The self storage sector continued to capitalize on the elevated demand created by the pandemic, recording significant rent improvements across the U.S. Street-rate rents rose 8 percent for the average 10×10 non-climate-controlled and 9.5 percent for the climate-controlled units of similar size, year-over-year as of April. National street rates also experienced strong growth on a month-over-month basis, increasing 1.7 percent for the 10×10 non-climate-controlled and 2.2 percent for climate-controlled units of similar size.
Overall, annual street rate performance was positive in all of the top markets tracked by Yardi Matrix, for both the standard 10×10 climate- and non-climate-controlled units. This record rent performance on a year-over-year basis may be attributed to the sharp rebound storage rates experienced after the initial dive at the onset of the pandemic. Nonetheless, the national average asking rate reached $122 for the 10×10 non-climate-controlled units and $138 for climate-controlled units of similar size, outperforming pre-pandemic rates in 2019 and 2018, proving the sector’s resilience.
Miami led the top markets in rent growth for the average 10×10 non-climate-controlled units, rising 15.1 percent year-over-year in April. Street rates for the 10×10 climate-controlled units also increased 14.7 percent, ranking Miami the fourth-best performing metro for this unit type.
The metro also recorded substantial rent growth on a month-over-month basis, up 3.6 percent and 3.1 percent for the average 10×10 non-climate- and climate-controlled units. With only 6.6 net rentable square feet of storage space available per capita, below the 6.8 national average, Miami will likely continue to see positive rent performance in the upcoming quarters.
Although industry experts predict an eventual slowdown in self storage construction, development activity remained steady in April. Nationwide, projects under construction or in the planning stages accounted for 8.3 percent of total stock, up 10 basis points over the previous month. Despite being somewhat oversupplied, with 8.1 net rentable square feet of storage space available per person, Sacramento saw the largest increase in construction activity—its new supply pipeline grew from 13 percent in March to 14.6 percent in April.