‘Rough slog’ predicted as deliveries continue depressing prices
SANTA BARBARA, Calif., Oct. 24, 2019 – New deliveries continue to weigh on street rates in almost all U.S. self storage markets, according to a new report from Yardi® Matrix.
New ground-up projects plus conversions and expansions produced a 2.5% year-over-year decline in street rates for standard 10×10 non-climate controlled units in September 2019. Rates fell in about 85% of the top markets that Yardi Matrix tracks compared to September 2018. Properties under construction or in the planning stages accounted for 9.4% of total self storage stock in September, a 10-basis-point increase over the previous month.
“Looking ahead, the self storage industry is in for a rough slog: Deliveries are expected to remain elevated, pushing down pricing for many operators and increasing the need for improved performance through tightened operating costs and better efficiency,” says the report, which compiles data from more than 27,000 U.S. self storage projects that are completed or in various stages of development.
More information about the development pipeline, demand in secondary markets and rates in 31 U.S. metros is available in the Yardi Matrix national self storage report for October 2019.
Yardi Matrix offers the industry’s most comprehensive market intelligence tool for investment professionals, equity investors, lenders and property managers who underwrite and manage investments in commercial real estate. Yardi Matrix covers multifamily, industrial, office and self storage property types. Email [email protected], call 480-663-1149 or visit yardimatrix.com to learn more.
Yardi® develops and supports industry-leading investment and property management software for all types and sizes of real estate companies. Established in 1984, Yardi is based in Santa Barbara, Calif., and serves clients worldwide. For more information on how Yardi is Energized for Tomorrow, visit yardi.com.