Cushman & Wakefield (C&W) has completed the sale of three separate self-storage transactions across California during the first quarter of 2018 totaling $84.5 million in value and more than 340,000 rentable square feet. One of the transactions was Fenton Street Self Storage, located in the Eastlake area of San Diego County and totaling 86,000 rentable square feet.
The project was sold by San Diego–based Pacifica Companies at completion and is a best-in-class asset located in what C&W has deemed “a dynamic, high-growth trade area.” The buyer was Strategic Storage Trust, which will operate the store under its brand name, SmartStop Self Storage. Cushman & Wakefield’s Greg Wells of the firm’s Self Storage Practice Group represented both the buyer and the undisclosed seller in the transaction.
“The self-storage market continues to see strong demand from all capital sources,” Wells says. “Fenton Street Self Storage was sold at completion of construction, offering the buyer higher yields versus stabilized assets.”
The other two assets sold in the Southern California market included Magellan Storage – Commerce, an institutional-quality asset located in central Los Angeles totaling in excess of 140,000 rental square feet, and Storage Solutions – San Jose, a converted warehouse building located in the Diridon Station area of Downtown San Jose. According to Wells, Magellan Storage – Commerce offered a very rare opportunity to acquire a class-A institutional-quality asset located in the densely populated, core urban central Los Angeles market. Storage Solutions – San Jose was a rare covered land play, allowing the buyer to buy and hold a cash-flowing asset while waiting for an area to redevelop.
Wells says the different dynamics and buyer profiles of the three separate sales demonstrate the attractiveness of the self-storage sector to a wide variety of buyers.
Magellan Storage – Commerce was purchased by a joint venture between US Storage Centers, a national self-storage operator, and an institutional private equity firm. Wells and David Hasbrouck of C&W’s Capital Markets group in Los Angeles handled the transaction on behalf of the seller.
Storage Solutions – San Jose was purchased by a joint venture between Trammell Crow and Google, Inc. and is planned to be a part of the proposed new Google campus in downtown San Jose. Wells, along with Eric Fox and Adam Lasoff of Cushman & Wakefield’s Northern California Capital Markets Group, represented the undisclosed seller.