Joe DownsCEO & Co-Founder, Belrose Storage Group. Founder, Storage Moguls.

When Expansion Doesn't Make Sense

20 Mar 2026 · 1 min

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In this segment, the speaker cautions against pursuing real‑estate expansion merely because it appears financially viable. He emphasizes that permitting hurdles, low occupancy rates (under 80%), unfilled vacant units, lack of stabilization, and broader market declines—especially when new competitors are entering—are strong signals to pause or abandon expansion plans, regardless of how attractive the projected pro‑forma may look.

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But how do we know when it doesn't make sense? Well, because we don't want to expand just because we can, like I said in the opening. So building on those permitting challenges here, sometimes expansion just isn't the right move, no matter how good the pro forma looks. So you should probably hit the brakes if, let's say, occupancy is below 80%. You haven't— you have vacant units to fill first. Yeah, you're not, you're not stabilized. A declining market, especially with new competitors, another red flag.