The number of businesses that are failing around the country can be depressing. Some goods and services just aren’t doing well giving the current economic climate. The self storage industry is lucky not to be one of those industries, and can be thankful that it is doing well in spite of the current economic climate. In fact, in the last year the self storage industry had over $20 billion in revenue.
For proof of the continued health of the industry you need only take a look at the amounts that some companies are spending to get into the industry as proof. After all, if a company—or in the case of the self storage industry, REITs (real estate investment trusts)—is willing to spend hundreds of millions of dollars at a time, the industry must be doing well.
A REIT managed by W.P. Carey & Co. recently spent $163.4 million to purchase a total of 40 self storage facilities in California, Illinois, and Hawaii from A-American Self Storage. The facilities combined have about 2.8 million square feet of storage space and around 25,000 storage units.
W.P Carey & Co. has been active lately when it comes to spending millions of dollars on self storage properties. Earlier this month they bought nine other facilities from A-American Self Storage for $31 million.
“With the completion of these transactions with A-American, we have assembled a diverse portfolio of stable self storage assets with the objective of providing consistent long-term income and diversification to our managed funds,” W. P. Carey President and CEO Trevor Bond stated.
W.P. Carey is not the only player getting really involved in the self storage industry. CubeSmart purchased 16 self storage facilities from Storage Deluxe for $357.31 million. The company also announced that it would be working on closing another deal in the first quarter of 2012 for six more facilities (as well as $88 million in debt) from Storage Deluxe for $202.7 million.
“This transaction validates once again the opportunity to create value when well-designed, state-of-the-art buildings are developed in strategic locations and are coupled with top quality property management…” said Nick Coslov, CEO of Storage Deluxe.
With over $700 million involved in those four transactions alone it is safe to say that there are many among the self storage industry with plenty of reasons to be thankful during the holiday season!
“Expensive Storage Space.” WSJ.com; 23 November 2011.
“W. P. Carey Announces $31 Million Acquisition of Nine Self Storage Properties.” Marketwire; 15 November 2011.
“$357.31 Million Sale of 16-Property New York City Metro Self Storage Portfolio Closed by HFF.” Marketwire; 07 November 2011.
2011 SSA Fact Sheet; Self Storage Association.