On the desk today · Public Storage
You fill the unit once. You pay for it every month. You never go back.
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The Rent You Pay
For Things You Forgot
In 1972, an entrepreneur named B. Wayne Hughes took $50,000, partnered with Kenneth Volk Jr., and rented out a few storage units in El Cajon, California. The idea was strange for its time — who would pay monthly rent just to store their own belongings? Hughes thought everyone would. Americans were accumulating more things than their homes could hold. They didn't want to throw anything away. They just needed somewhere to put it.
He was right. Over the next five decades, Hughes built Public Storage into the largest self-storage brand in the world — more than 3,000 facilities containing over 221 million net rentable square feet across the United States. He started with nothing and died in 2021 at 87, leaving behind three publicly traded companies, a Kentucky horse farm, and a legacy that Ron Havner, his longtime chairman, described with one word: "iconoclastic."
I rented a storage unit three years ago. I was between homes for a few months and needed somewhere to put furniture. I told myself I'd clear it out in 90 days. The furniture went in. The door closed. Three years later, I still had the unit. I visited it twice — both times to add more things. The monthly charge was $162. I paid it the way I pay the electric bill — without thinking, on autopilot, every month.
That autopilot is the entire business model.
Most people think of self-storage as a temporary solution. It isn't. Studies show that more than half of all storage tenants keep their units for longer than one year. Many stay for three, five, even ten years. The reason is not that they need the stuff. It's that getting rid of the unit requires effort — renting a truck, driving to the facility, opening the door, making decisions about every box, hauling it all somewhere else. Nobody schedules that weekend. The rent arrives automatically. The stuff stays.
Public Storage now operates approximately 3,073 facilities — the orange-and-white buildings you see off every highway exit, in every suburb, near every apartment complex. As of December 31, 2025, the portfolio held roughly 221 million net rentable square feet. The company employs about 5,900 people. It is a member of the S&P 500. And the Hughes family — through his daughter Tamara Hughes Gustavson, who sits on the board — still holds approximately 10% of the company.
In fiscal 2025, Public Storage reported $4.82 billion in revenue — up 2.7% from the year before. Core funds from operations reached $16.97 per share. The same-store net operating income margin was 78.4% — meaning for every dollar of rent collected on existing properties, 78 cents dropped straight to operating profit. The company acquired 13 facilities, delivered another 1.0 million square feet of new development, and — for the first time in over four years — saw year-end occupancy increase.
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That 78.4% NOI margin tells you everything about the cost structure. A storage facility is a concrete box with a roof, a rolling door, and a lock. There is no housekeeping. No room service. No lobby. No amenities. The building sits there. People fill it. The rent arrives. Operating costs are minimal — property taxes, basic maintenance, a manager at the front desk, and a security system. Nearly 80 cents of every dollar flows straight to the bottom line.
The pricing power lives in the inertia. Public Storage raises rents on existing tenants regularly — often 8% to 10% annually after the first year. Tenants receive a letter. They look at the increase. They think about moving everything out. Then they do the math — $20 more a month versus a Saturday of hauling boxes — and they pay the higher rent. The company calls it "existing customer performance." Chris Sambar, the chief operating officer, noted in the fourth-quarter 2025 results that strong existing customer performance drove year-end occupancy improvement for the first time in over four years.
Here is what makes the business nearly impossible to displace. Public Storage sits on the best corners in America — the visible, accessible locations near highway exits, apartment complexes, and residential neighborhoods where people are most likely to need storage. Those locations were acquired decades ago, often at prices a fraction of today's land values. A new competitor would need to buy land at current prices, build from scratch, and wait years to fill the units — all while competing against an orange-and-white brand that 70% of Americans already recognize.
The flywheel runs on America's accumulation problem. The average American home has grown 62% since 1970. Yet storage demand has grown even faster. There are now more self-storage facilities in the United States than McDonald's and Starbucks locations combined. And Public Storage owns roughly 9% of all self-storage square footage in the country. Every time someone downsizes, renovates, divorces, moves, or simply buys more than their closet can hold, the orange door opens. The stuff goes in. And the monthly check begins.
WHY THIS WORKS
The switching cost is physical. Moving your belongings out of a storage unit requires a truck, a free weekend, and the willpower to throw things away. Most people choose to pay another month instead.
78% margins on a concrete box. No amenities. No staff beyond a manager and a security system. The building costs almost nothing to operate — and nearly every dollar of rent drops to profit.
Location is the moat. Public Storage occupies the most visible, accessible corners in America — acquired decades ago at a fraction of today's land prices. Competitors can't replicate the real estate.
Rent increases stick. Existing tenants absorb 8–10% annual increases because the alternative — renting a truck and hauling everything out — feels worse than paying $20 more per month.
B. Wayne Hughes founded Public Storage in 1972 with $50,000 and a simple bet: Americans would rather pay rent on a concrete box than throw anything away. He was right. When Hughes died in 2021 at 87, the company owned more than 3,000 facilities across 221 million square feet. His daughter sits on the board. The orange-and-white buildings line every highway exit in America. And inside each one — behind a rolling metal door, stacked floor to ceiling — sit the things people once needed, no longer use, and can't bring themselves to part with. The rent arrives on the first of every month. The door stays closed. That is the product.
