With high demand persisting, operators push rates in many markets
SANTA BARBARA, Calif., Aug. 18, 2022 – Demand for self storage units is steady, so street rates remained at record highs last month, according to the latest National Self Storage Report from Yardi® Matrix.
Average U.S. street rates for 10X10 non-climate-controlled (NON CC) units remained at $132 in July, matching the all-time high set last month. Climate controlled (CC) 10×10 units were an average of $151, also an all time high.
The latest rates signal an expected slowdown in growth. Nationwide, the overall average street rate, which includes all unit sizes and types, grew 2.1 percent year-over-year in July, a 210-basis-point drop compared to June’s annual rate growth.
“With strong demand and street rates at all-time highs, storage operators have more opportunity to increase rents for existing customers and replace rate-sensitive existing customers with new customers at the elevated street rates,” say Matrix analysts.
During recent second-quarter earnings calls, several REIT executives said they expect seasonality to return in 2022’s second half after several quarters of unusually low move-outs. The number of customers moving out is likely to normalize later this year.
While street rates are shrinking in some areas of the country, growth remains the healthiest in the Southeast. For 10×10 NON CC units, nine of the top 31 metros had street rate increases greater than five percent in July, while rates decreased in four. For 10×10 CC units, only two of the top 31 had five percent or more growth, while eight experienced negative growth.
Yardi Matrix tracks a total of 4,156 self storage properties nationwide in various stages of development — including 1,555 planned, 762 under construction and 514 prospective properties. Matrix also maintains operational profiles for 28,531 completed self storage facilities across the United States, bringing the total data set to 32,687.
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, student housing, industrial, office and self storage property types. Email [email protected], call (480) 663-1149 or visit yardimatrix.com to learn more.
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