A lot has changed over the last 12 months, and we are starting to see “green shoots” as the bottom of the market is hopefully near. Factors impacting much of the U.S. economy are evident in the self-storage industry, which produced modest rent growth in July 2025 according to data compiled by Yardi Matrix, but also a slower-than-anticipated rental season, much to the disappointment of many industry insiders. After a white-hot listing market in April and May, new listings seemed to slow down in June and July. Meanwhile, Argus closings in the first half of 2025 were up 17% over last year, but the recovery has been uneven in several markets due to ongoing economic uncertainty and a still-fragile housing market. Steadying national occupancy levels and a slight uptick in summer occupancy have continued to encourage self-storage operators to continue rent increases, albeit at much less aggressive levels and frequency.
It’s not news to anyone that uncertainty has dominated the self-storage market and all commercial real estate investments over the last 12-24 months. However, U.S. CRE investment volume increased 14% in Q1 2025 but remained well below the trailing five-year average. Early this year, CRE fundraising revived appreciably from 2024 levels but slowed significantly as Q2 had macro market turbulence. At the same time, according to CBRE Capital Markets, nearly $1 trillion in CRE debt, or 20% of the $4.8 trillion of outstanding CRE debt, is set to mature in 2025. Clearly, this is a big wave of CRE maturities that includes self-storage properties and has many investors waiting to make their move to capitalize on strategic opportunities. The highest returns will be achieved in the coming quarters, but capitalizing on these returns requires action now.
In a self storge market with a meaningful amount of market data readily available, historical data is critically important but the numbers and data lag behind the reality on the ground. The reality is feeling like the market has bottomed and is slowly getting better. This rental season is not as good as anyone anticipated, but it is better than last year and will continue to get better as the still-fragile housing market continues to evolve. It’s important to remember that self-storage does well in “good times” and “bad times,” and as the housing market corrects, it will inevitably produce more storage demand than in years past, leading to rent growth and outsized market returns in the years to come. Market and submarket self-storage tailwinds are clearly on the horizon, move-in rents are stabilizing after steep declines in 2024, coastal markets are showing resilience, supply growth remains constrained at 1.5% annually and cap rates for Class A deals are in the mid to high-5’s putting values down 25% from the peak.
Perfection in self-storage investing comes at a steep price. I often find myself turning a client’s question/request into what I think should be answered in a 20-page slide deck, re-running the underwriting, double-checking the research, and ultimately starting over in hopes that the perfect inputs will lead to a better result. In most cases, a better outcome is rarely achieved, and often the opportunity is lost due to overanalysing the options. The breakthrough comes when the Argus network of 40+ self-storage advisors puts our more than 400 years of collective self-storage expertise and market knowledge to work, and we pick up the phone to advance our client’s opportunity forward. Some investors will buy too early, and some will sell too late, but the heavier cost falls on those who decide not to act at all. Remember that equity sitting still will earn nothing above the risk-free rate of return. Investors should not feel frozen, as there are compelling opportunities that still exist. Conviction beats perfection every time!
Author: Ben Vestal, Argus Self Storage Advisors
