Non-traded self-storage REIT Strategic Storage Trust generated $23.13 million in revenue during the first quarter, up 19 percent from the same period last year.
The Ladera Ranch, CA-based operator, which owns the SmartStop Self Storage brand, boosted its operating income by 41 percent over last year to $4 million. However, interest expenses of $4.6 million and other costs resulted in a net loss of $1 million. However, that’s an improvement over the first quarter of 2013, when the company racked up a $2.17 million loss.
Strategic Storage Trust saw positive numbers for same-store growth in the first quarter. Same-store revenue rose 7.6 percent compared with the same time last year, and same-store profit climbed 8.1 percent.
Average occupancy at same-store locations was 83.5 percent during the quarter, a new record for first-quarter occupancy. The company said in a news release that the occupancy gains put it in a “strong position for potential positive rental rate growth and increased occupancy.”
In addition, the REIT’s realized rents for the quarter increased 2.5 percent over the same period last year, to $9.99 per square foot.
Acquisitions and development
In the first quarter, the company grew its portfolio with the purchase of a 71,500-square-foot facility in Hampton, VA, for $6.7 million and a 51,000-square-foot facility in Chandler, AZ, for $4.9 million.
At a cost of $5.7 million, the company also picked up a majority interest in a facility it operates in San Francisco with a joint venture partner. Strategic Storage Trust now owns 98 percent of the 76,200-square-foot facility, which is at 190 Otis St. in San Francisco.
On the development front, the company bought a parcel of land in Toronto for $3.8 million. The deal happened after the quarter ended March 31. Strategic Storage Trust plans to build a 78,000-square-foot facility with 870 units.
The REIT now operates 126 facilities in 17 states and Canada.
Strategic Storage Trust II
Executives at Strategic Storage Trust are in the midst of an initial public offering for a second REIT called Strategic Storage Trust II.
According to documents recently filed with the U.S. Securities and Exchange Commission, $680,000 of the minimum funding amount of $1.5 million had been raised as of May 7.
The REIT has a contract to buy a portfolio consisting of three facilities in Raleigh, NC, and two facilities in Myrtle Beach, SC, for $22.1 million once the $1.5 million fundraising mark has been reached. Those five facilities then will fall under the Strategic Storage Trust II umbrella. The new REIT plans to assume an existing $12.8 million loan as part of the deal.
Strategic Storage Trust II ultimately wants to raise as much as $1 billion through the IPO.