Stores that cut their starting rents by more than 10% grew move-ins by 5.2% in the quarter, and every other group lost move-ins, per Cubby's first quarterly report.
That doesn't mean a deep cut pays. On move-in rent alone, it doesn't. Here's the math at a typical store.
What happened
The median REIT store cut its online rate on a 10x10 by 8.6% between May and September. Independents ended September within half a point of where they started, Cubby reports. Three in four single-store owners never touched their online rate all quarter.
Across stores on Cubby's platform, same-store occupancy hit 80.4%, up 2.9 points from a year ago. Average move-in rents fell 4.4%. Revenue per available square foot still rose 4.9%. All three are from the same report.
The deep cutters were not a fringe. 38% of stores cut starting rents by more than 10%.
Andrew Capranos, President, Self Storage at Cubby, put the independent's problem this way:
If you run an independent store, you're competing with the online rate at the facility down the street, and that rate has changed.
The data comes from stores on one platform, so it isn't the whole industry. The report summary credits the cuts for the occupancy gain. Treat that as Cubby's read, not a measured result.
What it means for your facility
What the deep cut costs
Assume your store rents 25 10x10s a month at a $130 online rate. That's $3,250 of new monthly rent.
A 10% cut takes the rate to $117. Add the 5.2% lift and you rent 26.3 units, which is $3,077.10. New rent is 5.32% lower than before the cut.
To break even on new rent alone, a 10% cut needs 11.11% more move-ins. Deeper cuts need more. The best group in the data got less than half of that.
So whatever payback the deep cutters got came from somewhere else, most likely occupied units that stay. The 4.9% revenue per available square foot gain covers every Cubby store, not just the deep cutters. The report summary doesn't say whether the deep cutters came out ahead. We broke down the same trade in our earlier break-even post.
If you hold your rate, the gap grows. A store that started May at $130 and cut the median REIT's 8.6% is now at $118.82. You're $11.18 higher on the same 10x10.
Our read: a deep cut is an occupancy purchase. It makes sense where you're short of occupancy and have the units to fill. It's the expensive way to rent one more unit at a store that's already full.
Where rent increases start to cost you
The same report has churn data on increases. Tenants of 12+ months moved out within 90 days at 8.5% after an increase under 8%, against 7.9% with no increase. At increases of 25% or more, it was 16.0%.
Assume 200 tenants of 12+ months paying $100 a month. We'll use a 7% increase for the under-8% group.
- No increase: 15.8 move out. The remaining tenants pay $18,420 a month.
- 7% increase to $107: 17 move out, 1.2 more than with no increase. The remaining tenants pay $19,581.
- 25% increase to $125: 32 move out, 16.2 more than with no increase. The remaining tenants pay $21,000.
The big increase still collects the most rent at day 90. The Cubby numbers don't say a bump past 8% is a mistake. They say what the 25% costs: 15 more vacates than the 7% case, each one a unit to re-rent while online rates are falling.
There's a second cost. Your tenant at $125 can see a 10x10 advertised at $117 after a 10% cut. That's a vacate waiting for a reason. Our 60-day notice post covers the notice side, and our ECRI explainer covers the mechanics.
The 90-day window is all the data shows. Check whether your own vacates keep coming after day 90.
What to check this week
- Pull each store's online 10x10 rate for May and for today. Compare your change to the 8.6% REIT median and the half-point independent range.
- Sort your stores into three groups: cut more than 10%, cut less, no change. Compare move-ins and occupied NRSF for each group against last year.
- Before any cut over 10%, work out the lift it needs. A 10% cut needs 11.11% more move-ins, so multiply your monthly move-ins by 1.1111 and see if your leads can produce that.
- Pull every increase you sent in the last quarter and bucket it by size. For anything at 25% or more, count vacates in the first 90 days.
- Check your GBP rating and your reviews from the last 30 days at any store where you're thinking of cutting. Modern Storage Media argues that rating and recency decide whether a shopper inquires, and that with similar ad campaigns the stronger-reviewed store often converts better. A lower rate doesn't fix a weak Map Pack listing.
If you want rates, reviews and move-ins read together across your stores, that's our self-storage marketing service, and the review side sits with GBP management.