Low space and high prices boosted self-storage stocks amid pandemic

FTSE Nareit U.S. real estate index shares returned more than 85%

New York /
Dec.December 22, 2021 05:00 PM

(iStock)

People across the United States locked down by the pandemic needed space to lock their extra things away, boosting self-storage properties to the top of the market.

Self-storage shares on the FTSE Nareit All Equity REITs Index have returned more than 85 percent between price gains and dividend payments since Feb. 21, 2020, according to the Wall Street Journal. This figure greatly outpaces the broader REIT index, which returned only 18 percent in the same period.

Specific self-storage companies are outpacing larger stock market gains as well. Since the start of the pandemic, the S&P 500 index has delivered a 41 percent total return. The Journal reported Public Storage stock returned 73 percent in the same time, while Extra Space Storage shares have doubled in value.

The net operating incomes of Public Storage, Extra Space Storage, Life Storage and CubeSmart combined to exceed $1.2 billion in the third quarter, according to FactSet data reported by the Journal. All four companies reported occupancy above 95 percent during the quarter.

Additionally, the average storage bill for renters is reportedly hitting new marks. Credit and debit card data examined by KeyBanc Capital Markets put the average monthly bill in November at $155.65. That’s the highest average bill in five years of analysis.

As a result of the booming self-storage sector, analysts are beginning to take note and make adjustments to projections for leading companies. The Journal reported price targets for storage companies are being raised as the sector proves its resilience in the face of the pandemic.

Self-storage firms are making big moves to capitalize on the rising tide for the sector. Pennsylvania-based CubeSmart recently closed on a $1.7 billion acquisition of Storage West. The public company owned at least 1,200 properties as of late 2020 and has only expanded since then.

In November, StorageMart reached an agreement to acquire Manhattan Mini Storage, reportedly for more than $3 billion.

Meanwhile, Southern California-focused MiniStorage is also exploring a sale, which could value the company at $400 million.

[WSJ] — Holden Walter-Warner


Related Articles

arrow_forward_ios
Equity Group Investments chairman Sam Zell (Getty, iStock)
Office market’s recovery will outpace retail amid “viability” questions, Zell says
Office market’s recovery will outpace retail amid “viability” questions, Zell says
(iStock)
CRE sales hit record $809B in 2021
CRE sales hit record $809B in 2021
Steven Pozycki, chief executive officer, SJP Properties, in front of 111 River Street in Hoboken, NJ (SJP Properties, LoopNet, iStock)
SJP, David Werner buy waterfront Hoboken office, retail property
SJP, David Werner buy waterfront Hoboken office, retail property
SUNY WCC President Belinda Miles and the Cross County Center in Yonkers (Great Ink Communications/Marx Realty)
College leases 40K sf at ex-Sears in Yonkers
College leases 40K sf at ex-Sears in Yonkers
Meridian Capital’s Ralph Herzka with 165 Central Avenue, 198 Scholes Street, 11 Gunther Place in Brooklyn (Getty, Google Maps, Apartments)
Meridian Capital could get exclusive on All Year’s $1B portfolio
Meridian Capital could get exclusive on All Year’s $1B portfolio
Southampton Town supervisor Jay Schneiderman (jayschneiderman.com, Google Maps)
Southampton Town considers buying 40 acres
Southampton Town considers buying 40 acres
Alan Feldman, chief executive officer, president & chairman of the board, Resource REIT; Stephen Schwarzman, chairman, ceo & co-founder, Blackstone (Resource REIT, Getty Images, 1000 Spalding Apartment Homes)
Blackstone to pay $3.7B for REIT in latest rental push
Blackstone to pay $3.7B for REIT in latest rental push
360 Kingsland Avenue in Greenpoint, Brooklyn (Google)
Sitex Group pays $30M for Greenpoint industrial property
Sitex Group pays $30M for Greenpoint industrial property
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...