Europe’s self storage investment market is entering 2026 with a noticeably different tone from the one that defined much of 2025. After a period marked by stalled portfolio sales, cautious underwriting and widening bid–ask spreads, Savills now expects transaction volumes across the UK and continental Europe to rebound. The advisory’s latest sector outlook frames 2025 not as a structural downturn, but as a year of delayed execution — a pause driven largely by financing friction rather than operational deterioration.
Several sizeable processes launched during 2025 did not formally close, compressing annual investment totals and creating the impression of market weakness. In reality, liquidity did not disappear. It waited for debt pricing and valuation expectations to realign. As lenders gradually return with more competitive terms and greater clarity on rate trajectories, Savills believes 2026 will see postponed transactions complete alongside new mandates entering the pipeline.
Fundamentals Remained Intact Through the Slowdown
The most important indicator that self storage avoided structural damage lies in rental performance. According to the latest industry data published by CBRE in cooperation with FEDESSA, average rental rates across Europe increased by 5.4% year-on-year to €313 per square metre per year. While occupancy softened modestly in some markets, operators prioritised pricing discipline over pure volume, protecting income growth in urban locations where supply remains constrained.
Investment volumes cooled after a strong 2024, with approximately €260 million transacted year-to-date and a further €200 million pipeline reported at the time of publication. The figures suggest not a collapse in demand but a recalibration of capital markets to higher borrowing costs and more conservative underwriting.
Debt Markets as the Inflection Point
Savills’ projection for 2026 is closely tied to the credit environment. Commentary from the firm’s debt advisory division indicates that lender appetite for self storage remains broad, spanning smaller single-asset financings and large portfolio transactions. Liquidity in credit markets has improved and margins are expected to tighten for platforms demonstrating operational scale, technology integration and revenue optimisation systems.
This is the mechanism through which deal flow typically restarts. In 2025, underwriting often failed to reconcile elevated borrowing costs with seller price expectations shaped by the low-rate era. As financing conditions stabilise and competition among lenders intensifies, transaction mathematics becomes viable again. Yield assumptions regain clarity, leverage levels become predictable and equity capital regains confidence in execution timelines.
Consolidation and Institutional Scale
Private equity has become increasingly dominant in European self storage transactions. Industry data indicates that approximately 59% of activity involved private equity capital, underscoring a structural shift toward platform-level strategies rather than single-asset acquisitions. Investors are targeting scalable operators capable of expanding through development, management agreements and bolt-on purchases in supply-constrained urban markets.
The UK listed sector continues to serve as a valuation barometer. In October 2025, Blackstone explored a potential acquisition of Big Yellow Group, then valued around £2.31 billion (≈€2.66 billion). Market speculation suggested a transaction might have required closer to £2.7 billion (≈€3.09 billion). Although discussions ended without agreement, the episode reinforced institutional appetite for scaled platforms while highlighting pricing discipline in a transitional rate environment.
Structural Supply Constraints
Europe continues to have materially lower self storage penetration per capita compared with the United States. Planning restrictions, zoning complexity and rising land values limit rapid supply expansion in dense metropolitan areas. These structural constraints underpin rental resilience and provide operators with pricing leverage in key urban markets.
Operators are increasingly using data analytics to identify underserved micro-locations and refine revenue management strategies. This operational sophistication strengthens the investment case, positioning self storage closer to institutional logistics and professionally managed residential assets than to niche alternative real estate.
From Pause to Execution in 2026
The expected rebound in 2026 should be viewed not as a speculative upswing but as a return to transactional normality. Deals that stalled in 2025 are likely to re-emerge as credit liquidity improves and valuation expectations recalibrate, while rental levels — currently averaging €313 per square metre per year across Europe — continue to underpin income stability. If financing spreads tighten further and leverage becomes more predictable, the sector could shift from a cautious holding pattern back to active portfolio expansion, marking a decisive transition from pause to execution.
