But year-over-year rate growth is resoundingly negative
SANTA BARBARA, Calif., May 17, 2023 – It’s a mixed bag of performance indicators for self storage owners and operators as spring moving season gets going, according to the latest National Self Storage Report from Yardi® Matrix.
National street rates saw modest gains month-over-month in April. Street rates for all unit sizes combined increased by $1 to $141 in April, up 70 basis points from March. Rates for standard-size 10×10 units, including both non-climate-controlled (NON CC) and climate-controlled (CC) unit types, remained level.
Metro-level street rate growth is overwhelmingly negative year-over-year. Each of Yardi Matrix’s top 31 metros recorded a drop in 10X10 CC rates compared to a year ago, while rates are down in 90 percent of the top 31 metros for 10×10 NON CC units. Street rates rose or remained flat in only three metros. However, operating income is being increased via existing customer rents.
“Despite near-term headwinds, self storage fundamentals remain strong. Occupancy has declined from pandemic highs, but demand is firm and street rates are rising as the busy leasing season progresses,” Matrix experts state.
“In recent earnings calls, REITs reported higher-than-expected operating income in the first quarter, and competition from new supply is expected to slow as developers face increasing difficulties with rising costs. Market sentiment is cautiously optimistic, though it is still early in the year and performance will depend heavily on the heart of the leasing season in coming months.”
Learn more about the state of the self storage sector nationwide.
Yardi Matrix tracks a total of 4,713 self storage properties in various stages of development, including 812 under construction, 1,885 planned, 638 prospective, 1,328 abandoned and 50 deferred. Matrix also maintains operational profiles for 29,515 completed self storage facilities across the United States, bringing the total data set to 34,228.
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.
About Yardi
Yardi® develops industry-leading software for all types and sizes of real estate companies across the world. With over 8,500 employees, Yardi is working with our clients to drive significant innovation in the real estate industry. For more information on how Yardi is Energized for Tomorrow, visit yardi.com.