Seizing on what its CEO calls an “unprecedented” volume of self-storage acquisitions, National Storage Affiliates Trust could end the year with $2 billion in deals.
The self-storage REIT just raised its acquisition forecast for 2021 to a range of $1.5 billion to $2 billion, up from the previous outlook of $1.1 billion to $1.3 billion.
Thus far this year, Greenwood Village, CO-based National Storage Affiliates has invested more than $1.3 billion in self-storage acquisitions. In the third quarter alone, the company spent $599.3 million to buy 76 wholly owned self-storage facilities. After the end of the quarter, the REIT earmarked about $325.7 million to purchase 39 wholly owned self-storage facilities.
National Storage Affiliates expects to rack up at least $1.75 million in acquisitions by the end of 2021, Tamara Fischer, the REIT’s president and CEO, told Wall Street analysts during a Nov. 3 call to discuss third-quarter financial results.
“We continue to see meaningful competition for transactions,” Fischer said, “and the amount of capital seeking to establish or expand the position in self-storage continues to drive cap rate compression, especially on larger portfolios.”
In targeting acquisitions, National Storage Affiliates is concentrating primarily on secondary and tertiary markets.
“Obviously, based on our revised acquisition guidance, the fourth quarter will be busy, but we are well capitalized and look forward to remaining a disciplined consolidator in our sector,” said Brandon Togashi, the REIT’s executive vice president and chief financial officer.
Other highlights of National Storage Affiliates’ third-quarter results include:
- Same-store revenue rose 18.5% compared with the same period a year earlier. The REIT now expects same-store revenue growth this year of 14% to 15%, up from the previous forecast of 11.75% to 12.75%.
- Same-store NOI climbed 24.3% compared with the same period a year earlier. The company now anticipates NOI growth this year of 18% to 20%, up from the previous forecast of 15% to 17%.
- Same-store property operating expenses increased 4.6% compared with the same period a year earlier. The REIT now expects same-store property expense growth this year of 3% to 4%, up from the previous forecast of 2.5% to 3.5%.