Among major metro areas, Dallas is expected to see the greatest volume of construction this year, with an estimated 49 projects and 9.02 million square feet slated to come on line, according to CBRE research. Rounding out the top five for this year are Miami, with 21 projects totaling 3.86 million square feet; New York City, 16 projects/ 2.92 million square feet; Houston, 16 projects/2.87 million square feet; and Atlanta, 15 projects/2.68 million square feet

Five leading metro areas have changed market condition when it comes to supply. CBRE says that Atlanta, Austin, Denver and Nashville were considered at equilibrium and will be oversupplied after new construction is complete. Sacramento moved from undersupplied to equilibrium following the completion of the new construction underway there.

Some metros were already oversupplied and added new construction nonetheless. For example, Dallas was oversupplied by 1.57 square feet per capita and went to 2.81 square feet oversupplied per person, while Oklahoma City went from 4.70 square feet/person oversupplied to 5.40 square feet/person oversupplied.

However, Dallas doesn't even rank first when it comes to new construction as a ratio of total supply. The top-ranked market in that department is Miami, where new construction represents 20% of the total supply. It's followed by Nashville (17.7%), Dallas (16.3%), Austin (13.9%) and Charlotte (12.3%).

“Of the leading markets for new construction, Texas has been a state that has typically encouraged new development and New York has historically been underserved, while Miami has had pockets of significant demand, such as Coconut Grove,” says Sonne. “We are also seeing increased demand in those markets impacted by the recent and historic hurricanes. Self-storage provides comfort for those who need to move belongings that could potentially be in harm's way to a facility for safekeeping. In both Florida and Houston, this has meant increased demand at the same time supply has declined due to damage.”

LOS ANGELES–“New construction is the hot topic in the self-storage sector,” says R. Christian Sonne, EVP of the self-storage valuation group within CBRE's valuation & advisory services platform. “While some investors are concerned about the level of new construction, overall supply and demand metrics remain roughly in line.”

Sonne's assessment is reassuring in view of the dramatic uptick in development across the sector. CBRE says approximately 900 new facilities are expected in 2017, a 50% increase on the 600 new projects built last year.

As of the third quarter, there were 474 self-storage projects under construction in the US, representing about half the total of planned new developments. Historically, about one-third of facilities make it out of the planning staged and are actually completed, but CBRE sees a significant increase in the number of planned projects and actual starts lately, with the planned/start ratio at the highest level in 10 years.

A natural refresh rate for the self-storage sector is 1% of total stock, which translated into an average year having approximately 500 new starts. Since this refresh rate has occurred only recently, and the sector has seen limited new construction since 2008, CBRE estimates that supply and demand metrics in the self-storage sector across the US are generally in equilibrium at present, despite the currently elevated levels of development.

Among major metro areas, Dallas is expected to see the greatest volume of construction this year, with an estimated 49 projects and 9.02 million square feet slated to come on line, according to CBRE research. Rounding out the top five for this year are Miami, with 21 projects totaling 3.86 million square feet; New York City, 16 projects/ 2.92 million square feet; Houston, 16 projects/2.87 million square feet; and Atlanta, 15 projects/2.68 million square feet

Five leading metro areas have changed market condition when it comes to supply. CBRE says that Atlanta, Austin, Denver and Nashville were considered at equilibrium and will be oversupplied after new construction is complete. Sacramento moved from undersupplied to equilibrium following the completion of the new construction underway there.

Some metros were already oversupplied and added new construction nonetheless. For example, Dallas was oversupplied by 1.57 square feet per capita and went to 2.81 square feet oversupplied per person, while Oklahoma City went from 4.70 square feet/person oversupplied to 5.40 square feet/person oversupplied.

However, Dallas doesn't even rank first when it comes to new construction as a ratio of total supply. The top-ranked market in that department is Miami, where new construction represents 20% of the total supply. It's followed by Nashville (17.7%), Dallas (16.3%), Austin (13.9%) and Charlotte (12.3%).

“Of the leading markets for new construction, Texas has been a state that has typically encouraged new development and New York has historically been underserved, while Miami has had pockets of significant demand, such as Coconut Grove,” says Sonne. “We are also seeing increased demand in those markets impacted by the recent and historic hurricanes. Self-storage provides comfort for those who need to move belongings that could potentially be in harm's way to a facility for safekeeping. In both Florida and Houston, this has meant increased demand at the same time supply has declined due to damage.”