6 Site-Selection Factors for Self-Storage Development

The right site is crucial when developing a self-storage facility. While local demand and other factors that contribute to business feasibility are important in the selection process, land characteristics can be just as impactful on project success. Which is more significant will depend on your individual investing strategy.

If you already own a piece of land, begin by assessing whether it can support a profitable self-storage project. If you’re looking for a parcel from scratch, start by gauging potential market demand. You can do this by determining the average rental rate per square foot and doing the math to see if land costs align with your return-on-investment expectations. Low rental rates combined with high land prices are a red flag. On the other hand, high rental rates offer more flexibility in site selection and development because the larger estimated profit margin offers a greater margin of error.

Of course, this is just the tip of the iceberg. To properly evaluate a site for self-storage and it’s potential for longer-term profitability, you must consider the following key factors.

Critical Factor 1: Zoning

You may find an ideal piece of property in an area with demand for self-storage, but that means nothing if this building type is prohibited. Typically, facilities are permitted under industrial or light-industrial zoning. The local planning department can confirm this.

If the official says self-storage isn’t allowed, ask whether a variance or rezoning is possible. If they indicate that approval is unlikely, I suggest moving on instead of fighting an uphill battle. It’s always better to find a site where self-storage is allowed by right, meaning a developer isn’t required to obtain a special permit or variance from the municipality.

In rural areas, obtaining zoning changes can be easier, but it still requires careful planning and legal considerations. In either situation, always verify local regulations and understand what hurdles you may face in gaining approval before committing to purchase.

Critical Factor 2: Topography and Soil

It’s important to assess your site’s topography and soil early in the process to avoid unforeseen expenses and ensure it can support the necessary self-storage infrastructure. In particular, look at slope and composition. The ideal location is flat, with sandy or gravelly soil to minimize construction challenges. If a parcel has hills, rocky terrain or wetlands, it can dramatically increase costs, as it’ll require additional grading, foundation work or drainage systems.

Here are some specific steps to follow:

Walk the site after heavy rain or snowmelt to see if and where water pools. If it does, the soil may have poor drainage. I note this on my survey or site map to ensure my engineer takes core samples of those areas.
Check public records to see if the land is classified as wetlands or has soil issues.

Finally, consult with an excavator and civil engineer to evaluate grading and soil condition. You’ll often hear them discuss whether a site will “balance.” This refers to whether it requires extensive dirt import or export, which can significantly increase costs. To mitigate expenses, avoid parcels that require you to move a lot of dirt.

If the land has a slope, consider ways to use it strategically. For example, you may be able to design a multi-level facility with drive-up access at different elevations rather than invest in costly site work.

Critical Factor 3: Easements and Surveys

Make sure there are no easements, encroachments or hidden obstacles on the site that could complicate building self-storage there. Easements may restrict where you can build, while encroachments from neighboring properties can create legal headaches. To identify potential issues:

Obtain a current survey of the land to map out property boundaries.
Walk the site to check for buildings, fences or infrastructure that may not be visible on a survey.
Look for old septic systems, underground tanks or buried utilities that could require costly removal or relocation.
Confirm that there’s legal access to the property, especially if it’s behind another lot.

Here’s a real-world example from one of my own developments. My team and I were working on a lot-line adjustment in which we converted two equal-sized parcels into one larger and one smaller. After preparing the survey for approval, we discovered that the septic system for a small home on the property wasn’t where the original survey indicated. We then had to adjust the property lines to ensure that system stayed on the same lot. If we hadn’t caught this, it could’ve caused major delays and extra costs during construction.

Critical Factor 4: Access and Traffic

A self-storage facility’s success depends largely on visibility and ease of access. Ideally, it should be on a well-traveled road with convenient entry and exit points. A prime location with strong visibility can drive traffic and increase awareness of your business.

To evaluate traffic patterns, start by searching online for “[your location] + AADT,” which stands for “average annual daily traffic.” This will provide public data on the volume in the area.

High-traffic locations near highways, shopping centers or residential areas generally perform best. If your site is in a more remote location, expect to invest heavily in digital marketing, such as Google Ads and search engine optimization, to attract self-storage customers.

Additionally, make sure the site offers safe and convenient ingress and egress, including access for large moving trucks. While some self-storage investors focus too much on a specific traffic count, it’s important to consider the bigger picture. Is your facility on the busiest road in the area? Will customers find it easily?

Critical Factor 5: Competition and Market Demand

Even if a site meets all zoning and physical requirements for self-storage, it won’t succeed without demand, which is why you should always analyze the market before buying land. To begin, research competitors’ occupancy and pricing. If existing facilities in the area are at or above 85% occupancy with stable rental rates, it’s a strong indicator of demand. If they’re under 60% occupied or offering excessive discounts, it may be a sign to reconsider this location.

Also, compare rental rates per square foot to construction and land costs to estimate the potential return on investment. Finally, check population-growth trends, as an increasing number of homes will drive demand.

Critical Factor 6: Utilities

Before finalizing a site choice, verify whether it has access to the following essential utilities. Some properties lack these services, particularly in rural areas, making self-storage development more challenging and costly.

Electricity: Needed for lighting, security and HVAC systems
Water/sewer: Required if you plan to have an office or climate-controlled buildings
Stormwater management: Can significantly impact site design and costs, depending on local requirements
Internet/phone: Needed for security systems and general facility operation

Location is one of the most important decisions you’ll make when building a self-storage facility. It’s wise to collaborate with experienced professionals, including civil engineers, zoning consultants and feasibility analysts, to ensure you make an informed decision, especially if you’re new to development or the industry. A well-chosen parcel can lead to a profitable investment, while a poor choice can result in significant costs or even a complete fail.

Charlie Kao is the principal of Twin Oaks Capital, a Michigan-based commercial real estate company specializing in self-storage and multi-family assets. Services include real estate brokerage, asset management, feasibility studies, consulting and construction management. The company and its affiliates have owned, operated or planned more than 1 million square feet of self-storage. Charlie also owns House of Kaos Real Estate School, which provides continuing education credits for licensed realtors. He can be reached at [email protected].

About the Author

Charlie Kao

Principal, Twin Oaks Capital

Charlie Kao is the principal of Twin Oaks Capital, a Michigan-based commercial real estate company specializing in self-storage and multi-family assets. Services include real estate brokerage, asset management, feasibility studies, consulting and building-construction management. The company and its affiliates have owned, operated or planned more than 1 million square feet of self-storage. Charlie also owns House of Kaos Real Estate School, which provides continuing education credits for licensed realtors. He can be reached at [email protected].

See more from Charlie Kao

Late-Breaking Articles

Tenant Insurance/Protection
Tenant-Protection Plans for Self-Storage: What They Are, Features and Benefits, and the Keys to Program Success
Feb 22, 2026
|
4 Min Read
Marketing
Control the Narrative: DIY Marketing to Help You Tell Your Self-Storage Facility Story and Connect With Customers
Feb 21, 2026
|
7 Min Read
Revenue Management
ISS BLOG – Self-Storage Pricing Practices Under Scrutiny: Are the ECRI Chickens Coming Home to Roost?
Feb 20, 2026
|
5 Min Read
Charity and Fundraising
NationWide Self Storage of Canada Raises More Than $11K for Covenant House Vancouver
Feb 20, 2026
|
1 Min Read