In this solo presentation, Joe Downs (Storage Moguls) delivers a practical, four‑element framework for raising rates on long‑term boat and RV storage tenants— a topic many operators avoid despite its revenue potential. He begins by emphasizing the high switching costs and inertia of long‑term tenants, noting that a modest 3‑5% annual increase (e.g., $6‑$10 on a $200/month space) rarely triggers moves. The framework consists of: (1) Timing – announce increases in August, giving tenants 60+ days before the fall move‑in season; (2) Notice – provide a minimum 60‑day written notice, which is often a legal requirement; (3) Framing – present the hike as a facility investment (e.g., new rinse station, Bluetooth gate) rather than an apology; (4) Amount – use CPI‑linked or 3‑5% increases, reserving >5% for severely under‑priced facilities and phasing larger jumps. He adds a personal‑outreach step for high‑risk tenants, recommending a brief call before the notice to reinforce value. Downs supplies a sample rate‑increase letter and scripts for handling pushback, advising operators to listen, avoid discounts, and possibly offer a one‑month deferral for very long‑term tenants. Financial math demonstrates that at a 100‑space facility with $200 average rent, a 4% increase on 80% of tenants yields roughly $7,700 extra annual NOI, far outweighing the risk of vacancy. The video concludes with a call to join the free StorageMoguls.ai community for templates and peer support, and teases the next episode on storage ROI.
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And welcome to day 55 of the Boat and RV 100 series. I'm Joe Downs with Storage Moguls, and today I'm giving you the framework for the rate increases conversation that most operators avoid until they absolutely have to have it, and why that avoidance is costing them more than the conversation ever would have. Before we get into it, if you've been watching this series and you're not in the Storage Moguls community yet, today's the day to fix that. The seasonal pricing calendar template and the rate increase communication script we're referencing in this episode are both inside. It's free to join. StorageMoguls.ai. Real operators, real deals. The tools are already built. You just have to show up. But back to today. Your long-term tenants are your most valuable tenants. They are the ones that most operators are most afraid to raise rents on too. And that fear is costing you more than the conversation ever would have. And today we're going to fix that. Here's the insight that changes how you think about long-term tenant rate increases. Moving a 40-foot Class A motorhome or a 30-foot boat on a trailer is not a casual decision. It requires a truck with the right towing rating. It requires scheduling, requires finding a new facility. One with space available, the right aisle width, comparable amenities, and a comparable or lower rate even. Then it requires actually moving. The inertia of a well-situated long-term tenant in the boat and RV storage is actually pretty significant. That does not mean though that they'll absorb any rate at any time. It means the threshold for them to actually leave is higher than most operators assume. The operators who avoid long-term rate increases are leaving real money on the table based on that concern. Because when tested, it almost never materializes at the rates we're talking about. A 3 to 5% annual increase on a tenant paying $200 a month is $6 to $10 a month. Nobody moves a 40-foot RV over $6 a month. You got to know your numbers and have the conversation. The 4 elements of the rate increase framework That works are right here. It's first is timing. Communication— communicate annual increases in August before the fall move-in season. Saying this a few videos in a row now. This aligns your existing tenant rates with your new fall move-in rates and prevents the awkward situation where a new tenant is paying more than a long-term tenant for that same type of space. August also gives you Tenants, or gives the tenants 60+ days before they need to make any decision. And most of them are focused on fall season prep anyway, not facility switching. Second, your notice period. 60 days minimum in writing. And it's not just courtesy. In many states, it's actually the legal requirement for month-to-month storage agreements. So a 60-day notice protects you operationally and legally. And signals that you're running a professional operation. Third is framing. Do not apologize for the increase. Frame it as a facility investment. So then like this year we added X, or as we continue to invest in the facility, our rates are adjusting to reflect that. Tenants who receive real value from your facility— clean aisles, working gate, responsive management— will accept a professional rate adjustment that's framed as earned. And fourth, the amount. So CPI-linked or a 3 to 5%, anything above 5% in a single year should probably be reserved for facilities that are extremely underpriced relative to the market. And even then you want to phase that in, maybe stage it over 2 years if the gap is that big. Personal outreach for high-risk tenants is important in any facility. There are three to five tenants whose departure might materially impact you from an occupation or occupancy standpoint. So they might be in your largest or highest premium spaces. They might be multi-space tenants. They might be tenants who you know have been looking at other alternatives. They might be influential tenants. These tenants warrant a personal call before the written notice goes out, not to offer them an ex. But to make them feel valued before they see the paperwork. So you can call and say, hi, I wanted to reach out personally before you receive the annual rate adjustment notice. I want to make sure you knew we appreciate having you here and answer any questions directly, blah, blah, blah. Call takes 3 minutes. If it takes longer, probably means that they're very happy with you anyway. So for a tenant paying $400 a month, For 2 per space, for 2 spaces, retaining them. So they're paying $800 a month, retaining them through a 4% increase. That's $16 a month times 12. That's— no, 16 times 2, $32 a month times 12. That's $384 annually. The call pays for itself in the first month. Let me show you how this works here. So this is the letter that gets results without triggering pushbacks. You want to say, dear customer, want to thank you for your— not customer, their actual name, but you get it. Want to thank you for your continued trust in storing your boat or RV with us. Effective this date, your monthly rate will adjust from X to X. List a percent or not, depends. On how you want to frame it. This adjustment reflects your ongoing or our ongoing investment in the facility, including specific improvement. We value your tenancy and look forward to continue, you know, providing storage in the future. Experience blah blah blah. Any questions? Read that. That's it. It's direct. It's professional. Don't apologize. And be specific about what they're getting. The personal touch makes the big difference. So name the improvement specifically, not ongoing investments, rather the covered rinse station we installed this spring, or the Bluetooth gate upgrade we completed in March. Tenants who experienced that improvement know it was real. Tenants who receive value, uh, respond to acknowledgement of it. All right, let's talk about the pushback conversation because you need to have an answer ready even though you rarely need it. So the tenant who calls receiving the notice is almost always calling just to be heard, not to leave. They were leaving, they just leave. They, they want to, they want to feel like they matter, right? So here's how the conversation should go when you handle it right. So tenant calls, hey, I got the notice. I'm a little surprised by the increase. You know, I appreciate you calling. You've been with us for X amount of years and we generally value that. The increase of X per month, and I understand it's an adjustment. Is there something specific I can address for you? Kind of put it back on them. Most tenants at that point say, well, I just, you know, I want to flag it or You know, I was just surprised by it. And, you know, who knows what they say, but let them talk. They just want to be heard. The ones who push harder are almost— they're probably testing the water anyway and seeing if there's flexibility. And for a long-term tenant, say 2 or more years, maybe give them a one-time gesture of delaying it a month in the next billing cycle or something. That probably resolves the conversation. But definitely don't offer discounts. Don't apologize for running a business or imply the increase is negotiable. That signal will travel across the facility, especially if it's an influential tenant. So, and if one gets the exception, others are going to ask. And then what was the point? You created riff and you're not getting paid for it. The retention math that justifies every minute. He's been on this. It's pretty simple. At a 100-space facility with an average monthly rate of $200 per space, one space vacant for one month is $200 in lost revenue. The average tenant acquisition costs— covered this earlier— marketing, inquiry handling, move-in processing, low end $150, maybe up to $300 or more. So the switching costs to the tenant, well, it's a little higher, right? Vehicle movement, new facility search, setup. It's, it's significant, but not your calculation to make. It's theirs. So their rate increase that generates the most pushback risk is a well-communicated 4% increase. That's $8 a month on a $200 space. A tenant who leaves over $8 a month was already looking for a reason. Tenant who stays, and most do, just kicked in another $96 to your annual NOI. Across a 100-space facility, let's say you raise it on 80% of them, uh, that's a little under— that's what, $7,700 in annual incremental revenue if every tenant absorbs it? The math is not close. It's worth having the conversation. All right, here's the frame. Long-term tenants in boat and RV storage have high switching costs and low sensitivity to modest annual increases. So the operators who communicate increases professionally, frame them, frame them as earned, and have retention conversations ready almost always keep the tenants they want to keep. It's that simple. All right. If the switching cost framing changed how you think about long-term tenant rate increases, please like this video. Most operators are leaving money on the table here, and this is the episode that fixes that. Subscribe so you don't miss day 56. That's the covered storage ROI math, and it's one of the cleanest capital decisions in this vertical. The numbers almost always work. You just have to know how to run them. And if you want the rate increase letter template and the retention conversation script already written, that's at storagemoguls.ai. It's free to join storagemoguls.ai. The operators in there Have had this exact conversation. I've had it with them. You don't have to figure it out from scratch, folks. See you tomorrow.
