Real Estate Roundup: Self-Storage Transactions April 2016

Self-storage properties are constantly changing hands, and Inside Self-Storage is regularly notified of these market transactions. Many are covered in detail on the ISS website and available for viewing on the “Real Estate” topics page. Following are additional acquisitions and sales that weren’t covered independently due to missing information such as buyer, seller, sale price or other relevant details.

A three-property Florida portfolio was sold for $47.9 million. The facilities were previously managed by Extra Space Storage Inc., a publicly traded self-storage real estate investment trust (REIT) and third-party management firm. The facilities in Palm Harbor, Saint Petersburg and Tampa comprise 223,903 net rentable square feet of storage space in 2,291 storage units.

"Demand for Florida self-storage properties is vigorous, especially for top-quality assets like these with historically strong physical occupancies," said Michael Mele, senior vice president of investments in the Marcus & Millichap Tampa, Fla., office and senior director of the firm’s National Self Storage Group (NSSG). "The strength of the Tampa [Metropolitan Statistical Area], combined with the lack of supply, made this portfolio extremely valuable.”

Mele and Luke Elliott, a senior associate also in the firm's Tampa office, represented the buyer and the seller, a New York-based REIT.

Antioch Storage in Antioch, Ill., was sold to a limited-liability company. The property at 284 Main St. comprises 29,370 square feet of storage space in 245 units. It also includes 115 vehicle-parking spaces as well as vacant land for potential expansion. The facility was constructed in 1984 and expanded in 1992 and 2014. The buyer and the seller, also a limited-liability company, were represented in the transaction by Mele and Sean M. Delaney, vice president of investments in the Marcus & Millichap Chicago/Oak Brook office.

The two-property, family-owned portfolio that includes Byram Self Storage in Port Chester, N.Y., and New Haven Self Storage in New Haven, Conn., was sold for $25 million, or more than $218 per square foot, to a privately held company based in Santa Monica, Calif. Both facilities are just off Interstate 95, about 50 miles apart. Byram Self Storage at 2 Highland St. contains 937 units. New Haven Self Storage at 140 Ferry St. contains 1,063 units.

The buyer and the seller, a Delaware-based limited-liability company, were represented in the transaction by Mele and Kevin Menendez, an NSSG associate. “These properties had been in the seller’s family for generations, but after careful consideration, they realized the time was right to put them on the market,” Mele said. “We are seeing this more recently with smaller, family-run, self-storage operators. Increased competition from national players and record prices make now the perfect time for smaller operations to cash in.”

Columbia Storage Group, which operates nine facilities in New Jersey and Pennsylvania, purchased Advantage Storage & Rental in Pen Argyl, Pa., for $1.9 million. The property at 1059 Pennsylvania Ave. has been rebranded as Columbia Self Storage. Opened in 2008, it sits on nearly 4 acres and includes more than 200 storage units in nine buildings. The buyer and seller were represented in the transaction by Kevin Bledsoe, a brokerage advisor for Investment Real Estate LLC (IRE).

Griffis All-Stor Mini Storage in Newport, N.C., was sold to a regional investor for more than $41 per rentable square foot. The property at 1491 Hibbs Road comprises 25,500 net rentable square feet of storage space on 3.7 acres. Opened in 1996, it includes 224 storage units in five buildings, parking and a rental office. Midcoast Properties Inc. President Dale C. Eisenman represented the seller.

Lake Orion Self Storage in Lake Orion, Mich., and StorMax in Oxford, Mich., were sold to a limited-liability company. The Lake Orion property comprises 38,400 square feet of storage space. StorMax includes 9,150 square feet of storage space. The buyer and the sellers were presented in transaction by Tom Berlin, a self-storage investment specialist in the Marcus & Millichap Detroit office.

National Storage Affiliates Trust (NSAT), a real estate investment trust, purchased All-Stor Self Storage, in Monroe, Ga., for $4 million and rebranded it as SecurCare Self Storage. The property at 1005 S. Broad St. comprises 62,566 net rentable square feet of storage space in 472 units and 10 parking spaces. The buyer and the seller, a private corporation, were represented by Brett Hatcher, vice president of investments, and Gabriel Coe, associate, in the Columbus, Ohio, office of Marcus & Millichap.

Stein Investment Group sold three The Space Shop Self Storage properties in Hamilton, Hudson and Loganville, Ga., to a self-storage REIT. The facilities, which are within 60 miles of each another, comprise 216,000 square feet of space in 1,773 storage units. All were recently expanded. The buyer and seller were represented in the transaction by Elliott, Mele and NSSG Senior Director Stacey Gorman.

An unnamed industry REIT has purchased a newly built facility in Aurora, Colo., following construction but prior to the certificate of occupancy. The property is near the corner of East Iliff Avenue and Interstate 225. It comprises 86,175 net rentable square feet of storage space.

The buyer was represented in the transaction by Charles “Chico” LeClaire, senior vice president of investments, and Adam Schlosser, vice president of investments, of The LeClaire Group and the Denver office of Marcus & Millichap. “The sale represents a trend in the industry [in which] developers decide to sell the property upon completion instead of taking on the lease-up risk,” LeClaire said. “This strategy works best with class-A assets in excellent locations. The buyers range from large private operators to national REITs that are interested in acquiring select properties. There are a lot of developers out there that would like to sell at the certificate of occupancy stage, but the buyer pool is very small and the deals can be difficult to do.”

Headquartered in Salt Lake City, Extra Space owns or operates 1,347 self-storage properties in 36 states; Washington, D.C.; and Puerto Rico. The company’s properties comprise approximately 900,000 units and 101 million square feet of rentable space.

Since its inception in 1998, IRE has provided brokerage, construction, development and management services to self-storage owners and investors. Its construction arm, founded in 2000, has built more than 2 million square feet of self-storage space in eight states.

Marcus & Millichap is a commercial-property investment firm with more than 1,500 investment professionals in offices throughout the United States and Canada.

Midcoast Properties offers brokerage services to self-storage owners and investors in the Carolinas and Georgia.

Headquartered in Greenwood, Colo., NSAT is a self-administered and -managed REIT focused on the acquisition, operation and ownership of self-storage properties within the top 100 U.S. Metropolitan Statistical Areas. The company has 292 self-storage facilities in 17 states comprising approximately 17 million net rentable square feet. It's owned by its affiliate operators, who are contributing their interests in their self-storage assets over the next few years as their current mortgage debt matures.

Stein Investment Group is an Atlanta-based private real estate investment firm that’s actively seeking real estate acquisition opportunities in multi-family, office, residential, retail and self-storage throughout the Southeast.

Byram Self Storage, Port Chester, N.Y.

New Haven Self Storage, New Haven, Conn.