Despite the fact that it generates an estimated $39 billion, the self-storage industry is rarely discussed. That's likely because it's not terribly glamorous and it rarely carries with it the humanistic intrigue of the hospitality and restaurant industries that affect so many people during this global pandemic. But there are an estimated 60,000 storage facilities in the United States. Collectively, they take up 1.7 billion square feet at an average cost of $87.88 per square foot.
The largest of the self-storage companies is Public Storage ($PSA), which in 2019 generated $2.68 billion in revenue. New data shows that the company — and industry — could be headed for trouble: unused storage space is growing and prices are declining. This is an early sign that the self-storage industry will have a tough time weathering an economic downturn if it continues through the summer when people do a lot of moving and, as a result, storing. In areas like Houston, Texas, where self storage is a historically thriving business, prices are down an average of 45%. In Minnesota, prices have dropped by more than 50% for some storage spaces.
Inventory up, price down across the United States
At the beginning of March 2020, the average unit at Public Storage went for $114.80 per month. As of this week, that average is down to $96.31.
The price drop appears to be a reflection of swelling inventory. At this time last year, Public Storage listed 20,600 available units. As of this week, that number has more than doubled to 47,100. During the same time period, the average price dropped from $126.80 to the aforementioned $96.31.
Prices down across all states
The price drop is evident in all US states, some more than others. But even in New York, a typically healthy moving — and storage — market, From 2019 Apr 20 - 2020 Apr 20, prices are down 28% year-over-year while inventory has swelled by more than 58%.
Minnesota saw the largest drop in year-over-year prices at 39% on top of a 140% increase in available storage space.
The drop in price affected all types of storage spaces, as well, in a sign that even larger, corporate-friendly storage is seeing a clear lull in demand.
Houston, Texas saw largest decline in price
Houston, Texas, home of the most fast-food restaurants and a typically healthy market for self-storage with plentiful space, saw the largest change over the past year when it comes to prices and availability.
Small storage space prices are down nearly 46%, medium by 42.5%, and large by nearly 31%.
As of this week, the average monthly price for a small storage space in Houston is just $23.81. Last year at this time that same locker would have cost $45.21. The drop in prices will certainly hurt local storage businesses in Texas, which was already the least-expensive area in the country for the industry.
The table below shows the states listed by number of listings as of April 20. As you can see, prices are down in every state with one exception: Alabama.
|State||2019-04-20-listings||2019-04-20-avg-price||2020-04-20-listings||2020-04-20-avg-price||Chg% in Listings||Chg% in Avg Price|
About the Data:
Thinknum tracks companies using the information they post online - jobs, social and web traffic, product sales, and app ratings - and creates data sets that measure factors like hiring, revenue, and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.