Navigating Existing Customer Rate Increases in Self-Storage

One of the hardest pricing questions in self-storage is not what to charge the next customer who walks through the door.

It is what to charge the customer who has already been there for six months, a year, or longer.

Raise the rent too aggressively and you may create unnecessary move-outs. Leave rates untouched for years and a facility can end up with long-term tenants paying far less than newer customers—or far less than the market may support.

Large public self-storage REITs have spent years trying to manage that tradeoff.

Their approach offers an important lesson for independent owners: existing customer rate increases should be treated as a revenue-management decision, not an automatic calendar event.

That does not mean smaller operators should simply copy what a national REIT does.

Public operators have enormous portfolios, sophisticated pricing systems, extensive customer data, and the ability to test strategies across thousands of units. An independent owner may operate one facility in one market where customer behavior looks very different.

But the underlying principles are useful.

Here is what self-storage owners can learn from how the industry’s largest operators think about existing customer rate increases—and how to apply those lessons without losing sight of the economics of an individual property.

What Is an Existing Customer Rate Increase?

An existing customer rate increase, sometimes shortened in the industry to ECRI, is an increase in the monthly rental rate charged to a customer who is already occupying a unit.

That is different from a move-in rate, also called an advertised or street rate.

A move-in rate is the price offered to attract a new customer today.

An in-place rate is what an existing customer currently pays.

Those two numbers do not necessarily move together.

A facility may lower advertised pricing to remain competitive for new customers while increasing rates for some longer-tenured customers. That can create a noticeable spread between what a new customer is offered online and what an existing tenant pays.

The large REITs closely manage that relationship because both numbers affect total property revenue.

Independent owners should think about them separately too.

What the REITs Tell Us About Existing Customer Pricing

Public filings provide a useful window into how sophisticated storage operators think about rental increases.

Extra Space Storage stated in its 2025 annual filing that increasing existing tenant rental rates, generally on an annual basis, is an important component of revenue growth. It also said that the size of those increases is evaluated partly by estimating their effect on incremental move-outs.

That second point matters.

The goal is not simply to charge the highest possible rent.

The goal is to determine whether the additional revenue from the increase is worth the customer behavior it may trigger.

Public Storage has described a similar framework in its financial reporting. It has explained that long-term tenant rate decisions consider the additional revenue from an increase against the negative impact of incremental move-outs, including factors such as the customer’s current rent and prevailing market rents.

That is the core lesson for owners.

A successful increase is not necessarily the largest increase a customer will tolerate. It is the increase that improves total facility economics after accounting for retention.

Lesson 1: Do Not Treat Every Customer the Same

A blanket rent increase is easy to administer. It is not always the smartest approach. Imagine three customers renting identical 10x10 units.

• Customer A moved in eight months ago and pays $125.

• Customer B has been at the facility for three years and still pays $98.

• Customer C pays $137 after receiving a prior increase.

Sending all three customers the same percentage increase may be simple, but it ignores where each customer sits relative to the property and market.

A more disciplined approach looks at each customer’s current rate.

How does it compare with:

• Current advertised pricing?
• Other customers in the same unit type?
• Comparable facilities nearby?
• Previous increases the customer has received?
• The facility’s occupancy and availability?

A customer significantly below an appropriate in-place rate may present one pricing decision.

A customer who is already paying well above that level may present another.

That is revenue management.

Lesson 2: The Right Question Is Not “How Much Can We Raise Rates?”

A better question is:

What happens after we raise them?

Suppose 100 customers each pay $100 per month.  The owner increases every customer’s rent by $15.  If everyone stays, monthly revenue increases by $1,500.  Easy decision.

But what happens if 12 customers leave?

Those units may sit vacant. The facility may need to advertise lower move-in rates to replace them. New tenants may receive promotional discounts. Marketing costs may increase.

The simple $1,500 calculation no longer tells the full story.  That is why major operators pay attention to incremental move-outs after rate increases.  Independent owners should too.

You do not need a sophisticated machine-learning platform to begin measuring this.

Track:

• Customers receiving increases
• Average dollar and percentage increase
• Move-outs after notices
• Reasons for move-out when known
• Time required to re-rent vacated units
• New customer rates on replacement rentals
• Promotional discounts needed to fill units
• Net change in revenue

Over time, that information can reveal how sensitive your customers actually are to pricing.

Lesson 3: Existing Customers and New Customers Are Two Different Pricing Problems

This is one of the most important concepts in modern self-storage revenue management.

The price required to attract a customer today may not be the same as the rate an existing customer will continue paying.

During softer market conditions, operators may need competitive advertised rates to generate new rentals.

At the same time, longer-tenured customers may be paying different in-place rates based on previous increases.

Recent industry data illustrates the distinction.

Yardi Matrix¹ reported that national advertised self-storage rates remained down year over year in July 2026, even as REIT operating performance benefited from improving occupancy and growth in in-place rents. Yardi reported 0.5% in-place rent growth during the second quarter and noted that operators were continuing to focus on existing customer rates while new-customer demand remained relatively soft.

That is why owners should not assume: “Our online rate is $89, so every existing customer should pay $89.”

Nor should they automatically conclude: “A customer is already paying $120, so there is room for another increase.”

New-customer pricing helps answer what is required to compete for today’s available demand.

Existing-customer pricing requires a separate analysis of retention, current rent, customer tenure, availability, and expected revenue.

Lesson 4: Occupancy Changes the Equation

A 98% occupied facility has a different pricing problem than an 82% occupied facility.

When a property is nearly full, losing a customer may be relatively easy to absorb if there is strong demand for the unit.

At lower occupancy, voluntarily creating additional vacancy through aggressive increases may be much more expensive.

Unit-level occupancy matters too.

A facility might be 92% occupied overall but have every 10x20 non-climate-controlled unit rented and 20 vacant 5x10 climate-controlled units.

Those unit types should not necessarily receive the same pricing treatment.

An owner should understand:

• Facility occupancy
• Occupancy by unit type
• Current vacancies
• Rental velocity
• Customer demand
• Length of time vacant units remain available

A nearly full unit category with a waiting list gives the operator different pricing flexibility from a category that is already struggling to lease.

Lesson 5: Customer Tenure Matters

Longer customer stays are valuable. They reduce turnover and can make facility revenue more predictable. But long tenure can also create pricing gaps.

A customer who has occupied the same unit for four years without an adjustment may be paying a rate established under completely different market conditions.

That does not automatically mean the owner should deliver a dramatic increase. It means the account deserves review.

Public operators monitor the relationship between customer tenure and rate growth because longer-tenured tenants can become an important part of property revenue.

For an independent facility, a basic customer-tenure report can be extremely useful.

Group tenants into categories such as:

• Less than 6 months
• 6–12 months
• 12–24 months
• 24–36 months
• More than 36 months
• Do move-outs increase within 30 or 60 days of notices?
• Are certain percentage increases associated with more departures?
• Are highly occupied unit types less sensitive?
• Are newer customers more sensitive than established customers?
• Does behavior differ by facility?
• Are customers paying well above current advertised rates more likely to leave?
• Lower advertised rent
• First-month discounts
• Digital advertising
• Call-center or staff time
• Unit cleaning
• Lock checks
• Administrative work
• Days or weeks of vacancy

Then compare average rents within each unit type. You may quickly find pockets of customers whose rates have drifted well away from the rest of the property.

Lesson 6: Rate Increases Should Be Measured in Dollars, Not Just Percentages

A percentage can sound dramatic without telling you much. A 10% increase on a $50 monthly rent is $5. A 10% increase on a $300 unit is $30.

Customers may experience those two increases very differently. Owners should look at both the percentage change and the actual dollar amount.

Ask:

What will the customer’s new monthly payment be?

Then evaluate whether that amount makes sense relative to the customer’s existing rent, the unit, competing options, and the likely cost of moving.

Looking only at percentages can make pricing decisions unnecessarily mechanical.

Lesson 7: Avoid Training Customers to Expect a Specific Increase

Predictability can be good for operations. Too much predictability can also create unintended behavior.

If every tenant receives exactly the same increase at exactly the same interval, the pricing program becomes disconnected from the actual economics of the facility.

A customer dramatically below the property’s current in-place rates may need a different review than someone who received an adjustment recently.

The REIT lesson is not that every tenant should receive increases constantly. It is that operators repeatedly evaluate existing customer pricing as part of overall revenue management.

For smaller operators, that could mean establishing regular review periods rather than automatic increases. The review asks whether an adjustment makes sense. It does not predetermine the answer.

Lesson 8: Watch Move-Outs After an Increase

An owner who sends increases but never measures subsequent behavior is only seeing half the result. If customer move-outs jump immediately after a particular increase, that is information. If move-outs barely change, that is information too.

The challenge is separating normal turnover from increase-related turnover.

Not every customer leaving after an increase left because of the increase. People move, buy homes, finish renovations, sell belongings, close businesses, or simply stop needing storage.

But patterns become visible with enough data. The objective is not perfect attribution. It is better decision-making.

Lesson 9: Think About the Cost to Replace the Customer

A move-out does not only create one empty unit. That is why comparing an existing tenant’s rate with the advertised move-in rate is not enough.

Suppose a customer pays $145. The current web rate is $110. The customer moves out after an increase.

The owner now needs to find a replacement at $110, perhaps with a promotional discount, and may experience vacancy between tenants.

The lost economics can exceed the value of an aggressive increase. This does not mean the original customer can never receive another rent adjustment.

It means the operator should understand the potential replacement cost before deciding how hard to push.

Lesson 10: The Biggest REIT Advantage Is Data, Not Aggressiveness

It is easy to look at a national operator and conclude that its advantage is the ability to increase rents aggressively.

A bigger advantage is that it can measure what happens afterward.

Extra Space² said in its 2025 annual report that its revenue-management platform and machine-learning capabilities help convert market conditions into operating performance. It also reported low vacate activity during 2025 while improving existing customer rental rates.

Independent owners may not have that technology. But they often have something valuable in return: detailed knowledge of one local market and direct visibility into their customers.

A smaller operator can build a useful pricing discipline with relatively basic information.

At minimum, track:

You do not need thousands of properties. You need consistent data from yours.

What Smaller Owners Should Not Copy From REITs

Public REIT practices provide useful insight, but copying their tactics without context can be a mistake.

A national operator may be able to test different pricing strategies across hundreds of thousands of customers.

A single-property owner cannot.

• Greater brand recognition
• More sophisticated pricing technology
• Centralized marketing
• Larger digital advertising budgets
• Call centers
• Broader customer datasets
• Multiple nearby properties
• Advanced demand forecasting

That creates a different margin for experimentation.

The lesson is therefore not:

“The REITs raise existing customer rents, so independent operators should do the same thing in the same way.”

The better lesson is:

“The REITs continuously measure the relationship between price, occupancy, retention, and revenue. Independent operators should develop their own version of that discipline.”

Customer Experience Still Matters

A mathematically sound increase can still be poorly executed.

Storage customers may be especially sensitive to pricing when they believe an introductory rate was presented as something more permanent.

Clear communication matters.

Owners should make sure their rental agreements, disclosures, notices, and rate-change practices comply with applicable agreements and federal, state, and local requirements. Requirements vary by jurisdiction, so operators should obtain appropriate legal guidance for their facilities rather than relying on a national pricing article as legal advice.

Beyond compliance, there is a customer relationship question.

• How clearly was the original pricing explained?

• How much notice does the customer receive?

• Can staff explain the adjustment accurately?

• What happens when a customer calls?

Consistency and professionalism can matter almost as much as the increase itself.

What Lenders Think About Existing Customer Rate Increases

Why should a lender care about ECRI strategy?

Because rental revenue supports debt service.

When evaluating an existing self-storage facility, a lender may look at historical revenue, occupancy, operating expenses, in-place rents, advertised rates, and the assumptions behind future performance.

If an acquisition model assumes significant revenue growth because the buyer plans to increase existing customer rents, the lender may want to understand how realistic that assumption is.

A forecast that says: “Current tenants are below market, so we will raise everyone 20% after closing” may deserve substantial scrutiny.

A stronger analysis considers:

• Current customer rates by unit type
• Customer tenure
• Historical increases
• Market asking rates
• Current occupancy
• Competitor pricing
• Likely tenant response
• Timing of increases
• Expected move-outs
• Replacement rental assumptions

Lenders generally prefer projections they can follow. That is especially important in an acquisition where future rate increases are necessary for the property to achieve projected debt service coverage.

Existing Customer Rate Growth Cannot Fix Every Storage Problem

Rate increases are a tool. They are not a substitute for demand.

If a property is losing customers, struggling with occupancy, facing significant new competition, or operating in a market with falling rents, aggressively increasing existing customer rates may create another problem instead of solving the first one.

The 2026 market is a good reminder.

Yardi Matrix¹ reported in August that advertised rates were still down 1.6% year over year nationally in July even as REIT results showed improvement in occupancy, in-place rents, and revenue. Yardi also cautioned that much of the improvement had come from fewer move-outs rather than a major rebound in new demand.

That distinction matters. Strong retention can support existing-customer pricing.

But owners should not interpret retention as proof that every customer can absorb a large increase indefinitely.

Eventually, customer economics, competitive pricing, and market demand still matter.

A Better Framework for Reviewing Existing Customer Rates

For each customer or group of similar customers, consider five questions.

1. Where is the customer today?

What is the current monthly rate?

2. How does that compare?

Look at relevant in-place rates, current advertised pricing, and comparable competition.

3. How replaceable is the customer?

Consider occupancy, availability, rental velocity, and expected replacement pricing for that unit type.

4. What happens if the customer leaves?

Estimate vacancy, promotional costs, new-customer rent, and other turnover expenses.

5. What does the data from previous increases tell you?

Use your own history rather than assuming customer behavior will match someone else’s portfolio.

This framework does not generate one universal answer. That is the point.

The Real REIT Lesson: Manage Revenue, Not Just Rent

Existing customer rate increases can be an important part of self-storage revenue growth.

But the public REITs demonstrate something more useful than simply how often rents can be raised.

They show the importance of treating pricing as a system.

• Move-in rates affect new demand.

• Existing customer rates affect in-place revenue.

• Increases affect retention.

• Move-outs affect occupancy.

• Vacancy affects marketing.

• Replacement rates affect future revenue.

• Every decision connects to another.

For independent storage owners, the goal does not have to be building a REIT-sized revenue-management platform.

It can start with a simpler discipline: know what every customer is paying, know what your units are worth in today’s market, track what happens after an increase, and make the next decision based on the results.

That approach can also make a storage property easier for a lender to understand.

First Bank of the Lake is a nationwide SBA Preferred Lender with experience financing commercial real estate, acquisitions, construction, and complex SBA transactions.

If you are buying, expanding, developing, or refinancing a self-storage facility, a clear understanding of your facility’s pricing and operating performance can help support a more informed financing conversation.

Connect with a Self-Storage Lending Specialist

Frequently Asked Questions About Existing Customer Rate Increases

1. What is an ECRI in self-storage?

ECRI is an industry term commonly used for an existing customer rate increase.

It refers to raising the rental rate paid by a customer who already occupies a storage unit, as opposed to changing the advertised rate offered to a new customer.

2. How often should a self-storage facility raise existing customer rents?

There is no universal schedule that fits every facility or customer.

Large operators periodically evaluate existing customer rents, but timing varies. Extra Space has disclosed that existing tenant increases are generally considered on an annual basis, while Public Storage has historically described adjustments for long-term tenants occurring at intervals such as six to twelve months.

Independent owners should base decisions on their rental agreements, applicable laws, customer rates, tenure, occupancy, market conditions, previous increases, and expected retention rather than copying a fixed schedule.

3. How much should a self-storage owner raise rent?

There is no single appropriate percentage.

The amount should be evaluated in the context of the customer’s current payment, relevant market rates, facility occupancy, unit availability, tenure, prior adjustments, and likely response.

Operators should also comply with applicable rental agreements and legal notice requirements.

4. Should existing tenants pay the same as new customers?

Not necessarily.

The advertised move-in rate is designed to attract today’s available customer. Existing-customer pricing reflects a different set of factors, including tenure and previous rate adjustments.

Sophisticated operators manage both pricing streams while watching total revenue and occupancy.

5. Why would a storage company lower move-in rates while raising existing customer rates?

Because attracting a new tenant and retaining an existing one are different pricing decisions.

When new-customer demand is soft, an operator may need competitive advertised pricing to generate move-ins. Existing tenants may have different willingness to pay depending on tenure, current rent, convenience, and other factors.

However, a widening gap between advertised and in-place rents can also increase move-out risk and customer dissatisfaction, so owners should monitor it carefully.

6. Do lenders give credit for planned rent increases?

Potentially, but lenders generally evaluate whether projected revenue is reasonable and supportable.

If an acquisition depends on substantial post-closing rent increases, a lender may scrutinize historical rents, market rates, occupancy, customer tenure, competition, and projected move-outs.

Loan structure and underwriting ultimately depend on the specific transaction.

Why Work with First Bank of the Lake

First Bank of the Lake helps business owners nationwide find the financing they need to grow, expand and invest in what comes next. Our experience has made us one of the country’s leading SBA lenders. Since 2023, First Bank of the Lake has ranked among the top 1% of SBA 7(a) lenders, placing 15th nationwide by approval amount and have also ranked as the third most active SBA franchise lender by lending volume, according to the U.S. Small Business Administration.

Founded in 1985, we combine national lending capabilities with the personal attention you would expect from a community bank. Our knowledgeable team takes the time to understand your goals, walk you through your options and support you at every step.

If you are considering financing for your business, we would be happy to answer your questions. Call us at (888) 828-5689 or complete the form above to start the conversation. You can also visit our website or connect with us on Facebook and LinkedIn.

1 https://www.yardi.com/news/press-releases/yardi-matrix-documents-u-s-self-storage-recovery-trends-in-q2-2026/

2 https://www.sec.gov/Archives/edgar/data/1289490/000128949026000031/q42025exrannualreport.pdf