As select commercial real estate property sectors continue to face challenges in 2021, the self storage industry remains a bright spot. Aided by a COVID-driven boost in demand, self storage has proven resilient and fundamentals continue to perform well. For the fifth month in a row, national street rate performance was positive on an annual basis for both 10×10 non-climate-controlled and climate-controlled units. Furthermore, development activity remained stable across the nation in February, despite 17 projects being abandoned from the new-supply pipeline. The strong performance of the storage sector offers promise as we move further into 2021. However, there is some uncertainty as to whether storage demand can maintain current levels as the core markets begin to recover, which may be a headwind for the industry in the future.<\/p>\n
The outlook for self storage remains positive in light of strong street rate performance. National street rates for 10×10 non-climate-controlled (NON CC) units increased by 2.6% compared to February 2020, and rates for 10×10 climate-controlled (CC) units grew by 3.1% year-over-year. While street rates nationwide did see substantial growth on an annual basis, rates for both 10×10 NON CC and CC units remained flat month-over-month in February.<\/p>\n
Annual street rate performance was positive in approximately 90% of the top markets tracked by Yardi Matrix for 10×10 NON CC units in February. Year-over-year, only one top market saw negative rate performance for this unit type, while rates remained flat in two of the top markets.<\/p>\n