Rental Crisis Drives Self-Storage Boom In The UK

Posted by Brad Hadfield on May 6, 2024 8:15:00 AM

The United Kingdom's £1B storage industry is booming, reports the BBC, fueled by a national housing and rental crisis. According to the outlet's You and Yours program which aired last week, home downsizing, rising rents, and evictions are driving people into the open arms of self-storage facilities while they wait to find a smaller place to live – or a place to live, period.

"There's a big, big need for self storage, with a lot of people having to re-house because they can't pay the rent," one facility owner, who's been in the business for 15 years, tells the outlet. "There are a lot of distressed customers right now getting 21 days to move out of the place they call home. We try to make it as nice and easy as possible because they're going though a bad time."

She says that some tenants are staying for 9-12 months, if not longer, while they try to find a livable situation. "But at least [their stuff] is safe, at least it'll be there when they need it."

Rennie Schafer, Chief Executive Officer at SSA UK and FEDESSA, told the program that aside from people making home or rental changes – which can take some time in the current market – others are beginning to consider self-storage a "lifestyle."

"Ever since COVID, people are staying at home more, and they're working from home too," explains Schafer, who adds that some tenants are keeping their units indefinitely, and using them for different things as they move through various stages of their life. "These people are taking more pride in their home and looking for more space. Self-storage then becomes their 'home away from home'."

The last big piece of the self-storage pie, Schafer explains, is businesses, which he says make up about 25% of self-storage rentals. "For small business owners, self-storage is a place to work out of instead of home. It's not a warehouse with a fixed lease and size. Self-storage gives them the ability to try one size, upgrade, downgrade, move-out in a month, etc. It gives them flexibility."

This isn't lost on self-storage operators. The Big Yellow Storage Company, for example, which operates one of the largest portfolios in the UK, advertises itself on Right Move – the UK's largest property rental website – and it lists itself as an "agent" for businesses.

You can listen to the self storage episode below. Discussion on self storage begins at the 33:00 mark.