Self-Storage Sector Bounces Back As Investors Move Past Market 'Trough'
Investment in the self-storage market has been making a comeback after years of high interest rates and fewer home sales put a damper on the sector.
Last week, Public Storage, the world’s largest self-storage operator, completed its $10.5B acquisition of Denver-based National Storage Affiliates Trust. Earlier this year, StorageMart paid $1B for 15 facilities in New York City totaling 1.3M SF of storage space, Inside Self-Storage reported.
Nearly $6B in self-storage properties traded hands through November 2025, up from $3B in 2024, according to real estate consulting firm MMCG Invest. While overall sales volume in the first half of 2026 was down compared to the same period last year — $2.8B compared to $3.8B — the price per pound that investors are paying for those units jumped roughly 26% to $123 per SF, according to data compiled by Yardi Matrix.
Panelists at Bisnow’s National Self-Storage Conference said the sector bottomed out and is now hitting a turning point.
“Right now is a great time from a buying standpoint because you're at the trough or you're going up from the trough,” Tom Hughes, chief investment officer at Reliant Real Estate Management, said at the July 21 event at the Wyndham Atlanta Buckhead Hotel & Conference Center.
The housing industry and self-storage have long had a symbiotic relationship. As people move, they tend to need to store their extra furnishings, thus feeding demand and rents for self-storage facilities.
But after the rapid interest rate increases that started in 2022, home sales dropped. Self-storage property values tumbled, falling about 25% from peak levels by the second quarter of 2025, according to a 2026 report from Nuveen Real Estate.
“The worst thing that happened with storage was when interest rates went up. It wasn't necessarily our cost of lending. It was the fact that people stopped moving,” said Beau Raich, SROA Capital’s vice president of development.
Self-storage property prices hit their lowest point in Q2 2025 but then increased over the next two quarters, according to the Nuveen report.
As U.S. home sales start to rise again, demand for self-storage is slowly rebounding.
Some investors have become more selective when deciding what properties to buy and develop. The Ardent Cos. partner Thomas Olson said his firm will look at 40 or 50 deals each month and “maybe put one under contract,” and maybe two over a year.
Investors are still returning their attention to the sector because it proved resilient during the pandemic with cash flow and double-digit yields, said Zachary Dickens, chief investment officer with Extra Space Storage.
But Dickens said he is having to temper yield expectations due to an oversupply of units stemming from post-pandemic demand as well as slower rent growth. In the years immediately following the pandemic, returns on investment could reach upward of 18%, he said.
“Everybody wants the consistency of the cash flow, the higher yield. But I think the industry was fortunate. We were so blessed to have kind of double-digit growth,” Dickens said.
“Now, it’s more difficult. We’re starting to have those conversations, and they’re long conversations about resetting the expectations to a low double-digit kind of return, like 10[%] to 12[%]. They look at that and go, ‘What happened to the 18% to 20% I used to see?’ It just doesn’t exist today.”
