Curated News
By: NewsRamp Editorial Staff
September 17, 2025
Self Storage Sector Rebounds: Positive Growth Returns After Two-Year Slump
TLDR
- DXD Capital's analysis reveals self storage operators can leverage constrained supply and returning pricing power to achieve rental rate growth and outperform in high-barrier markets.
- DXD Capital's Q2 2025 report shows self storage street rates returned to positive growth after two years of compression due to stable occupancy and limited new supply.
- Constrained self storage development preserves neighborhood character while stable occupancy ensures reliable service for households during economic transitions and moving periods.
- Self storage REITs posted positive rental growth for the first time in over two years signaling a market turnaround driven by supply constraints.
Impact - Why it Matters
This news matters because the self storage industry serves as a critical barometer for broader economic health, particularly housing markets and consumer mobility. The return to positive rental growth after two years of compression signals recovering consumer confidence and spending power. For investors, the constrained development pipeline and lending challenges create opportunities for strong returns in stabilized properties. For consumers, understanding these market dynamics helps in making informed decisions about storage needs and rental timing. The sector's performance also reflects broader trends in real estate, construction financing, and household formation patterns that affect millions of Americans.
Summary
Cory Sylvester, principal at DXD Capital, leads the firm's innovative approach to self storage investments through data-driven technology and strategic development. In a recent Q&A discussing DXD Capital's Q2 2025 Self Storage Report, Sylvester revealed surprising positive trends, including a return to positive street rate growth across major REITs like Extra Space and Public Storage after two years of compression. This indicates returning pricing power driven by stable occupancy and constrained new supply pipelines.
Sylvester, who also co-founded Radius+ and oversees their data validation efforts, provided a bullish outlook for the self storage industry. He anticipates moderate rental rate growth through 2025, particularly in high-barrier markets, with stronger upward pressure expected in 2026 if interest rates decline and home transactions increase. The constrained development environment, caused by tighter lending standards and construction costs, creates significant tailwinds for existing operators and properly capitalized new developments.
The bifurcated investment market shows stabilized assets trading well while lease-up deals face challenges, with lending market constraints being the primary factor limiting new investment. Despite these challenges, the scarcity of new development positions the sector for strong returns, especially in underserved markets with limited developable land, high regulatory barriers, and wealthy populations.
Source Statement
This curated news summary relied on content disributed by citybiz. Read the original source here, Self Storage Sector Rebounds: Positive Growth Returns After Two-Year Slump
