In the past couple of years we have seen a lot of migration within the United States. According to a study from John Burns Research & Consulting based on the US Census data the state of New York had a net international and Domestic migration into the state of -222K YoY from July 2021- July 2022 (not including deaths and births). The Radius+ team took a look to see how this has affected the Self Storage market in the NYC metropolitan area.
In 2020 the total supply of the New York-Newark-Jersey City, NY-NJ-PA CBSA increased by 5.3%
In 2021 it increased by 3.9% But in 2022 total supply increased by 4.9% and so far into 2023 the total supply has increased by 1.9% in just one quarter. The slight slow down in supply growth we saw in 2021 seems to have been reversed in the subsequent years with supply growth picking back up again.
However the average price per square foot for self storage in NYC in Q1 of 2022 was $2.15 which dropped by 10% to $1.93 in Q1 2023.
Population decline and average price per square foot decreasing is often linked to a decrease in demand, but developers seem bullish on the market and are continuing to add supply. It is possible that the net decrease in population of New York State is attributed to areas outside of the NYC metropolitan area having people migrate out leaving the population in NYC robust. It is also possible that the decrease in average price per square foot YoY we noted is just rates stabilizing from the drivers brought on by COVID-19. There is also a distinct possibility that New York City storage is on track for oversupply in the coming years, but only time will tell.
