Dean Jernigan, a 34-year veteran of the self-storage industry, has stepped down from day-to-day management of self-storage financing and investment REIT Jernigan Capital Inc., with John Good replacing Jernigan as CEO and Jonathan Perry assuming the role of president.
Jernigan hasn’t left the company he founded, though. He remains executive chairman of the Memphis, TN-based REIT and said he plans to remain “very active” in the company, including involvement in investment decisions as a member of the investment committee.
But he made it clear that Good will be in charge.
“After working together for many years on other ventures, John and I have been partners building Jernigan Capital from an idea in early 2014 to what it is today,” Jernigan said in a news release. “I have thoroughly enjoyed working with John to build our world-class team that continues to serve our shareholders exceptionally well.”
Good has been president and chief operating officer since June 2015.
“John is perfectly suited to be the CEO of an internally managed and internally advised equity REIT in [the] storage sector,” Jernigan told Wall Street analysts Nov. 1 during the REIT’s third-quarter earnings call.
Perry, Jernigan’s son-in-law, had been executive vice president and chief investment officer (CIO) since June 2018. In addition to becoming the new president, he retains the CIO title. Perry previously was an executive at Malvern, PA-based self-storage REIT CubeSmart. Jernigan is former CEO of CubeSmart.
“I have worked with Jonathan since 1998 in many capacities in the self-storage business and know him as one of our industry’s best minds, as well as like-minded with John and me on how to create shareholder value,” Jernigan said.
Good’s and Perry’s ascent to their new jobs came about as part of a succession plan launched in 2016.
View of the development market
In his first earnings call at the helm, Good offered an assessment of the current state of self-storage development. Development sites and financially attractive development deals have both become difficult to find, he said.
“If you’re looking to build in an urban core area that has high density and low square footage per capita with good incomes and good population growth, whereas 2.5 years ago you’re picking low-hanging fruit — or in some cases picking fruit off the ground — now you’re really looking for needles in haystacks,” Good said. “We feel like that’s being supported by a drop-off in construction lending.”
For the third quarter, Jernigan Capital reported:
- A 170 percent spike in revenue compared with the same period in 2017.
- A 169 percent jump in net profit compared with the same period in 2017.
- Full ownership of six of the initial 11 self-storage facilities it financed in 2015, including a recent acquisition in Charlotte, NC.
- Delivery by business partners of over 50 percent of the self-storage projects that have been financed by the REIT.
- Cautioned that delivery of facilities being developed by business partners could shift from the fourth quarter of 2018 to the first quarter of 2019 due to labor shortages and other construction hurdles.