The remarkable boom in the UK self-storage industry is seeing it turn over £750 million per annum and it could be one of the keys to future-proofing the Welsh economy, according to an industry expert.
Self-storage in Wales is a multi-million pound concern and certain self-storage firms are incubating thousands of SMEs through their vital early years and beyond. Simon Williams, CEO of Storage Giant, a firm which has just been nominated in the Economic Contribution category of the Welsh Business Growth Awards, has seen more than 900 SMEs flourish under the Storage Giant roof in Wales alone. And it is a practice that is bringing economic vibrancy to all of the regions served by his company.
Simon says: “Self-Storage has become one of the most impressive success stories for the Welsh economy, not simply because of the value of the industry but for those SMEs they support, if they are based upon the kind of model we use, where we always include valuable office space. This model is supporting thousands of start-up and small firms that are the lifeblood of the Welsh economy.
“For our part, going from a single site facility established in 2007, in Newport, to a £70m concern, with nine sites, is gratifying. But it is particularly pleasing to be able to say we have supported entrepreneurship in all of the regions we operate – from Swansea and Llanelli, to Cardiff and Newport. Small businesses in Wales turn over £126m per day, according to Federation of Small Business figures, and we see first-hand the impressive young brands and start-ups that are making their mark on the economy here.
“Our square footage growth has gone from 17,805 sqft of storage space to a combined total of 267,805 sqft of lettable space, representing a 1,404 percent increase in little over 10 years. This figure will increase to 431,875 sqft upon completion of existing and pipeline developments. From the inception of Storage Giant we have made it a central plank of our business model that a percentage of our footprint would be set aside for SMEs, by offering the kind of very low rates and flexible terms that are attractive to them. So, our sites are home to everything from tech start-ups, to charities, fashion labels, designers and accountants, and in our Welsh sites alone, the SMEs under our roof provide employment for an estimated 5,000 people. While figures for the average value of a Wales-based SME are unavailable, UK-wide the value is 90,000, so we’re seeing significant benefits to the South Wales economy.”
The same trend is mirrored across the UK, where around 40 percent of self-storage customers are businesses and SMEs in their early years. A report released last week by Storagemonkey.co.uk showed that 70 new self store sites opened last year across the UK, with a footprint of 45m sqft and that renting storage in London now costs more per square foot than office space in The Shard and Canary Wharf, so storage is a serious asset class.
Simon adds: “Entrepreneurs are more savvy than ever in keeping their costs down and maximising profits, and I cannot see the trend for self-storage based firms slowing down. We know that here in Wales, businesses are facing ever-growing business rates and rental costs. Traditional landlords are, in some respects, pricing themselves out of the market and being slow to keep up with the needs of modern entrepreneurs. It is important that we, as potential landlords, are agile in meeting their needs if we want the Welsh economy to blossom.”