Courtesy / Scarborough Storage Solutions
An 80,000-square-foot self-storage development at the Innovation District at The Downs in Scarborough is expected to open in August.
Updated: January 4, 2021
Former merchant mariner finds self-storage sector is lucrative ‘chapter two’
Courtesy / Scarborough Storage Solutions
Self-storage entrepreneur Mike Pride has broken ground at 192 Innovation Way in Scarborough on 550 units across 10 buildings. He’s seen here with his operations team — his mother Shirley and wife Silvana. “They are my most ardent supporters and that, along with their extensive accounting backgrounds, have helped me to realize my development dream,” he said.
A former merchant mariner who got into the self-storage business several years ago recently broke ground on an 80,000-square-foot self-storage development in the Innovation District at The Downs in Scarborough.
Mike Pride bought Lots 8, 9, 13, 14 and 27 at 192 Innovation Way from Crossroads Holdings LLC for $1,152,500. The lots are adjacent to each other and total 4.53 acres.
Thomas Gadbois of F.O. Bailey Real Estate and Drew Sigfridson and Jon Rizzo of Boulos Co. brokered the deal, which closed Dec. 1.
Gadbois has facilitated other transactions for Pride, including a 2017 off-market transaction for a self-storage facility at 226 Gorham Road in Scarborough and another self-storage facility at 14 Tory Hill Drive in Buxton.
Prime spot
The two agreed that Innovation District was a prime spot for a large, new facility, Gadbois said.
“We thought that Scarborough needed another facility and we thought this would be a great location,” Gadbois said. “A lot of businesses and housing are going in there and it’s right off the interstate.”
Pride hails from Falmouth and is a 1994 graduate of Maine Maritime Academy in Castine. He was in the merchant marine for 21 years and retired four years ago as a chief engineer.
As a side gig, he began investing in commercial real estate, with a focus on professional uses such as doctor’s offices and hair salons.
After his retirement, he began looking for a business that he could more actively run.
“I had to go to chapter two,” he said.
Several years ago, Gadbois showed him the 226 Gorham Road self-storage property.
“I thought, 'It’s a business but not a lot of employees, so I can run it myself,’” Pride recalled.
Still, he wasn’t familiar with the self-storage market.
“I’m thinking, ‘Who puts their stuff in storage?’” he said.
When he bought 226 Gorham Road, it had a lot of vacancy. But he quickly created a website, put his phone number on the sign, and did some advertising. The facility, called Scarborough Self Storage, filled within a few months.
He said he found it interesting to learn about the clientele. They included small business owners who maybe couldn’t afford a small warehouse and instead rented storage units. People who run mall kiosks needed a place to store products. Older folks downsizing didn’t have enough storage space in their smaller homes.
“You have people who don’t have enough room for all the cars in their garage,” he said. “Sports gear. People who come through town, get a small apartment, are here for a year, and need storage space. There was a lot of demand.”
He also found he enjoyed meeting his customers. And there’s not a lot of customer turnover, making the business easy to manage, he said.
“So I became a believer in the business,” he said.
Gadbois found him the second facility in Buxton that was in a similar situation with a lot of vacancy and the potential for marketing.
‘I cleaned it up, got a website, answered the phone,” he said of the facility, named Pride Storage Solutions of Buxton. “I’ll drive there at 10 at night for people who call and need a unit. So I’m very hands-on and willing to do the work.”
Looking to expand
Receiving frequent inquires for units, Pride decided to expand, but couldn’t add on to his existing facilities due to zoning restrictions. He determined that most of the demand was in Scarborough, so he spent about a year and a half looking at industrial properties there. The search landed him at the Innovation District. After consulting with other self-storage facility owners to figure out economies of scale, he decided to build big.
To make the finances work, Pride decided to sell several other, non-storage properties. When the pandemic hit, sales contracts on a couple of those properties fell through. Pride had to step back and decide whether he would be able to move forward on the new development. But he remained optimistic.
“I thought, ‘If I step away from this development, someone else will step in,’” he said. “So I decided to stay the course.”
He found new buyers. Ultimately, the sale of the three properties and the purchase of the Innovation District lots and another property in Yarmouth formed two sides of an exchange under section 1031 of the IRS tax code.
He also obtained a loan with an interest rate below 3% through the Small Business Administration’s 504 program. The 504 program provides long-term, fixed-rate financing used to acquire fixed assets for expansion or modernization. The program includes a bank for a first loan and the SBA for a second loan; the second loan is handled by a certified development company. In this case, the bank was Katahdin Trust Co. and the certified development company was Granite State Development Corp. in Portland.
“It wasn’t an easy process. Fortunately, the Maine real estate market cooperated,” he said.
The development, which broke ground the week of Dec. 7, will consist of 10 large, single-story self-storage buildings on an open, flat site. There will be 550 drive-up units, each with its own door. There will be security fencing and a rooftop solar component to help offset energy consumption. Acorn Engineering Inc. In Portland developed the design.
The goal is to open in August.
Pride credited the town of Scarborough for its business-friendly permitting process and Crossroads Holdings LLC for delivering ready-to-build land.
“They were great to work with,” he said.
Pride keeps his business interests lean. “I do the management and maintenance, and oversee my vendors,” he said. “My wife and my mom both have accounting backgrounds, so they handle the bookkeeping.”
It all boils down to enjoying what you do, he said.
“I was told that, if you like what you’re doing, you’ll never work a day in your life,” he said. “I work nights, weekends — but I don’t feel it’s work because I like doing it. When I was shipping out all those years, I’d mark the calendar every day because I was away from friends and family and yearned to be home. Since I left all that, I’ve grown this business to quite a few properties and I probably work more than ever. But I feel the most at peace and things are going well.”
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Anonymous
January 4, 2021
Nice job Mike.. congratulations
Good luck in this new adventure
The Stryker’s
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