Thailand is Hot! Multiple factors are driving self-storage to new heights in this Southeast Asian nation

Andrew Work, executive director of Self Storage Association Asia (SSAA), sees bright prospects for self storage in Thailand.

“We had our Expo last year in Bangkok on account of the rapid growth of self storage there and in other cities in Thailand,” said Work. “One of our members Storage Asia PLC – is listed on the junior board of the Stock Exchange of Thailand, known as the TES LIVE Board, and they have been attracting a lot of local investment from logistics giants. Thailand’s self storage story is very exciting.”

Thailand storage pioneer Pakdee Anivat, founder and CEO of Storage Asia PLC, had his “aha” moment in 2015 when he saw how self storage was growing in other countries, such as the U.S., UK, Australia, Hong Kong, Singapore and China.

“I have always been interested in the real estate industry,” said Mr. Pakdee. “Plus, I thought self storage had potential in Thailand because of the customers’ behavior, especially those who live in condominiums, and also the density of population in the Bangkok urban area.”

(Cultural note: By contrast with the U.S., Thai naming conventions put more emphasis on one’s given name, which precedes one’s family name. Thus: Mr. Pakdee rather than Mr. Anivat.)

He launched Storage Asia PLC in June 2015, then opened the company’s first facility under its i-Store Self Storage brand in Silom in October 2017. i-Store’s 1,700-square-foot foray into the industry drew a modest response initially. “During the first three months, we only had fivecustomers,” Mr. Pakdee said. “However, with more awareness and our team’s hard work, we now have 100,000 square feet with seven branches.

Mr. Pakdee pointed to several factors driving the growth of i-Store Self Storage and of the industry more broadly in Thailand – among them urbanization, population density, rising condo prices in Bangkok, growing e-commerce, more people adopting a digital-nomad lifestyle, and greater awareness of self storage as a service.

In addition to condos costing more, their size is shrinking, leaving residents pressed for space. Mr. Pakdee said the average one-bedroom unit in the Bangkok area is 250-300 square feet, with an average cost of $400 per square foot.

In addition to residential storage, e-commerce growth stats for Thailand indicate a rapid and significant increase now and in the years ahead. “For online merchants, they need a place to stock their items while buyers need a place to keep what is rarely used,” observed Mr. Pakdee. “Thus, self storage can serve as business storage as well.” On top of those trends, he noted, more foreigners are coming to Thailand, sometimes to work and sometimes to retire. “Self storage is needed during their relocation and while they are living in Thai- land,” he said.

An estimated 3 to 4 million of Thailand’s 71.85 million residents are foreigners. Most of those are from nearby nations in Southeast Asia, but many are from other countries around the globe. Thailand which is about twice the geographic size of Oregon, for example – ranked sixth out of 53 nations as the best place for expats, according to the latest survey by InterNations, a Germany-based global community of 5+ million members in 420 cities around the world that offers networking and socializing opportunities for expats. Bangkok ranked ninth out of 49 cities in InterNations’ 2023 Expat City Ranking.

Mr. Pakdee sees plenty of room for further growth in Thailand’s self storage market. He said Thailand has about 500,000 square feet of self storage, compared to around 30 million square feet throughout Asia.

“We would like to expand the business within five years,” said Mr. Pakdee. “We are planning to open in Phuket, Pattaya, Chiang Mai and other provinces.” His planned expansion would add 300,000 more square feet of net leasable area to his current 100,000. Mr. Pakdee said he welcomes any partners or investors who are interested in expanding i-Store Self Storage which has won several awards from the SSAA in Thailand and into other Southeast Asian countries, especially in those other countries’ capital cities.

He attributed some of i-Store’s success to the technology that has enabled his team to provide a positive customer experience. They developed their own proprietary unit rental and storage management system so it would work with the Thai accounting system. They are trying different payment systems and platforms to see which one best suits their needs. They developed their own booking system (website and UX/UI) but outsourced its implementation. And they are testing different access-control providers as they integrate it into their website and management system.

Credit : SSA Magazine July 2024