Self Storage Report 2022-template-v8

While rental rates in London are higher, so is the average disposable income. The cost of living is also higher, as are land prices and property rents for leasehold stores. The following chart shows that whilst the Midlands & Wales are showing lower returns, their population has a lower average household income. A break in this trend is shown in Yorkshire & The Humber, which also has lower household income, but are achieving higher storage rents.

INDUSTRY PROFITABILITY

80%

70%

60%

£35000

50%

£30000

£30

40%

£25000

£25

30%

£20000

£20

20%

£15000

£15

10%

£10000

£10

16.18%

£21.97

£21.06

£19.96

£19.61

£21.00

£22.15

£22.68

£23.08

£23.11

£23.08

£23.94

£26.13

0%

2010 2011

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

£5000

£5

PROFITABILITY

NET RENTAL RATE / sf p.a.

OCCUPANCY RATE

£0

£0

LONDON SOUTH EAST

SOUTH WEST

WEST MIDLANDS & WALES

EAST MIDLANDS

EAST OF ENGLAND

NORTH SCOTLAND YORKSHIRE & THE HUMBER

UK

HOUSEHOLD DISPOSABLE INCOME PER CAPITA £

AVERAGE RENTAL RATE (MATURE STORES)

Source: Oxford Economics

Measuring rental rates on their own only shows part of the equation, as profitability of the business is tied to both rental rates and occupancy. If one is increased at the expense of the other, then the increase in profit is limited. As the following chart shows, the increase in both occupancy and rental rates has seen a sharp increase in profitability for the industry for the second year in succession, continuing a similar trend from 2020. However, while the increase in 2020 was primarily driven by occupancy increases, this year it was influenced more by the increase in rental rate on a per square foot basis.

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S E L F S T O R A G E A N N U A L I N D U S T R Y R E P O R T 2 0 2 2

S E L F S T O R A G E A S S O C I A T I O N U K - C U S H M A N & W A K E F I E L D