For many, the pandemic has been a story of disruption, delay and even disaster, but for a few sectors, the impact of Covid-19 has been positive. One of those outliers is self-storage.

Occupancy hit 82% last year, up from 76.2% at the start of 2020, the highest since records began in 2004, according to the UK Self Storage Annual Report 2021, while returns climbed from £22.82/sq ft in 2020 to £24.66/sq ft this year.

Thanks to growth in space of more than 5%, there is nearly 6m sq ft of additional occupied self-storage space than there was at the start of the pandemic two years ago. There are now just under 2,000 self-storage ‘stores’ operated by 998 brands. But will the growth spurt continue – or will demand revert to pre-pandemic levels?

Opinion is divided among the sector’s biggest operators. Some predict sunny climes while others warn of darkening clouds.

Philip Macauley, partner and head of self-storage at Cushman & Wakefield, believes there will be no slowdown in the market “any time soon” up to 2027 and beyond. “We have a long way to go in terms of where we are as a market,” he says.

Obvious drivers of the market have been the strong housing sector and people decluttering their homes to create working from home office space during the pandemic. Some of this demand could tail off, but Macauley believes some of the decline could be mitigated by the change in people’s shopping habits to online, which has resulted in businesses, like SMEs, having to store more stock. This need is “not going to fall away”, he says.

Investors’ interest has also been piqued. “We are seeing new money coming in – institutional and private equity,” says Macauley. “Institution wise, Legal & General has been making a sizeable play in the UK market in the past 12 months. It will buy, invest and develop a facility and drop in an operator on a management agreement who will run the business, and L&G will pay them a base fee, and have their rates for achieving X-percentage profit.”

Rennie Schafer, chief executive of the Self Storage Association UK, however, is more cautious about the outlook because of increasing business rates, energy, staffing, packaging and insurance costs. Then there are the land issues.

“The cost of expansion or developing new sites has also risen due to the increasing price of steel and other construction costs,” he notes. “Competition is high for the purchase of quality existing assets, with some recent sales indicating cap rates below 5% as more institutional investors look to enter the market and existing operators seek to grow. Land for development is also scarce and fiercely competed for.”

According to Schafer, this is leading some operators to look for alternative development opportunities such as the mixed-use sites being developed by Lok’nStore in conjunction with Lidl supermarkets – or smaller unmanned sites using automated technology, mobile device access and online booking systems being developed by independent operators.

To gauge opinions, Property Week canvassed key operators for their views on the effects of Covid and what is in store for the self-storage sector.


Hi Res Andrew Jacobs

Andrew Jacobs

Andrew Jacobs, executive chairman

“Fundamentally, [the last couple of years have] been amazingly good, which I’m not sure anyone would have forecast at the beginning of the pandemic. The last full year, our turnover was up over 20%.

“In March/April 2020, at the beginning of the pandemic, people took a breath, but the government sensibly decided self-storage was part of the essential logistics chain. For instance, we have a lot of doctors and surgeries as customers.

“People decluttering to make space for home offices is an obvious reason for growth. But we had a hospital that cleared out a gym to turn it into a Covid ward and a restaurant that cleared out tables so it could operate socially distanced when it was allowed to reopen.

Basildon is a brand-new, leased purpose-built store; 20% of our portfolio going forward will be leasehold stores

“There are 15 sites in the pipeline currently, and we are on site at Staines, Bedford, Stevenage, Wolverhampton and Basildon, which is a brand-new, leased, purpose-built store; 20% of our portfolio going forward will be leasehold stores.

“Predominately, we are now building from scratch, allowing a wider choice of sites as you’re not limited by the building already there.

“[In terms of growth] consolidation or buying out existing companies is not on the cards as we have considerable capital with £100m of firepower: our access to finance is equity and a revolving credit facility with the bank. Plus, we make more money by buying sites and developing new stores than we do from buying an existing operation.

“As for the immediate future, economic news for a few days was about the cost of living, but it’s been knocked off by [the war in] Ukraine. But we are careful not to prognosticate on things we don’t know a lot about. What we do know is that Lokn’Store has been trading for 27 years, that every year has been successful and that the business has grown continuously over that period.”

2022 Feb

Flexiss Group, incorporating trading brands SureStore and The Self Storage Company

Mike Smith, chief executive

“Demand has certainly been at its highest following the Covid lockdown period. While still strong, it has softened slightly moving into 2022, as house moves have seasonally slowed, although this has been compensated for by commercial occupancy.

“Operationally, we had already invested considerable sums in a technology platform that provided for remote management of our stores, and we adopted a more focused model completing customers’ move-ins fully online to reduce face-to-face contact. Last-mile logistics has certainly increased following the outbreak of Covid, as individuals’ purchasing habits have changed.

“The Flexiss Group sources, develops and manages investments in storage facilities, not only for us and in our joint venture partnership with Seneca, but now on behalf of other institutions.

“We continue to expand our independent management platform, and now have 15 stores operating for two institutions, Legal & General and Schroders. We currently have a pipeline of 12 stores that will be developed over the next two years.

“Having been at the forefront of developing Generation 4 assets [ground-up new-build self-storage facilities, built to the highest specifications to include the latest technology available to the industry], we continue to innovate and are adding further flexible workspace opportunities to our new facilities in line with the demand drivers post Covid.

“In addition, we now have a separate workspace and office management platform and are seeking to roll this out across the UK.”

Wigan Sure Store

Storage King

Robin Greenwood, chief executive

“We experienced a 20% uplift in demand during the pandemic, and it has continued at that level since the easing of lockdowns. The stamp duty reduction also increased demand as people relocated out of the cities and others moved back home.

“But the industry is very cyclical. During the last financial crisis, we went into the curve with oversupply and lower demand. During the pandemic, we saw demand increase and outstrip supply. This will continue until we see supply outstripping demand in three to five years’ time.

“Covid brought forward our decision regarding the ability of customers to be able to sign up remotely online with online contracts and ID checks, which have been retained. We moved our stores to single-manned sites and reduced staff hours, but we are now back to normal working hours.

“Growth wise, we have a sister group based in South Africa and are looking to expand in both markets. We have doubled our store count in the past four years and aim to do the same up to 2026. Offices have always been a complementary part of self-storage, but trade counters and business units would be the way forward.”


Big Yellow

James Gibson

James Gibson

James Gibson, chief executive

“Activity levels in and out of our stores were affected by the first lockdown in spring 2020. However, once restrictions were relaxed towards the end of May 2020, we experienced a significant increase in activity. As with other self-storage operators, our performance has been relatively robust since June last year.

“Given we are a relatively small island with complex planning laws and significant competition for land in our areas of operation – London, its commuter towns and the larger regional cities – supply remains relatively restricted.

“We and our competitors are opening stores, but each store from acquiring the land to achieving stabilisation has a seven- to 10-year business plan. Looking at London by way of example, there were five openings in 2021, which on approximately 12m sq ft is 2.5% growth, and we believe the structural demand is sufficient to absorb these stores into the market.

“There are developers of self-storage in some of the smaller conurbations and also institutions already in the market that are also looking to grow, but what they all have in common is none of them are developing product: they are buying existing regional assets for the reasons mentioned above.

“Big Yellow has no intention of going into international markets and we will focus on the UK. Our external growth will come from building out our development platform and continuing to add raw land.

“And we have no interest in dark kitchens or food delivery, as this is not suited to our multi-storey space with limited car parking, although we can see why some of the industrial operators are letting spaces to these types of users.

“It will be interesting to see how demand for those pandemic-type concepts, which are highly operationally geared with fierce established competition, play out as city economies fully reopen.”


Duncan Bell, vice-president, operations

“Occupancy levels were strong in 2021, increasing on average by 1.9 percentage points compared with 2020. Early indicators are that demand will stay strong in 2022.

“During Covid, we fast-tracked the introduction of our e-rental process, an end-to-end digital experience for clients to make a rental contract in just six minutes, 24/7. Up until the end of December 2021, this was used by 24,000 customers.

“This is just the start of our extensive digitalisation programme, which will include launching an app for improved customer convenience, an upgraded access control system making use of Bluetooth connectivity and a building management system. We are increasingly becoming a proptech company.

During Covid, we fast-tracked the introduction of our e-rental process. This is just the start of our digitalisation programme

“But the market is still at low levels of penetration compared with the US and Australia and it is likely more operators will appear while consolidation takes place among existing operators. The top 10 operators in Europe manage less than 18% of all self-storage sites.

“Europe-wide, in 2022 we plan to open 12 new units through development and acquisition. We see opportunities to buy and lease smaller sites close to existing stores and manage them remotely. We remain confident we can deliver our stated 10 newly developed stores per year by 2024.”

Ready Steady Store

Andy Egerton, operations director

“We’ve always pushed to become more technology focused and this was accelerated by Covid. Everything can be done online or over the phone and we will continue to offer this to customers. It provides the flexibility and freedom to move in when they like.

“Looking into the future, we believe there will be consolidations with smaller storage suppliers selling to the big players across the UK. Realistically, it is a great time for them to sell as there is an appetite for growth, but fewer available sites.

“We already know the UK market is under-penetrated, so the big players, including us, will look to continue to expand and are actively looking for and acquiring new sites. We are just about to open a store in Great Yarmouth, on the site of a former furniture retailer, and have recently opened an unmanned satellite store site in Leeds.

Looking into the future, we believe there will be consolidations with smaller storage suppliers selling to the big players

“There’s a growing interest from institutional and private investors in the market that many may see as a challenge, but it only supports our view that the self-storage industry is strong and robust with lots of interest and potential for the future.”

Metro Storage

Angus Burnett - Metro Storage

Angus Burnett

Angus Burnett, director

“For self-storage, Covid was not a disaster. Most people needed to find more room at home to work, which created an initial bounce.

“We are an event-driven purchase. The length of time customers stay will be affected by the amount of money they have in their pockets, perceived or in reality. The ‘events’ will continue to happen and customers will continue to sign up, but will they stay as long? This could increase the churn rate and increase advertising costs to attract new customers to replace the outgoing ones; as most discounts are given up front, this will have an impact.

“But the pandemic dealt a blow to our expansion plans. Having worked for more than two years on a deal, the week we thought we were going to sign the landlord pulled the plug due to a portfolio-wide evaluation. The landlord is a national brand, and this process is still ongoing for them.

“While overall self-storage is in a good position, there is a lot of uncertainty out there right now and that could have a negative impact on the industry.

“The industry is moving forward fast with leaps in technology to help provide around-the-clock service, but human customer service will always remain at the heart of what we are about.”


Attic Self Storage

Callum Kempe, property director

“While the UK is a maturing market, compared with Australia and the US, we are undersupplied: the US market is more than eight times larger than the UK on a per-capita basis, so we feel there is plenty of growth still to be had.

“During Covid, we continued to trade existing facilities but also doubled the size of the business. We are growing rapidly within central London, having acquired three sites last year and two so far this year. Our ambition is to achieve a portfolio of between 15 and 20 high-quality freehold sites within the next few years.

“London is one of six geographical areas our private equity owners have backed. Where possible, to maximise the value from our sites, we increasingly look at introducing complementary uses, such as standalone industrial units, artist studios and even residential.

“We are constantly looking at how to improve our new facilities. Storage hasn’t always produced the most aesthetically pleasing buildings, which is something that we are looking to change with an emphasis on high-quality design.”

Self-Storage supplement April 2022