The Underline: Where Strategy Outperforms Timing

2026: Where Strategy Outperforms Timing.

Every self-storage owner should understand the value of their facility, not just when they plan to sell, but because value drives nearly every meaningful business decision. Refinancing terms, insurance coverage, property taxes, capital improvements, and long-term exit strategies all hinge on value. Value is not a static number. It is a function of income, risk, and where your market sits in the cycle.

The market cycle is often illustrated as a smooth circle of expansion and contraction. In reality, it behaves more like a roller coaster. Sharp climbs, sudden drops, unexpected pauses. If you are in this business today, you are already strapped in. The only question is whether you understand the ride well enough to make smart decisions along the way.

A Five-Year Look Back: From Calm to Chaos

The period from 2019 through early 2022 reshaped commercial real estate and self storage in ways few predicted.

According to Green Street’s Commercial Property Price Index (CPPI), all commercial property values increased roughly 15% from pre-COVID levels, reaching an index of approximately 155. Self storage, however, far outpaced every other sector. During the same period, self-storage values increased 69%, peaking at a CPPI of 312.9 in March 2022.

That peak was not accidental. It was driven by three powerful forces working together:

• Historically low interest rates

• A 10-Year Treasury hovering near record lows

• Massive demand for income-producing assets with perceived durability

Self storage sat squarely in the sweet spot.

 

The Turn: Peak Valuations and the Reset

March 2022 marked the top.

Since that peak, all commercial property values have declined approximately 16%, bringing the CPPI down to roughly 130.3. Self-storage values declined about 21%, yet still remain one of the strongest property types, holding the second-highest CPPI among all sectors, behind manufactured housing and ahead of industrial assets .

That distinction matters. A decline from peak does not mean weak. It means normalization.

 

Interest Rates, the 10-Year Treasury, and Cap Rates

Commercial real estate is a long-term investment. Because of that, it is most often compared to the 10-Year Treasury, not short-term rates.

When the 10-Year Treasury was exceptionally low, real estate became more attractive on a relative basis. Investors accepted lower cap rates because the spread over Treasuries still felt compelling. Cap rates compressed, pricing surged, and sellers experienced unprecedented leverage.

Layer historically low borrowing costs on top of that dynamic and you had the best of both worlds for sellers. Cheap debt. Aggressive buyers. Rising rents.

That environment no longer exists.

As Treasury yields moved higher, spreads widened. Buyers demanded more return. Cap rates stopped compressing. Values reset. None of this is abnormal. It is exactly how long-term markets function.

 

 

Transactions Tell the Story

Yardi Matrix data provides critical perspective.

From 2014 through 2020, approximately 1,100 self-storage facilities sold nationally each year, at an average price of $87 per square foot. In Georgia specifically, the average was 53 properties per year, trading at roughly $75 per square foot.

Then came 2021 and 2022.

Transaction volume nearly doubled. Pricing nearly doubled nationally and more than doubled in Georgia. Many owners who might have sold in 2023 or 2024 accelerated their plans and exited at peak pricing.

This is an important point that often gets overlooked.

We are quick to blame slower transaction volume in 2023 and 2024 solely on interest rates and underwriting challenges. Those factors mattered. But just as important, many natural sellers were already gone.

 

Regaining Momentum Without Recklessness

By 2025, the industry began finding its footing again.

Underwriting assumptions adjusted. Buyers began modeling flat or modest rent growth. The percentage of stabilization expectations decreased. Interest-rate volatility became more predictable. Confidence returned, not because conditions improved dramatically, but because uncertainty declined.

Transaction volume in 2025 is running at roughly 70% of pre-COVID levels, yet pricing tells a different story. National price per NRSF is approximately 166% of pre-COVID averages, while Georgia pricing is closer to 198% of pre-COVID levels .

That is sticker shock, in a good way, for sellers.

 

But there is a catch.

Revenue Management Is No Longer Optional

Today’s buyers are constrained by lender requirements. Debt service coverage ratios are higher. Pro formas are scrutinized. Expense assumptions are conservative.

That means owners cannot afford complacency at any point. Revenue management matters before listing, during marketing, and through due diligence. Sloppy rent rolls, unmanaged delinquency, or inconsistent rate strategies will show up immediately and directly impact value.

This is not the market for passive ownership.

 

Local Markets Matter More Than Ever

Self storage is hyper-local. Your facility does not compete with national averages. It competes within a three-to-five-mile radius.

That means two owners in neighboring towns or even neighboring counties can experience very different outcomes. Supply pipelines, zoning restrictions, population movement, and household mobility all influence performance.

Housing activity remains the single most important demand driver. Green Street continues to emphasize that home sales and self-storage move-ins are strongly correlated, and the housing recovery is expected to be slow and uneven .

Until residential transactions meaningfully rebound, owners will continue fighting for every rental. Success will require broadening demand beyond traditional movers and leaning into business storage, life-event storage, downsizing, and long-term renters.

 

A Longer-Term View: Demographics and Demand

Looking years ahead, the middle-class story cannot be ignored.

Average incomes may rise, but not fast enough to offset the cost of living. Homeownership is increasingly delayed. Renting lasts longer. Mobility increases. Space gets tighter.

These forces support long-term self-storage demand, but not without effort. Owners who adapt operations, pricing, and marketing will outperform those waiting for the market to “come back.”

 

Closing Thought: Build for Legacy

The strongest operators today are running their businesses as if they plan to sell tomorrow, even if they never do.

That means surrounding yourself with experienced professionals. Lenders who understand the asset class. Insurance advisors who know storage risk. Brokers who live in the data, not just the headlines.

Value is not something you check once a year. It is something you manage daily.

And the owners who understand that will still be standing strong five years from now.

Sources:
Green Street CPPI and Self-Storage Sector Updates
Yardi Matrix National Self-Storage Report, December 2025

– Sauls Commercial Real Estate