Self-Storage Sector Faces Refinancing Risks Amid Declining Occupancy Rates

The self-storage sector is currently navigating a precarious landscape characterized by significant refinancing risks and declining occupancy rates. According to Trepp Talk, a notable concentration in the self-storage debt market is evident, with just 12 sponsors backing over 50% of the securitized self-storage debt. This concentration raises alarms about potential refinancing challenges, especially as it has been reported that 98% of the estimated refinancing shortfall through 2028 is attributed to only three loans ¹³.

The implications of this concentration are profound, as the reliance on a limited number of sponsors could lead to vulnerabilities in the market. The self-storage sector is already facing headwinds, with occupancy rates across securitized properties showing a broad decline. Currently, 62.7% of the $14.08 billion in reported occupancy is backed by properties with lower occupancy levels, indicating potential challenges ahead for the sector ²⁴.

As the market grapples with these issues, stakeholders are urged to monitor the situation closely. The concentration of debt and the declining occupancy rates could lead to increased pressure on self-storage operators and investors alike.

In contrast to the self-storage sector, other areas of investment, such as global research and development (R&D) and manufacturing, are witnessing significant capital allocation. For instance, ACME Group has invested over $4 billion in Oman, while GSK has established a global R&D center at the Cambridge Biomedical Campus ². This trend underscores a robust interest in enhancing technological capabilities and infrastructure, contrasting sharply with the challenges faced by the self-storage market.

As the self-storage sector continues to evolve, the focus will likely remain on addressing refinancing risks and improving occupancy rates to ensure long-term stability and growth.

Sources

1. Trepp Talk — 12 Sponsors Back Half of Securitized Self-Storage Debt, While Refinancing Risk Is Even More Concentrated
2. Site Selection Magazine — WORLD REPORTS: September 2026
3. Trepp Talk — Three Loans Account for 98% of Self-Storage’s Estimated Refinancing Shortfall Through 2028
4. Trepp Talk — Occupancy Has Broadly Declined Across Securitized Self-Storage Properties, but Refinancing Risk Remains Concentrated