Self-storage during the pandemic: Three trends to watch this year
During the first year of the pandemic, moving in the U.S. fell to a historic low not seen since 1947. Still, that didn’t mean self-storage declined. In fact, according to an article from The Progressive Magazine, 2020 saw an all-time high of 13.5 million households with self-storage units (even with the downturn because of COVID). And a report by Matthews Real Estate Investment Services says “In 2021, self-storage saw sales volume rising 180 percent from the year prior, reaching $23.6 billion” overcorrecting the downturn and then some.
So, what does the future look like for self-storage facilities? We’ve done our research to present three 2023 (and beyond) trends from industry experts. Enjoy!
1: Emerging companies will face a few challenges
Like so many other industries, the self-storage industry is experiencing high demand along with limited supplies which will make it tough to launch new self-storage facilities through 2023. According to an S&P Global Market Intelligence article “Rising material, labor and land costs, as well as the challenge of gaining city approvals, will likely keep development of new self-storage facilities limited through 2023.”
Adding more woes to new and emerging self-storage facility companies is a double whammy of what Tenant Inc. CEO, Lance Watkins calls “aggressive underwriting” combined with inflation. “We’re going to see some companies failing,” said Watkins. “There’s been some really aggressive underwriting that made a lot of serious assumptions to guarantee success, and if those assumptions don’t all come true, it’s not going to end well for those companies,” Watkins said.
2 While some limitations may be felt, global growth will continue
While new and emerging self-storage companies may struggle a bit in 2023, established companies may have it easier. Research and Markets (the world’s largest market research store) report Self Storage Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2022-2027 predicts growth to continue. In fact, the report says that the global self-storage market will increase in value by more than 20 billion in just four years.
So, what’s behind that continued growth? Research and Market’s report claims it’s a combination of urbanization, a fast-growing global population, better customer experience thanks to AI and the Internet of Things, and the continuing pandemic. Want to get more valuable insights? Read the report for drilled-down information that can help inform your short-term and long-term business plans.
3 Technology will be a large factor in growth
Emerging self-storage company owners may be concerned about inflation and inventory delays, but there are steps they can take to make survival and success easier. One of them is to run their business remotely with technology that makes it possible—like artificial intelligence (AI).
AI can help remote employees have collaborative video meetings while reducing distracting technical glitches and help employers track employees as needed. Another thing AI can help with? Reducing those exhaustive and inefficient email hunts by automatically organizing and clumping together emails that are related so (almost) nothing gets lost.
But what about security—one of a self-storage facility owner’s top priorities? Secyre’s QR code solution gives you the option of printing and placing a QR code that’s unique to your business anywhere on your premises. That way, if there is any sign of trouble, you, your staff and/or your customers can use it to report the problem and have a security guard physically arrive to handle the situation if necessary.
If the pandemic has taught the world anything it’s that predicting the future isn’t an exact science, but these trend predictions seem to be on track for 2023. We hope you’re able to use some of them to help guide your business this year for success well into the future.
Check out this very detailed report from Research and Markets for more information about trends in the self-storage facility industry in 2023 and beyond.