What Are Self-Storage Cap Rates
JB
Jeremiah Boucher Founder, Patriot Holdings • Author of Finding Your Edge
Key Takeaways
- Self-storage cap rates are driven by NOI, not revenue — always underwrite to stabilized NOI after expenses.
- Class B and C storage in secondary markets often trades at higher caps with better cash-on-cash returns.
- A facility's cap rate is meaningless without understanding the rent roll, occupancy trend, and rate management history.
- Compare cap rates against yield on cost to see if there's a value-add play hiding in the numbers.