The market was valued at USD 37.33 billion in 2018 and is expected to reach a value of USD 49.24 billion by 2024, at a CAGR of 134.79%, over the forecast period (2019-2024). The growth in this industry is expected to be positive, during the forecast period, due to the trends of increased urbanization and improved economic outlook, across regions, which have led to new business growth.
- Growing urbanization is one of the significant factors that are positively driving the market growth. The growing urban population mean smaller and increasingly expensive living spaces in cities and the creation of more renters who move around more frequently. London is a prime example of this trend, with its population hitting a new all-time high of 8.6 million in 2015 and projected to rise above 10 million by 2030.
- The improved economic outlook in countries, such as the United States, European and Asian counties are positively augmenting the market growth. Economic growth in the United States is constantly being driven forward by ongoing innovation, R&D, as well as capital investment. For instance, over the past several years, the size of self-storage space completed in the United States has risen from 18.5 million square feet in 2015 to over 36 million square feet by 2017.
- Government regulations are challenges the market’s growth. Storage operators have continued to receive nonspecific warnings from the Department of Homeland Security that their facilities can be used to store materials which could be unleashed in the terrorist attack.
- The Self Storage Association is the voice of the self-storage industry that serves as the industry’s primary advocate on government relations and legislative matters. Over the past decade, SSA spent millions of dollars influencing dozens of the relevant laws, including laws providing for licenses to sell tenant insurance, modernizing required methods of notice, authorizing reasonable late fees, and fighting the imposition of sales taxes on self-storage rents.
Scope of the Report
The self-storage industry is a sub-sector of the commercial real estate market. The personal storage segment of the self storage market is expected to register the highest share, considering the critical demand driver of the market, and urbanization.
Key Market Trends
Personal Storage Segment to Occupy the Maximum Market Share
- In the current scenario, homeowners and consumers are moving in an intriguing manner when it comes to their material possessions. Trends in the housing market favor downsizing to small, compact living spaces like condos, which prompt house owners to decide whether they’re keeping or ditching larger items. In addition, the houses are adopting modern, minimalist aesthetic like the Marie Kondo trend.
- Many of the baby boomers i.e., the population born between 1941-1965 are gearing up for retirement and looking into shifting from large houses to compact condo units.
- Globally, in many developed countries, a few building types have boomed like self-storage lockers. They’ve proven to be one of the highest revenue generating sources in real estate over the past half-century,
- Operators in the self-storage services industry have benefited from steady demand from Australian consumers over the past five years. Consumers that are relocating for employment or study often use industry services, as few competitive substitutes exist. Consumers in transit between primary places of residence are another source of industry demand.
Asia-Pacific to Witness the Highest Growth
- The increasing population density, along with the improving economic conditions across the Asia-Pacific region, in addition to the aging population and changing cultural norms, are the factors supporting the demand for self-storage in the region.
- Additionally, the emergence of the new players in the unexplored Asian regions, like India, adds significantly to the market growth. For instance, Orange self-storage company based in Bengaluru (considered to be the Silicon Valley of India) recently announced its plans to expand its presence into several other Indian cities, in order to capitalize on the growing demand for storage facilities.
- In Taiwan, owing to the rapid growth in online shopping and e-commerce sector, some vendors have rented their storage space in several locations to facilitate last mile delivery. Self-storage facilities in commercial areas are mostly designed for business use. Many prominent companies have also started using these services for expanding their business footprints across the region.
The self storage industry is very fragmented and has a low market share concentration owing to the presence of numerous small, medium, and large-sized vendors. Companies are competing for customers based on prices and other terms of storage contracts. Companies offer incentives such as low-monthly prices to attract customers.
- November 2018 - StorageMart announced about its plans to develop a total of 135,000 net rentable square feet of climate-controlled self-storage units in Lee's Summit, Missouri.
- September 2018 - CubeSmart opened a USD 7.5 million worth, 89,000-square-foot storage unit, in Lantana, South Florida. The self-storage space is to eventually have up to 750 spaces, priced between USD 68 a month, and USD 363 a month, depending on the size of the space.
- July 2018 - Life Storage Inc., announced the rollout of “Rent Now,” its fully-digital rental platform. Customers can now “skip the counter” by selecting a storage unit, completing the rental agreement, and making their rental payment online.
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