bank run blog

Reuters reports that shares in US self-storage companies have risen over the past two quarters, in part, due to the wave of foreclosures sweeping across America;

“Self-storage companies had performed strongly in 2005 and 2006, helped by occupancy increases in areas hit by hurricanes. But their market value fell significantly in 2007 as reconstruction efforts picked up in hurricane-hit regions and concerns about a slowing U.S. economy grew. The sector staged a comeback this year as foreclosures swelled and fourth- and first-quarter results proved reassuring.”

Self-storage company’s stocks have risen between 30 percent and 75 percent since early January, but analysts now say that they may have reached their peak. Reuters says that analysts believe that “mounting foreclosures may help the companies’ margins, but they are not going to create a massive inflow of new rentals.” Therefore, the stocks of self-storage companies will hold, but not see the type of growth that they experienced over the past eight months.

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Reuters : US self-storage stocks’ foreclosure ride nearing end