Los Angeles-based real estate developer Concord Wilshire Cos. has partnered with Denver-based private-investment firm Summit Investment Management LLC to pursue self-storage acquisitions and developments. The $480 million Concord-Summit Fund-1, launched by the partners’ joint advisory firm Concord Summit Capital (CSC), intends to buy or build 40 self-storage facilities over the next four years, according to a press release. The initiative will operate under the Concord Summit Storage moniker, though it’ll seek a “brand franchise” to manage its properties.
“Over the last decade, the self-storage industry has consistently performed throughout economic cycles and outperformed all other commercial real estate sectors, with average returns of over 20%,” said Kevin O'Grady, managing director of CSC. “We have plenty of aggressive debt and equity capital available for this market.”
Concord Summit has already acquired interest in two Atlanta self-storage facilities and entered agreements to purchase and develop five additional properties in Atlanta (two), Boston (one) and Tampa Bay, Florida (two). Of the $92.5 million estimated cost, $22 million will come from Fund-1, with the remainder through structured financing, the release stated.
The partnership is also targeting investment opportunities in Illinois, Pennsylvania and New Jersey, according to a source.
The Concord/Summit self-storage model will include “the best available and user-friendly technology and applications,” with targeted rental rates of more than $2 per square foot, O’Grady told a source. The fund will also pursue related mixed-use projects with residential and retail components as well as provide “rescue capital” for existing self-storage facilities.
The fund is also expected to consider other real estate investment opportunities, including build-to-rent properties and hospitality.
Founded in 1992, Concord specializes in mixed-use, residential and resort developments. It has more than $10 billion in acquired and developed assets, according to the release.
Founded in 2002, Summit invests in and manages distressed and underperforming commercial debt and other financial instruments. It’s invested more than $1.5 billion across multiple industries and capital structures, with transactions ranging from $1 million to $75 million, the release stated.
The Real Deal, First-Time Fund Managers Bet $480M on Self-Storage Across US
Yahoo Finance, Concord Summit Capital Announces the Commencement of Concord Summit Fund-1