Public Storage Buys 360 KSF Minneapolis Portfolio
- Aug 22, 2018
Public Storage, a Glendale, Calif.-based self-storage company, acquired a six-property portfolio in the Minneapolis-St. Paul metropolitan area from the Pegasus Group.
JLL’s Capital Markets team of Brian Somoza and Steve Mellon facilitated the transaction.
“This acquisition increased the buyer’s footprint in Minnesota by 12 percent,” Somoza told Commercial Property Executive. “With an average occupancy of approximately 90 percent, these six extremely well-maintained assets were in strong and growing submarkets throughout the Minneapolis-St. Paul MSA with high barriers to entry and attractive demographics.”
The properties consist of 425 Washington Ave. N, in Minneapolis; 150 81st St. W, in Bloomington; 21002 Heron Way in Lakeview; 5040 Winnetka Ave., in New Hope; 7225 Bush Lake Road in Edina; and 407 School Road NW/1015 Highway 7 in Hutchinson.
Overall, the properties total more than 360,000 square feet and 3,243 units. The self-storage units boast climate control, interior drive-thru loading, electronic access control, 24-hour video surveillance and retail-oriented customer service offices.
“Recent sales along with strong cash flows—more than 28 percent of the tenant base have rented at the locations for more than three years—and demand for stabilized cash flowing portfolios were the high-level factors that made this the right time for this deal,” Somoza said. “There was a tremendous amount of interest from publicly traded companies, private equity, regional operators and private investors.”
All six properties are situated in downtown Minneapolis and nearby popular cities, within an average 3-mile population ring of more than 91,000 residents, which is estimated to rise more than 5.3 percent by 2022. Located along major thoroughfares, the facilities also offer excellent visibility and signage.
The buyer plans to rebrand all six properties to Public Storage by changing out signage and colors (when possible).
In June, the JLL team of Somoza and Mellon represented Weiss Realty Group in Merit Hill Capital’s acquisition of Safe Keeping Self Storage, a 76,485-square-foot facility in Baytown, a suburb of Houston. In February, the team arranged the sale of a 951-unit sustainably designed self-storage facility located in Austin.
Image courtesy of JLL