Update 1/6/21 – BREIT completed its acquisition of Simply Self Storage on Dec. 18. With the deal complete, the company believes it is now the third largest non-listed self-storage operator in the United States, according a press release.
Simpson Thacher & Bartlett LLP served as BREIT’s legal adviser, while BofA Securities Inc. and Deutsche Bank Securities Inc. served as its financial advisers. Fried, Frank, Harris, Shriver & Jacobson LLP, Newmark Group Inc. and RBC Capital Markets LLC advised BAM.
10/27/20 – Blackstone Real Estate Income Trust Inc. (BREIT), a non-traded real estate investment platform affiliated with Blackstone Group Inc., has agreed to acquire Simply Self Storage (SSS) from Brookfield Asset Management Inc. (BAM), a global asset manager with large investments in commercial real estate. The $1.2 billion deal is expected to close before year-end, according to a press release.
BREIT currently owns a $300 million portfolio of self-storage properties, the release stated. “This transaction is a complementary addition to BREIT’s high-quality portfolio of income-generating real estate, which is heavily weighted towards logistics and multi-family primarily in growth markets,” said Frank Cohen, CEO and chair of BREIT. “Simply Self Storage is a best-in-class company with significant potential for growth through future acquisitions in a highly fragmented sector. Similar to logistics, self-storage is a resilient sector through economic cycles because of low tenant turnover, minimal maintenance costs and stable cash flows. We look forward to continuing to acquire high quality assets on behalf of our BREIT investors.”
BAM had been fielding interest from prospective buyers on the 124-facility SSS portfolio since at least September, according to an earlier report from Bloomberg. With facilities across 23 states, SSS ranked on both of the Inside Self-Storage 2020 Top Operators Lists, placing at No. 15 on the list of 100 facility owners and No. 21 on the list of 50 facility-management companies. It reported a portfolio of owned and managed properties comprising more than 10.3 million net rentable square feet, though BREIT officials indicated the portfolio size is 8 million square feet.
BAM acquired SSS in 2016 and sold 112 facilities in 2018 to a joint venture between real estate investment trust (REIT) National Storage Affiliates Trust and an affiliate of Heitman Capital Management LLC for $1.325 billion. “Brookfield more than doubled the size of the company and helped transform the business into a fully integrated institutional platform,” BREIT officials said.
BAM has $550 billion in assets under management, according to its website. It owns and operates assets with a focus on infrastructure, private equity, property and renewable energy. The company offers a range of public and private investment products and services, and is co-listed on the New York, Toronto and Euronext stock exchanges.
BREIT invests in stabilized, income-generating commercial real estate in the U.S. as well as real estate-related securities. More than 90 percent of its investments are in industrial, multi-family and net-leased assets. The company has approximately $3.6 billion of immediate liquidity it can use for acquisitions, according to the release. It’s managed externally by a subsidiary of private-equity firm Blackstone, whose real estate business was founded in 1991. Blackstone has approximately $167 billion in investor capital under management.
Sources:
Business Wire, Blackstone Real Estate Income Trust Completes Acquisition of Simply Self Storage for Approximately $1.2 Billion
Blackstone, Blackstone Real Estate Income Trust to Acquire Simply Self Storage for Approximately $1.2 Billion
The Globe and Mail, Blackstone to Buy Simply Self Storage from Canada’s Brookfield for $1.2-Billion
