By Richard Bourne, CEO Martin’s Properties
It’s not new news that the self storage sector is growing, with double digit growth and new entrants being announced regularly.
After all, storage demand doesn’t seem to waiver and demand pressure is increasing. New homes are built smaller with negligible storage space. Garages are making way for additional housing density meaning modern homeowners need overflow storage space. Domestic and commercial employees are also needing to free up areas for office space. Homeowners are looking to extend their useable footprint through storage, rather than the cost of moving home. In summary, urban renters, flexible workers and consumers navigating higher costs are all turning increasingly to self storage as a practical storage solution.
There are now over 1,500 facilities open with an average occupancy over 80%. For investors the sector is ‘firmly embedded as one of the most robust performers within the alternatives space.’ This is according to ‘An Alternatives View’ report produced by strategic property consultancy, Rapleys. Investors like the short contract lengths, which allow for frequent charging reviews as well as the relative simplicity to manage and scale the sites and businesses.
The report also highlights that operators in the sector are expanding but most are container-based models with additional income raised through parcel lockers, workspaces, cafes and delivery hubs. Some bigger operators are innovating – using solar-powered energy systems and lean, low staff operating models to drive efficiency whilst also driving rental growth. However, they all look and operate rather similarly overall.
There is a case for a new type of product that will appeal to a new kind of demographic. That’s exactly how we have approached our entry into the self storage sector – setting up a new integrated platform within the Martin’s Properties business but operating as an entirely standalone business. We acquire sites, obtain planning, develop and operate self-storage schemes that are high tech, safe, secure, easy to access and sustainable with strong ESG characteristics.
By doing this, we believe we can open up the market to a new demographic including females, senior persons and younger professionals that haven’t previously made up the core target consumer market for self storage.
We believe that we can cut through the competition and offer a new product that will appeal to this growing and more diverse audience. We want to deliver developments that are more focussed around the consumer experience. That means, easy to access with the ability to drive straight up to the unit, rather than trying to find a small unit in a vast sea of doors and corridors. Our schemes will be more aesthetically pleasing than a rabbit warren of identikit steel shutters. They will be well-lit and protected by cameras so the environment is secure and safe. The units will be insulated so there is no condensation. The tech-driven access and amenities will be controlled via an app, which again enhances the access and experience, rather than fiddling around with codes for one part of a building and then a lock and key for the individual unit via another code for a lift. All of our sites will be sustainable with green credentials including PV’s that not only help power and light the development but also have a positive impact on the surrounding environment and community.
We also believe that the drive-up aspect will increase demand from business users who can easily unload equipment for safekeeping. This might include professional craftsmen, corporate businesses with files of mandatory paperwork, or businesses that have seasonal storage needs or require reasonable amounts of stock to be easily accessible.
We don’t believe that this product – with all these positive attributes – currently exists in one place. It will soon. We hope it helps change the game and drive self storage into the future with even more demand, happier customers, more innovation and higher returns.