Is a Storage Company a Good Investment?

In order to determine if a storage company is a good investment, search out the facts. One should determine how much growth has occurred in recent years, how much growth is expected, approximately how many storage facilities there are currently, and if trends support the continued use of storage companies. In addition, a prospective owner must determine how many facilities there are locally, if a new or existing facility is going to be built or purchased and how he/she expects to grow the business for the future.

A good place to start might be the Self Storage Association (SSA.) The SSA can provide potential buyers with a history of the self storage industry, industry details in regard to rent histories, industry trends, and regional revenues versus expenses for a more accurate total view. In addition, with its legal resources department, the SSA could help prospective buyers make a highly educated decision regarding the industry.

Here are a few facts about the storage industry:

• Self storage has been a viable business since before 1975. In 1975 the Self Storage Association opened its doors.
• Self storage is the fastest growing commercial business to be found. Given how much “stuff” the population has and the need to hold on to much of it, the industry appears to be geared up for sustained growth.
• Ten years ago only one out of every 1.5 dozen households used self storage, today, that number is now one out of every ten!
• Approximate 2 billion square feet of space has been devoted to self storage, roughly 6 square feet per person.
• Military personnel, college students and movers account for the majority of storage usage.
• The average revenue annual income generated by each facility is approximately $250K, depending on the square footage of the facility, of course.
• Despite steady growth over the last 30 years, explosive growth within the last ten years has caused a great deal of competition between facilities for customers. This is where successful marketing techniques will really make a difference in coming years; as well superior customer service and state of the art facilities.

Use every resource available to determine if a storage company is a good investment before buying one. Remember to consider past, current and projected trends, area growth, industry growth, area employment trends, and specific industry behaviors. These can all help bring possibilities or pitfalls to light.