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Self-Storage Real Estate in Western Canada: A Review of 2009, Predictions for 2010

Candace Watson Comments
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In British Columbia, there were two sales in late 2009 of facilities with almost 90,000 square feet of net rentable area (NRA). One was well-established in an interior town, with stabilized occupancy and a good location. It sold for an estimated 8 percent cap rate after one year of marketing ($106 per square foot of NRA).

The other facility had a more urban location within the Lower Mainland, in an area with a significant amount of new supply, which affected occupancy. The property, which has the potential to add a third phase, has been on the market since 2007. The sale price (share sale) reflected a value per square foot of NRA in the range of $129, after adjustment for the expansion potential, and a cap rate lower than 6.5 percent. A small, 15,000-square-foot facility in Victoria sold in mid-2009 at an estimated cap rate of 6.5 percent after being on the market since 2007.

To my knowledge, there were very few sales in Alberta in 2009, though two small facilities (31,000 and 25,000 square feet) in the towns of Stoney Plain and Whitecourt sold at prices indicating a range of $61 to $123 per square foot of NRA. Both have land for expansion. 

Predictions for 2010

Judging by the current state of the Canadian self-storage industry, a limited new supply in all markets should result in an improvement in occupancy, depending on economic conditions. There will be modest rent increases on select unit sizes based on occupancy, and there will be uncertainty in the B.C. market based on the potential effect of the HST. Few facility sales will be completed due to the limited amount of product on the market and the gap between purchasers’ and sellers’ expectations as to value. Finally, a re-entry of large players is possible based on the availability of capital. 

Candace Watson is the principal of Canadian Self Storage Valuation Services Inc., which provides appraisal and feasibility analyses to self-storage owners and developers. Watson has been appraising self-storage facilities since 1978 and has evaluated approximately 40 percent of the current supply in the Lower Mainland. She is a regular speaker at industry tradeshows and conferences. To reach her, call 604.681.2929; e-mail

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