Last month, Big Yellow announced that it raised £110m from investors to fund its existing development pipeline.

Nicholas Vetch Big Yellow’s Executive Chairman said: “The net proceeds will allow us to expand capacity in London, our strongest market.”

COVID-19 has acted as an accelerator of growth for the self storage industry

Furthermore, Safestore Holdings PLC recently released its interim financial statement for the fourth quarter of its 2023 fiscal year.

The report indicates that the company has experienced growth in revenue and average rental rates for most of its operating portfolio.

Safestore opened four new facilities and completed one expansion project during the quarter. This resulted in adding 150,100 rentable square feet to its portfolio. The company has 30 development projects in its pipeline, which are expected to comprise 1.5 million square feet.

“We believe that the COVID period has acted as an accelerator of growth for the self storage industry. Furthermore, whilst demand stabilised during the year at a level that is below 2022, we are still seeing inquiry levels that are ahead of the pre-COVID period,” said CEO Frederic Vecchioli.

“Self storage financing options have adapted to fuel self storage industry growth”

In recent years, the landscape of financing options within the UK’s self storage industry has adapted, paralleling the sector’s growth.

The self storage industry turnover soared to £990 million in 2022 and is anticipated to reach the £1 billion mark in 2023.

Approved Finance Group has become one of the fastest-growing finance brokerages in the UK. With over 30+ years of experience in the business finance arena, the team specialises in securing funding for numerous sectors. One of them being self storage.

“The self storage industry has seen a significant shift in the quality of sites over the past few years. A few lonely containers in a farmer’s yard are no longer appealing to customers.

“We have had to educate our lenders on the evolving industry and alter their outdated perception of it. We have now built a large panel of lenders with a deep understanding of the industry. This has opened up a myriad of finance products available to the industry.” – Approved Finance Group

Additionally, after COVID-19, the commercial property market witnessed turbulence, particularly in retail and office spaces. However, the warehouse and logistics space has remained resilient and investors have been keen to support projects in this space.

Insights into the future of self storage financing

Looking ahead, forecasts suggest significant growth poised for 2024 in the self storage sector.

Andrew Hubbard, Senior Finance Broker at Approved Finance said:

“We have done a lot of work with our lending panel to bespoke products such as low-start repayment, development finance, mezzanine and equity slice products. We also offer traditional term debt solutions.”

Lastly, the evolution of financing options within the UK’s self storage industry isn’t just a sign of how robust the industry is but also a peek into what’s coming next.

A future of innovation, adaptability, and collaborative financial partnerships tailored to the sector’s specific needs.

Find out more about self storage financing.

Contact Kuboid to discuss your self storage needs.