Update 7/18/16 – Sovran has completed its acquisition of LifeStorage. The purchase was funded primarily with the proceeds from an offering of 6.9 million shares of common stock and the sale of $600 million in 10-year notes with an interest rate of 3.5 percent. As part of the transaction, the self-storage REIT will rebrand its entire operation as Life Storage Inc. The move includes changing the name of all Uncle Bob’s locations and altering its ticker symbol on the New York Stock Exchange from SSS to LSI, according to a press release. Rebranding efforts will commence in August.
“The LifeStorage properties are a tremendous addition to our portfolio,” Rogers said. “We’ve added 84 class-A stores to our portfolio, 55 of which are in some of our already established key markets. We’ve also gained a presence in two new markets: Las Vegas and Sacramento, Calif. We welcome the managers and staff at all of these stores to our family, and thank the employees at LifeStorage and Sovran for their diligence and hard work these past few weeks to complete this transaction.”
The rebranding, which will include a new logo and website as well as a re-wrap of the company’s entire fleet of rental trucks, is expected to cost about $22 million, according to the release. The new Life Storage website is scheduled to launch the week of Aug. 8 and will include the recently acquired 84 facilities previously branded as LifeStorage. Current Uncle Bob’s locations will be added as they are converted to the new name. Most of the rebranding costs are related to signage replacement and truck wraps, company officials said.
The renaming of Uncle Bob’s locations will begin in August on a market-by-market basis and is expected to conclude during the second quarter of 2017. UncleBobs.com will remain operational until all stores are converted, the release stated.
“Life Storage is the perfect brand name for our company and for our stores,” Rogers said. “Our customers see us as an extension of their homes or businesses, where the environment is welcoming and their belongings are secure. We’ve always operated with that in mind, but the Life Storage name brings it into focus. It’s about the customer, not about us.”
Sovran now operates approximately 650 self-storage facilities in 29 states.
5/19/16 – Sovran Self Storage Inc., the real estate investment trust (REIT) that operates the Uncle Bob's Self Storage brand, has agreed to acquire LifeStorage LP for approximately $1.3 billion. Sovran has secured $1.35 billion in bridge financing to “provide certainty of closure,” but intends to permanently finance the cash transaction with proceeds raised through debt and equity offerings, according to a press release.
Founded in 2011, LifeStorage operates 92 self-storage properties in nine states, with a heavy concentration in the Chicago area. Once the deal closes, Sovran will own 84 LifeStorage facilities, with a certificate-of-occupancy contract to purchase three additional locations expected to be ready toward the end of this year or in early 2017, the release stated. The LifeStorage portfolio comprises 6.5 million square feet.
The deal will bolster the Uncle Bob’s presence in several markets, including the addition of 25 locations in Chicago, 19 facilities in Texas, and three properties each in Los Angeles and Orlando, Fla. The REIT will also gain inroads to new markets, including 17 assets in Las Vegas and 10 locations in Northern California.
"We are delighted to announce this acquisition,” said David Rogers, Sovran CEO. “LifeStorage has built a high-quality national portfolio, and these stores will enhance and complement our physical footprint and digital presence."
Sovran expects the deal to close during the third quarter. To help finance the transaction, the REIT has launched a public offering of 6 million shares of common stock. In addition, the company has granted the underwriters a 30-day option to purchase up to 900,000 additional shares, according to a press release.
Joint booking managers for the offering are Citigroup, SunTrust Robinson Humphrey and Wells Fargo Securities.
Sovran scheduled conference a call this morning to discuss the LifeStorage acquisition. A slide presentation is available for viewing on the investor-relations section of UncleBobs.com. A telephone replay of the call will be available for 72 hours by dialing 877.660.6853 in the United States or 201.612.7415 internationally. The conference ID is 13638094.
Based in Buffalo, N.Y., Sovran operates more than 550 facilities in 26 states. Its portfolio of owned and managed facilities comprises more than 38.5 million square feet.
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