Glendale, CA-based Public Storage, the world’s largest owner of self-storage facilities, has struck a deal that will make it a little bit bigger.
Public Storage announced that the company entered an agreement to buy 48 self-storage locations from Columbia, MD-based ezStorage for a total of $1.8 billion. Public Storage plans to fund the purchase with unsecured debt.
The deal is one of the most highly-valued self-storage transactions of all time, eclipsing Blackstone’s $1.2 billion purchase of 101 facilities from Simply Self Storage last year. The deal is also more than triple the $528 million Public Storage paid to purchase the 38-property Beyond Self Storage portfolio in December. Since the start of 2019, Public Storage has spent $4.1 billion on development, acquisitions, and redevelopment to add a net rentable square footage of 21 million square feet to its storage footprint.
The 48 ezStorage locations are located in Virginia and Maryland in the Washington D.C. metro area. Together the portfolio encompasses an estimated 4.8 million square feet of self-storage space. Unlike the newly developed Beyond Self Storage locations that are mostly still in lease up phase, the ezStorage portfolio features an average occupancy of 92 percent. The facilities have an average population of 110,000 and incomes of $130,000 within a 3-mile radius.
Investment has flowed to the self-storage industry over the last year as a safe bet during the global coronavirus pandemic. The renewed interest from non-traditional storage players like Blackstone has increased buyer pool competition and compressed cap rates.
The ezStorage portfolio was privately shopped to a limited pool of buyers. Kieran O’Shea of Eastdil Secured represented ezStorage in the sales process. O’Shea declined to comment on the deal when reached. The ezStorage company was started by the Manganaro family in 1987.
The ezStorage deal is set to close in May.