According to Bloomberg Markets, storage space is “… the number one alternative investment“. During recent years, Self Storage has seen returns in the triple digits, fueled by homeownership dipping to it’s lowest point in years after the real estate crash.
Growth has leveled off recently, but to a healthy pace now that the economy seems to have strengthened and American’s start to get back in the home buying mode.
So why is Self Storage in Indiana as attractive as an investment today as it ever has been?
Here are 5 reasons Self Storage is a great asset class to seriously consider as you diversify your portfolio this year and beyond.
- Resistant To Recession: Self Storage weathered incredibly well during the last recession and has proven over the years to be resistant to recession. Default ratios don’t tend to dip as low with Self Storage as with other types of real estate… resulting in more stability.
- Relatively High Returns: Compared to other types of real estate, Self Storage tends to provide relatively high returns as far as capitalization and yield rates according to Cushman Wakefield. In addition, Self Storage has had “the highest total annual returns over 5, 10, and 15 year averages” starting in the mid 1990’s.
- Opportunities For Consolidation: The Self Storage industry is still relatively new as an industry and is currently ripe for further consolidation as the big operators look to acquire more units across the U.S. and in Indiana.
- Lower Breakeven Occupancy Rate: Self Storage properties tend to break even at a 40-45% occupancy rate, compared to 60% or more for apartments.
- Low Maintenance And Less Hassle: Since Self Storage units tend to be simple vs. apartment units, maintenance is less costly and tenants can be easier to manage.
There are many reasons here at Scott Meyers we’ve chosen to focus on Self Storage in the Indiana market and surrounding areas.
Dive in and learn more about Self Storage as an investment class here on our website, or feel free to reach out to us to discuss Self Storage in the Indiana area.
Just give us a ring at (866) 693-5999 or connect with us via email here on our website.