By contrast, self-storage facilities can be as simple as inexpensive prefabricated metal buildings on open land on the outskirts of an urban or suburban area. Any remaining after-tax profit is available to the business, either to reinvest in more property, or to return to shareholders through dividends. This is the largest self-storage company and it acquires, develops, owns, and operates self-storage facilities. Our commitment to you is complete honesty: we will never allow affiliate partner relationships to influence our opinion of offers that appear on this site. It also owns 42 percent of an office parks … It also must get at least 75% of its gross income either in the form of rental income from real property or from mortgage interest or real-estate sales. For the real-estate businesses that want to elect REIT status, the payoff is that REITs are allowed to avoid taxation at the corporate level. Investors should expect newly built facilities to take time to ramp up to full capacity, but persistent high vacancy rates can indicate poor decision-making in picking a location for the self-storage facility. But because the profits that fund the dividend distribution from the REIT haven't been subject to tax, the REIT is able to pay a larger amount of income to its shareholders than it would ordinarily be able to pay if it were a regular corporation. Also, National Storage has seen its share price more than double, leaving its rivals on this list in the dust. Finally, changes in overall economic conditions in a particular location can dramatically affect the supply and demand dynamics for storage facilities. For instance, the shift in population away from the Rust Belt toward the South is likely to put pressure on self-storage holdings in areas with declining populations while promoting rapid expansion in popular locations. Bigger doesn’t always mean better but in this case it does. Cumulative Growth of a $10,000 Investment in Stock Advisor, 5 Top Self-Storage REITs to Buy Now @themotleyfool #stocks $PSA $EXR $CUBE $LSI $NSA, self-storage REITs can be a lucrative way, Public Storage is by far the largest player, Public Storage is one of the biggest landlords, Public Storage has been a reliable dividend-payer, 3 Dividend Stocks to Supplement Your Social Security, CubeSmart (CUBE) Q3 2020 Earnings Call Transcript, National Storage Affiliates Trust (NSA) Q3 2020 Earnings Call Transcript, Extra Space Storage Inc (EXR) Q3 2020 Earnings Call Transcript, Copyright, Trademark and Patent Information. It's this second requirement that divides REITs into two large categories: equity REITs, which hold real estate directly and collect rental income from tenants; and mortgage REITs, which invest in mortgage-backed securities related to financing for real-estate investments by others. Fundamentally, National Storage is working hard to grow. Public Storage is by far the largest player in the self-storage REIT space. Access to timely real estate stock ideas and Top Ten recommendations. The potential for further share-price growth plus dividend income is a big draw for REIT investors, and self-storage has a lot of promise. To be a REIT, a company must invest at least 75% of its total assets in real estate of various types. Early in its history, Public Storage saw the potential network effects that could come from pulling together self-storage facilities in different cities under one corporate umbrella, building a brand that those who needed storage space could rely on wherever they lived. And with a set of unfair advantages that are completely unheard of with other investments, it’s no surprise why. Funds from operations in the first quarter of 2018 were up more than 20% from year-ago levels, and the REIT spent about $145 million on acquisitions of roughly 25 self-storage properties. In an environment in which mall occupancies are declining and technological changes like telecommuting could pose long-term threats to the office and mall REIT spaces, inertia serves self-storage REITs quite well. Finance. In 2008, it was the largest of four publicly traded storage REITs. How to Buy Your First Investment Property With 5% Down (Or Less), These REITs are Immune to the Coronavirus' Impact, Cities and States That Have Paused Evictions Due to COVID-19, The Metros Where Retail CRE will be Hit the Hardest. The Pennsylvania-based REIT recently acquired 21 stores in places ranging from South Carolina to Massachusetts to Florida. But those barriers have come crashing down - and now it’s possible to build REAL wealth through real estate at a fraction of what it used to cost, meaning the unfair advantages are now available to individuals like you. Below are five of the most promising top self-storage REITs for investors to consider. Many of these storage solutions come at relatively low cost, with affordable rental rates that make it easy for users to hold onto their self-storage units indefinitely. For income investors, Public Storage has been a reliable dividend-payer. “The Big 4 self-storage REITs have recently pulled-back, and are once again worth consideration. Certain other metrics can be helpful for REIT investors to consider, although they aren't quite as important in the self-storage context. Real-estate investment trusts are specifically structured businesses that hold interests in real estate. Even when you ignore the impact of dividends, the REIT's share price has jumped more than 500% over the past decade. Per share of self-storage REITs that meet the requirements above do n't have to pay corporate income tax any! Be interested to see how far self storage public reits self-storage REIT space saw average rates increase about 12 percent October... 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