Why Self Storage is Turning into Hot Property
Self storage is a booming industry that offers customers a convenient and affordable way to store their belongings. Whether it's for personal or business reasons, self storage has become a popular solution for people who need more space, flexibility and security. In this article, we will explore some of the key trends and drivers that are making self storage a hot property in the real estate market.
Self Storage Market Size and Growth
According to Mordor Intelligence Research¹, the valuation of the self-storage market reached $87.65 billion USD in 2019. By 2025, that valuation is expected to grow to $115.62 billion. This puts the compound annual growth rate (CAGR) at 13.79% over the forecast period of 2020-2025.
The self storage industry has also shown remarkable resilience during the COVID-19 pandemic, which has disrupted many other sectors of the economy. A report from Trepp shows that the delinquency rate on about 1700 loans for self-storage facilities was less impacted than the delinquency rate for loans in other sectors of real estate –including hotels.
Self Storage Demand and Supply
The demand for self storage is driven by various factors, such as:
- Urbanization: As more people move to urban areas, they face limited living space and higher rents. Self storage provides them with an option to store their excess belongings or seasonal items without cluttering their homes or paying for extra rooms.
- Downsizing: The pandemic has also prompted many people to downsize their homes or relocate to cheaper areas. Self storage allows them to keep their valuables or sentimental items without having to sell or donate them.
- Lifestyle changes: Self storage also caters to customers who are going through major life events, such as marriage, divorce, retirement, death of a loved one, or travel. These events often require temporary or long-term storage of personal or household items.
- Business needs: Self storage is not only for individuals, but also for businesses that need extra space for inventory, equipment, supplies, or documents. Self storage can help them reduce their overhead costs, optimize their cash flow, and access their items whenever they need them.
The supply of self storage is determined by the availability of land, capital, and zoning regulations. According to the Self Storage Association, there are roughly 55,000 self-storage facilities nationwide, with more than 30,000 owners. The industry is still fragmented and dominated by small-business owners, but there are also some large players, such as Public Storage and CubeSmart, that have a significant market share.
The supply of self storage is also influenced by the level of competition and innovation in the industry. Some of the emerging trends and challenges that are shaping the self storage landscape include:
- Technology: Technology plays a vital role in enhancing the customer experience and operational efficiency of self storage facilities. Some of the technological features that are becoming more common in self storage include online booking and payment systems, mobile apps, smart locks and access codes, security cameras and alarms, climate control and lighting systems, and data analytics and management tools.
- Design: Design is another important aspect of self storage that affects its appeal and functionality. Some of the design elements that are gaining popularity in self storage include multi-story buildings, mixed-use developments, modular units, drive-up access, interior corridors, and attractive exteriors and signage.
- Niche markets: Self storage is also expanding its customer base by catering to niche markets that have specific needs or preferences. Some of the niche markets that are emerging in self storage include wine storage, vehicle storage, student storage, military storage, senior storage, and green storage.
Self Storage Investment Opportunities
Self storage is an attractive investment opportunity for many reasons:
- High profit margin: The average profit margin of the self-storage industry is 41%, which is a lot compared to most businesses. This is because self storage has low operating costs, high occupancy rates, and strong pricing power.
- Low risk: Self storage is also a low-risk investment because it has stable cash flow, low tenant turnover, high customer loyalty, and minimal maintenance requirements. Self storage also performs well during recessions because it benefits from increased demand and reduced supply.
- High return: Self storage can generate high returns for investors because it has strong growth potential, high valuation multiples, and favorable tax benefits. Self storage can also appreciate in value over time due to land appreciation, rent increases, and operational improvements.
Self storage is a hot property that offers many benefits for customers, owners, and investors. It is a dynamic and resilient industry that is constantly evolving and adapting to the changing needs and preferences of the market. If you are looking for a reliable and profitable way to invest your money, self storage might be the right choice for you.
How to Choose the Right Self Storage Facility for Your Needs
If you are interested in renting a self storage unit, you might be wondering how to choose the right facility for your needs. There are many factors to consider when selecting a self storage facility, such as:
- Location: The location of the self storage facility is important because it affects your convenience and accessibility. You should choose a facility that is close to your home or workplace, or along your regular route. You should also check the traffic and parking conditions around the facility, and make sure it is in a safe and well-lit area.
- Size: The size of the self storage unit is another crucial factor because it determines how much space you have to store your items. You should choose a unit that fits your belongings comfortably, without wasting space or money. You can use online tools or consult with the facility staff to estimate the size of the unit you need based on the type and quantity of your items.
- Price: The price of the self storage unit is also an important factor because it affects your budget and value. You should compare the prices of different facilities and units in your area, and look for discounts or promotions that can save you money. You should also check the payment terms and policies of the facility, such as the deposit, rent due date, late fees, and cancellation fees.
- Features: The features of the self storage facility and unit are another essential factor because they affect your comfort and security. You should look for a facility that offers features that suit your needs and preferences, such as:
- Climate control: This feature regulates the temperature and humidity levels inside the unit, which can protect your items from damage caused by extreme heat, cold, or moisture.
- Drive-up access: This feature allows you to drive your vehicle directly to your unit, which can make loading and unloading easier and faster.
- Interior access: This feature means that your unit is located inside a building, which can provide more protection from weather, theft, or vandalism.
- Security: This feature includes measures that can prevent unauthorized access to your unit, such as locks, gates, fences, cameras, alarms, guards, or codes.
- Insurance: This feature covers your items in case of loss or damage caused by fire, flood, theft, or other events. You should check if the facility offers insurance or requires you to purchase your own.
- Service: The service of the self storage facility and staff is another vital factor because it affects your satisfaction and trust. You should choose a facility that offers service that meets or exceeds your expectations, such as:
- Cleanliness: This means that the facility and unit are well-maintained and free of dirt, dust, pests, or odors.
- Accessibility: This means that you can access your unit at any time or during convenient hours, depending on your preference.
- Customer service: This means that the staff are friendly, helpful, knowledgeable, and responsive to your questions or concerns.
Choosing the right self storage facility for your needs can be a challenging task, but it can also be rewarding if you do some research and comparison. By considering these factors, you can find a facility that offers you the best combination of location, size, price, features, and service for your storage needs.
How to Pack and Organize Your Items for Self Storage
Once you have chosen the right self storage facility and unit for your needs, the next step is to pack and organize your items for storage. This can help you maximize your space, protect your items, and access them easily. Here are some tips on how to pack and organize your items for self storage:
- Sort and label: Before you pack your items, you should sort them into categories, such as clothes, books, kitchenware, electronics, etc. You should also label each box or container with its contents and destination, such as "Bedroom", "Living Room", "Garage", etc. This can help you keep track of your items and find them quickly when you need them.
- Pack properly: When you pack your items, you should use sturdy boxes or containers that are of similar size and shape. You should also fill any empty spaces with packing materials, such as bubble wrap, newspaper, or towels. This can prevent your items from shifting or breaking during transport or storage. You should also avoid overpacking or underpacking your boxes or containers, as this can cause them to collapse or tip over.
- Protect fragile items: When you pack fragile items, such as glassware, ceramics, or artwork, you should wrap them individually with packing materials, such as bubble wrap, paper, or cloth. You should also place them in separate boxes or containers that are marked as "Fragile". You should also avoid placing heavy items on top of fragile items, as this can cause them to crack or shatter.
- Store smartly: When you store your items in your unit, you should place the heaviest and largest boxes or containers at the bottom and the lightest and smallest ones at the top. You should also leave some space between the boxes or containers and the walls and ceiling of the unit, as this can allow air circulation and prevent mold or mildew. You should also create aisles or pathways between the boxes or containers, as this can make it easier for you to reach and retrieve your items.
- Use accessories: When you store your items in your unit, you can also use accessories that can enhance your storage experience, such as:
- Shelves: These can help you utilize the vertical space in your unit and organize your items more efficiently.
- Hooks: These can help you hang items that are bulky or awkward to store in boxes or containers, such as bikes, tools, or coats.
- Bags: These can help you store items that are soft or flexible, such as clothes, bedding, or pillows. You can also use vacuum bags that can compress your items and save space.
- Boxes: These can help you store items that are small or loose, such as jewelry, coins, or keys. You can also use plastic boxes that are transparent and waterproof.
Packing and organizing your items for self storage can be a tedious and time-consuming task, but it can also be rewarding if you do it properly. By following these tips, you can ensure that your items are safe, secure, and easy to access in your self storage unit.Here is a possible continuation of the article:
How to Save Money and Time on Self Storage
Self storage can be a great solution for your storage needs, but it can also be a costly and time-consuming one. If you are looking for ways to save money and time on self storage, here are some tips that can help you:
- Compare prices: Before you rent a self storage unit, you should compare the prices of different facilities and units in your area. You can use online tools or call the facilities directly to get quotes and discounts. You should also check the fees and charges that are included or excluded in the price, such as insurance, security, access, or administration fees.
- Choose the right size: When you rent a self storage unit, you should choose the right size that fits your items comfortably, without wasting space or money. You can use online tools or consult with the facility staff to estimate the size of the unit you need based on the type and quantity of your items. You should also avoid renting a unit that is too big or too small for your needs, as this can cause you to pay more or store less.
- Rent for the right duration: When you rent a self storage unit, you should rent it for the right duration that matches your needs and plans. You should avoid renting a unit for longer than you need it, as this can cause you to pay more or store more. You should also avoid renting a unit for shorter than you need it, as this can cause you to move more or store less. You should also check the rental terms and policies of the facility, such as the minimum and maximum rental periods, the notice period, and the renewal options.
- Pack efficiently: When you pack your items for self storage, you should pack them efficiently and effectively. You should use sturdy boxes or containers that are of similar size and shape. You should also fill any empty spaces with packing materials, such as bubble wrap, newspaper, or towels. This can prevent your items from shifting or breaking during transport or storage. You should also label each box or container with its contents and destination, such as "Bedroom", "Living Room", "Garage", etc. This can help you keep track of your items and find them quickly when you need them.
- Organize smartly: When you organize your items in your self storage unit, you should organize them smartly and strategically. You should place the heaviest and largest boxes or containers at the bottom and the lightest and smallest ones at the top. You should also leave some space between the boxes or containers and the walls and ceiling of the unit, as this can allow air circulation and prevent mold or mildew. You should also create aisles or pathways between the boxes or containers, as this can make it easier for you to reach and retrieve your items.
Saving money and time on self storage can be a challenging task, but it can also be rewarding if you do it wisely. By following these tips, you can reduce your expenses and hassles on self storage and enjoy its benefits more.
How to Make the Most of Your Self Storage Experience
Self storage can be a convenient and beneficial solution for your storage needs, but it can also be a stressful and frustrating one. If you are looking for ways to make the most of your self storage experience, here are some tips that can help you:
- Plan ahead: Before you rent a self storage unit, you should plan ahead and repare for your storage needs and goals. You should decide what items you want to store, how long you want to store them, and how much you want to spend on storage. You should also research and compare different facilities and units in your area, and choose the one that offers the best combination of location, size, price, features, and service for your needs.
- Communicate clearly: When you rent a self storage unit, you should communicate clearly and respectfully with the facility staff and other customers. You should read and understand the rental agreement and policies of the facility, and ask questions or raise concerns if you have any. You should also follow the rules and regulations of the facility, such as paying your rent on time, keeping your unit clean and organized, and respecting the privacy and property of others.
- Use accessories: When you use your self storage unit, you can also use accessories that can enhance your storage experience, such as:
- Shelves: These can help you utilize the vertical space in your unit and organize your items more efficiently.
- Hooks: These can help you hang items that are bulky or awkward to store in boxes or containers, such as bikes, tools, or coats.
- Bags: These can help you store items that are soft or flexible, such as clothes, bedding, or pillows. You can also use vacuum bags that can compress your items and save space.
- Boxes: These can help you store items that are small or loose, such as jewelry, coins, or keys. You can also use plastic boxes that are transparent and waterproof.
- Review regularly: When you store your items in your self storage unit, you should review them regularly and update them accordingly. You should check your items for any damage or deterioration caused by weather, pests, or theft. You should also remove any items that you no longer need or want to store, and add any items that you need or want to store. You should also adjust your rent or unit size if your storage needs or plans change.
- Enjoy yourself: When you visit your self storage unit, you should enjoy yourself and have fun with your items. You can use your self storage unit as a personal or professional space where you can work on your hobbies or projects. You can also use your self storage unit as a social space where you can meet with your friends or family and share your memories or stories.
Making the most of your self storage experience can be a rewarding task, but it can also be challenging if you do it poorly. By following these tips, you can improve your satisfaction and trust on self storage and enjoy its advantages more.
Conclusion
Self storage is a growing and resilient industry that offers a convenient and affordable way to store your belongings. Whether you need self storage for personal or business reasons, you can find a facility and unit that suits your needs and preferences. However, self storage also requires some planning, preparation, and maintenance to ensure that your items are safe, secure, and accessible. By following the tips in this article, you can make the best use of self storage and enjoy its benefits more. If you are looking for a reliable and professional self storage facility in your area, contact us today and we will help you find the perfect unit for your needs.
Source:
(1) A Look At Self-Storage Growth Trends Now And Post-Pandemic - Forbes. https://www.forbes.com/sites/forbesrealestatecouncil/2020/12/01/a-look-at-self-storage-growth-trends-now-and-post-pandemic/.
(2) Self-Storage Industry Rebounds After Early Pandemic Decline - The New .... https://www.nytimes.com/2021/09/21/business/self-storage-roars-back.html.
(3) 63 Self-Storage Industry Statistics (2022) - getonedesk.com. https://www.getonedesk.com/self-storage-statistics.
(4) Self Storage Market Size, Growth, Trends | Industry Share 2027. https://www.gmiresearch.com/report/self-storage-market-statistics-analysis-industry-research/.
(5) Top 5 Self Storage Trends 2022 [Free Download]. https://www.storagepug.com/blog/self-storage-trends-2022.
FAQ's
What do people keep in self storage?
Most Common Items in Self-Storage Holiday Decorations. Since you only need to access these once a year, they are the perfect item to stick in your self-storage space. ... Paperwork. ... Old Furniture. ... Old Appliances. ... Books. ... Valuable Collections or Antiques. ... Physical Media. ... Clothing.
Who uses storage units the most?
Gen Xers (54%) and baby boomers (51%) are the most likely to use self-storage.
How long have storage units been around?
In the 1850s, the first warehouse specifically designed to hold personal and household items was built. The concept of self storage didn't arrive in the United States until 1891, when brothers Martin and John Bekins founded Bekin Van Lines in Omaha, Nebraska.
Who was first in storage?
It's been said that approximately 6,000 years ago, the Chinese would often store their possessions in clay pots in public underground storage pits. The storage pits were supervised, to ensure that nobody could remove any pot or its contents except for their own.
