Rental income increased Nationwide due to the increases in asking rental rates even though the physical occupancy decreased. The graph below shows the rental rate averages for the other non-climate controlled, down stairs, standard unit sizes that are offered at storage facilities Nationwide.
Notably, rent per available square foot increased in the 3rd Quarter 2022 for both Nationwide and REITs. The REITs had very strong performance this year, and the pandemic caused the market sector to recover stronger than the normal self storage yearly cycle. This demonstrates the sector’s resiliency during the pandemic.
Supply and demand metrics appear to be growing this quarter, as well as compared to all of last year. Construction starts increased 25% from last quarter and increased 27% as of 3rd Quarter 2021. According to F.W. Dodge, there have been 533 new starts the last four quarters (new starts includes new construction and alterations, additions, or renovations).
SELF STORAGE PERFORMANCE INDEX – The SSPI decreased 0.6% compared to 2nd Quarter 2022 and increased 10.1% to compared to 3rd Quarter 2021. The SSPI now stands at 177.2.
ASKING RENTAL RATES – Asking rents increased 1.5% compared to 2nd Quarter 2022 and increased 11.7% compared to 3rd Quarter 2021, and the REITs did not change 0.0% compared to last quarter and increased 2.6% from 3rd Quarter 2021.
PHYSICAL OCCUPANCY – Median physical occupancy did not change 0.0% compared to 2nd Quarter 2022, and decreased 1.0% over the 3rd Quarter 2021, and REITs stayed the same 0.0% change compared to last quarter and increased 1.0% form the 3rd Quarter 2021..
CONCESSIONS – The cost of concessions index absolute change increased 7.0% compared 2nd Quarter 2022, also increased 17.4% over the 3rd Quarter 2021. The facilities offering concessions absolute change increased 2.6% from last Quarter and increased 4.7% from year ago, the Concession Cost Index increased to 161.7 in the 3rd Quarter 2022.
RENT PER AVAILABLE SQUARE FOOT – RPASF for the benchmark 100 square foot non-climate controlled units are up 1.2% from the 2nd Quarter 2022, and are up 10.3% compared to the 3rd Quarter 2021 and the REITs increased 0.2% compared to last quarter and increased
6.6% from last year.
*Data reflected herein does not necessarily reflect current market conditions.
Read the full performance review: CWSSAG_Self-Storage-Performance-Quarterly-Overview-2022-Q3_web
