Commercial sectors that have best weathered the economic downturns caused by the COVID-19 pandemic? Most people would point to industrial and multifamily. But there’s another sector that has remained strong even during the worst days of the pandemic: self-storage.
And two Midwest markets — Chicago and Minneapolis — have starred, according to STORAGECafe’s ranking of the 10 most active self-storage markets in the United States in 2020.
According to the report, the Chicago metro area — which includes not only Chicago but the Naperville and Elgin markets — was 2020’s fifth most active self-storage market, having added more than 1.3 million square feet of inventory last year.
That is down slightly from 2019, when the Chicago-area self-storage market added 1.6 million square feet. But 16 new storage facilities did open in the Chicago area last year, accounting for 3 percent of existing inventory.
And how much does it cost to rent a self-storage facility in the Chicago market? Last year, a 10-by-10 storage unit rented for an average of $100 a month. That’s a jump of 0.6 percent since 2019.
Today, the Chicago-Naperville-Elgin metropolitan area offers more than 47.3 million square feet of self-storage space.
The Minneapolis-St. Paul-Bloomington market of Minnesota performed well, too, ranking as the 9th busiest self-storage market in STORAGECafe’s report. This market saw 1.2 million square feet added last year, down from the record-setting 1.7 million square feet added in 2019.
Self-storage rents, though, did drop last year. In fact, the Minneapolis-St. Paul-Bloomington market saw the biggest price drop among STORAGECafe’s top-10 markets, with rents averaging $108 a month in 2020, down 5.9 percent from a year earlier.
As of December of 2020, this market had more than 18 million square feet of self-storage inventory.
The busiest self-storage market last year? That’d be the New York-Newark-Jersey City market, which added 3.2 million square feet of new construction last year, an all-time record. This market also has the highest average rents, $178 a month last year.
Nationally, the average street rate for a standard 10-by-10 self-storage unit stood at $118 a month in 2020. That’s a jump of 3.5 percent when compared to the previous year.
New self-storage developments added 49.4 million square feet of space to the market across the United States last year. That’s a solid number, but it’s actually down from the 56.3 million square feet of storage space added in 2019 and the 56.9 million added in 2018.
The current self-storage inventory in the United States is 1.5 billion square feet. This will only grow this year. STORAGECafe reports that 590 self-storage facilities are slated for delivery this year. That will bring 43.6 million new square feet of rentable self-storage space to the market.