Cushman & Wakefield Releases Market Report

Cushman & Wakefield (C&W) has released its “U.S. Self-Storage Market Trends and Outlook Report” for the first half of 2025. It shows the sector adjusting to normalized transaction volumes, stable capitalization (cap) rates, and moderated rent growth after the record-setting activity of the pandemic era.

According to the report, total self-storage transaction volume reached $2.8 billion in the first half of the year, which is less than 1 percent higher than the same period in 2023 and consistent with pre-pandemic trends. Between 2020 and 2022, industry investment surged to nearly $50 billion, far exceeding the $35 billion transacted in the seven years prior.

“Investor interest in self-storage remains strong, even as the market moves into a steadier cycle,” said Tim Garey, managing director and practice group leader for C&W’s self-storage division. “Valuations have moderated, but long-term fundamentals and demand drivers continue to underpin confidence in the sector.”

Other key findings revealed in the report include:

• After peaking at $174 per square foot (PSF) in the first quarter of 2023, self-storage valuations declined for six consecutive quarters to an average of $159 PSF in Q2 2025, down 12% from peak levels.
• Self-storage cap rates averaged 5.8% over the past six quarters, with class-A assets ranging from 5% to 5.5%, and class B between 5.5% to 6.5%.
• National occupancy has held steady at around 90% since 2023, with regional variations between 89% and 92%.
• Rental rates, which reached a peak of $134 PSF in Q3 2022, have since ranged between $124 and $132 PSF, averaging $127. In Q2 2025, the Northeast and Pacific regions posted the highest averages at $193 and $154 PSF, respectively.
• Elevated costs, potential tariffs on materials and tight debt liquidity have slowed self-storage development, with more projects placed on hold in the second quarter of this year.
• 56% of industry leaders expect little to no change in cap rates over the next 12 months. While 39% cited the housing market as the top concern, nearly two-thirds of investors plan to be net buyers over the next year.

“While market conditions have normalized, the appetite for self-storage remains resilient,” Garey said. “Investors are increasingly targeting secondary markets and value-add opportunities, positioning the sector for steady activity into 2026.”

The full report is available at CushmanWakefield.com.