13 Jan 2025
With 2024 behind us we have the opportunity to see how Web rates have changed in the past 2 years.
This study is being conducted on the top 25 markets using 10x10 CC Web rate data being advertised by the big 3 REITs (Public, Extra Space Storage, and Cubesmart).
From 2023-2024 the average price per square ft was $1.38
From 2024-2025 the average price per square ft was $1.16
This represents a 15.5% DECREASE YoY for web asking rates.
While multifaceted, the decrease in asking rates can be attributed to two main reasons.
Oversupply: The main factor contributing to rent growth is and always has been supply. There was a lot of irresponsible development that occurred as Self Storage gained positive attention for its resilience as an asset class during the COVID-19 lockdown.
There was 2.9% new supply added within the top 50 markets in 2023 and 2.8% new supply added within the top 50 markets in 2024. However, these percentages are relative to total supply meaning that the actual NRSF added in 2024 was MORE than the NRSF added in 2020 (which was 3% new supply added relative to total supply)
Frozen Housing Market: US Existing Home sales are at almost a 30-year low limiting self storage demand from the renters who are moving and in need of storage.
With a surplus of supply and a decrease in demand we can understand why asking rates have decreased so heavily. This paired with the high cost of capital due to high rates have created an environment where new development is difficult, so we hope to see web rates begin to flatten out in the Summer of 2025 as demand catches up to the supply added.
