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Strategic Storage Growth Trust to be Acquired for $12 Per Share

Strategic Storage Trust II Inc. (SST II) and Strategic Storage Growth Trust Inc. (SSGT), two publicly registered non-traded REITs sponsored by SmartStop Asset Management, have entered into a definitive merger agreement where SSGT will merge with and into a wholly-owned subsidiary of SST II.

Strategic Storage Trust II Inc. (SST II) and Strategic Storage Growth Trust Inc. (SSGT), two publicly registered non-traded REITs sponsored by SmartStop Asset Management, have entered into a definitive merger agreement where SSGT will merge with and into a wholly-owned subsidiary of SST II.

SST II plans to acquire all of the real estate owned by SSGT, consisting of 28 self storage facilities located in 10 states and Canada. Additionally, SST II will obtain the rights to acquire two self storage facilities currently under contract with SSGT.

Under the merger agreement, SST II will pay SSGT stockholders $12.00 per share in cash, which represents a total purchase price of approximately $340 million, including current outstanding SSGT debt to be assumed or repaid.

The special committees and the boards of both REITs have approved the proposed merger, which is subject to approval by SSGT stockholders, as well as other customary closing conditions. Stockholders will vote on the proposal at a special meeting on a date to be announced.

“We are excited for the opportunity to consolidate SSGT with SST II, into a company with revenues that we anticipate will exceed $100M next year,” said H. Michael Schwartz, CEO and chairman of the board of directors of SST II. “The SSGT portfolio will infuse SST II with a key growth driver, along with adding assets in key SST II markets for further economies of scale.”

The merger agreement also provides SSGT with a go-shop period, during which the special committee of SSGT’s board of directors will actively solicit alternative proposals from third parties for the next 45 days until November 15, 2018.

SSGT will pay a termination fee of $2.9 million to SST II if it terminates the merger agreement due to a superior proposal that arises during the go-shop period, or $9.6 million if it terminates after the go-shop period.

The merger is expected to close during the first quarter of 2019.

Strategic Storage Growth Trust focuses on the acquisition, development, redevelopment, and lease-up of self storage properties. The company’s portfolio currently consists of 27 operating self storage facilities and one development property. The offering launched in January 2015 and raised more than $281 million in investor equity before closing in March 2017, according to Summit Investment Research.

Strategic Storage Trust II invests in stabilized self storage properties and oversees a portfolio of 83 properties located in 14 states and Ontario, Canada. The offering was declared effective by the SEC in January 2014 and closed three years later after raising $570 million in investor equity.

SmartStop sponsors four public non-traded REITs: Strategic Storage Trust IV Inc., Strategic Storage Trust II Inc., and Strategic Storage Growth Trust Inc., all focused on self storage assets, and Strategic Student & Senior Housing Trust Inc., focused on student and senior housing assets. SmartStop is also a national sponsor of Section 1031 exchange offerings using the Delaware statutory trust structure.

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