Despite high property prices, new self storage projects continue to spring up across Australia. The managing director of the Kennards Self Storage brand questions whether overbuilding is on the horizon and offers a performance overview of existing operations.
Despite high property prices, new self-storage projects continue to spring up across Australia. The entrepreneurial spirit is high “down under,” with many established operators adding new locations, and small and new investors entering the sector.
The investment metrics for new projects are increasingly marginal, but the lack of alternative opportunities and the continuing capitalization-rate compression are still justifying new development—for now. Is overbuilding imminent in this well-established market? Let’s look at local operating performance and other factors.