Self-storage companies are vying for market share in Russia, where the industry is a relatively new concept and consumer demand is steadily increasing. Notable players in the Russian self-storage market include KR Properties (City Box) and Red Box.
KR Properties, a developer of commercial real estate, opened its first self-storage facility in October 2010. The $3.2 million property is already fully rented, according to an article in The Moscow Times. Red Box was at 80 percent occupancy with its one Moscow facility as of this spring.
Vladimir Strigin, a project manager at City Box, said the company is seeing 15 percent monthly increase in demand. The average lease period is six months.
Former KR Properties chief executive Sergei Kalinin said that in terms of liquidity and return on investment, self-storage is significantly better than large warehouses.
City Box is planning a second and third facility to bring the company’s total storage space to 6,000 square meters. Red Box recently opened another facility in Southeast Moscow.
According to the Times article, the investment return on self-storage in Russia is not more than eight to 10 years, usually about 4.5 years. The cost to develop a square meter of space is $400 to $800, and a 4-square-meter unit can rent for about $1,500 per year.