Fee-simple Self-storage Don't Expect To See It Soon.

Last week the national media reported that a parking space within a New York City condominium was on the market for $225,000. nMeanwhile in Waikiki, a commercial real estate broker wondered aloud before several hundred of his colleagues when such a deal might come to Honolulu. nWith the self-storage boom on Oahu of the past couple years showing no signs of abating any time soon, Mark Ambard of Ambard & Co. ended his forecast for the industrial market with the following prediction: n"Someone will condotel self-storage for $400 per square foot or more for fee-simple storage or fee-simple parking," Ambard told a group of real estate professionals. nAmbard, who is marketing a fee-simple industrial condominium project in Waipio, pointed to the proliferation of hotels converting to resort condominiums, or condotels, as an example of how it could be done. n"If they own them in fee they could do it," he said. nBut it's unlikely to happen any time soon here because the self-storage market is not designed for long-term buyers, said Stephen Metter, CEO and managing partner of MW Group Ltd., the developer of Hawaii Self Storage . n"It's currently not a viable economic model for self-storage," he said. "People don't buy self-storage for the long haul usually." nThe typical storage service provider user rents a unit for four to 10 months, he said. nWith land and construction costs rising each year, finding a bargain is unlikely. nFor example, at $400 per square foot, a user of a five-foot-by-10-foot unit theoretically would pay $20,000 for the 50-square-foot unit. nThat's not all. n"If one bought a unit in a self-storage facility, they then would have to pay their share of the maintenance," Metter pointed out.