People have a variety of reason that causes them to feel the need to rent a self storage unit. It may be because they are downsizing, starting an at-home business, de-cluttering the home, and a whole host of other things. However, the same thing is true about each and every reason—they just need a little extra space.
The self storage industry was created to provide people with that much needed space. Since the early days of the industry in the 1960s to the present the industry has grown to over 50,000 facilities in the United States alone. That’s a whole lot of extra space!
With $22 billion in revenue in 2011 it is pretty clear that the nation has taken to the self storage industry. Of course whenever an industry does this well in spite of what is largely considered a poor economy business leaders take notice. Larger companies look to expand their holdings in order to get a larger piece of the proverbial pie.
Self storage companies become the client as they hunt for extra space of their own.
Extra Space Storage, one of the leading self storage companies in the nation, has been looking for some additional space of late and recently made a pair of acquisitions to boost the company portfolio.
The company is in the process of finishing off one deal that when all is said and done should add approximately 1.5 million square feet of storage space and just under 15,000 self storage units to the company’s already impressive totals of more than 70 million square feet and 640,000 self storage units.
For $196 million the company will acquire around 20 facilities from All Aboard Mini-Storage in California. Along with the facilities the company takes on over $100 million in debt as well.
California is not the only warm weather climate that Extra Space has increased its holdings in. It recently spent $30 million to acquire a pair of facilities in Hawaii.
“Extra Space Storage had targeted the Hawaii market, and particularly Honolulu, as a market where they needed to grow,” Hugh Horne of CBRE self storage advisory group said in a statement. “We were very pleased to help them accomplish a larger footprint by acquiring one of the premiere storage facilities in the state.”
Sound like a lot of money going out? That would be a hard point to argue, but as the saying goes sometimes you have to spend money to make money. Whatever Extra Space is doing must be working since over the last 12 months the company’s stock has risen by 45 percent.
“Extra Space Storage Agrees to Buy Self-Storage Properties.” Wall Street Journal; 17 June 2013.
“Extra Space Storage buys two more Hawaii self-storage properties.” Bizjournals.com; 11 June 2013.