Build or Buy in 2025?
Hey {{first_name}},
Storage construction costs have exploded 85.8% above inflation since 2005.
The numbers are staggering: New storage facilities were going up in 2005 for $36.30 per square foot, on average.
To build the same facility today would cost $67.50 per square foot – and yes, these numbers are both adjusted for inflation.
But there's a specific strategy emerging from these skyrocketing costs that could completely change how smart investors approach storage in 2025…
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The data shows that we’ve crossed a critical threshold:
Building new storage from scratch may no longer make financial sense in many markets.
If construction costs had simply kept pace with inflation, you'd be paying about $36 per square foot today (in real purchasing power).
Instead, you're paying nearly double.
And that's just the base construction cost. When you add site work ($7/SF), soft costs and permits ($6.50/SF), contingency ($4.18/SF), and professional fees ($4.18/SF)…
Your "modest" $67.50 facility becomes a $90+ per square foot reality.
…And for multi-story builds, you're looking at $120-150+ per square foot all-in.
The data shows this isn't temporary. Construction costs have been growing 3.1% above inflation every single year for 20 years straight.
Even during the 2008 financial crisis, costs only dropped temporarily before resuming their relentless upward march.
So here's where the trend is leading:
Instead of fighting a 20-year trend of escalating construction costs, many investors are shifting to adaptive reuse and conversion projects.
When you can buy an existing 50,000 square foot building and convert it for $40-60 per square foot instead of $120+ for new construction, the math becomes obvious.
Old retail spaces, defunct manufacturing facilities, abandoned big-box stores –
Many of these structures can be converted at costs closer to the price of a new build in “the good old days.”
The data shows costs accelerating recently (28.9% real increase from 2020-2025)…
Steel volatility, labor shortages, and regulatory requirements are pushing costs even higher.
Meanwhile, conversion opportunities are everywhere.
Every dying retail plaza, every vacant industrial building represents storage potential at pre-2020 cost levels.
The conversion opportunity is massive because most investors are still thinking in 2005 construction cost terms.
They see current pricing and think it's temporary. The 20-year data proves it's not – this is the new reality.
Here's to your success,
Cody