Today the investment market for self-storage assets can best be described as having flat or softening values, but the demand remains strong. It is still a seller’s market, for now! Over the last 3 years, selling prices of self-storage properties have risen dramatically. A typical owner has seen their value (without any increase in rents or occupancy) go up by about 27%+; even more if your operating results improved. This large jump in value comes almost exclusively from cap rate compression of 150-300 basis points. These outsized gains in value over the last 3 years have resulted in the first wave of new development hitting the market. This, along with a few other headwinds will temporarily slow the pace of self-storage investment. Let’s take a look at a few things that will impact investment opportunities in the self-storage space over the next year and what you can do to stay competitive despite this potential slow down.
VII-2017: Staying Competitive in Today’s Market
- IX-2023: Pricing Discovery Amid Market Uncertainty
- VII-2023: The Rich get Richer!
- VI-2023: Preparing for Change in Uncertain Times