Why Are There So Many Self Storage Places?

The self-storage industry has experienced rapid growth in recent years, leading to a proliferation of storage places across the United States.

Americans are increasingly turning to self-storage as a solution for their storage needs. Factors such as the pandemic, work-from-home trends, and the need for extra space have all contributed to the surge in demand for self-storage units.

Despite living in spacious homes, many individuals and businesses find themselves in need of additional storage space. Gen Xers and baby boomers are among the most common users of self-storage, often utilizing these facilities during downsizing or moving processes.

Idaho, Utah, and New Mexico have emerged as states with the highest percentages of self-storage users, highlighting regional trends in the industry. The most popular storage unit size is 10′ x 10′, providing customers with ample space to store their belongings.

The self-storage industry has expanded rapidly, with over 50,000 facilities in the US and an annual growth rate of over seven percent. This growth can be attributed to societal factors such as increased wealth, the work-from-home trend, and the availability of capital for construction and renovation.

However, there are concerns about potential overbuilding in some markets, leading to lower occupancy rates and rental prices. It is essential for developers to exercise caution and strategically identify areas of opportunity for new facilities to avoid financial risks associated with overbuilding in weak or competitive markets.

The self-storage industry provides a valuable service to individuals and businesses alike, offering a secure and convenient solution for storing belongings. As the demand for additional space continues to grow, it is important to approach the development of new self-storage facilities with careful consideration and planning.

Factors Driving the Growth of Self Storage

Several factors have contributed to the significant growth in the number of self-storage places, including the impact of the pandemic, changing work-from-home trends, and the increasing need for extra space.

With the onset of the pandemic, many people found themselves spending more time at home, leading to a growing realization that their living spaces were no longer sufficient to accommodate their needs. As remote work became more prevalent, individuals sought dedicated spaces for home offices, causing a surge in the demand for self-storage units. Additionally, the closure of businesses, the downsizing of offices, and the rise of e-commerce led to a greater need for extra storage space.

The shift towards a work-from-home environment also brought about lifestyle changes, with people decluttering and reevaluating their possessions. This, coupled with the desire for more spacious living quarters, resulted in a higher demand for self-storage units. Gen Xers and baby boomers, in particular, have been major users of self-storage, utilizing these facilities during periods of downsizing, moving, or simply to store seasonal items, recreational equipment, or excess belongings.

Demographic	Main Reasons for Usage
Gen Xers	Downsizing, moving, additional storage space
Baby Boomers	Downsizing, moving, additional storage space

Geographically, certain states have witnessed higher self-storage usage rates. Idaho, Utah, and New Mexico, for instance, have shown a greater proportion of self-storage users compared to other regions. In terms of storage unit size, the most popular dimensions are typically 10′ x 10′, providing ample space for storing furniture, appliances, and miscellaneous items.

The self-storage industry has experienced rapid expansion, with over 50,000 facilities currently operating in the United States. This sector has enjoyed an annual growth rate of over seven percent, fueled by societal factors such as increased wealth, the work-from-home trend, and the availability of capital for facility development and improvement. However, concerns have arisen regarding potential overbuilding in certain markets, resulting in lower occupancy rates and rental prices. It is important for developers to exercise caution and carefully identify areas of opportunity to avoid financial losses associated with overbuilt and competitive markets.

Who Uses Self Storage and Why?

Self-storage is utilized by a diverse range of individuals, but it has been particularly popular among Gen Xers and baby boomers who require extra space due to various life events such as downsizing, moving, or the need for additional storage. Despite living in spacious homes, many Americans find themselves in need of self-storage solutions to accommodate their changing circumstances.

• Gen Xers, born between 1965 and 1980, often utilize self-storage when downsizing their homes as they transition into empty nesters or seek a simpler lifestyle. The process of downsizing involves reducing the amount of possessions, and self-storage provides a convenient solution for storing items that hold sentimental or temporary value.
• Baby boomers, born between 1946 and 1964, also rely on self-storage when downsizing or transitioning to a smaller living space. Many baby boomers are in the process of retiring, and self-storage offers a secure place to store belongings that may not fit into their new homes.

However, it’s important to note that self-storage is not limited to these age groups. People from all walks of life and age brackets utilize self-storage for a variety of reasons. For example, individuals who are in the midst of a move often use self-storage to temporarily store their belongings until they have finalized their new living arrangements. Additionally, people who require extra storage space for seasonal items, recreational equipment, or business inventory find self-storage to be a reliable and convenient solution.

State	Percentage of Self-Storage Users
Idaho	28%
Utah	26%
New Mexico	24%

When it comes to self-storage usage across the United States, certain regions stand out. Idaho, Utah, and New Mexico have the highest percentages of self-storage users, indicating a greater demand for storage units in these areas. This may be attributed to factors such as population growth, housing trends, or the specific needs of residents in these states.

Furthermore, the most popular storage unit size among self-storage users is typically 10′ x 10′. This size provides enough space to store the contents of a one-bedroom apartment or a small business inventory, making it a versatile option for various storage needs.

Regional Trends in Self Storage Usage

While self-storage is prevalent throughout the United States, certain regions, such as Idaho, Utah, and New Mexico, have higher percentages of self-storage users compared to others. This may be attributed to various factors, including population density, economic conditions, and cultural norms.

In Idaho, the self-storage industry has experienced significant growth in recent years. With its booming population and diverse economy, more individuals and businesses are relying on storage units to fulfill their space needs. The state’s unique geographical features, such as outdoor recreational opportunities and seasonal activities, may also contribute to the demand for storage.

Utah, known for its strong job market and growing tech industry, has seen a surge in self-storage usage. As people move to the state for employment opportunities, they often require additional space to store their belongings during the transition. Moreover, Utah’s thriving outdoor recreation scene, including skiing and hiking, attracts individuals who need a secure place to store their sporting equipment and seasonal gear.

Similarly, New Mexico has experienced a notable increase in self-storage usage. The state’s vibrant arts and cultural scene, combined with its desirable climate, attract retirees and second-home owners who may require storage for their personal belongings. Additionally, New Mexico’s proximity to border states and its role as a transportation hub contribute to the demand for storage facilities.

State	Percentage of Self-Storage Users
Idaho	23%
Utah	21%
New Mexico	19%

The most popular storage unit size among users in these regions is typically the 10′ x 10′ unit. This size provides enough space to accommodate the possessions of an average household or small business, making it a practical choice for many individuals.

As the self-storage industry continues to grow, developers and investors should consider these regional trends and market demands. While there may be opportunities for expansion in areas with high storage usage, it is crucial to exercise caution and conduct thorough market research to avoid overbuilding in weak or competitive markets.

Growth and Concerns in the Self Storage Industry

The self-storage industry has experienced rapid expansion, with over 50,000 facilities in the United States and an annual growth rate of over seven percent, driven by societal factors such as increased wealth and the work-from-home trend. However, concerns loom over potential overbuilding in certain markets, leading to lower occupancy rates and rental prices.

With the availability of capital for construction and renovation, the self-storage industry has thrived, attracting investors and developers alike. The demand for storage units has been fueled by the accumulation of wealth among Americans, allowing for the accumulation of personal belongings. Additionally, the shift towards remote work and the need for more space at home has further contributed to the increased demand for self-storage units.

While the industry has experienced significant growth, there are concerns that it may be reaching a saturation point in certain markets. Overbuilding, in particular, is a major worry. If an area becomes oversaturated with self-storage facilities, it can lead to lower occupancy rates and rental prices as the competition intensifies. This can negatively impact the profitability and viability of existing and new storage facilities in those markets.

Concerns	Impact
Overbuilding	Lower occupancy rates and rental prices in certain markets
Competition	Intensified competition among storage facility operators
Conversion difficulties	Difficulty in converting self-storage facilities to other uses

Another concern is the difficulty in converting self-storage facilities to other uses. Unlike other types of real estate, self-storage facilities are highly specialized and their design does not easily lend itself to repurposing. This means that if there is overbuilding in weak or competitive markets, it can result in financial loss for developers.

Given these concerns, developers and investors in the self-storage industry need to exercise caution and carefully identify areas of opportunity for new facilities. Strategic planning and thorough market analysis are essential to ensure the long-term success and profitability of self-storage ventures.

By considering the factors driving industry growth, the potential risks of overbuilding, and the challenges of repurposing, stakeholders can navigate the self-storage market more effectively and make informed decisions that benefit both investors and consumers.

Final Word

The self-storage industry’s growth has been remarkable, but it is crucial for developers to exercise caution and identify opportunities for new facilities strategically, considering the potential risks of overbuilding in certain markets.

Americans have increasingly turned to self-storage, driven by factors such as the pandemic, work-from-home trends, and the need for extra space. Gen Xers and baby boomers, in particular, have become the main users of self-storage despite living in spacious homes. Downsizing, moving, and the need for additional storage space have emerged as the primary reasons for renting storage units.

Regional trends reveal that states like Idaho, Utah, and New Mexico have the highest percentages of self-storage users. Furthermore, the 10′ x 10′ storage unit size has proven to be the most popular choice among consumers.

The self-storage industry has capitalized on societal factors such as increased wealth, the work-from-home trend, and the availability of capital for construction and renovation. With over 50,000 facilities in the U.S. and an annual growth rate surpassing seven percent, the industry has experienced rapid expansion.

However, it is important to be mindful of potential concerns. Overbuilding in certain markets could lead to lower occupancy rates and rental prices, creating financial challenges for developers. Moreover, self-storage facilities are highly specialized and cannot easily be converted to other uses, further emphasizing the need for strategic planning and careful consideration of market demand.

In conclusion, while the self-storage industry presents significant growth opportunities, developers must approach new facility construction with prudence. By identifying areas of opportunity and avoiding overbuilding in weak or competitive markets, developers can maximize the potential for success in the ever-expanding self-storage industry.