A joint venture between private investment company Centerbridge Partners, Singapore sovereign wealth fund GIC Private Ltd. and self-storage real estate firm Merit Hill Capital has purchased 57 self-storage facilities from Prime Storage Holdings LLC for $636M. The properties will be managed by self-storage real estate investment trust Extra Space Storage and branded under its name, according to the source.
The purchase was secured with $468 million in first-mortgage debt from Citi, Goldman Sachs and JPMorgan Chase as well as $168.3 million of the venture’s own equity. The deal closed on July 14, according to analysis from Kroll Bond Rating Agency (KBRA).
The two-year commercial mortgage-backed securities loan includes three one-year extension options, and interest-only payments that’ll pay investors at a rate of one-month LIBOR plus a spread of 1.85%, KBRA noted. The deal includes a 0% LIBOR floor.
Built between 1960 and 2014, the facilities comprise 4 million square feet in 26,700 units. They’re in or near 23 metro areas across more than a dozen states, including Maine, New Jersey, South Carolina and Virginia. The portfolio’s average occupancy as of May was 93.1%, KBRA reported.
Founded in 2013 and based in Saratoga Springs, New York, Prime operates more than 255 facilities nationwide.
Centerbridge is a multi-strategy private investment firm focused on leveraged buyouts and distressed securities. Based in New York, it manages more than $25 billion in assets.
Established in 1981, GIC is a global, long-term investor with more than $100 billion in assets in 40-plus countries.
New York-based Merit Hill acquires, owns and manages 130 self-storage properties in 30 states.
Commercial Observer, Citi, JPMorgan, Goldman Sachs Lend $468M for Self-Storage Portfolio