestos in older buildings
• Accessibility, exits and travel distances against the new layout

Mezzanine floors on an existing slab

Most of the value in a conversion comes from adding floor area inside the building. A steel mezzanine is supported on columns that bring concentrated loads down onto the existing slab. A retail slab was not designed for those loads. Where cores and the geotechnical conditions show it cannot carry them, new footings are cut into the slab under each column. That work is predictable if it is found in the assessment and expensive if it is found during construction.

Adding a floor also changes the building. It adds storeys and floor area for the purposes of the Ontario Building Code, it brings requirements for stairs, exits and fire separations, and it usually means a freight elevator so tenants can reach the upper level.

Sprinklers and fire protection

The existing sprinkler system was designed for the previous use. Storage of unknown contents is a different hazard, a mezzanine creates new floor area that needs coverage underneath it, and interior partitions change how water reaches the fire. Expect the sprinkler system to be redesigned and expect to confirm the water supply can deliver what the new design needs. This is one of the largest and least visible items in a conversion budget.

Change of use and approvals

Turning a store or warehouse into storage is a change of use. Two separate questions follow:

• Zoning: whether the municipality's zoning by-law permits self storage on that property. Commercial zones in particular may not list it, and a minor variance or zoning by-law amendment may be needed
• Building code: a building permit for the conversion, reviewed against the requirements for the new occupancy, including fire protection, exits and structure

Both are settled before the purchase closes, or the purchase is made conditional on them.

Loading, elevators and the tenant route

A converted big-box store has a front entrance designed for shoppers and a rear loading dock designed for tractor-trailers. Neither suits a storage tenant with a pickup truck. Most conversions add a covered drive-in loading area or reconfigure the entrance, add a freight elevator where there is an upper level, and plan the corridor layout so the route from car to unit is short. The office usually takes the most visible corner.

Where conversion budgets go wrong

• Buying the building before the structural and sprinkler assessment
• Assuming the slab can carry mezzanine loads without cores
• Carrying the existing sprinkler system in the budget as reusable
• Underestimating the partition and door package, which is priced by the unit count
• Leaving the zoning question until after closing

What it costs

Conversions are indicatively $50 to $120 per square foot of converted floor area, before the purchase of the building. The spread is the existing building: a sound, tall warehouse with a good slab sits at the bottom, and an older retail building needing a new roof, slab reinforcement, a sprinkler redesign and an elevator sits at the top. A Class C estimate after a site review, before the purchase is firm, is the number to plan against.