The self-storage industry has rebounded nicely from the recession despite oversupply in some areas, real estate investment trust CubeSmart recently revealed in an article interview. The company, which owns or manages 517 self-storage facilities in the United States, reported its shares closed at $16.92 on Friday. The company’s stock price bottomed out at $1.35 during the recession.
The industry is doing “extremely well” due to a stronger housing market, lower unemployment and higher consumer confidence, CubeSmart President Christopher Marr told the source. Other experts agreed with Marr’s assessment, saying self-storage is required by many consumers, regardless of economic cycles. Changing jobs or homes and starting a business are just a handful of the reasons people use self-storage, executives told the source.
In addition, the recession slowed the rapid building of self-storage facilities, which allowed the supply and demand for the service to catch up in many areas of the country. CubeSmart's utilization rate climbed to 84.4 percent in 2012 from 78.4 percent in 2011, according to the source.
"The industry is doing really well," Paul Adornato, said senior analyst with financial-services provider BMO Capital Markets. "People don't have enough closets, and Americans are pack rats."
In January, Marr will become CubeSmart’s CEO, replacing Dean Jernigan. The company underwent rebranding last year, changing its name from U-Store-It to CubeSmart. In May, the company and its board of trustees declared a quarterly dividend of $0.11 per common share for the period ending June 30. The dividend is payable on July 15 to common shareholders of record on July 1. CubeSmart also recently completed $800 million in unsecured bank financing through amendments to its existing credit facility and term-loan agreements.
CubeSmart owns or manages more than 500 self-storage facilities across the United States and operates the CubeSmart Network, which consists of more than 800 additional self-storage facilities. According to the Inside Self-Storage Top-Operators List, the company is the fourth largest operator of self-storage facilities in the United States.