Is Self Storage a Good Investment?
There is no doubt that self storage is a booming industry. In 2017, the global self storage market was worth $38.3 billion and is projected to grow to $52.5 billion by 2022. So, is self storage a good investment? The answer depends on how you look at it.
What is self storage?
Self storage is a type of storage facility in which people can rent out space to store their belongings. It is usually used for short-term storage, such as when people are moving houses or going on vacation.
How is a self storage investment classified?
Self storage is considered a real estate asset, meaning that if you are evaluating how to balance your portfolio, self storage should be part of your real estate allocation.
How to invest in self storage
There are a few different ways to invest in self storage, but the most common is through purchasing a share in a REIT that owns and operates self storage facilities. This is a hands-off way to get exposure to the asset class.
How to predict the performance of a self storage stock
The best way to predict the performance of a self storage stock is to look at the fundamentals of the company. This includes things like occupancy rates, rental rates, and expansion plans. This will give you the information to determine the performance of the company.
However, typically, expansion and trends in the real estate market have the biggest impact on the price of a stock. Unfortunately, you would only know the former if you were close to the acquisition team. The latter is easier to see if you pay attention to the real estate market trends.
Top Self Storage Stock in the US
Public Storage (PSA)
Prologis (PLD)
Americold Realty Trust (COLD)
Extra Space Storage (EXR)
CubeSmart (CUBE)
Stag Industrial (STAG)
Life Storage (LSI)
Top Self Storage Stock in Canada
The only publically traded self storage stock traded in Canada is StorageVault (SVI.T)
