Why Real Estate Investors Like the Self-Storage Industry
September 13, 2023 | Demitri Diakantonis | Mergers & Acquisitions
There are many reasons why the self-storage sector attracts real estate investors. For one, it is recession-resistant with predictable revenue. Also, customers for self-storage units are typically paying a relatively low rent, as opposed to single-tenant real estate such as retail or office buildings where occupants are on the hook for a bigger check each month which can carry more risk. But investors tell us there are even greater benefits to the space.
“Life changes generally drive consumer demand, and if there is a recession on the horizon, life changes will increase, and consumer demand will increase as well,” says Jacob Vanderslice, a Partner at Denver-based self-storage focused investment firm VanWest Partners. Lifestyle changes include an aging population looking to downsize.
“On the contrary, when the economy is robust, consumers generally have more disposable income to spend on a storage unit rent and acquire more items which they then need a place to store,” Vanderslice adds. “Everyone knows someone who planned on renting a storage unit for three months, then still have it three years later.
