06 Apr 2020
Story originally published by Sparefoot.com.
Steven Weinstock is the national director of the Marcus & Millichap Self Storage Division. Weinstock, based out of Chicago, also serves as a first vice president and regional manager of Marcus & Millichap’s Chicago Oak Brook office and specializes in investment commercial real estate sales. SpareFoot talked with Weinstock about the 2020 investment outlook for self storage.
Has the self storage industry reached its peak in this real estate cycle for development? What does the development pipeline look like for 2020? Weinstock: We believe the self storage development cycle peaked in 2018 with nearly 67 million square feet of self storage delivered nationally. In 2019, deliveries dropped to 64.5 million square feet — not a significant drop but, if we are looking at trends, it pulled back. In 2020, self storage deliveries could fall below 60 million square feet. Labor and materials are more costly. New properties are taking longer to stabilize and today’s longer lease-up period is causing a little bit of concern...
Do you anticipate the current presidential election season having any impact on the sector? Weinstock: There’s always a potential uncertainty in the financial markets. We see things happen in the political process that cause the market to react positively or negatively. But if we look bigger picture, we would need a material event to really impact self storage such as declining economic growth, rising unemployment, or slowing consumer spending. I’m not sure we see these on the horizon.
Thumbnail: Photo by Jules Bss on Unsplash
