July 11, 2011 5:15 PM
Self storage is rocking the REIT world, and according to Spencer Kirk, chairman and CEO of Extra Space Storage (NYSE: EXR) there are many reasons to celebrate. Revenues in the sector are up, expenses are down, net operating income (NOI) is up and occupancy rates continue to climb. [More]
January 17, 2011 8:09 AM
In the second half of 2010 investors swarmed to the self storage industry, buying up businesses like they were on the clearance rack. And the 2011 outlook for the domestic self storage market has “bullish” written all over it. Niche investors and lenders are increasing movement to this sector as In the second half of 2010 investors swarmed to the self storage industry, buying up businesses like they were on the clearance rack. And the 2011 outlook for the domestic self storage market has “bullish” written all over it. Niche investors and lenders are increasing movement to this sector as capitalization or CAP rates continue to decline and new investors join the buying game. [More]
December 30, 2010 8:36 AM
Overall, during the past few years the self storage market has proven to be recession-resilient and this has led to many acquisitions for investment. There is a bubble of safety around the storage business because of a constant growing demand. Just this week in a major purchase, Virtus, an Austin, Texas, based real estate private equity firm has purchased 20 self storage facilities throughout the southeastern U.S., totaling 1,000,000 sq. ft. of space at a cost of $50 million. [More]
April 5, 2010 2:46 PM
This week brought in plenty of new data for economists and financial analysts. The Consumer Confidence Index statistics for March have come in, and the Standard & Poor’s/Case-Shiller home price index report is in for January. Consumer confidence and home prices are both rising, slowly.
A rising Consumer Confidence Index is good news for self storage operators, as well as for other businesses. Consumers who feel that the economy is good may also feel more confident taking on the responsibility of a month-to-month self storage unit lease. Improvements in housing markets, too, are worthy of cautious optimism. [More]
April 1, 2010 4:22 PM
Grubb & Ellis AGA US Realty Fund manager Jay Leupp predicted Wednesday that self storage real estate will bounce back before most of the rest of the real estate market, probably within a year or two.
“We see commercial real estate in the early stages of a three- to five- year recovery,” Leupp told an interviewer from Wednesday’s Fund Manager Five Spot feature, a regular feature featured by The Street in which prominent investment fund managers recommend stock picks in answers to five quick questions. “The sector recoveries will be at different paces though. We see apartments, health care real estate and some of the specialty areas, like self-storage, recovering very soon, over the next 12 to 24 months.” [More]
February 25, 2010 6:47 PM
Strategic Storage Trust, Inc. (SSTI) announced today that it purchased two self-storage facilities from Chicago Five Properties, LLC, for a combined purchase price of $23 million, cash. One facility is located in Fort Lee, New Jersey, while the other is located in Weston, Florida.
SSTI's chairman and CEO, H. Michael Schwartz, was pleased with the acquisition. "These facilities represent newer Class A properties in prime markets," he said. "Both properties offer the latest generation of secured climate-controlled self storage featuring convenient access to major roads and interstates." [More]
January 8, 2010 5:04 PM
Yesterday, CEOWorld Magazine listed Extra Space Storage as one of its "Top Best Dividend Stocks to Own in 2010." Extra Space is in good company on CEOWorld's list -- the other stocks on the list include market giants Altria Group (the parent company of Philip Morris), Best Buy, Colgate-Palmolive, Harsco (formerly the Harrisburg Steel Corporation), Intel, Sysco, and Visa.
Explaining CEOWorld's choice of Extra Space for the list, writer Amarendra Bhushan says that Extra Space is the second largest self-storage operator in the United States and that it "is a growth-oriented company creating a new standard in the self-storage industry. Both customers and communities benefit from Extra Space Storage's professional approach to storage." She goes on, "Featuring attractive, convenient and secure facilities operated by professional managers, Extra Space Storage seeks to change the association of self storage as a temporary holding place for rarely-used things to a desirable, safe, and customer-oriented facility perfectly suited for maintaining and accessing valued personal and business possessions." [More]
December 30, 2009 7:32 AM
The Wall Street Journal this morning predicted a much more stable real estate market for 2010 than the wild ride the market took investors for in 2009.... the WSJ reports that the Dow Jones Equity All REIT (Real Estate Investment Trust) Total Return Index is up 31% this year, which means that it has improved over its 2008 performance, when it was down 38%. In 2009, the real estate market showed its strongest performance since 2006. It even outdid the Standard & Poor's 500-stock index, which posted a 25% return. "It's been very much a roller coaster ride this year," noted Goldfarb. "And we're about to end this year on a high note."
....Lucas told the WSJ that he expected self-storage to be one of three types of REITS that will outperform the rest of the market (the other two are industrial and student-housing REITs). Self-storage can be expected to do well because it does not depend on the creation of new jobs. The recession has been less damaging to the self-storage industry, in general, than it has been for other real estate businesses. According to Inside Self Storage, this is partly because self-storage owners use 30-day leases, and therefore have the flexibility to change their rates immediately in response to changes in the market and to changes in demand. ISS also attributes the stability of self-storage companies to the fact that self-storage business owners, unlike the REITs Kirby refers to, tend not to over-leverage their businesses -- they are more likely to keep their leverage within responsible limits. As a result, they are less vulnerable to sudden shifts in the market.... [More]
December 21, 2009 10:11 AM
....Invista has received a $42.7 million investment from an American institutional investor, which it plans to invest in Big Orange. The new investment in Big Orange shows investor confidence in the Asian self storage market, which is beginning to heat up....Big Orange was established in 2006 to focus on the Asian self storage market. Many self storage investors are finding the Singapore market to be robust. In November, Hersing Corporation of Singapore, which owns the first self storage facility to open in Singapore (StorHub), reported that its 2009 third quarter profits were quadrupled over its profits from the third quarter of 2008. Not all of Hersing's profits came from StorHub -- many came from the Asia-Pacific branch of ERA Real Estate, which saw a 58 percent revenue increase during the same period -- but Hersing noted that the StorHub Self Storage business had proven to be very recession-resilient....
In Singapore, the demand for self storage is in large part driven by the demand for specialty storage such as wine cellars.... [More]
December 16, 2009 1:38 AM
Earlier this month, Global Self Storage, in San Bernardino County, California, sold for $4.5 million after having been foreclosed upon earlier in the year. This Monday, in another early indication of the improving economy and the rising market for self storage facilities, Strategic Storage Trust, Inc. (SSTI), bought two new self storage facilities in Pittsburgh, Pennsylvania, for a combined purchase price of $5.7 million, paid in cash.
SSTI bought one property on Landings Drive, and one on Lebanon Road, in Pittsburgh. Both properties were previously owned by Sovran Acquisition Group. Together, the facilities will become part of a new self-storage brand established by SSTI in mid-November: Smart Stop Self Storage. SSTI hopes eventually to re-brand all its properties, of which there are 24 in 13 states, with the Smart Stop name. [More]