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Brazil Self-Storage Joint Venture MetroFit Receives $184M Investment Pledge from Goldman Sachs Group

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MetroFit SA, a São Paulo-based joint venture between Illinois-based self-storage operator Metro Storage LLC and Brazil-based real estate development and management firm TRX Group, has received a $184 million investment pledge from Goldman Sachs Group Inc., a multi-national banking firm. Goldman Sachs will make its investment over the next six years, according to the source. The capital infusion will be used to “recapitalize” existing facilities and fund expansion across Brazil, according to a Metro Storage press release.

Bank officials liked that Brazil’s self-storage industry has continued to grow despite the worst recession since the 1930s, according to TRX CEO Luiz Augusto do Amaral. “Goldman Sachs is betting on a longer-term recovery," Amaral told the source. "And the timing is good to expand, since this year there is a lot of new real estate coming to the market with prices lower than expected."

Launched in 2012, the MetroFit brand currently operates three self-storage locations, with a fourth under development. The joint venture intends to build up to 10 facilities per year in different Brazilian state capitals, Amaral said, adding the company may use part of the investment to fund acquisitions as well as new development.

Competitors in the region, including GoodStorage and GuardeAqui, which is controlled by Chicago-based investment-management company Equity International, have also announced expansion plans, the source reported.

“Through the investment, MetroFit intends to become the leading self-storage platform in the Brazilian market,” the release stated. The company estimates there are 150 storage facilities in Brazil serving a national population of about 200 million.

“The continued urbanization of Brazil’s large metropolitan markets, combined with the growing consumerism across all income segments, portend well for self-storage operators like MetroFit that provide short-term, flexible storage solutions for personal as well as commercial customers,” company officials said.

“We are totally confident in Brazil’s long-term prospects, and Goldman’s investment in MetroFit demonstrates why self-storage is such a compelling business opportunity in Brazil,” Amaral said in a released statement.

“Given the unplanned growth of many Brazilian cities and how unpredictable things can be from one day to the next, self-storage has become an alternative for those who need additional space quickly and in a practical manner,” added Hans Scholl, CEO of MetroFit.

Founded in 2007, TRX Group has developed more than 15 million square feet of commercial and industrial properties in Brazil and manages $1.8 billion in real estate assets. It has eight employees in Miami and another 80 worldwide. TRX Investments LLC, an affiliated investment fund, was launched in 2014 to develop and manage development projects in the United States.

Headquartered in Lake Forest, Ill., Metro Storage is a privately owned, fully integrated real estate operating company specializing in the acquisition, development and management of self-storage facilities in the United States. Its portfolio includes 120 self-storage properties in 12 states comprising more than 8.1 million square feet. Its participation in the MetroFit joint venture is handled through its wholly owned subsidiary, Metro Storage International LLC.

Sources:

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