A joint venture between Harbert U.S. Real Estate Fund IV L.P. (HUSREF IV) and self-storage real estate investment trust W. P. Carey Inc. has sold a large self-storage portfolio consisting of 20 facilities across nine states. The properties comprise 1.4 million net rentable square feet and 12,561 storage units. As of Sept. 30, the average occupancy for the portfolio was 85 percent, officials said in a press release.
HUSREF IV and W. P. Carey formed a joint venture in 2009 with the intent to acquire a portfolio of unstable properties, stabilize them and then sell to a strategic buyer, officials said. In January 2009, the joint venture purchased 13 self-storage facilities in California, Connecticut, Florida, Georgia, Massachusetts, Ohio and Texas in a single transaction. In 2010, the companies acquired seven more facilities in four transactions that included five assets in Chicago, one in Arkansas and one in Florida. The properties were owned by the joint venture and managed by third-party managers.
"We are very pleased with the execution of the portfolio roll-up strategy," said Travis Pritchett, managing director of HUSREF IV. "We entered the self-storage sector as a defensive play in 2009. We liked the risk profile and the timing but needed the right operating partner to execute. W. P. Carey delivered that expertise, and we are very pleased with the result."
"[We] are very pleased with the performance of this joint venture with Harbert,” added Anne Coolidge Taylor, managing director of W. P. Carey. “Through active management, we were able to grow net operating income for the portfolio and achieve a favorable exit."
HUSREF IV, the majority owner in the joint venture, is a fully invested fund actively selling properties as they stabilize. It is a sponsored fund under Harbert Management Corp.’s (HMC) Real Estate Group. HMC is actively seeking new acquisitions for Harbert United States Real Estate Fund V, L.P., a follow-on fund formed to invest in undervalued, fundamentally sound apartment, office, retail and industrial real estate assets.
New York-based W. P. Carey is a publicly traded REIT that oversees a global investment portfolio of approximately $15.8 billion. It provides companies worldwide with long-term sale leaseback and build-to-suit financing, and engages in other types of real estate-related investment, including self-storage.