A self-storage business in Australia is typically worth between 4x and 8x its annual EBITDA, or — more precisely — between 7% and 10% capitalisation rate applied to net operating income. These two approaches should arrive at roughly the same number. If they don’t, there’s usually a reason worth understanding before you go to market.
The question that dominates everything else: do you own the land?
Two Ways Buyers Will Value Your Business
Self-storage sits in an unusual position: it’s part operating business and part commercial real estate. Most businesses are valued on earnings multiples. Commercial property is valued on capitalisation rates. Self-storage attracts both treatments, and understanding each is worth the effort.
The Cap Rate Method
A capitalisation rate is net operating income divided by property value — expressed the other way around, it’s the yield a buyer expects from the asset before financing costs.
Net operating income (NOI) = revenue minus operating expenses, excluding depreciation, interest, and owner-specific costs. If your facility generates $800,000 in revenue with $320,000 in operating costs, your NOI is $480,000.
Apply a cap rate of 8%: $480,000 ÷ 0.08 = $6,000,000.
That’s your indicative value using the property approach.
Current Australian cap rates for self-storage:
- Metro, institutional-grade: 5–7% (think National Storage REIT acquisition pricing)
- Metro, independent operator: 7–8%
- Regional or smaller facilities: 8–10%
Higher cap rate means buyers are demanding more yield — which means lower value. When National Storage or Abacus Storage King come calling, they’ll use the lower end. When it’s an individual buying their first facility, they’ll price for more margin.
The EBITDA Multiple Method
Most business buyers are more comfortable with EBITDA multiples than cap rates. The good news is both approaches should converge on a similar answer.
Working multiples for the Australian market in 2025–26:
- Leasehold, smaller facility: 3–5x EBITDA
- Freehold, established operation: 5–8x EBITDA
- Premium freehold, metro location, 85%+ occupancy: 7–10x EBITDA
The higher multiples apply when institutional buyers are competing — typically when a facility is large enough to attract REIT interest. At that point, the pricing logic shifts from “what return does a private buyer need” to “what’s this worth on a portfolio basis to someone with a 5.5% cost of capital.”
When the Two Numbers Diverge
If your cap rate valuation and EBITDA multiple produce materially different results, the usual explanations are: the land value isn’t being captured in the earnings approach, the building is significantly depreciated (which suppresses EBITDA but doesn’t affect NOI), or your operating expenses include personal costs that need normalising out.
An advisor who understands both frameworks can often recover value that a single-method approach misses.
The Land Question
This is the variable that changes everything.
A self-storage facility on land you own is simultaneously an operating business and a commercial property investment. The buyer pool is broader — property investors, business operators, and listed REITs all become potential acquirers. Banks will lend against the combined asset. Competition between buyers pushes pricing up.
A facility running on leased land is a different proposition. The buyer is acquiring a business — a good one, in most cases — but they’re also inheriting a lease, a landlord, and renewal risk. When the lease term ends, the landlord has leverage. Experienced buyers price that in, and the buyers who don’t tend to be the ones who walk away at due diligence.
I worked with a Perth operator who had built a 180-unit facility in the city’s southern suburbs over nine years. He’d been telling himself the business was worth around $1.8 million, based loosely on what he’d paid for it plus some renovations. When we actually looked at the numbers — 91% occupancy, NOI of $290,000, freehold land owned outright — the cap rate method landed the value at $3.6 million and the EBITDA multiple confirmed it. He sat with that for a moment and said: “I should have called you three years ago.” (His wife had apparently been saying the same thing. About the phone call, presumably.)
The point isn’t that owners underestimate value (though that happens). It’s that the real estate component introduces a variable that standard business valuation frameworks don’t capture well. You need both lenses.
What Drives Your Number Up
Within any cap rate or EBITDA range, individual factors move you toward the top or bottom:
Occupancy rate. Stabilised facilities with sustained occupancy above 85% sit at the top of the range. Buyers apply a meaningful discount for anything below 75%, because they’re pricing the time, cost, and risk of filling those units themselves. Occupancy trajectory matters too — a facility trending from 70% to 82% over 18 months is in a different position than one sitting flat at 80%.
Revenue per square metre. A facility achieving $180–$220 per sqm per year demonstrates pricing power and market position. Many long-established operators are significantly below market rate (they haven’t raised rents in three years, or they gave loyal customers a permanent discount that never got removed). That gap is simultaneously a valuation risk — buyers see it as customer relationship management risk — and an upside story if it’s credible.
Management systems. Automated access, online booking, and remote management capability reduce dependency on you or your site manager. A facility with documented processes that runs without you being physically present is valued differently than one that relies on your daily involvement. (One of the clearest signals a facility is well-run is whether the owner can take two weeks’ leave without their phone ringing constantly. Many can’t.)
Climate-controlled storage. Climate-controlled units typically command 20–40% higher rents per square metre than standard units. In Perth’s climate — where summer temperatures regularly exceed 40°C — the value proposition is obvious, and facilities with strong climate-control offerings attract a more stable tenancy that churns less and pays on time more consistently.
Location and catchment demographics. Proximity to arterial roads matters for commercial customers. Proximity to growing residential suburbs matters for household customers. A facility in a fast-growing corridor with limited competing supply is a fundamentally different asset than an identical facility in a static suburb with three competitors within two kilometres.
What Hurts Value
Low occupancy without explanation. A facility at 65% occupancy requires a credible explanation — too much competing supply, pricing above market, management problems, or the facility opened recently and is still in lease-up. Buyers who can’t get that answer will price for worst-case, or walk.
Short lease tenure. A leasehold operation with five years remaining and no option to renew is a genuine structural risk. Some buyers won’t engage. Those who do will build the renewal risk into their offer.
Deferred maintenance. Self-storage is relatively low-maintenance by design, but roller doors, roofing, drainage, and security systems deteriorate. Buyers inspect thoroughly. Issues they find in due diligence become negotiating points — or reasons to reduce their offer.
Owner dependency. If the facility runs because you’re there six days a week, buyers see transition risk. A capable site manager with a documented handover process makes a cleaner deal.
New competition. The major REITs have been expanding aggressively into metropolitan markets. If a National Storage development is two years from completion within your catchment, informed buyers already know about it. Your sale price should account for that reality, not be structured around hope that nobody noticed.
The Asset Sale vs Share Sale Question
Self-storage businesses — particularly freehold facilities held in company structures — raise a structural question that materially affects tax outcomes: asset sale versus share sale.
In an asset sale, you sell the land, building, and business separately. In a share sale, the buyer acquires the company that owns everything. Buyers generally prefer asset sales (clean start, no inherited liabilities). Sellers sometimes prefer share sales, especially where the small business CGT concessions are available on the shares but not directly on the underlying property.
This conversation should happen with your accountant and corporate advisor before you go to market, not after a buyer makes an offer.
How the Sale Process Actually Works
Self-storage transactions in Australia typically take six to twelve months from first engagement to settlement. The process is similar to other freehold property-backed business sales, but with a few nuances worth understanding.
Because land is involved, buyers need both a business assessment and a property valuation — and these are sometimes done by different advisors who don’t talk to each other. Coordinating that properly is one of the things a good corporate advisor earns their fee on. Buyers who finance through a bank will need a registered valuation, which adds time and introduces a third party with their own view on the numbers.
Due diligence on a self-storage facility covers financial records (three years minimum), lease agreements with tenants, occupancy history, competing supply analysis, physical property inspection, planning and zoning compliance, and environmental assessment if the site has any historical industrial use. That list is manageable, but the environmental piece catches some operators off guard — land with prior industrial history can trigger contamination investigations that delay or complicate a transaction.
If your books are clean, your occupancy is strong, and you own the land with no encumbrances, a process can move efficiently. If any of those things needs work, it’s worth spending six to twelve months before going to market to fix what you can.
What Buyers Are Paying Right Now
The EBITDA multiples by industry in Australia benchmark puts most self-storage businesses in the 4–7x range — consistent with what we’re currently seeing for independent operator transactions. The outliers are large freehold metro facilities where REIT appetite pushes pricing above that band.
Before you approach the market, you need clarity on:
- Your normalised NOI (with owner-specific costs removed and any one-off items adjusted)
- Your occupancy rate over the last 36 months and its trajectory
- Competing supply within 5km — what’s operating, what’s approved, what’s under construction
- Whether the land title is clean, encumbrance-free, and in the entity you intend to sell from
Getting this right before you go to market is the difference between a clean process and a messy one.
If you want a confidential conversation about what your self-storage business is worth and how a sale process might work, reach out to Miro Capital. We work with business owners across Australia and don’t charge for initial conversations.