2025 Self Storage Industry Growth Projections and Trends

As 2024 winds down, it is a good time to reflect on the current year and look to the year ahead. In a report from Deloitte Research Center for Energy & Industrials, “The construction industry in 2024 was defined by strong fundamentals, marked by a 10% increase in nominal value added and a 12% increase in gross output. Construction spending crossed US $2 trillion and maintained a balanced trajectory in the first half of 2024”¹.

Nevertheless, the industry had its fair share of challenges. High interest rates and price inflation continued to affect the commercial segment. Looking ahead to 2025, there are reasons to be more optimistic. According to the Deloitte analysis of the Oxford Economic Model, short-term interest rates are likely to decrease gradually over the next couple of years, following a 50 basis point interest rate cut by the Federal Reserve in September 2024. The improving economic conditions are likely to influence construction demand across various segments.

Overall, the US construction industry is likely to record moderate growth in the medium term with slowing inflation and a supportive monetary policy. However, the construction industry, and especially those utilizing steel, such as Forge, is not without additional challenges.

Here’s a look at some of the top trends and innovations expected to shape the construction industry in 2025².

Sustainability and Green Construction

In 2025, sustainability will continue to be a priority in construction. Governments, stakeholders, and the public are pressing for greener buildings to mitigate environmental impact and reduce carbon footprints.

The push for net-zero buildings by 2050 has also influenced design approaches and material choices. Technologies like carbon-capturing concrete and bio-based materials, including hempcrete and timber alternatives, are gaining traction. Modular and prefabricated buildings, which produce less waste and consume fewer resources, are also gaining favor. In addition, many governments have implemented regulations to limit emissions in construction processes, pushing companies to adopt sustainable practices or risk fines and reputational damage.

Modular and Off-Site Construction

Modular and off-site construction techniques are expected to flourish in 2025 as companies look for efficient ways to manage time and reduce costs. Prefabricated components can be manufactured off-site and assembled at the project location, reducing waste, speeding up project timelines, and minimizing on-site disruptions.

This approach is especially advantageous for urban construction, where space is limited and labor costs are high. Modular construction also allows for greater quality control as components are built in controlled factory environments. As these techniques become more mainstream, they’re likely to reshape how commercial structures are built.

Investment in Resilient and Adaptable Infrastructure

With climate change increasing the frequency and severity of natural disasters, building resilient infrastructure is a growing priority. In 2025, more construction projects are expected to integrate features that help buildings withstand extreme weather events like hurricanes, floods, and wildfires. Materials designed for resilience, such as impact-resistant glass, fireproofing materials, and flood-resistant foundations, are becoming standard in vulnerable areas. Additionally, adaptable infrastructure—such as buildings designed for repurposing rather than demolition—is gaining popularity. As cities continue to grow, adaptive buildings reduce the need for new construction and preserve resources.

Increased Government Regulations and Incentive

Governments worldwide are tightening construction regulations to meet environmental targets and improve safety standards. Regulations related to carbon emissions, waste management, and energy efficiency are becoming more stringent. At the same time, incentives are being offered for sustainable building practices, such as tax breaks, grants, and financing options for projects that meet high environmental standards.

On the flip side, 2025 will also have its challenges.

Antidumping and Countervailing Duty Investigations of Corrosion-Resistant Steel Products

On September 5th, the Department of Commerce announced the antidumping duty (AD) and countervailing duty (CVD) investigations on steel imports coming from ten countries³. Over the next several months, this investigation could drive domestic steel prices up in anticipation that these countries are guilty of dumping. If these countries are found guilty, a duty will be applied to all imported steel. When the price of imports goes up, the domestic steel mills will likely counter by raising their prices too.

Forge Building Company has noticed that since the announcement of this investigation, CRU steel pricing has started increasing.  It is unknown at what rate the mills will escalate pricing or at what interval; however, it is the company’s professional opinion, based on experience, that prices are going to trend up over the next year.

During 2024, there was a lot of price correction in the market due to the aftermath of COVID-19 pandemic. The Forge team watched steel prices steadily decreasing over the last year; however, economists believe that there will be a higher demand for steel in 2025. When this is taken into account along with the impacts of the AD/CVD investigation, then it is very likely that prices for steel will increase.

New laws for the new year

Another trend to watch for 2025 is new legislation affecting the commercial (or self storage sector).  While each state has its own laws regarding the operation of a self storage business, there are often similarities among them. The team at Forge has addressed these in previous years. See:

New Laws for the New Year that Could Impact Your Storage Business

2024 Self Storage Industry Growth Projections and Trends

Here’s a summary of some of the new laws taking effect next year⁴.

• Non-monetary default.  A non-monetary default occurs when a tenant breaches any provision of the rental agreement other than the requirement to pay rent or fees, for example, they commit a crime at the facility such as living in their unit. In these cases, the facility owner can terminate the rental agreement and tell the tenant to vacate the space.
  
  If a self storage tenant fails to move out after receiving a termination notice, the operator must file an eviction action with the local court and go through the hassle of removing them. With a recent wave of legislation in California, Georgia, Idaho, Kansas, and Utah self storage operators are entitled to terminate a tenant’s rental agreement and dispose of their property if the tenant doesn’t vacate the space within a certain amount of time. Each of these laws requires the operator to send a notice to the tenant clearly stating the demand timeline. The statutes will allow operators in these states to remove troublesome tenants and free up their storage units much quicker and at a fraction of the cost.
• Unsigned rental agreements. Georgia, Idaho, Kansas, Utah, and Virginia have passed legislation that make it possible to enforce an unsigned self storage rental agreement. If the requirements in the statute are met, the contract and its terms can be enforced simply by the act of the self storage tenant continuing to rent the space. This new legislation enables operators to change the terms of their rental agreements without the hassle of having each tenant sign a new rental agreement before it becomes enforceable.
• Junk fees.  Junk fees are defined as unexpected or hidden fees that a company charges customers for a service. California recently passed a law making it illegal for a company to advertise a product at a low price but then add mandatory fees. It’s important to note that California is the first state to move in this direction. Many others have proposed similar laws.
  
  This new legislation impacts the self storage industry as more operators offer discounted pricing via their websites. Therefore, operators must update their website to clarify pricing and any additional charges, making sure to disclose any administrative or other fees that are added on top of the rent. Additionally, the same goes with any other advertising. When offering an initial, discounted rate, operators must disclose how much it is, how long it’ll last, and the rent the tenant will be charged once it ends. More than ever, it’s important to be transparent about move-in rates, the right to increase rent, and any fees that can be charged to the customer.

For 2025, the construction industry is moving toward a more sustainable, tech-driven, and resilient future. While labor shortages and regulatory hurdles will present challenges, they also push the industry toward innovation. The emphasis on sustainability, modular construction, and smart infrastructure is reshaping the industry’s landscape, making it an exciting time for both seasoned professionals and new entrants. As the construction industry evolves to meet these demands, companies, such as Forge, that embrace change, invest in digital transformation, and prioritize sustainability will be best positioned to thrive in the years to come.

Works Cited
1. akingump.com. (2024, September 12). Retrieved from Akin: https://www.akingump.com/en/insights/alerts/new-antidumping-and-countervailing-duty-petitions-on-certain-corrosion-resistant-steel-products-from-ten-countries
2. azclc.com. (2024, 6 November). Retrieved from Arizona Contractor License Center: https://www.azclc.com/blog/construction-industry-outlook-for-2025-trends-challenges-and-innovations
3. Deloitte.com. (2024, November 4). Retrieved from Deloitte Research Center for Energy & Industrials: https://www2.deloitte.com/us/en/insights/industry/engineering-and-construction/engineering-and-construction-industry-outlook.html
4. Oblinger, A. (2024, October 5). insideselfstorage.com. Retrieved from Inside Self-Storage: https://www.insideselfstorage.com/legal-issues/the-modernization-of-state-self-storage-laws-recent-changes-and-the-modifications-on-the-horizon