The Quiet Win: How Self-Storage Builds Durable Passive Income
By Carl Fischer
Self-storage is not the most talked-about real estate asset class, but its long-term performance has made it increasingly difficult for investors to ignore. While other sectors often rely on market timing, leverage, or aggressive growth assumptions, self-storage has quietly built a reputation for consistency, resilience, and operational control.
In a recent educational webinar hosted by CamaPlan, commercial real estate investors Christy Brock and Margot Kennedy walked through why self-storage continues to attract long-term capital and how investors can evaluate opportunities in this space more effectively. Their discussion highlighted three core reasons self-storage has remained durable across multiple economic cycles.
- Demand is driven by life events, not market conditions
“Self-storage isn’t just a passing trend,” says Brock. “It’s an asset class that thrives because life happens—no matter the economic climate. The key reasons people need storage—divorce, death, downsizing, dislocation, disaster, disease—happen in any market.”
When people experience these transitions, they often need temporary space for their belongings. Downsizing from a larger home, relocating for work, managing an estate, or rebuilding after a loss frequently leads to storage use. Importantly, these needs are not discretionary and do not depend on consumer confidence.
Key demand characteristics discussed in the webinar include:
- Approximately 11 to 12 percent of U.S. households currently use self-storage
- Increasing adoption by businesses for inventory, records, and equipment
- Expanded use following COVID as remote work reduced available space in homes and offices
This demand profile has helped self-storage maintain relatively stable occupancy even during periods of economic stress. When households downsize during downturns, belongings are often stored rather than sold. When conditions improve, those items often remain in storage longer than initially planned. This behavior has historically supported consistent utilization across cycles.
- Operations are simpler and more controllable
One of the defining advantages of self-storage is operational simplicity compared to other real estate asset types. Unlike residential or multifamily properties, storage facilities do not house tenants and have minimal interior buildout.
Operational characteristics highlighted in the webinar include:
- No residents living onsite
- Limited plumbing and utility exposure
- Durable block and steel construction
- Minimal wear and tear inside units
- Fast and low-cost unit turnover
Unit turnover in self-storage is often completed in a short period of time and does not require extensive renovation. In many cases, a unit can be cleared and prepared for re-rental within an hour. This contrasts with residential turnovers that may require weeks of downtime and significant capital.
Staffing and payroll are also more controllable. Many facilities now operate using hybrid or remote management models supported by call centers and automation. Customers can lease units, make payments, and receive assistance without requiring full-time onsite staff. This reduces one of the largest operating expenses for most real estate assets.
Utilities tend to be lower as well. Storage units typically do not require water or sewer services, and many facilities use motion-activated lighting to control electricity costs. These factors contribute to more predictable operating expenses and fewer unexpected maintenance issues.
- Value is created through net operating income
As with most commercial real estate, self-storage property values are driven by net operating income rather than comparable sales. This allows investors to create value through operational improvements rather than relying solely on market appreciation.
During the webinar, Brock and Kennedy emphasized that even modest improvements in income or expense efficiency can materially impact long-term value.
Common value drivers include:
- Bringing rents closer to market levels while maintaining occupancy
- Reducing expenses through automation and operational efficiencies
- Adding tenant protection programs
- Introducing ancillary revenue such as unit monitoring or specialty parking
- Improving marketing, signage, and online visibility
Because self-storage is often a fragmented market, many facilities are still owned by small, independent operators who have not optimized pricing, technology, or management practices. Over 70 percent of facilities remain in this category. This fragmentation creates ongoing opportunities for professional operators to improve performance without relying on aggressive growth assumptions.
In the case study discussed during the webinar, a facility acquired from long-term owners had below-market rents, limited marketing, and outdated operations. Through operational improvements and expense controls, the projected net operating income was expected to double over the hold period, significantly increasing the property’s value.
A steady asset class worth understanding
Says Kennedy, “Self-storage stands out as a durable, long-term investment—offering consistent income and solid returns for those with a patient outlook.” Its performance is tied to life events, operational efficiency, and income fundamentals. That combination has allowed it to perform consistently through multiple economic cycles.
For investors using self-directed retirement accounts, understanding how value is created in self-storage can be particularly important. Evaluating demand drivers, expense control, and net operating income provides a framework for assessing opportunities in this space.
While self-storage may not be the most visible real estate asset class, its long-term fundamentals have made it a quiet but durable option for investors seeking consistency and risk-aware growth.
Carl Fischer is one of the founders and principals of CAMA Self-Directed IRA, LLC (dba CamaPlan). CamaPlan is a national, self-directed tax advantaged plan administrator company headquartered in Ambler, PA.
Members of National REIA can save up to $784, including a free consultation with the founder, one year of VIP customer service, and the opportunity to set up a new account for only $1. Plus, there are no annual fees until your first investment. You’ll also receive one free expedited transaction processing and two complimentary outgoing wires for your real estate deals. Please visit www.iraasset.app/nationalreia for more info.
