The self-storage sector has decelerated from its peaks in 2021 and 2022, but the sector continues to out-perform its pre-COVID levels. Fourth quarter 2021 saw $13.5 billion of investment in self-storage, per Cushman & Wakefield.
A new report from Cushman & Wakefield reveals there was a 57 percent year-over-year decrease in U.S. self-storage transactions in July. Occupancy levels remain high nationwide though, averaging around 90 percent, as the Midwest and Southeast markets experienced a slight decrease in occupancy rates while the Northeast and Southwest markets continued to see relatively steady occupancy growth.
Self-storage has traditionally had higher capitalization rates than certain other property types, such as apartments, reflecting the higher risks that investors perceived in the sector. Yet, in second quarter 2023, self-storage cap rates neared an all-time low, averaging 5.1 percent, at the same time that apartment cap rates have risen. This indicate