A Note from the Founder 8.18.2025

Zachary Urow October 28, 2025

Climate-Controlled Units Show Strength as National Rates Level Off

  • June 2025 national average asking rents across all unit types held at $16.90 per square foot, a near-flat performance compared to the prior year.
  • Climate-controlled units reported a 0.4% annual increase, showing stronger resilience than non–climate-controlled units, which declined by 0.4%.
  • Among the top 30 metros, 19 reported gains for climate-controlled units and 13 reported gains for non–climate-controlled units.

Construction Prices Rise While Steel Costs Ease Slightly

  • The Producer Price Index rose 0.9% in July, the sharpest monthly increase since June 2022 and well above expectations.
  • Core producer prices, which exclude food, energy, and trade services, increased by 0.6% in July, the largest jump in more than two years.
  • Steel mill products, a primary building material in self-storage, eased to 308.1 in July from 309.6 in June (PPI index value, base year 1982 = 100).

Our Thoughts

  • The continued climate-controlled rent strength highlights sustained tenant demand for premium space. Investors with holdings in climate-controlled facilities may see more stable returns even as overall rent growth levels off.
  • Rising input costs, paired with only slight relief in steel prices, keep new development challenging. Current owners will face reduced competition from new supply as construction becomes less feasible.