Stock Storage Bldg

CASE STUDY:
Maximizing Property Value During Lease-Up

Background

The Miami MSA is one of the hottest markets for self-storage acquisition in our industry today. With the great migration occurring all over the state of Florida, the Miami market has prospered in recent years with significant job and rent growth across the board. Last fall, the Miami, FL self-storage market was reeling from dozens of self-storage deliveries simultaneously opening, thus creating a short-term supply and highly competitive trade area for neighboring properties.

Senior Associate: Cameron Vale, 813.602.0228
Director: Ryan Clark, 216.302.3661

ESS Miami Just Sold

Challenges

Our sellers engaged the SkyView team to determine what a market response could be for new stores nearing stabilized physical occupancy, in a high-growth market. The portfolio consisted of four Class A multi-story climate controlled facilities in high traffic areas managed by Extra Space Storage, totaling 258,379 NRSF and 3,341 units, with current rental rates well below stabilized market rates. 

Experiencing similar circumstances? Email Cameron Vale at cvale@skyviewadvisors.com.  

Strategy

Our team went to work with our all hands on deck approach to fully understand the opportunity and time the marketing of the assets with the properties’ optimal maturation and operational seasonality. We delivered a highly detailed business plan and custom strategy detailing how SVA would challenge the market to achieve full stabilized value today.  The strategy enabled our sellers to mitigate the inherent market timing risks from holding the portfolio. The foundation of the strategy was the SkyView Process, a 252-point proprietary process, designed to ensure our team works collaboratively and in lock-step with all our clients.

Result

In marketing the portfolio through our multi-stage Call for Offers Process, the SkyView team was able to provide certainty in achieving a fully stabilized value today. Our sellers avoided any market timing risk and supply headwinds in the Miami MSA. The entire portfolio received 10 written offers and international interest from large Private Equity, Family Office, Private REIT, and Public REIT entities. The 3rd party REIT manager did not participate in the offering.

Takeaways

With self-storage deliveries reaching their highest levels in recent years, the market continues to have a strong appetite for high quality product where the fundamentals remain strong for long-term growth. Many new developers who have entered the space are wondering if they should see their self-storage property through to the full physical and economic stabilization or capitalize on this market timing window in the current cycle. While the ultimate answer lies with your investment goals, there is absolutely a closing window wherein this cycle’s pricing will no longer be available in the marketplace.

SkyView Advisors has sold more institutional 3rd party managed product than any other firm over the last 18 months. We specialize in advising clients on risk mitigation and navigating lease-up towards disposition. If you are thinking about selling or have received a direct offer, click here to schedule a call to determine how much value you could be leaving on the table. 

Edited by: Paris Patrick, SkyView Marketing
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