Industry Valuation, NOI, and Cap Rate Analysis from TractIQ

The total value of U.S. self storage real estate declined to approximately $432 billion in 2025, representing a roughly 2% decrease year over year. Slower demand recovery, muted rate growth, and elevated operating costs continued to pressure valuations across the sector.

After years of outsized growth, 2025 marked another period of normalization for self storage. While fundamentals remain structurally sound long term, near term performance has yet to fully rebound. Below, TractIQ breaks down how we estimate the total value of the industry and what the data signals for owners, investors, and brokers heading into 2026.

This analysis estimates the total value of the U.S. self storage industry using TractIQ facility level street rate data covering more than 38,000 properties, publicly disclosed REIT operating metrics, and industry standard valuation assumptions. The full model and assumptions are available here for review and scenario testing. The decline in value reflects a combination of slightly lower street rates, flat occupancy, and persistently high expense ratios across much of the country.

Methodology

Gross Potential Income (GPI): This is the rental income the industry would generate if every facility in the country operated 100% occupied at average street rates. To estimate the 2025 GPI of the industry, we’ve multiplied the average annual street rate per square foot by total rentable square feet in the US. TractIQ continuously tracks advertised street rates across the country, providing a real time view of pricing trends.

GPI also includes ancillary income from administrative fees, tenant insurance, billboards, retail sales, and other non rent revenue streams. Based on Q3 2025 public filings, ancillary income for the five major publicly traded self storage REITs ranged from approximately 3.8% to 13.0% of rental income. Because REITs represent a minority of total industry square footage, we conservatively applied a 3% ancillary income assumption across the broader market.

In 2025, achieved rates often exceeded street rates due to existing customer rent increases. According to TractIQ’s Q3 2025 Self-Storage REIT Report, achieved rates averaged 3.7% higher than advertised street rates. We intentionally excluded an achieved rate premium from this analysis due to the difficulty of consistently applying it across non REIT operators. Including this premium would increase estimated industry value.

Effective Gross Income (EGI): This is the net revenue generated by the industry after applying vacancy and collection loss to GPI. For reference, the publicly traded storage REIT’s average occupancy rates for Q3 2025 ranged from 84.5% to 93.7%. We’ve used an 88% occupancy rate in our analysis to account for collection loss in addition to physical vacancy. 

Operating Expenses: Operating expenses include property taxes, insurance, payroll, management fees, utilities, marketing, repairs, and administrative costs. We applied a 35% operating expense ratio to EGI.  For reference, the publicly traded storage REIT’s expense ratios for Q3 2025 ranged from 24.4% to 33.6%.

Net Operating Income (NOI) and Total Value of Real Estate: Net Operating Income is calculated as Effective Gross Income minus operating expenses. To estimate total real estate value, we applied a 5.5% capitalization rate to industry wide NOI. The table below illustrates how valuation changes across different cap rate and expense ratio scenarios.