Is your city seeing the highest rate volatility in self storage?
As we move through the 4th year of the development cycle move-in rates across the country continue to be impacted by new supply. That being said, self storage is a regional market and we see some regions are being impacted more than others. The graphic below depicts the year over year growth rate of advertised web rates in the top 25 markets.
Riverside and Boston have been the best performing regions as demand is stable and supply growth is quite muted. Riverside specifically has only seen 0.5% increase in self storage stock over the last 3 years.
The most notable metro is Orlando which despite significant growth in new supply (11.6% increase in stock since Q1 2016) continues to see relatively firm rental rates for self storage (rates only down slightly). The new supply is being quickly absorbed as employment growth, the greatest driver for self storage demand, has been extremely robust.
Orlando is moving beyond their traditional tourism economy and is rapidly growing jobs in the manufacturing and technology sector. The tech sector has seen the most prominent growth up 150% in the last year as the surplus of high quality graduates from the University of Central Florida has attracted many new companies to setup headquarters there. Another attraction is the lower cost of operations compared to the skyrocketing costs in Silicon Valley.
On the flip side, markets like Denver, Charlotte, Austin and Seattle are unable to absorb all the new supply despite their relatively strong economies. Markets like Chicago are impacted by both new supply and lackluster demand.
Union Realtime utilizes innovative tech solutions to deliver self-storage data and analysis. We specialize in high quality data-driven analytics for the self-storage industry. Our technology provides the industry with the most accurate self-storage development supply information available, and now provide that same accuracy with self-storage occupancy data along with market reports and self-storage statistics — updated daily.
For more information, please reach out to:
Cory Sylvester • Principal
cory@unionrealtime.com
(646) 883–9427
