How Self-Storage Valuation Works
Storage facilities are valued like any income property: value = NOI ÷ cap rate. Net operating income is what the facility earns after operating expenses (but before debt payments), and the cap rate is the yield buyers in your market currently accept. That's the whole formula — the skill is in using honest inputs, and that's exactly what this page helps you do.
Two input tips that keep the estimate honest. First, use collected income, not the rent roll's theoretical maximum — discounts, concessions, and delinquency are real. Second, if you only know gross income, an expense ratio of 35-40% is a fair starting assumption for a stabilized facility; mom-and-pop financial statements often understate expenses by omitting management, marketing, and reserves.
Choosing the Cap Rate
The cap rate is a local, current number — but these ranges (as of late 2025 / early 2026) will get you in the neighborhood:
- Class A, primary market, stabilized: 5.25-6.25%
- Class B, secondary market: 6.25-7.5%
- Tertiary market / smaller facility: 7.5-9%+
When in doubt, value at two or three cap rates and treat the spread as your uncertainty — that's exactly what the sensitivity table in your results does for you. A half-point of cap rate moves a $2M valuation by roughly $150K, which is why sellers and buyers argue about it.
The Two Cross-Checks
Price per square foot. Divide the value by net rentable square feet and compare against recent sales of similar facilities nearby. If your income-approach value implies $180/sq ft in a market where facilities trade at $110, one of your inputs is too optimistic — better to find out now.
Replacement cost. If the value lands far above what it would cost to build the same facility next door (roughly $60-$95/sq ft all-in for single-story drive-up, $110-$170+ for multi-story climate-controlled, excluding land), ask what stops a developer from doing exactly that. A value below replacement cost, on the other hand, is a built-in margin of safety. Full numbers in our buying vs. building guide.
Value vs. the Price You Should Pay
This calculator estimates market value — what the facility is worth to a typical buyer. Your maximum price is a different number: it depends on your financing, the property-tax reassessment at your purchase price, deferred maintenance, and how much upside you can actually execute. Once you have a value estimate you like, run the full deal through the Self Storage Calculator to see DSCR, cash flow, and cash-on-cash at your real numbers — that's the step that turns "interesting" into "offer."
Financing the purchase? Get a free introduction to lenders active in self-storage.
Want the complete playbook? Start with the Self-Storage Investing Guide and the step-by-step deal analysis walkthrough.