I mentioned in last week’s episode that I think self storage demand will increase as a result of the COVID-19 pandemic.
I believe that even more as I researched what I think “work” is going to look like after the stay in place order, or strong suggestion, depending on where you live, is lifted.
From what I am seeing, many workers are doing surprisingly well at home. They are embracing new cloud-based technologies and are being very productive.
The “office sector” never appeared to me to completely bounce back from the last economic recession, and I bet this crisis will weaken it even further.
Many companies have been utilizing virtual technologies that allow them to exist without any office space for years, and now many office heavy companies realize that productivity can increase with all the new ways of doing business.
At the very least, the companies that will use office space will most likely use less of it as a certain percentage of workers are going to request to remain virtual after the stay in place orders are lifted across the country in a gradual format.
What does this have to do with self storage demand?
A lot, I think.
The more workers that stay at home working, the more people are going to re-organize their living space. That creates demand for self storage.
Air Quality
A big factor around office space I have not heard much talk about, but I recognize from my days of leasing and managing office buildings is their HVAC.
Most office buildings recycled indoor air.
Now with an airborne pathogen being the culprit for this crisis, many companies and workers are going to be very sensitive to this fact.
I know I certainly would not want to be exposed hours and hours on end to this type of air quality.
Building owners will most likely be addressing this in various ways, such as air purifiers and perhaps even new HVAC systems that rely on outdoor air. Still, the perception of having poor air quality will take longer to alter than the air itself in many buildings.
Thus, more stay-at-home workers.
Thus, more self storage demand.
Social Distancing
I think the time will come when if an employee feels unsafe in an office environment, they will have a legal right to have an alternative work environment provided.
The simplest and least expensive alternative for companies will be to allow them to work at home.
Most likely, at some point, there will be regulations on the number of workers per square foot as well, forcing business owners to consider ways to reduce office demand for their companies.
Many have seen that workers can be productive away from and not under the eye of a supervisor. And if a company wants to manage what someone is doing, it is not hard with the technology out there.
The number of calls, time on each call, etc. can be measured with an employee at home just as well as in the office (or almost as effectively).
All of this points to less office space demand in the future.
All of this points to more self storage demand. At least in the foreseeable future as people adjust their living environments to reflect the new reality.
As we move towards this alternate universe, part of our job as self storage owners will be to let the workers that will be affected by the new work protocols, that self storage will support them.
Those of use that can effectively target that demographic will do well in self storage.
