Self-Storage on the Global Stage

Domestic self-storage statistics speak for themselves: the self-storage industry is growing exponentially with no slowing in sight. But while demand continues to climb in the self-storage industry here at home, the opportunity is not limited to the US; there’s a global self-storage market to consider.

Granted, functioning globally – in any industry – is complicated and presents its own set of challenges. For example, completing a self-storage transaction in North Carolina versus one in Texas is really not all that different. You get a property condition assessment (PCA) report completed, as well as a phase 1 environmental study, and you’re off to the races. However, when we compare North Carolina to, let’s say, a deal transacted in the Netherlands, one must consider a number of factors including the different language, accounting, and legal practices, and cultural uptake of the industry; not to mention a foreign currency play and the repatriation of funds, just to mention a few factors.

I’ve seen firsthand the rise in self-storage across the globe. Having participated in speaking engagements throughout Asia and Europe—I’ve seen how these global markets are introducing, building, and benefitting from what the self-storage industry has to offer. These foreign markets really look at the United States – and brokerage firms like Lindsey Self Storage Group – as the shining beacon of where the industry as a whole is going. When I started getting calls to do consultation and speaking engagements abroad five or six years ago, I quickly realized that foreign markets really heeded our message.

Unsaturated Opportunities

With the self-storage industry being relatively “new” in locations throughout the world in comparison to the US market, opportunities abound for those who aren’t afraid of a challenge. Many of these foreign markets look to the US’ track record as their future regarding where their industry is going, and they adapt quickly.

In 2017, I attended my first Self Storage Association Asia expo in Hong Kong, which was an eye-opening experience. A virgin real estate sector that hosted over two hundred attendees (compared to the United States, with over five thousand) was rapidly evolving through the stages of the storage industry, and honestly had already developed much more advanced technology than what we had in the United States at the time—and still to this day, in my opinion.

I had been invited to speak on the state of the US economy and share a little about how it compared to the Asian market. While sitting on a panel with fellow industry professionals who had projects ranging from Australia to the UK and Italy, we were able to paint a broad global picture of the storage industry. I, for one, at the time was able to hone in on the beginning of the development boom that we had seen come to fruition over the prior sixteen months or so in the United States.

The UK and Australia were beginning to enter their first “mature” cycle of storage owner-operators, having really started to get into the business in the 1990s. Italy, on the other hand, was a relatively new and evolving market—one that posed its own challenges; for example, no one wants to build in south Italy due to high levels of corruption.

Europe overall though is exploding with storage. Countries like the Netherlands and France reign supreme, with a massive wave of German stores in tow over the past five years. Some countries have been slower to adopt storage (Belgium) than one would have anticipated from a socioeconomic and cultural perspective, but regulations have been challenging there, to say the least. In addition to these areas, the industry continues to push east into countries like Latvia and the Ukraine, and south into Spain and Portugal; Europe has a long runway of self-storage for many years to come.

Unlike its UK/European counterpart, Asia is the Wild West of self-storage. A virgin market, Asia has jumped leaps and bounds ahead of other nations, including the United States, from a technological perspective. However, parts of Asia still struggle with an ever-shifting real estate landscape, especially in major cities like Hong Kong. Shady real estate practices by landlords, corrupt political landscapes, and wild lease terms and timelines are just a few of the headaches many operators have had to overcome throughout cities such as Hong Kong.

Maybe the Grass Isn’t Greener

But despite the opportunities found globally, investors in these countries still want in on US self-storage. Since that first trip to Hong Kong, many of the Asian nations that I meet at these conventions are eager to invest in the United States, and this stage presents me an opportunity to paint a picture of the storage landscape that has evolved over the past forty-plus years stateside and why it’s such a sound and excellent investment today. While countries such as China need to worry about issues such as unsanctioned government shutdowns of their businesses, the United States is seen as a guiding light and stability for investment. The United States is also seen as the forefront leader in self-storage, giving us an additional leg up in the attractiveness of the investment.

One of the main reasons for this is we’ve proven the industry here in the US is successful no matter what happens. With fifty-plus years of multiple real estate and economic cycles, presidents, debt crises, wars—you name it—the US self-storage industry has stood strong through it all. In fact, it truly has flourished through sour cycles, as uncertainty breeds demand for self-storage.

Even the three Ds (death, divorce, downsize) in regard to storage all reflect times of uncertainty. But times of uncertainty don’t have to be negative by any means. It could also mean you have job options all over the country, your kid is deciding between various major universities, you’re thinking about buying the second house, or maybe your husband is about to buy yet another car he doesn’t need to work on—all of this drives demand for space in one capacity or another.

These factors aren’t specific to the US though, and the need and opportunity for self-storage globally will only continue to grow. We have already recognized a monumental shift across multiple facets of our business over the past decade, and these trends will continue to come faster and be more impactful as the competition within the industry and certain regions intensifies. Learn more about how to get involved in the domestic and international self-storage industry by reading my book, The Sexy Side Of Self-Storage: An Insider’s Guide To A Necessary Commodity.