Last spring, Phoenix, AZ-based Wentworth Property Group bought a shuttered semiconductor plant manufacturing plant in Scottsdale.
Wentworth, a 40-year-old real estate company, owns several million square feet of industrial and retail space in Arizona. After buying the former Microsemi plant for $6.75 million, the company was considering self-storage as a possible use—but they weren’t familiar with the business.
So an employee called his grade school friend, David King for some advice.
When opportunity calls
At the time, King was vice president of business development at Newport Beach, CA-based storage operator Westport Properties, and had been for four years working from his own office in Phoenix.
“The guys at Wentworth called me for my opinion about using part of the building for a storage facility to go along with an office user that they already had in tow,” King said, “It quickly became obvious to me that it would be a phenomenal site for self-storage – storage was an approved use under the existing zoning which is very hard to find in that area.”
The site also had great visibility from the 101 freeway and King said there was a lot of pent up demand in the area.
“I worked through the process with them, not to go with a creative office use but to do the whole building as self-storage with added drive-up spaces.”
King advised them to convert the entire building to self-storage, nixing the plan to convert part of the building into creative office space. The initial plan was that Westport Properties would assist Wentworth with the development of the site and manage the finished product under its US Storage Centers banner.
A surprise offer
One thing led to another and Wentworth asked King if he was interested in heading up a new self-storage division within the company.
“It was the hardest decision of my life to leave Westport,” King said.
King was hired by Westport in 2011 to help grow its third party management pipeline and find acquisition, development and conversion opportunities across the country.
“It was really a dream job as I had been wanting to switch over to the owner-operator side of the business,” King said.
Prior to Westport, King was a business development manager at kiosk-maker OpenTech Alliance for more than three years.
From wafers chips to storage units
Work is now underway for the Scottsdale project at 8700 E. Thomas Road. The existing building will be converted into 87,000 square feet of climate-controlled storage units, and 33,000-square-feet of drive up storage units are also being built on the property—including some oversized units for RVs. The facility will offer more than 950 units when it opens in the second quarter.
US Storage Centers will manage the finished facility.
Wentworth is also offering two retail pad sites on the property. It already sold about five acres to the city of Scottsdale for $3.68 million for water treatment and flood control uses, the Phoenix Business Journal reported.
Full speed ahead
King started his new job as vice president of the self-storage division on June 15 and hit the ground running.
Since then the company has closed on three acquisitions of existing storage facilities in Las Vegas. Those locations are also managed by US Storage Centers.
Wentworth is closing this month on a former retail furniture store in Tempe, which will be the company’s second conversion project and is slated to be complete by fall. King said they are also closing on an existing facility with a planned expansion in Phoenix.
To help the company’s expansion into storage move faster, King recently hired David Brown as director of self-storage. Brown, who King knew from when they used to bartend together, recently completed three certificate of occupancy storage deals as a senior investment manager at Monolith Group Development.
Shopping for storage
So far, King said that the company is under contract, negotiating contracts or has letters of intent on 20 sites in seven states. The sites are an even mix of existing facilities and development projects.
“It changes day to day,” King said. “I’ve looked at 10 acquisitions today that aren’t a fit for us and I’ve looked at two conversions and one development deal that is a fit. Next week could be different. We are really opportunistic.”
King said the company is equally prepared to hold its facilities for the short or long term, depending on the market.
“If in five or seven years we decided to sell, we can look at that option. If that is not an option, we are fine holding,” King said. “We have good partners that trust our judgement.”