Cushman & Wakefield: Self Storage Normalizes in H1 of 2023
According to a report from Cushman & Wakefield, transaction volume of sales in the U.S. self-storage sector cooled in the first half of 2023, with the trailing 12-month volume down by 57% year-over-year, following the peak levels achieved in 2022.
The increased cost of debt and lack of overall liquidity will create headwinds, primarily for higher leveraged owners, while creating opportunities for well-capitalized investors. Occupancy leveled out near 90% in the fourth quarter of 2022 and has remained nearly flat through the first half of 2023.
Newer properties with state-of-the-art amenities that include climate-controlled and secured units are holding value. “Self-storage fundamentals remain healthy at the midyear point of 2023. Conditions have cooled from peak levels, representing a normalization after a period of accelerated growth,” said Managing Director Tim Garey. “As rate hikes pull the self-storage market back to historical levels, the overall market fundamentals for the sector point to a favorable outlook.”
Jasmine Kilman is Content Director of Connect Commercial Real Estate, covering Chicago and greater Chicagoland, the Midwest, Seattle, and the Pacific Northwest. She covers industry trends, transaction deals, market research, and produces daily news stories.
With experience in marketing and communications for academic nonprofits and corporate clients, including Hearst Media, Hilton, and Coldwell Banker, Kilman has written about commercial real estate, environmental, social, and corporate governance (ESG), technology, healthcare, and philanthropy. She was born and raised in California and graduated with a degree in public relations. In her spare time, Kilman enjoys hiking and traveling to new locations with her family.