Self Storage Feasibility Study in Arizona

Arizona storage at a larger scale

Self storage in Arizona is a high-ticket class, with 63 loans adding up to $97.5 million between FY2017 and FY2026. A median loan of $1.0 million comes to 1.08x the national median, the central band spans $683,000 to $2.2 million, and the class is 12 of 50 across the states. Within Arizona's own mix it holds only 16 of 39, and a ratio of 1.22x against the national share suggests a modest tilt toward storage in the state's SBA mix. No single measure here sets Arizona storage apart, so this page serves as a reference for scale rather than a story of an outlier.

504 lenders and a national 7(a) leader

Arizona's 63 storage loans run 36 through 7(a) and 27 through 504, so both programs are in regular use. Franchise brands appear in 4.8% of loans. On the 504 side, Arizona Capital Source heads the table at 9 loans and $10.0 million; The Mortgage Capital Development Corporation posts 7 loans and $14.6 million, and CDC Small Business Finance Corp. 7 loans and $12.0 million. In 7(a), Live Oak Banking Company stands alone with 13 loans worth $34.1 million. Maricopa County holds 18 loans, Yavapai 12, Mohave 10 and Pima 7, so the county list is long rather than concentrated in one place.

A boom and a drop

Approvals reached 16 loans and $19.8 million in FY2022 after 10 loans and $17.8 million in FY2021. Since then the tally has fallen to 7, 5, 6 and finally 2 loans worth $2.2 million in FY2026, the year that closed on 2026-09-30. The earlier low was FY2020, with 2 loans and $958,000. A lender can see the decline in the counts, though the loan record does not say why the tally fell.

Cancellations and an omitted rate

Withdrawals ahead of funding removed at least 18.2% of Arizona storage approvals in FY2017 to FY2024, or 20.0% if loans still unfunded count as dropped, a high floor that warns a borrower not to treat an approval letter as a closed deal. No charge-off rate appears because fewer than 30 loans make up the early disbursed group; that is not the same as zero.

What the study has to test

Storage demand is local, so the study should draw a trade area by drive time, count rentable square feet per household already in it, and test street rates against competing facilities, including climate-controlled space. With a median near $1.0 million, land and construction cost must be tested against achievable rent per square foot and the pace of lease-up, usually slow in a new building. The loan-payment test should be shown at stabilised occupancy and at a discounted lease-up, since the appraiser will capitalise stabilised net income and an optimistic ramp is dangerous. Vehicle storage is folded into the same code, so recreational vehicle projects should be read with that caveat.