The results are in: self-storage in the UK is experiencing growth, with occupancy and profitability on the rise. In the rest of Europe, the storage sector is more fragmented; and whilst it is still growing, growth is slower and uptake remains low.
So, what is the current state of the industry and what can we expect from it in 2019?
UK Self-Storage is Growing
Demand for self-storage is strong, and the UK is leading this demand in Europe. The UK is the largest market with 47% of the total number of facilities. France comes in at number two but is still considerably smaller. From the amount of storage space and the number of facilities to the number of users, the UK dominates.
There are now over 1,500 self-storage sites in the UK, a rise of 5% when compared to the previous year; the amount of space used for storage is also up 8.8%. This is equivalent to 44.6 million square feet of space. These figures from the Self-Storage Association UK clearly show the importance of the sector in the UK, as well as growing customer demand.
The average size of units in the UK is growing, although domestic users continue to take smaller spaces (almost 70% rent less than 100 square feet) compared to commercial users. Customers tend to be older and will travel, on average, 20 minutes to reach their storage unit. When it comes to business storage, individuals and companies rent larger units, with some even having more than one. Across the country, the balance of domestic and business customers is still largely unchanged (60% of clients are domestic and 40% are business owners).
In 2017, 2.4 million square feet of storage space was added with the opening of 70 new stores across the UK – 29 of these had over 150 units when they opened.
There are many self-storage operators in the UK, particularly around London and the South East of England, so supply here is twice the UK average per capita. Unsurprisingly, rental rates are also higher in these regions. In Scotland, most operators are concentrated across the Central Belt in Edinburgh and Glasgow.
Challenges Faced by the Industry
Contrary to what you may think (especially in the face of the figure above), self-storage is still a developing market in the UK. Surprisingly, only 2% of Brits use self-storage; yet, of those users, over 40% say they will repeat the experience.
Another challenge facing the UK market is the relatively low public awareness of self-storage and, in particular, the operators. Most people who choose self-storage do so out of necessity, not due to a lifestyle purchase. This means that many customers, from students to home and business owners, have no idea of the cost of storage or the unit size they need. The same is true for knowing the benefits that self-storage offers. Still, both domestic and business clients are storing for longer periods of time. At Kangaroo Self-Storage, which owns Smart Storage, the average stay is in excess of 100 weeks.
Consumers tend to use the Internet to search for storage, which means they no longer interact with staff in the same way. While this is clearly the future, it can make it difficult for new customers to understand the service and how to make the most of it.
What to Expect in 2019?
There are several opportunities for growth in 2019, not least through the expectation of more sites becoming available for development. Some operators are starting to offer a larger range of services, such as goods disposal, longer opening hours, shelving in units, Wi-Fi and more lighting options.
The UK is still feeling the remnants of the recession with mortgage availability only rising now, and housing transactions continue still at a low level. However, uncertainty in the property chain can provide an opportunity, and the team at Smart Storage intend to continue providing fantastic self-storage and world-class customer service, as well as offering great incentives to make our clients’ lives easier.
At Smart Storage, we’re excited about what the year will bring and look forward to growing our self-storage service. You can also continue to expect excellent customer service from us, so talk to us or pay us a visit if you want to know more about what you get by choosing Smart Storage for your storage needs.