Self-Storage Sector Having Great 2016

An Uncle Bob’s Self Storage facility in Chicago, operated by Sovran. The company will rebrand these properties as LifeStorage.

CHICAGO—The major self-storage REITs continue to see their revenues soar, along with occupancy levels and net operating income, as each brings in high-tech management systems that boost individual site performance, according to a new quarterly report from MJ Partners, a Chicago-based self-storage firm. Furthermore, new development may have picked up, but remains far below existing demand, making the sector an attractive one for investors.

The industry continues to consolidate as well, as the big players acquire both Mom-and-Pop operations and small- to mid-sized firms. As reported in GlobeSt.com, in the second quarter, Sovran Self Storage, a Buffalo-based REIT, completed the purchase of an 84-property portfolio from LifeStorage for $1.3 billion. That was the biggest move of the quarter, but Public Storage, by far the largest REIT, acquired another 12 facilities for $99 million, and since July 1 acquired or had under contract another 21 facilities for $169 million.