An experienced perspective on real estate leadership in volatile times
The CRE Lending Retreat: A Crisis in Confidence
Banks are pulling back. Rates are rising. And once-bulletproof CRE sectors like office and multifamily are wobbling.
But there’s one asset class that continues to deliver: self-storage.
Since 2023, regional banks—who provide nearly 70% of all commercial real estate loans—have come under intense pressure. Higher interest rates, declining asset values, and tighter regulatory scrutiny have made them more cautious than ever.
This caution has led to a widespread pullback in lending, especially in CRE segments like:
- Office: Vacancy rates are soaring due to hybrid work
- Retail: E-commerce continues to chip away at brick-and-mortar demand
- Multifamily: Hit by inflation, oversupply, and tightening margins
As a result, the traditional capital stack that supported CRE for decades is being rewritten.
Why Self-Storage Is Defying the Trend
While many CRE sectors struggle, self-storage remains resilient. Here’s why:
1. Recession-Resilient Demand
When people downsize, relocate, or restructure their lives, they need storage. Economic uncertainty often increases—not decreases—self-storage demand.
2. Low CapEx, Strong Margins
Unlike multifamily or office buildings, storage requires minimal ongoing capital expenditures. Operating margins often exceed 60%, as noted by Inside Self Storage.
3. Debt-Friendly Fundamentals
Stable income, modest build costs, and conservative underwriting make self-storage assets easier to finance—even in tight credit environments.
Smart Capital Is Shifting Strategies
Institutional investors are paying attention.
According to the Self Storage Association, institutional ownership of self-storage facilities has tripled in the last decade.
REITs like Public Storage and Extra Space Storage continue to expand aggressively.
This is a signal—not a coincidence. As banks retreat, private equity and institutional capital are leaning into self-storage due to its consistent performance, lean operations, and ability to adapt to shifting demand.
Where Signal Ventures Is Investing
At Signal Ventures, we’re doubling down on self-storage.
Using proprietary analytics, we identify:
- Underserved markets
- Optimal unit mixes
- Operational efficiencies
In markets like Bend, Corvallis, and Springfield, Oregon, we’re transforming underutilized parcels into high-performing self-storage assets.
These communities exhibit strong population growth and a noticeable undersupply of modern storage options.
Our local-first, data-driven model allows us to create tailored developments that meet real demand, with a long-term hold philosophy aligned with our LPs.
Final Thoughts: Where Capital Seeks Shelter, Smart Investors Follow
Traditional CRE, heavily dependent on bank financing, now feels exposed.
In contrast, self-storage continues to deliver stable, passive income in an increasingly unpredictable world.
This isn’t just about surviving the downturn—it’s about thriving in a redefined CRE landscape.
📘 Curious how we underwrite self-storage in today’s environment?
Download our Passive Investor’s Guide or reach out directly.
Because self-storage isn’t just resilient—it’s leading.
Ready to learn how you can invest alongside us?
Explore opportunities at Signal Ventures today.