In the first quarter of 2018, the manufactured housing, self-storage and industrial sectors were the stars of the REIT show, as real estate investment firm PGIM Real Estate noted in a market review.

NREI: Like manufactured housing, self-storage is a NIMBY sector. What’s your assessment of the self-storage sector?

Marc Halle: Storage has evolved in terms of the type of product that’s out there. It’s become a much more retail product. It’s no longer the “German shepherd,” as we used to call it, where it’s in some industrial lot with a chain-link fence and two dogs running around. They’re now in more retail locations; the properties are much more consumer-friendly and access-friendly. And it’s easier to build a self-storage facility, in that it requires a lot less capital than a manufactured home community, so the barrier to entry in manufactured homes is much higher than self-storage.

But in the self-storage sector, you really have to be careful of the supply dynamic because some markets tend to get overbuilt quickly. Having said that, you’re looking at excellent same-store growth and at stocks that are very fairly valued in the market....

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