As developer interest rises, Coon Rapids hits brakes on new self-storage

A surge in inquiries to build self-storage facilities has left cities like Coon Rapids hitting pause.

The north metro city is freezing new self-storage projects or expansions of such businesses as city officials take a closer look at what's behind a trend that has raised similar questions in other suburbs.

Coon Rapids officials said their six-month moratorium, which takes effect March 9, will give them time to dig into zoning rules, study the areas where more storage units could take root and weigh where they may fit in best.

They also plan to figure out exactly how much storage has already been built in the city of 62,000.

"We noticed all of a sudden there were a lot of them," Mayor Jerry Koch said. "We need to get a handle on this."

From Maplewood to Brooklyn Center, some cities are noticing an uptick in calls from brokers and site selectors about self-storage projects.

The interest comes from a booming industry. Construction spending on ministorage centers and self-storage nationwide leapt to $4 billion in 2017, up from about $2.1 billion in 2016 and $954 million in 2015, according to U.S. Census Bureau data.

City officials suspect that downsizing baby boomers and the growing number of apartment dwellers of all ages may be helping to fuel demand.

For residents like Anita Ewald, of Fridley, it's a matter of needing more storage in a mobile home without much extra room.

Ewald said she used to have three different storage units but is down to one in Coon Rapids, where she keeps bikes in the winter, spare mattresses and heaps of bins holding everything from seasonal decor to future gifts for her big family.

"I've got six kids and two grandkids," said Ewald, 38. "We use it because we have no space."

Good fits for tough sites

Two requests have come before the Coon Rapids City Council in recent months, and city staffers say they are aware of interest for two other facilities.

Nearby Brooklyn Park also has seen a string of proposals in recent years, including one for an Acorn Mini Storage facility on 85th Avenue N. and another for Extra Space Storage at 8570 Aspen Lane.

Brooklyn Park opted to hit the brakes on self-storage along Highway 610 as part of a moratorium enacted in 2017 to fine-tune regulations along the proposed Bottineau Blue Line light-rail project. Last year, officials tightened zoning after deciding self-storage facilities didn't offer what they wanted for the area: jobs.

That's not to say the city doesn't welcome them elsewhere, Mayor Jeff Lunde said.

"The tax valuation of these types of buildings is surprisingly very high. It's just as high as if it was a commercial building," he said. "They have value to a city — just where do you want them is the question."

Self-storage facilities can be good fits for sites traditionally short on suitors, city officials say. That's the case for two storage projects in the works on sites near Interstate 494 in Maple Grove.

"Both are on parcels that it was kind of tough to find other kinds of development," said Joe Hogeboom, the city's community and economic development director. "They're sort of off the beaten path."

Concerns about image, jobs

It's been a similar story in Brooklyn Center, where city officials decided self-storage offered an ideal match for a site that's been tricky to develop near Hwy. 100.

In 2005, the city's Economic Development Authority bought and cleared the property, which once housed a shopping complex, and found groundwater pollution from an old dry cleaning business.

Now the property is finding new life as the city's first self-storage facility, a four-story indoor project approved by the City Council last spring.

City staffers said the most frequent calls they've been getting lately from site selectors have been for self-storage facilities.

That includes interest in two sites near major highways in town. One property sits just north of the state's first Topgolf location, a high-tech, all-season driving range and entertainment hub. The other is made up of nearly 5 acres visible from Interstate 94, near the regional FBI building.

But city officials have indicated that self-storage isn't a good fit for either site. They instead prefer a restaurant or brewpub near Topgolf and a project with more jobs at the 5-acre property.

"Not that there's anything terrible about self-storage," said Brett Angell, Brooklyn Center's business and workforce development specialist. "It's just looking to get a higher number of jobs per acre on the sites that we're selling."

Coon Rapids recently turned down a self-storage project pitched near Coon Rapids Boulevard, considered a key gateway into town.

"We were concerned about image and appearance," said Grant Fernelius, community development director.

City officials wanted to take a step back amid the uptick in proposals and opted for the moratorium, a measure not often tapped in Coon Rapids, Fernelius said.

Still, just last week and only days before the moratorium kicks in, a new application arrived at City Hall: another indoor self-storage facility.

hannah.covington@startribune.com 612-673-4751