Smart Buy For SmartStop

Fresh from its fifth storage facility purchase in metro Phoenix, Strategic Storage Trust's Wayne Johnson tells us the market is rebounding, hence his love for the city. SSTI operates a chain of self-storage facilities across the country called SmartStop Self Storage, and most recently, it purchased a 480-unit facility on West Chandler Boulevard for nearly $5M with plans to renovate and rebrand it. Its others here are on Missouri Avenue, Washington Street (below), Guadalupe Road in Mesa, and Broadway Road in Tempe. (Now you can store your old baseball card collection in five places, so your spouse can't throw the whole thing away at once.)

At the time, SSTI entered the market buying up distressed storage facilities as developers struggled during the recession, Wayne says. Now things are turning a corner and rates have picked up, while occupancy jumped 15% portfolio-wide here. SSTI is still shopping for more in the Valley, though it's getting tougher to find product as competition is stronger. To offset this, SSTI has established two additional funds: One buying stabilized facilities at more aggressive cap rates and the second providing local developers equity for ground-up development—such as it's doing in Toronto.

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