London: Capitalizing on Demand

How London remains the heart of the UK’s self storage industry

In its long history, London has seen many industries come and go. Fishing, docking and, more recently, high finance have all at one time or another served and employed its residents for a while before decreasing in prominence as the economic tide turned.

Self Storage is an industry currently at the crest of the wave. Having been the starting point for its entry into the UK, London has a longer experience with self storage than anywhere else and so has built up the country’s most mature and valuable market.

An examination of the industry reveals this should be a position it is able to keep. London remains, for several reasons, the environment with the greatest demand for self storage in Britain.

Yet it has also taken more of a blow from the economic crisis than other places too, and the self storage industry has not been unable to escape its repercussions unaffected.

Strength in Numbers

The obvious place to begin with London self storage is a simple question of who, what, where, how and why? The question of how many leads to an impressive answer as there are 154 storage centres in Inner-London alone, as well as significant clusters located around the outskirts.

What makes the market so profitable is how much they can charge. The average square foot of storage space costs £27.78 a year to rent in London, compared to only £15.61 in the North. Altogether, a unit in the capital is likely to be 66% more expensive than anywhere else in the rest of Britain.

This is partly a reflection of London’s much higher general living costs, but also indicates the herculean strength of demand in a city where sky-high property prices cause many residents to live in tiny abodes that lack storage space.

The high number of multiple operators in London is also part of the explanation, as they price smaller ones out of the race for rare pieces of land, and build larger facilities that employ more staff and have greater running costs.

This can be seen in the fact that the average London facility has 677 rooms, compared to a much lower 416 elsewhere.

Self Storage reshaped to fit the landscape

One aspect of the ‘where’ question encompasses the type of buildings that are used for storage centres. In London these are likelier than in almost any other part of the country to have been converted from another function, with two thirds of them in this category.

This is a reflection of two aspects of London life. The first is the extremely high prices and scant availability of undeveloped land, which is often protected by strong planning restrictions that make putting up new buildings even harder.

The second is the convenient availability of old warehouses, factories and power stations around the inner-city that can be converted with relative ease and cheapness into storage centres.

Big Yellow’s flagship Fulham store in SW6 is a prime example, as it was conversion job done on the old Fulham Power Station, an Edwardian building that had once supplied electricity to Tube lines before being mothballed in 2000.

The fact that buildings like this are often listed has led to their outsides and facades being preserved, meaning the growth of self storage has not reshaped London’s urban landscape as much as many other types of development.

Indeed, what this trend and others, for example the use of railway arches to house containerised storage units, has shown is the way self storage has had, in contrast, to alter its shape to fit in with London’s, largely Victorian, landscape and not the other way around.

Capital punishment: Self Storage in London during a recession

14% fewer new self storage facilities were able to open in London during 2009 than had done in 2006. Add this to the bankruptcy of Red Devil self storage, based in Kennington, and the 2.6% decline in rental rates that the city’s industry experienced, and it’s clear the recession did not go unnoticed by London’s self storage operators.

However, there’s no reason UK self storage won’t bounce back from this small blip in its most important market.

Having begun in the 1980s, a nascent self storage industry was established in London at the time of the last major economic crisis in 1992, and the after-effects of that didn’t prevent its future growth to the extent of today.

Indeed, some indicators seem to suggest that self storage has an even bigger role to play in people’s future domestic arrangements than it does now.

If modern houses without enough storage space continue to be built, than places like the New South Quarter Development in Croydon may become the norm.

This is a building of flats, some not much larger than storage units, whose entire ground floor has been given over to an Access Self Storage branch.

The relentless downward trend in house sizes means that complete integration like this between housing and hired storage space seems set become an established part of crowded urban living, something that’s bound to help the industry get back on its feet once this crisis has passed.

2 Responses to “London: Capitalizing on Demand”

1. Alligator Storage says:

   June 7, 2010 at 9:38 am

   A fascinating article, David – this is a great insight into the storage business in London. There does seem to be a trend for new properties in London to be very small, often in blocks of apartments, which offer very little room for storage, and usually without garages or any additional storage space. At our branch of Alligator Storage in Camden we have not noticed a particular slowdown in business, although people are perhaps more keen to negotiate a small discount or special offer than they were two years ago. I still think this is an industry with plenty of potential for further growth.

2. Storage says:

   February 15, 2011 at 12:18 pm

   Good work.This is really a fascinating article.thx