Top Takeaways: Inside Self-Storage World Expo 2021
Slatt Capital Senior Vice President John Darrow and Commercial Mortgage Banker Ethan Habecker attended the Inside Self-Storage (ISS) World Expo last week in Las Vegas, Nevada. The following were their top takeaways from the three-day annual event.
- The COVID-19 pandemic was undoubtedly a massive boon for the storage industry as occupancy rates climbed to record highs in Q1 2021. This was driven largely by increased migration but also consumers’ increased desire to create additional room in their existing homes for remote work and school.
- Capital sources are increasing their appetite for self-storage as an asset class. Lenders that have historically focused on multifamily, retail, office, and industrial are allocating more capital to self-storage.
- Self-storage assets have never been more sought after in the marketplace. Investment sales brokers reported accepting LOIs mere hours after bringing listings to market, and at cap rates 150-200 basis points inside of pre-COVID pricing.
- Dramatic cap rate compression has led both private and institutional investors to focus on new site development or big-box retail conversions to achieve desired returns.
- SBA Lenders are experiencing extremely high volume as borrowers rush to take advantage of a CARES Act 3-month payment subsidy valued up to $9,000 prior to the September 30th deadline