The positive results from a new nationwide survey of small and midsize business owners bode well for the self-storage sector, an industry veteran says.
The survey, by financial services company PNC, found that one-fifth of the businesses plan to add full-time employees over the next six months—the highest number since 2012—and that more than 30 percent intend to boost their employees’ pay. Meanwhile, 37 percent of business owners expressed optimism about their companies’ prospects over the next six months, up from 22 percent in last fall’s PNC survey.
Stuart Hoffman, chief economist at PNC, said the effects of the brutal winter on the U.S. economy overall appear to be short-lived. Economic expansion and job growth “should quickly bounce back this spring and propel what should be the economy’s best year since before the Great Recession,” Hoffman said.
‘Great for self-storage’
Former CubeSmart CEO Dean Jernigan, founder of self-storage financing firm Jernigan Capital, told The SpareFoot Storage Beat that this economic optimism is prompting more people to buy homes and move, and more business owners to seek space to accommodate growth. Movers make up about half of a typical facility’s customer base, according to Jernigan, and businesses represent about one-fifth.
“An improving economy is always great for self-storage,” Jernigan said.
This year, most facilities will see their occupancy rates climb and—if their managers are good—see their street rates go up by as much as 3 percent to 4 percent, he predicted. That comes against the backdrop of relatively few new facilities coming online in 2014.
However, Jernigan added, “this is the first year of a new development phase, and we will see many more [facility] starts this year compared to any year since 2009.”