2020 record year for self-storage industry
Last year I wrote that 2020 had become a record year for the self-storage industry in many ways. In the first two months of 2021, this trend continued in the field of acquisitions.
Investors are still looking for a safe haven because the book values of their other properties, such as offices and shops, have fallen sharply. This safe haven is clearly located in ‘our’ successful self storage industry.
The security within the self-storage industry, corona-resistant, a high occupancy rate, also attracts many newcomers. Think of private equity firms and other real estate funds that until now did not have a track record in the storage industry.
2021 and beyond
All indications are that 2021 and subsequent years will continue along the upward trend.
However, some consolidation is already visible in the USA. Although the amounts of the acquisitions have increased, the number of acquisitions themselves has fallen by about 20%.
The reasons for the continued success are easy to explain. Cheap debt combined with cheap equity plus the urge to invest in property other than shops, hotels or other hard-hit properties. One reason is not particulary more important than the other, but all together they will lead to a strong takeover market in the coming years.
Moreover, due to the steady increase in vaccination coverage, government support and the economic recovery, a wave of self-storage activities is to be expected, this year and in the years that follow.