Investing in self storage

 

SELF STORAGE INDUSTRY KEY FACTS

  • There are now approximately 46,500 primary* self storage facilities in the U.S.
  • Nearly 1-in-10 of U.S. households, or 10%, currently rent a self storage unit, which has increased from 1-in-17 since 1995. This represents a 65% increase in the last 15 years
  • The self storage industry has been the fastest-growing sector of the U.S. commercial real estate industry over the last 35 years
  • Primary self storage facility gross revenues for 2010 were approximately $22.0 billion
  • The total market capitalization of the entire U.S. self storage industry is well in excess of $220 billion
  • Nationally, primary self storage facilities employ 163,000 persons, or an average of 3.5 employees per facility (excludes ownership)
  • There are some 27,650 small business entrepreneurs (90% of all self storage companies) who own and operate just one primary self storage facility
  • The top 5 self storage companies, including the 4 public companies, own and operate some 4,850 self storage facilities, or about 10% of all primary facilities
  • Total self storage rentable space in the U.S. is estimated to be 2.22 billion square feet (as of Q4-2010). That figure represents more than 78 square miles of rentable self storage space under one roof - or an area well more than 3 times the size of Manhattan Island (NY)
  • There are 7.0 sq. ft. of self storage space for every man, woman and child in the nation, thus, it is physically possible that every American could stand - all at the same time - under the total canopy of self storage roofing

Self Storage Association “Industry fact sheet” (6/11)

THE SELF STORAGE INDUSTRY

“Self storage” refers to properties that offer do-it-yourself, month-to-month storage space rental for personal or business use. Self storage offers a cost-effective and flexible storage alternative. Tenants rent fully-enclosed spaces that can vary in size according to their specific needs and to which they have unlimited, exclusive access. Tenants have responsibility for moving their items into and out of their units. Self storage unit sizes typically range from five feet by five feet to 20 feet by 20 feet. Self storage provides a convenient way for individuals and businesses to store their possessions, whether due to a life change or simply because of a need for extra storage space. According to the 2011 Self Storage Almanac, self storage facilities generally have a tenant mix of approximately 71% residential, 17% commercial, 6% military and 6% students. The mix of residential tenants using a self storage property is determined by a property’s local demographics and often includes people who are looking to downsize their living space or who are not yet settled in a large home.

The items residential tenants place in self storage properties range from cars, boats and recreational vehicles to furniture, household items and appliances. Commercial tenants tend to include small business owners who require easy and frequent access to their goods, records or extra inventory, or storage for seasonal goods. Self storage properties provide an accessible storage alternative at a relatively low cost. Properties generally have on-site managers who supervise and run the day-to-day operations, providing tenants with assistance as needed. Tenants choose a self storage property based largely on the convenience of the site to their home or business. Therefore, high-density, high-traffic population centers are ideal locations for a self storage property. A property’s perceived security and the general professionalism of the site managers and staff are also contributing factors to a site’s ability to secure rentals. Although most self storage properties are leased to tenants on a month-to-month basis, tenants tend to continue their leases for extended periods of time. However, there are seasonal fluctuations in occupancy rates for self storage properties. Generally, there is increased leasing activity at self storage properties during the summer months due to the higher number of people who relocate during this period.