Money In Self-Storage
As investors appetites for risk seem to wax and wane, the self-storage real estate market may be a smart move for a long term position. As a niche play on real estate, the group tends to be less sensitive to the credit market and falling property values that affect other forms of real estate. The group, in fact, usually has the opposite effect, posting stronger revenues in times of financial turbulence. Downsizing, foreclosure and divorce all require storage of goods.
The group did suffer during the crash of 2008, but improved cost controls and promotions have many analysts raising praise for the sub-sector going forward. These upgrades plus the sector dividends make them ideal positions to help wait out the markets storm.
Sovran Self Storage (NYSE: SSS) was upgraded to Buy from Hold at Bank of America-Merrill. The REIT yields 4.9%.
Public Storage (NYSE: PSA) was upgraded to Market Perform from Underperform at BMO Capital earlier. PSA yields 3.4%.
Extra Space Storage (NYSE: EXR) was upgraded to Outperform from Sector Perform at RBC Capital during the end of May. Extra Space yields 2.7%
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