Development is heaviest in underpenetrated markets and fast-growing cities
SANTA BARBARA, Calif., Oct. 22, 2018 – A new report from Yardi® Matrix shows that new self storage projects coming online pushed U.S. rent rates down in September 2018.
The report, a compilation of data from more than 2,000 self storage properties in the pipeline, shows that rent rates for 10×10 non-climate-controlled units declined by 4.8% year-over-year. Rents for climate-controlled units of similar size fell by 3.5%.
Development activity for self storage properties “continues to be highest in underpenetrated markets with strong employment growth, which attracts a large influx of new residents. Demand is also on the rise in fast-growing cities that are seeing a surge in multifamily construction,” the report says.
The heaviest development is occurring in millennial migration targets such as Portland, Ore., and Nashville, Tenn. In September, those two metros, plus Orlando, Fla., Boston and Seattle, had the highest percentage of units under construction and planned as a percent of existing inventory among 31 major metros. California’s Inland Empire, Los Angeles and Chicago had the lowest percentage.
Units planned or under construction accounted for 9.5% of the existing national inventory in September, up from 9.3% in August.
The full national self storage report for October 2018 is available for download.
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