That may sound like an odd statement coming from someone whose profession is built on comparisons.
In commercial real estate, we compare sales, rental rates, occupancy, cap rates, expenses, construction costs, and market trends every day. Without comparisons, there would be no valuations.
So, comparison isn’t the problem. Comparison gives us perspective.
The problem comes when we compare emotionally instead of objectively.
Many self-storage owners are still comparing today’s market to the peak of 2022. They remember waiting lists, record-high valuations, historically low interest rates, and buyers competing for quality facilities.
That market was real. It was also extraordinary.
Today’s market is different. Values remain below their 2022 peak. Borrowing costs are higher, underwriting is tighter, and operators are competing harder for every rental. Rental rates have stabilized or declined in many markets, while operating expenses continue to rise.
At the same time, new supply has slowed as financing and construction costs have increased. Buyers who once focused heavily on future growth are now paying closer attention to sustainable NOI and operational discipline.
The mindset has shifted from “the market will make me money” to “my operations create value.”
For most owners, today’s environment is more challenging than it was four years ago. But that makes it even more important to focus on what can actually be controlled.
Instead of asking how your facility compares to April 2022, ask how it compares to six months ago.
Are collections improving? Are expenses growing more slowly than revenue? Is occupancy moving in the right direction? Have you strengthened your online presence or improved tenant retention? Is your operation stronger today than it was six months ago?
Those are the comparisons that build value because they measure progress rather than nostalgia.
Market cycles will continue to change. Interest rates will move. Cap rates will adjust. Construction activity will rise and fall. Owners cannot control those forces, but they can control how their facilities perform within them.
That means understanding your numbers, managing expenses, paying attention to rental trends, improving the customer experience, and continually evaluating where operational improvements can be made.
It also means understanding what your facility is worth in the current market. Value affects far more than a future sale. It can influence refinancing decisions, capital improvements, insurance coverage, expansion plans, and long-term strategy.
The strongest operators are not necessarily the ones who predict the next market cycle correctly. They are the ones who continually improve their operations regardless of the cycle.
Comparison is valuable when it provides perspective.
Just make sure you’re comparing your business to where it’s going, not to a market that no longer exists.
Source: Sauls Commercial Real Estate
