Self Storage Proves Resiliency During Pandemic, Yardi Matrix Reports

Street rates appear to be recovering, and
construction of new units has been mostly unaffected

SANTA BARBARA, Calif.,
Aug. 19, 2020 – After
experiencing accelerated declines in street rates at the start of the COVID-19
crisis, the storage sector saw June and July rates trending upwards on a
month-over-month basis, states the latest National Self Storage report from Yardi® Matrix. Tempering the fast
recovery somewhat, street rates contracted for both 10×10
non-climate-controlled (2.6%) and climate-controlled units (5.2%) on a
year-over-year basis.

“Despite
COVID-19’s unprecedented economic impact in recent months, street rate
performance in July illustrated the recession-resistant nature of the self
storage sector,” the report summarizes.

The best example
of this resiliency is California’s Inland Empire, one of the nation’s tightest
industrial markets, which had a 2.7% month-over-month increase for 10×10
non-climate-controlled units and was the only market to see year-over-year rate
growth for this unit type (up 0.9%).

COVID-19 has yet
to significantly impact new self storage development, but this month did see an
uptick in abandoned projects in the new-supply pipeline. Matrix data shows at
least 31 storage properties in the new-supply pipeline were abandoned in July,
representing a 182% increase over the 11 storage properties abandoned in July
2019.

Nationwide, Yardi
Matrix tracks a total of 2,196 self storage properties in various stages of
development—comprising 592 under construction, 1,172 planned and 432
prospective properties. Even though the development pipeline saw an increase in
abandoned projects, most of the abandonments were in the prospective phase. Thus,
July’s increase in projects under construction or in the planning stages still
resulted in growth of the new-supply pipeline. Matrix also maintains
operational profiles for 26,105 completed self storage facilities across the
United States, bringing the total data set to 28,301.

Gain detailed
insights into this resilient real estate market in the new self storage national report.

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 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.