Self-Storage Rents Are Softening – But Operators Are Doubling Down on Efficiency

Written by:

Alejandra Rodriguez

Date:

02 Apr 2026

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The self-storage industry’s pandemic boom has ended. Rents are declining, and supply now exceeds demand in many markets. Yet some operators are outperforming peers, not by slashing prices, but by aggressively improving operational efficiency.

Rather than focusing solely on filling units, successful operators are investing in back-office systems that save time and reduce waste. This approach is allowing them to maintain profitability even as market conditions become more challenging.

The Current State of the Self-Storage Market

Over the past year, self-storage rents have softened across much of North America. New facilities continue to open, but population growth has not kept pace with this influx of supply. As a result, several large real estate investment trusts (REITs) have revised their pricing to reflect weaker demand.

“The country is not a monolith,” says Luke Shardlow, CEO of Ai Lean, a company that automates collections and compliance for storage operators. He notes that some metropolitan areas with strong population growth or rising multifamily rents are performing better, but overall, rents continue to decline.

This cooling market has prompted a change in strategy among top operators. Instead of reacting with aggressive discounting or marketing, many are asking: “How can we run leaner and more efficiently to withstand this downturn?”

Efficiency as a Growth Driver

When rents are rising and occupancy is high, operational inefficiencies are often overlooked. But as margins tighten, the cost of wasted hours and uncollected debt becomes more visible. Operators can no longer afford to ignore inefficiencies that erode their bottom line.

Shardlow’s company targets collections and delinquency management—tasks that many storage operators still handle manually, consuming valuable staff time. Automating these processes allows district managers to focus on activities that drive revenue, such as optimizing pricing and improving customer service.

This marks a shift from prioritizing rapid expansion to focusing on sustainable profitability. In a softening market, operators who control costs and streamline operations are better positioned to outperform competitors.

A Case Study: Time Savings and Performance Gains

Shardlow describes working with an operator who managed delinquency in-house for years. The team believed their process was effective, but a closer review revealed that district managers spent multiple hours each week on compliance audits, tracking lien deadlines, and chasing late payments.

After automating these tasks, managers recovered more than 10 hours each week. This freed time was redirected toward improving occupancy, refining pricing strategies, and addressing customer issues—efforts that directly increased revenue. “We give time back to district and regional managers, as well as facility managers,” Shardlow says. “Our value proposition remains strong.”

The outcome was not just labor savings. The operator improved occupancy rates and reduced bad debt, turning efficiency into a clear competitive advantage.

Action Steps for Operators and Investors

For Operators:

– Audit how your team spends its time. District managers often lose hours each week on compliance and collections tasks that could be automated. That’s time not spent on revenue-generating activities.
– Monitor your bad debt rate closely. If it’s rising, your collections process may not keep pace with your portfolio’s growth. Even modest improvements in collections can have an immediate impact on net operating income.
– Question long-standing processes. Just because a system has worked for years does not mean it’s optimal for today’s market. Operators who adapt quickly to new challenges tend to outperform those who rely on legacy methods.

For Investors:

– Ask operators about their efficiency strategies, not just their occupancy rates. Operators with clear plans for reducing operational drag are better equipped to maintain profitability during downturns.
– Pay attention to bad debt and delinquency figures. These metrics reveal much about an operator’s discipline and directly affect net operating income and property valuations.

Efficiency as a Competitive Edge

Self-storage is not in crisis, but it is undergoing a period of adjustment. Rents have softened, new supply is putting pressure on occupancy, and the era of easy growth is over. Still, opportunity remains for those who can adapt quickly.

The most successful operators right now view efficiency not as a cost-cutting tactic, but as a growth strategy. By automating time-consuming back-office tasks and empowering managers to focus on revenue, they can maintain or even improve performance while others struggle to keep up.

“We see ourselves as partners to operators,” Shardlow says. “We want to arm them with the tools that allow them to continue to outpace their competitors.” In today’s self-storage market, every point of margin matters. Operators who prioritize efficiency are gaining the edge needed to weather current challenges and prepare for future growth.

This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.