In the midst of an ongoing wave of growth for the industry as a whole, self storage company Midgard Self Storage recently opened four new locations during Q4 2022 — and plans to open even more in the near future.
As Todd M. Allen, managing principal of Midgard Self Storage explains, these latest developments for the company aren’t just an indicator of his own company’s success. They also illustrate increased demand for self storage services from businesses and residential customers alike.
The Latest Growth
In Q4 2022, Midgard Self Storage opened its newest locations in Okahumpka and Lutz, Florida, as well as Gainesville and Augusta, Georgia. The Gainesville location is also the company’s first contactless facility. “We’re thrilled at being able to open these new locations and give more people access to convenient self-storage,” Allen says.
“This is all possible thanks to the support of our current customers, and of course, the fact that people are always going to need storage assistance in some capacity. This has been a great year for us, and we’re looking forward to expanding even more in 2023.”
Midgard Self Storage has enjoyed steady growth since its inception, currently boasting over 80 locations nationwide. The company’s self storage facilities are primarily located in the Southeastern United States (Alabama, Arkansas, Florida, Georgia, North Carolina, South Carolina and Tennessee), though it also operates a few locations in Colorado.
The most recent openings are a reflection of the strong growth experienced by the self-storage industry as a whole, which is expected to have annual growth of 5.76 percent between 2022 and 2027.
An Economically Resilient Industry
Allen is quick to point out that self-storage is an incredibly resilient industry — a fact that has certainly played a role in the growth of his company. “No matter what the economic climate is like, people need storage space. During good times, they tend to accumulate more goods, and end up needing a place to store them,” he explains.
“When times get tough, there’s a tendency to downsize living spaces and office spaces — and as a result, people need extra storage to store the items that will no longer fit in their new space. The affordability and flexibility of self storage makes it an easy solution.”
Indeed, it is estimated that 13.5 million households in the United States — 10.6 percent of all households — rely on a self storage unit in some capacity. Add in the businesses that also rely on self storage in some capacity, and the result is that nationwide, the average self storage facility occupancy rate sits at over 90 percent.
Other Trends Driving the Self Storage Boom
While self storage has proven to be a resilient industry regardless of economic conditions, Allen notes that there are currently a few key trends that bode well for the industry in the years ahead. “We have a growing number of Baby Boomers who are leaving the workforce and looking to downsize to manage their costs in retirement,” he explains.
“As they move to new, smaller homes, they naturally end up needing additional storage for the items that will no longer fit in their space. And with more Baby Boomers set to retire, storage demand will only go up. Pair that with younger generations living in smaller spaces to save on costs and moving more frequently thanks to remote work, and self storage becomes a necessity for them, too.”
The demand for smaller living spaces can to some extent be attributed to the current housing issues plaguing the United States. Even though the housing market has cooled off after the COVID-19 pandemic, rising interest rates and elevated prices have shut many out of the housing market. Rather than buying a larger home, many are choosing to rent (which typically results in more frequent moves), or to buy a smaller property.
In each of these situations, self-storage can help mitigate some of the challenges of living in a smaller space, particularly in regards to storing seasonal or less-frequently-used items. Growing demand for self storage bodes well for Midgard Self Storage (and others’) expansion plans for 2023.
Optimism for the Future
For Allen, these trends paint a bright future for self storage companies that are able to deliver what their customers are looking for.
“If there’s one thing the last few years have taught us, it’s that flexibility is more important for today’s consumers and businesses than ever before — and that includes their storage needs. When self-storage companies can provide flexibility in terms of unit sizes, types of storage, payment options and more, they can meet customers where they’re at to deliver the right solutions at the right time. I think as long as we can continue to do that, we’ll be able to keep growing.”
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