A Note from the Founder 5.28.2025

Zachary Urow August 12, 2025

Economic Indicators Drop, But No Recession Signal Yet

  • The Leading Economic Index (LEI) dropped by 1.0% in April. This was the largest decline since March 2023 and marked the fifth consecutive monthly decrease.
  • Most components of the index showed a decline, with the sharpest drops in consumer expectations, building permits, and manufacturing hours.
  • The six-month growth rate remains negative, but above the recession threshold. The Conference Board currently expects U.S. GDP to grow 1.6% in 2025, down from 2.8% in 2024.

Designing the Future of Self-Storage

  • A recent ISS article highlighted how self-storage design is shifting towards greater aesthetics, durability, and sustainability to meet municipal and tenant expectations.
  • Cities are enforcing stricter zoning rules to encourage the use of materials like stucco, glass, and parapets that better blend into communities.
  • Technology, rising costs, and tenant demand are driving adoption of climate control, solar readiness, smart access, and multi-story layouts.

Our Thoughts

  • The LEI’s continued decline reflects weaker consumer confidence, along with drops in permitting and manufacturing. This could delay new self-storage development in the coming months.
  • New design standards and zoning rules may raise development costs, but improve long-term asset value. Investors should prioritize properties with modern features and compliant exteriors to stay ahead of shifting expectations.