Strategic Storage Trust II Inc. (SST II), a public, non-traded, self-storage real estate investment trust (REIT) sponsored by SmartStop Asset Management LLC, has released its financial statement for fourth-quarter and full-year 2018, which ended Dec. 31. In general, the company showed year-over-year gains in total revenue, same-store revenue and net operating income (NOI).
SST II increased total revenue 4.1 percent to $800,000 during the quarter, while same-store revenue and NOI grew 3.4 percent and 1.3 percent, respectively, compared to the same period in 2017. For the year, total revenue grew 5.7 percent to $4.3 million, while same-store revenue and NOI grew 4 percent and 4.8 percent, respectively.
Same-store occupancy was 88.5 percent at for the year, down from 92.7 percent in 2017. The REIT reported growth in same-store annualized rent per occupied square foot, showing an increase of 9.5 percent ($15.81) year over year. During the quarter, same-store annualized rent per occupied square foot increased 7.6 percent to $16.19.
Modified funds from operation (MFFO) fell about 10 percent to $500,000 compared to the same quarter in 2017. For the year, MFFO increased 7.8 percent to approximately $1.4 million.
“The existing SST II portfolio continues to perform,” said H. Michael Schwartz, CEO and chairman of the board. “We are also excited for the recent closing of the Strategic Storage Growth Trust Inc. merger, which will be a transformative acquisition for the company. Following the merger, SST II has become a portfolio of over 110 high-quality self-storage assets with a combined value in excess of $1.3 billion.”
After factoring operating and other expenses, SST II reported a net loss for the year of about $3.7 million, an improvement from a loss of nearly $15 million in 2017. The REIT took in more than $78.4 million in self-storage rental revenue and $1.9 million in ancillary operating revenue in 2018.
The SST II portfolio includes 111 self-storage facilities in Canada and the United States. It comprises approximately 70,000 self-storage units and about 8.1 million rentable square feet of storage space. The company is sponsored by SmartStop Asset Management, a diversified real estate company with a managed portfolio of 129 self-storage facilities in Canada and the United States. Its managed properties comprise approximately 9.6 million rentable square feet.