Yardi Releases ‘Self Storage National Report’ Examining Impact of Rates, New Supply

Yardi Systems Inc., which provides management software for self-storage and other types of real estate, has released a “Self Storage National Report” through its Yardi Matrix self-storage data-services platform examining the impact of industry rental rates and supply across the United States. The 10-page publication includes information on development projects and pricing for 31 markets.

Annual street-rate growth was negative in October for all 31 markets, with the national average for annualized same-store asking rate per square foot falling 1.6% from September to $16.77. That figure was a 4.2% decline year over year.

Same-store pricing for traditional units fell year over year in all but one market, while asking rates for same-store, climate-controlled units decreased across the board.

“The self-storage industry is still feeling the impact of broader economic forces on demand,” the report states. “Elevated residential mortgage rates have slowed home sales, reducing population mobility, a major driver of storage demand. As a result, storage operators continue to lower asking rates to drive new rental demand.”

On the positive side, in-place unit rates for existing self-storage tenants continue to trend upward, “supported by existing customer demand [and] helping bolster rental income for operators,” Yardi officials said in a press release. “In addition, the labor market remains relatively strong and inflation is slowing, which will benefit the sector as it helps boost the financial confidence of new and existing customers.”

On the development front, the national pipeline of new self-storage supply—facilities either under construction or in the planning stages—contracted 10 basis points month over month, with inventory under construction accounting for 3.8% of completed net rentable square feet, according to the report. About 10 of the 31 metros tracked saw a decrease in their construction pipelines month over month, while half saw their pipelines remain unchanged.

The report is available in PDF format as a free download from the Yardi Matrix website.

Nationally, the Yardi data platform tracks 29,234 existing self-storage facilities and 5,006 storage projects in various stages of development.

Yardi Systems develops and supports software for commercial property management. Its suite of programs handles accounting, ancillary processes, operations and services. Based in Santa Barbara, California, and founded in 1984, the company serves clients worldwide from offices in Asia, Australia, Europe, the Middle East and North America.

Sources:
PR Newswire, Self Storage Street Rates Continue to Soften, Yardi Matrix Reports
Yardi Matrix, Matrix Self Storage National Report-November 2023