Arizona Self-Storage Sector Lowers Rents — Except for Boomtown Peoria

Article originally posted on AZ Big Media on March 10, 2023

The Arizona self storage sector continues to be generous compared to other states. According to a recent StorageCafe study, most cities in Arizona are deemed renter-friendly, with plenty of storage options and reasonable prices. Moreover, following the national trend, self storage rents have decreased in many locations around the state, with Scottsdale experiencing the biggest drop year-over-year among the biggest Arizona cities – 4.8%.

Peoria, however, is an exception to the state-wide trend, with rents climbing 3.9% year-over-year. The good momentum for self storage rates can be attributed to a strong economic and migration picture with the city emerging as one of 2022’s boomtowns. In fact, Peoria’s population has been on an upward trend for the last decade, seeing an impressive 21.46% growth in 2021 compared to 2012. Coupled with an undersupplied self storage sector – which offers approx. 4.2 sq. ft. per capita, considerably below the national benchmark – it’s no surprise storage rents are growing.

Currently, a storage unit in Peoria rents at $127 per month on average. Take a look at how this compares with the rents in Arizona’s other major cities and at how these rates have been changing:

Self Storage in Arizona Remains Good Value with Phoenix Showing Below-Average Rates

If you live in Metro Phoenix, you will be experiencing the area’s magnetic pull on new businesses and residents, plus self storage that is generally good value. The monthly average rates in Mesa, Glendale and Phoenix itself — $110, $114 and $123, respectively — are below the national figure of $126.

Tucson also posts a very reasonable monthly rate of $120, a small decrease of 1.6% year-over-year. The city of Phoenix’s rate dropped by 4% from 2021 to 2022 and the other big Valley of the Sun cities saw reductions of between 2% and 4.8% — nationally the figure was a 2.3% decrease.

Many of the country’s other big urban hubs are seeing much higher prices — the average monthly rate in similarly sized Philadelphia is $144. The big coastal metropolises, meanwhile, may charge around twice as much as Phoenix, with average rates in San Francisco, Los Angeles and New York at $264, $253 and $242, respectively.

Arizona’s Self Storage Is Being Boosted in Many Places With Tucson Leading

Scottsdale has one of the strongest Valley of the Sun storage sectors, offering 7.17 square feet per capita. In addition — and this could further lower the average rent of $174 there — around 220K square feet of storage space was completed, planned or under construction in 2022, per Yardi Matrix data. That represents 8% of Scottsdale’s inventory — coincidentally, the same increase of storage coming online was registered in both Gilbert and Peoria last year.

The storage per person in some Metro Phoenix cities is not so high, with square footages of 5.80 in Mesa, 4.51 in Chandler, 4.06 in Tempe, 3.67 in Gilbert and 2.58 in Glendale. But if you are a resident of one of these fine places, you also have access to 100 or so facilities in the city of Phoenix itself. The state capital offers 4.82 square feet of storage space per person, but no less than 386K square feet of new space was reported in 2022, a 4% increase of the inventory.

Tucson, however, beats out all Metro Phoenix locations, having 7.64 square feet per resident, above the national average. In addition, storage provision there is increasing more rapidly than in any other major Arizonan city, with 625K square feet of space completed, planned or under-construction in 2022, which adds an additional 10% to the city’s inventory.