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USA Self-Storage REITs: Sector Focus
Monday, 29 September 2014 03:32

Self Storage: The number of storage locations in the US has swollen from 27,500 (1998), to 52,000 (2014), with an estimated 25m units producing $24bn in revenue (2013), as at least 11m Americans now pack spare possessions into storage units every year, many due to “life-changing events” like birth, death, marriage, divorce, up/down-sizing. These facilities are about 90% owned by about 28k small entrepreneurs in the US, comprising approx 2.2bn sqft of space (av 47k sqft or 7sqft/capita), worth about USD220bn, with almost one in ten of all households using them, up from only one in seventeen back in the mid-1990’s (a 65% increase), making it the fastest growing sector over the past 35yrs, and generating about USD$22bn in annual revenue. The market share of the top 50 companies is approx 15% by number of facilities & 20% by net lettable area, with average 76% occupancy, of which the top 5 account for about 10% of the facilities, and Prologis (the largest) approx 4% or 6% by net lettable area (2011). Self-storage is required by many regardless of economic cycles for many reasons, including the ever increasing frequency with which people (voluntarily or not) change jobs, and become entrepreneurs (voluntarily or not). Furthermore, "People don't have enough closets, and Americans are pack rats" (analyst at BMO Capital Markets).