By Emmalee Rice
Storage for recreational vehicles is yet an emerging niche market that can hold value for potential investors. During and after the COVID-19 pandemic, many people purchased RVs, boats and other large recreational toys creating a need for large storage facilities. An added 
benefit of investing in RV storage is that storage facilities are unlikely to suffer major loss of income from any kind of recession as storage facilities will still be needed as people cut back. This is reflected in the expected higher income clientele that is seen by many RV storage facilities. RV storage facilities often retain clients for many years resulting in reliable revenue. On top of all these income guarantees, RV storage facilities find themselves in a high-demand, low-competition market.
Impermeability
Many smaller niche markets are at high risk of loss of income during a recession as people sell assets and otherwise cut back on expenditure. RV storage facilities are unlikely to see the same level of income loss. This is because to cut back on RV costs people are likely to sell the RV rather than choose RV costs to limit. In selling, the new owners will still need a place to store their RV. Additionally, as people downsize in other areas of their life, they can find that they require more storage for larger possessions such as boats, street vehicles and off-roading vehicles. This may also be a time when businesses find they need storage for large assets such as trucks, trailers and vans, which may be stored in large RV storage facilities.
Though the RV may be the first thing to be cut back on for many people, the clientele of RV storage facilities often have higher income, which allows them to retain their RV and storage units. Having clientele with a higher income provides the added benefit of customer loyalty. These clients are likely to continue paying for their preferred unit while not using it to retain it for themselves or they will return during their off season. This kind of customer loyalty can also lead to new customers as clients advise new RV owners on how to store their RVs. This customer loyalty is also affected by the restricted areas people who own RVs often live in. Many RV owners live within a homeowners association (HOA) or other areas that do not permit street or property parking for large RVs, boats or other large recreational toys. They will be looking for a facility that is reliable and near to their home.
Consistent Income
Between a resistance to recession and a reliable customer base, RV storage facilities have consistent income. While this may fluctuate a little overall, it remains profitable. Many RV storage facilities find that their customers stay with them for many years, even when they replace their RV. While the pandemic RV-living boom has all but died, those looking to rid themselves of the RV must store it or sell it. Either of these options requires somebody to store the RV. Having a clientele with higher incomes also mitigates the chances that numerous clients will fall into hard times at once thus eliminating the risk of a mass exodus of clients.
On top of the reliable customer base and resistance to recession found in RV storage facilities, the supply/demand dynamic still places RV storage in high demand with limited supply. Following the record-breaking RV sales during the pandemic there were not enough storage facilities to accommodate everyone who wished to rent a unit. As the market emerges more competition has arisen, which forces facilities to keep innovating to make their facilities desirable to clients. However, there is not so much competition that failure of any one facility is likely.
Benefits of Investing
There are many great reasons to invest in RV storage facilities. An added benefit of these types of facilities is their size. While they are usually too large for urban areas, it is easy enough to purchase a plot of land just out of town on a busy road. This will allow for easy access to clients and cost savings for the developer. Larger properties offer facilities more options to expand further in the future, should the need arise. Operators can evaluate their supply and demand to decide whether to add similar types of units or to add either a more budget-friendly option or a more “luxurious” option (such as fully enclosed or canopied) depending on the needs and demands of the facility’s clientele.
Investing in RV storage may seem like a risk due to how niche of a market it is. However, the market is rapidly growing to accommodate the needs of consumers and potential tenants. This market is resistant to economic recession. It is unlikely to experience a dramatic loss of revenue. The clientele of these facilities tend to be higher income and will likely refer others to the site, providing a reliable and consistent revenue. The size of the current market means that the demand for these facilities is quite high while competition is still low. For owners that means they can build smaller facilities and grow their property in a systematic, need-based strategy.
Emmalee Rice is a university student with a passion for doing research that can help others.
Sources
10 reasons to invest in RV storage units: Storage Business. Mini Storage Outlet. (2022, November 3). https://www.ministorageoutlet.com/invest-in-rv-storage-units/
Gorman, P. (2023, December 21). RV storage: A longtime niche emerging as its own asset class. Knowledge Leader – Commercial Real Estate Content Hub. https://knowledge-leader.colliers.com/patrick-gorman/rv-storage-a-longtime-niche-emerging-as-its-own-asset-class/
Hajewski, S. (2023, November 8). Why now’s the right time to invest in boat/RV storage. Inside Self Storage. https://www.insideselfstorage.com/vehicle-boat-rv-storage/why-now-s-the-right-time-to-invest-in-boat-rv-storage-and-considerations-for-building-it
REIS, M. (2023, September 5). Exploring & storing: A look into boat and RV Storage. https://www.matthews.com/thought-leadership-boat-and-rv-storage/
Toy Storage Nation. (2023, February 3). The top-10 reasons that RV and boat storage is a winning investment. https://toystoragenation.com/2022/11/28/the-top-10-reasons-that-rv-and-boat-storage-is-winning-investment/
