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Navigating Steel Tariffs in Self-Storage Development

There’s been growing discussion around the potential impact of rising steel tariffs on construction and development. While some of these concerns are valid, it's important to view them through the lens of today’s self-storage market realities—particularly in how materials are sourced and how developers are adapting to evolving economic conditions.
 
Domestic Sourcing Mitigates Immediate Tariff Impact
While some news highlights the potential for increased construction costs due to tariffs, it should be recognized that many self-storage builders have proactively adapted their sourcing strategies. Note - a significant portion of building components, such as cold-formed steel framing, metal wall panels, and roofing, are procured from domestic mills. This shift towards domestic sourcing means that these materials are not subject to the newly imposed tariffs on imported steel.
 
 According to industry reports, domestic steel mills currently supply approximately 75% of the steel used in U.S. construction projects. While the increased tariffs may lead to a rise in demand for domestic steel, potentially affecting prices in the long term, the immediate impact on self-storage construction costs is mitigated by existing domestic supply chains. At MakoRabco, we’re proud to be part of a family of companies that puts American sourcing at the forefront. Our parent company, Trachte Building Systems, and their partner brand, Trac-Rite, exclusively source building components from domestic suppliers. In times like these, that commitment matters more than ever—not just for quality and control, but for fueling the success of self-storage development across the country.
 
In contrast, industries like automotive manufacturing, beverage canning, and home appliances—where there is a reliance on imported steel and aluminum —are seeing more immediate cost increases. For example, steel comprises roughly 60% of a vehicle's weight, and automakers are already projecting price hikes of $1,500 to $3,000 per vehicle as a result of the tariffs.
 
Strategic Planning and Market Positioning
It's also crucial to consider the strategic implications of delaying development projects in anticipation of potential cost increases. In a competitive market, postponing construction can result in missed opportunities, allowing other developers to capture market share and establish a foothold in key locations. As the adage goes, "If there's demand and you don't build it, someone else will."
 
Moreover, the self-storage industry has demonstrated resilience and adaptability in the face of past economic challenges. Developers who proceed with well-planned projects, factoring in current costs and potential future fluctuations, position themselves to meet market demand effectively and capitalize on long-term growth.
 
 Conclusion
While it's prudent to remain vigilant about the evolving economic landscape, including tariff policies and their potential effects, it's equally important to recognize the industry's capacity for adaptation. By leveraging domestic sourcing and strategic planning, self-storage developers can navigate the current environment successfully, ensuring they remain competitive and responsive to market needs.