The market for self-storage in Greater Boston : an analysis of facilities, management and potential

Abstract

The core objective of this thesis was to undertake a comprehensive study of the Boston-area self-storage market and determine where and what to build in order to achieve the highest profitability. The study begins with a preliminary look at the history of self-storage in the United States and an analysis of the facility and market characteristics of the national self-storage industry. Then, using first-hand data accumulated through site visits, fifty local self-storage facilities in thirteen cities are analyzed. Statistical measures, including hedonic regression analysis, show the particular facility and management characteristics that affect the price per square foot that can be charged for storage unit rents. Based on information regarding national rent and occupancy levels and the field data gathered on local facility and management quality, this study concludes that the market for self-storage in the Boston-area is still young and largely underserved. The regressions showed that population density and closer distances to the Boston central business district tended to yield higher rents per square foot. Additionally, for certain sized units, the quality of security and availability of climate control were significant factors in determining price. While the data identified the most significant variables included in price per square foot for the properties surveyed, the management and facility ratings provided the most important insight into the market. Most of the facilities and managers surveyed received sub par quality ratings. These quality ratings show the current inefficiency in the Boston self-storage market and, along with some favorable market factors, show opportunity for development.