Single-facility deals dominated self-storage acquisitions in January

February 3, 2014 0
Single-facility deals dominated self-storage acquisitions in January

The first month of 2014 was fairly busy for single-facility acquisitions. Notably absent were large portfolio deals, which dominated the fourth quarter of 2013.

Extra Space Storage Inc., however, did finally close on a previously reported $200 million acquisition of a 17-facility portfolio in Virginia from Mini Price Storage. The portfolio added 14,000 units and 1.5 million square feet of rentable space to the company’s footprint.

“Extra Space Storage is a growth-oriented company,” CEO Spencer Kirk said in a news release, “and the addition of these assets to our portfolio will continue to allow us to provide strong returns to our shareholders.”

Extra Space bought 78 properties in 2013 for a combined total of $586 million. The self-storage REIT has another five properties under contract for $58 million.

Paul & Jerry's

Paul & Jerry’s Self Storage in Spring Hill, FL.

Public Company Deals
Other publicly traded self-storage operators completed or announced a handful of deals in January:

  • Public Storage Inc. bought a 4½-acre site in Sarasota, FL, for $1.3 million. The property is at 4500 Clark Road. Mark D. North sold the property, which was owned by his family for more than 30 years. Public Storage has filed plans to build five single-story buildings on the site, according to the Herald Tribune.
  • CubeSmart LP bought Adams Street Self Storage at 166 Adams St. in Manchester, CT, for $4 million from Manchester Self Storage LLC. The 72,900-square-foot facility was built in 2009.
  • U-Haul bought Strand Storage Center in Little River, SC, for $3.3 million. The facility, at 3195 Highway 9 East, features 88,601 square feet of rentable space and 60 RV and boat parking spaces. U-Haul also bought a 66,331-square-foot facility at 1501 W. 10th St. in Sioux Falls, SD, for an undisclosed price. The facility formerly operated as The Vault.

Private Company Deals
The Cleveland-based Amsdell Companies, operating as Compass Self Storage, bought an 89,000-square-foot facility in Spring Hill, FL, for $4.9 million. The facility, at 10161 County Line Road, was sold by Paul & Jerry’s Self Storage. The location will be Compass’ 11th in Florida.

Bloomington, IN-based Storage Express bought a 37,000-square-foot Community Storage facility on Lynhurst Drive in Indianapolis. The purchase marks the company’s sixth location in the area.

The sales price wasn’t disclosed, but the property last was sold for $1.3 million in 2010.

Storage Express operates more than 80 facilities in five states.

Outback Storage

Outback Storage in Horn Lake, MS.

Other Notable Transactions
Tulsa, OK: Alcatraz Storage in Tulsa, OK, sold its two locations for a combined $6.1 million to an unidentified buyer. The two facilities, at 6501 S. Peoria Ave. and 12565 E. 21st St., encompass 139,960 square feet in 946 units.

The sellers—Stillwater, OK, investors Jeremy and Rachelle Cumming—bought the first property in 2009 for $1.98 million and the second property in 2012 for $1.8 million. They were were represented by Chris Anderson of the Grant Group.

Horn Lake, MS: Austin, TX-based Virtus Real Estate Capital bought Outback Storage, a 97,800-square-foot facility in Horn Lake, MS. The property, at 1634 W. Goodman Road, will be Virtus’ ninth location in the Memphis, TN, area.

“With local population growth expected to average 2 to 3 percent for the next five years and significant retail and residential development along the Goodman Road corridor, this site was a prime target for Virtus to add to our existing portfolio of Memphis stores,” said Scott Humphreys, acquisitions manager at Virtus.

Built in 2005, Outback Storage features 636 units. Virtus tapped Extra Space Storage to manage the facility, which will become the REITs 26th branded location in the metro region.

Virtus financed the property with a $4.16 million loan from Wells Fargo, according to county property records.

Dillsburg Rent-A-Space

Dillsburg Rent-A-Space in Dillsburg, PA.

Dillsburg, PA: D&K Holdings LLC, a first-time investor in self-storage, purchased a 17,000-square-foot storage facility at 107 N. Second St. in Dillsburg, PA, for $500,000, according to York County property records. The property was sold by Multiforce Developers LLC; it operated under the name Dillsburg Rent-A-Space. The first phase of the facility was built in 1984, with the most recent addition completed in 2002.

“This is a neat transaction, in that we sold the property to the current seller many years ago and now they have made their money and are moving on,” said John Gilliland, president and CEO of Investment Real Estate LLC, which brokered the transaction.

Austin, TX: Move It Management LLC of Dallas purchased a 32,475-square-foot facility at South Congress Avenue and Stassney Lane in Austin, TX.

Bellomy & Co. represented the seller, an Austin developer, as well as the buyer. The purchase price of the 274-unit South Austin Self Storage facility was not disclosed.

Lexington, VA: Marcus & Millichap brokered the sale of a 49,000-square-foot facility in Lexington, VA, for $2.7 million. The deal for the 380-unit facility was between two unidentified limited liability companies.

“This transaction reflects the high level of investor interest in the Mid-Atlantic market,” Marcus & Millichap investment specialist Robert Bloch said. “Even in minor markets quality self-storage facilities continue to generate significant premiums for owners.”

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