Self Storage Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 9,500 self storage service providers in the US rent or lease secure space, such as rooms, compartments, lockers, containers, or outdoor space, for clients to store and retrieve goods. Storage properties include one story buildings, multi-story buildings, climate controlled units, and parking areas for boats and motor vehicles. Sources of revenue include rent, sales of storage items (boxes, packing materials), insurance, late fees, administrative charges, and truck rentals. Large companies may offer management services.
Demand Dependent On Local Demographics
Because the majority of demand for self storage comes from customers within a one to three mile radius, a company’s business health is related to local population demographics and density.
Oversaturation Drives Down Occupancy
Some markets suffer from excess supply due to oversaturation.
Industry size & Structure
The average self storage company operates a single location, employs 6-7 workers, and generates about $2 million annually.
- The self storage service industry consists of about 9,500 companies that employ 59,500 workers and generate $19.5 billion annually.
- The industry is fragmented; the top 50 firms account for about 60% of total revenue.
- Just over half of self storage facilities are located in suburban areas; about 36% in urban; and 12% in rural.
- About 10% of US households and 12% of US businesses rent self storage units.
- Large companies include Public Storage, Extra Space Storage, CubeSmart, and National Storage Affiliates.
Industry Forecast
Self Storage Services Industry Growth
Recent Developments
Feb 21, 2025 - Homebuilder Confidence Drops
- Home builder confidence in the single-family market moved lower in January 2025 amid rising tariff concerns and high mortgage rates and home prices, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), fell five points to 42 in February from 47 the previous month. Any HMI reading over 50 indicates that more builders see conditions as good than poor. While tariffs on imports from Mexico and Canada have been paused, builders are still concerned levies could increase their costs. Builders have relied on price cuts to attract buyers, but the strategy may be weakening as high interest rates keep more would-be buyers on the sideline. In February, 26% of builders said they cut prices compared to 30% who did so in January. New home sales are a key demand driver for self-storage services.
- The average metro rate for medium (10x10 & 10x15) climate-controlled self-storage units decreased by 0.8% year-over-year in January 2025, according to Yardi Matrix. Average metro rates for medium (10x10 & 10x15) non-climate-controlled units dropped 0.9% year-over-year. Average annualized same-store street rates – storage rent rates quoted to new customers – for non-climate-controlled units fell 1.1% in January compared to a year earlier, while street rates for climate-controlled units declined by 1.3%. The pace of rate declines slowed at the end of 2024 and in January, a trend that’s expected to continue in 2025 as fewer new units come online. A weak housing market continues to weigh on self-storage demand. In response, owners have been more assertive about rate increases for existing customers.
- Young adults are staying in their parents’ homes longer amid a lack of affordable rents, the run-down in pandemic-era savings, and high mortgage rates, according to National Association of Home Builders’ analysis of recently released US Census data. In 2023, 19% of adults ages 25-34 lived with parents, which was unchanged from 2022. While the percentage of adults living with parents in 2023 was the second lowest since 2011, it was elevated by historical standards. Young adults typically account for about half of first-time homebuyers, so continuing to live with parents reduces household formations, which puts downward pressure on housing demand. A reduction in household formations can reduce demand for self-storage services.
- Many US homeowners are seeing their housing costs spiral higher amid rising insurance rates and property taxes, according to the Wall Street Journal. More frequent natural disasters and higher costs for home repairs have prompted insurance companies to increase premiums, while soaring home values have led to higher property taxes. According to Intercontinental Exchange, 32% of the average single-family mortgage payment was for home insurance and property taxes in September 2024, marking the highest rate for these costs since 2014. For about 9% of homeowners, insurance and taxes account for more than half of their monthly mortgage payments. Higher tax and insurance costs combined with elevated home prices and interest rates have prompted many would-be homebuyers to quit looking. Home sales are a key demand driver for self-storage services.
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