Chapter 2 Fun Self Storage Facts
The self-storage industry over the past 35 years has been one of the most profitable and fastest growing business opportunities in the United States.
The self-storage industry in the United States grossed approximately 24 billion dollars in fiscal year 2013 and is projected to grow approximately 30 billion by year 2019. This is a projected increase in growth of one billion dollars per year for the next five years.
Self-Storage new construction is booming throughout the United States, with over $580M spent in 2014.
Key drivers impacting the explosive performance in self-storage include the fact that there is little need for tenant improvements or paying lease commissions, which results in a higher net rental income than other commercial alternatives. Low maintenance requirements also contribute to an increased bottom line in performance. Self-storage has a low level of revenue volatility meaning self-storage is generally consistent regardless of economic conditions.
There are over 50,000 self-storage facilities today in the US. Compared this to 1984 when there were 6,601 facilities. Owners who own just one facility comprise over 30,000 of the 50,000 plus self-storages in the U.S. today. But the word is out and the large REITS and other wealthy organizations are pumping in millions and millions of dollars of smart money, buying recorded numbers of self storage facilities.
Increasing population, mobility and rising household formations, together with a limited pipeline, will keep self-storage conditions exceptionally tight.
Americans continue to store more stuff year after year. Approximately 9% of all American households currently rent a self-storage unit.
There are currently more self-storage facilities in the United States than there are McDonalds and Subways combined.
Some 68% of all self-storage renters live in a single-family household; 27% live in an apartment or condo.
Some 65% of all self-storage renters have a garage but still rent a unit; 47% have an attic in their home; and 33% have a basement.
The approximate self-storage demographic distribution of U.S. households are as follows: 32% urban, 52% suburban and 16% rural
The average revenue per square foot varies from facility to facility; however, here is the data for Q3 2014: $1.20 PSF for non-climate controlled 10′ x 10′ unit and $1.53 PSF for 10′ x 10′ climate controlled unit.
Some 47 percent of all self storage renters have an annual household income of less than $50,000 per year; 63% have an annual household income of less than $75,000 per year.
As the U.S. economy continues to build momentum, demand for self-storage facilities will continue to rise.