Self-storage space is down and rents are way up

Self-storage company Public Storage has earnings out today. Prices for rental units have shot way up over the last few months, according to data from DXD Capital, a storage investment company. Over the few years just before the pandemic, there was too much space available.

As an analyst for Truist, Ki Bin Kim knows a lot about the self-storage industry. But when he started working from home last year, storage problems became personal. His solution?

“Uh, stacking. Things on top of each other,” he said. “Not very efficient.”

The self-storage industry has boomed over the last year. Rents are at record levels, Kim said, and occupancy rates are pushing 96% in some cases.

In part, this is thanks to the three “D’s.”

“Death, divorce, dislocation,” Kim said. “And we’ve just seen more of that happen in the last year.”

Radius Plus is a self-storage data company. Founder Cory Sylvester said based on his research, customer’s motivations were broad: students moving out of dorms, shuttered businesses storing equipment and people unable to go to the gym.

“But I need a place for my Peloton,” Sylvester said. “So I need to empty out a bedroom.”

And if the recently expired federal eviction moratorium does force many people to move, Sylvester said folks looking for storage will pay more and may have to travel farther to find available space.

‍