Does lower market saturation (Square Foot per Capita) lead to higher storage rates?

Source: Noah Starr
Sponsored By: TractIQ

We looked at the top 25 MSAs in the US to compare SF/C with 10x10 Non-Climate Controlled Street rates PSF.

The result?

There’s a clear trend that as SF/C increases, street rates drop.

But…if you’re reading closely, you’ll notice that we cut the chart off at 8 SF/C.

What happens when we look at the second half of the chart for SF/C above 8?

That’s right. Price PSF is perfectly flat.

My takeaway? 8 is the new 10 for top MSAs.

When you’re looking at a primary market, if SF/C is below 8, the lower the metric the higher the rent.

But for markets with higher SF/C, other factors, such as incoming housing starts, population growth, and commercial construction, could add more weight to support or refute you’re thesis.

A market with SF/C of 15 may be no worse than a market with 9 SF/C if other factors suggest the market can handle the demand.

Want to learn more? Click here for a nationwide supply per capita map: https://lnkd.in/ggPdZxVn