The average monthly rent for a standard 10X10 storage unit in San Francisco was $254 this February, according to Yardi Matrix data, which means that the city remains the country’s most expensive self storage market. By way of comparison, the national average monthly rent was $114 this February for the same type of unit.
Low per-capita inventory the key factor behind high street rates
San Francisco has a total inventory of 2.14 million square feet of rentable self storage space, which translates to about 2.43 square feet per capita. That’s significantly lower than the national benchmark of 7 square feet of storage space per capita. The reduced inventory is one of the main factors influencing self storage street rates in San Francisco.
Two new large-scale self storage facilities are planned to be built in San Francisco, adding another 620,000 square feet of space to the total inventory.
A comparison between San Francisco and another major Californian city, San Diego, reveals an interesting picture on how the per capita availability of self storage impacts street rates. San Diego has a total inventory of 5.52 million square feet of storage space, meaning that the storage space per capita is 3.9, notably higher than in San Francisco, but still well under the national benchmark.
The higher per capita inventory in San Diego translates into significantly lower street rates compared to San Francisco – the monthly average price for a self storage unit in San Diego was $161 this February, according to Yardi Matrix.
Expensive housing goes hand-in-hand with pricey self storage
San Francisco is notoriously expensive in terms of housing, which is another factor that puts pressure on the self storage industry. The average monthly rent for an apartment in San Francisco was $3,700 this January, according to RENTCafé, and that is more than double the national average rent of $1,463.
The expensive housing market brings extra heat to the self storage industry, as people are more likely to rent smaller homes or to live with roommates and to make up for the loss of space by getting a self storage unit. The pricey housing market is also pushing people to move more frequently, and moving is one of the main reasons why people decide to rent self storage.
Street rates dropped year-over-year, but the trend seems to be reversing
Looking at the evolution of self storage street rates in the city of San Francisco during the past 12 months, it’s safe to say that, even though the prices are sky-high, they are not skyrocketing. In fact, compared to a year ago, there’s been a 4.9% drop in the average monthly rent of a 10X10 storage unit, from $267 in February 2019 to $254 this February, as per Yardi Matrix data.
However, the descending trend appears to have stopped, as self storage street rates in San Francisco increased by almost 0.8% month-to-month, from $252 in January 2020 to $254 in February.