Section 11 • Self-Storage Market Conditions
Alabama 4,951,876 Alaska 744,733 Arizona 7,031,568 Arkansas 3,041,640 California
674,875
146 861 628
39,611,295
Colorado 5,594,670 Connecticut 3,648,725 Delaware 971,403 District of Columbia
Florida 20,619,313 Georgia Hawaii
Idaho 1,714,694 Illinois
Kentucky 13,027,812
Indiana 6,746,689 Iowa 3,199,548 Kansas
6,104,335
2,970,523 4,514,130
Louisiana 4,786,046 Maine 1,367,209 Maryland
Massachusetts 6,884,028 Michigan 10,024,786 Minnesota 5,604,047 Mississippi 3,044,258 Montana 6,191,231 Montana 1,059,459 Nebraska 1,938,966 Nevada 2,994,047 New Hampshire New jersey New Mexico New York
1,364,251 9,100,237 2,119,862
North Carolina North Dakota Ohio
Oklahoma
20,096,494 10,304,250 793,399
11,755,535 4,027,541
Oregon 4,122,334 Pennsylvania 12,976,662 Rhode Island South Carolina South Dakota
1,064,615 5,037,131 880,051
Tennessee 6,766,460 Texas 28,296,099 Utah 3,113,215 Vermont 642,128 Virginia 8,513,496 Washington 7,311,450 West Virginia
1,892,804
Wisconsin 5,824,481 Wyoming 598,332
Source: MiniCo Publishing and NKF 136 Self-Storage Almanac 2018
10,390,390 1,461,211
4,057 977 325 110 20
2,758 1,520 90
380
1,460 974 513 545 648 862 224 556 548
1,363 705 549
1,120 373 318 427 212 671 448
1,328 1,696 131
1,609 842 733
1,415 78
786 185
1,162 4,475 484 133
1,021 1,232 278 999 171
52,509,056 7,643,392 45,075,072 32,877,056 212,392,064 51,147,904 17,014,400 5,758,720 1,047,040
144,386,816 79,575,040 4,711,680 19,893,760 76,433,920 50,990,848 26,856,576 28,531,840 33,924,096 45,127,424 11,726,848 29,107,712 28,688,896 71,355,776 36,908,160 28,741,248 58,634,240 19,527,296 16,647,936 22,354,304 11,098,624 35,128,192
1,003
10.60 10.26 6.41
10.81 5.36 9.14 4.66 5.93 1.55 7.00 7.66 3.22
11.60 5.87 7.56 8.39 9.60 7.52 9.43 8.58 4.77 4.17 7.12 6.59 9.44 9.47
18.43 8.59 7.47 8.14 3.86
23,453,696 11.06 69,523,456 88,788,992 6,858,112
84,234,368 44,080,384 38,374,016 74,078,080 4,083,456 41,148,672 9,685,120 60,833,024 234,275,200 25,338,368 6,962,816 53,451,392 64,497,664 14,553,856 52,299,648 8,952,192
3.46 8.62 8.64 7.17
10.94 9.31 5.71 3.84 8.17
11.01 8.99 8.28 8.14
10.84 6.28 8.82 7.69 8.98
14.96
and will provide guidance relative to suggested rental rates, excess demand, and competitive positioning.
The market is commonly described as un-
dersupplied, oversupplied, or in equilibrium. An undersupplied market has demand capacity for more self-storage product; an oversupplied mar- ket has excess supply (square footage); and a market in equilibrium is generally in balance.
Demographics Once a market determination is made relative to supply and demand, a demographic analysis can put the conclusion in final context. A mar- ket with apparent over supply might just have a rental rate imbalance, with rates being too high. Or, inversely, a market with apparent substantial excess demand might just have an existing aver- age rate structure below balance. A market with a high percentage of renters will tend to be more mobile, so capturing demand is easier if the sub- ject site out positions an existing facility. Or, in a market with high average household income, price can take a second seat to convenience and amenities. In a market where existing rates are too high, if development costs allow a develop- er to sneak in under the competition relative to rental rates, grabbing demand can be easier with the newest facility in a sub-market and also being the lower cost provider.
Having precise demographic information of
the population within the trade area will provide perspective and enable a decision based on the totality of the data.
Analysis While it is critical that self-storage investors and developers perform their own due diligence to their own standards, these macro-market statis- tics can be helpful benchmarks when identifying possible self-storage investment opportunities. Additionally, the market conditions in the lo- cal trade area should be carefully analyzed and considered as the local market conditions have the most influence on a self-storage facility and ultimately usurp any conclusions reached based upon macro data.
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