The demand for storage units across the UK has seen significant growth in recent years, driven by urbanisation, smaller living spaces, and the rise of e-commerce businesses. Whether you are an experienced investor or looking for a new venture, purchasing storage units can offer consistent income and strong capital growth. With lower operating costs compared to other commercial real estate sectors, storage units are an attractive option for property investors seeking a stable, long-term investment.
In this guide, we will explore why storage units are a smart investment, what to consider when buying storage facilities in the UK, and how Fraser Bond can help you find the best opportunities.
Growing Demand Urbanisation and the rise of smaller homes have increased the need for personal storage. Individuals who are downsizing or decluttering, and businesses needing extra space for inventory, are increasingly turning to self-storage units. The demand for affordable and flexible storage options has led to steady occupancy rates across the UK, particularly in urban areas.
Stable and Predictable Income Storage units typically have long-term tenants, with most users renting for extended periods. This provides a steady stream of rental income with minimal turnover, making storage facilities a reliable source of revenue for investors.
Low Maintenance and Operational Costs Compared to other types of real estate, storage units have relatively low maintenance costs. There are no complicated tenant demands, and properties do not require the same level of upkeep as residential or commercial buildings. With simple infrastructure and minimal staff requirements, operating costs are generally lower, allowing for higher profit margins.
Diversification Adding storage units to your property portfolio offers diversification and lowers investment risk. The self-storage sector has proven to be resilient even during economic downturns, as the demand for personal and business storage remains strong regardless of market conditions.
Self-Storage Units These are the most common type of storage facility, offering individual units of various sizes that tenants can rent for personal or business use. Self-storage facilities are popular in urban areas where space is limited and tend to attract long-term renters.
Business Storage and Warehousing Business storage units cater to small businesses and entrepreneurs who need extra space for inventory, supplies, or equipment. Warehousing facilities, which are larger and used for distribution and logistics, are also in high demand, especially as e-commerce continues to grow.
Specialised Storage Some facilities offer specialised storage options, such as temperature-controlled units for sensitive items like antiques, artwork, or wine collections. These niche services can command premium rental rates and attract a different clientele.
Location As with any property investment, location is critical. Storage units in densely populated urban areas or near business hubs typically attract higher demand and yield better returns. Look for properties close to major transport routes, residential areas, or industrial zones where businesses may require extra storage space.
Size and Scalability The size of the storage facility is another key consideration. Larger facilities offer the potential for more units and thus higher income, but they also come with higher initial costs. Assess whether the facility has room for expansion or if additional units can be built to accommodate future growth.
Occupancy Rates Investigating the facility’s current and historical occupancy rates will help you assess its profitability. A storage facility with consistently high occupancy rates indicates strong demand and stable income potential. Be cautious of properties with low or fluctuating occupancy, as this could signal issues with location, competition, or management.
Security Features Security is a top concern for storage unit tenants. Facilities with modern security systems—such as CCTV cameras, gated access, and on-site management—are more attractive to renters. Well-maintained and secure facilities can also command higher rental rates.
Management Options Consider how you plan to manage the facility. Some investors choose to hire third-party management companies to handle the day-to-day operations, while others prefer to manage the property themselves. Outsourcing management can save time and effort, especially if the facility is located far from your primary residence.
Financing storage units for sale may require a commercial mortgage or investment loan. Banks and lenders typically evaluate factors such as location, projected rental income, and your experience as an investor before approving a loan. It’s important to have a solid business plan in place that demonstrates the profitability of the storage facility. Working with experienced financial advisors or lenders specialising in commercial real estate can help you secure the best financing terms for your investment.
Returns on storage unit investments can vary depending on factors such as location, occupancy rates, and facility management. However, many investors find that storage units provide higher returns than traditional residential or commercial properties. Rental yields typically range between 6% and 10%, with the potential for capital growth as property values increase over time.
By choosing the right location and facility, investors can benefit from long-term passive income and rising property values, especially in areas where demand for storage is expected to grow.
At Fraser Bond, we specialise in helping investors find high-quality storage units for sale in prime UK locations. Our team of property experts can assist you with:
If you’re ready to explore storage units for sale in the UK, contact Fraser Bond today. We can help you identify the best opportunities in the self-storage sector and guide you through every step of the investment process. Let us help you secure a profitable future in this growing market.
