Self-storage business draws investor interest
Tight living spaces, enhanced security and improved infrastructure boost demand in niche market
When Kevin Chan started out in Hong Kong's self-storage business in 2002, he believed the market had potential due to the high-density living in the city.
Twelve years later, the small sector has become more attractive as demand grows amid tight living spaces and improved security and infrastructure.
"In the beginning, most of our clients were expatriates who stayed in Hong Kong for the short term and needed space for storing their bulky or infrequently accessed items," said Chan, chief executive at Store Friendly Self Storage Group.
"But now we have 60 per cent of clients from the middle-income class who want to store clothes, ski gear and collections from wine to toys."
His company has more than 40 storage centres comprising a total area of about 1.2 million sqft, or more than 40 per cent of the market share in Hong Kong.
"Hong Kong's living space is too small. They need extra space for storage," he said.
According to a Colliers International estimate, about 852,000, or 76 per cent of private residential units in Hong Kong, lack dedicated storage space.