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Strategic Storage Trust II Reports Significant First Quarter Growth

Strategic Storage Trust II Inc., a publicly registered non-traded real estate investment trust sponsored by SmartSop Asset Management, reported its operating results for the first quarter of 2018.

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Strategic Storage Trust II Inc., a publicly registered non-traded real estate investment trust sponsored by SmartSop Asset Management, reported its operating results for the first quarter of 2018.

“Our first quarter same-store growth continues to be strong, following the re-branding of our properties in the United States under the SmartStop Self Storage brand,” said H. Michael Schwartz, chairman and chief executive officer of SST II. “The increase in the first quarter of 2018 was primarily driven by an increase in rental rates, which demonstrates the institutional quality of the portfolio in conjunction with a solid property management team and platform.”

First Quarter 2018 Highlights:

  • Increased total revenue by approximately $2.2 million, or 12 percent, when compared to the same period in 2017. Total revenues for the first quarter were approximately $19.9 million compared to $17.7 million for the same period last year.
  • Increased same-store revenues and NOI by 7.9 percent and 13.9 percent, respectively, compared to the same period in 2017. Same-store revenues were $17.8 million in the first quarter of 2017, compared to $16.5 million for the same period last year. Same-store net operating income was $11.7 million in the first quarter of 2018 compared to $10.2 million for the same period last year.
  • Increased same-store annualized rent per occupied square foot by approximately 12.8 percent, when compared to the same period in 2017, from $13.86 to $15.64.
  • Increased modified funds from operations by approximately $1.6 million, or 45 percent, when compared to the same period in 2017. MFFO was approximately $5.3 million in the first quarter of 2018 compared to nearly $3.7 million for the first quarter of 2017. Funds from operations for the first quarter were $5.5 million compared to $3.2 for the first quarter of 2017.
  • Net loss attributable to common stockholders was approximately ($661,000) in the first quarter of 2018 compared to ($5.2 million) for the same period last year.

Potential Acquisitions: Joint Venture with SmartCentres

In March 2018, a REIT subsidiary and a subsidiary of SmartCentres Real Estate Investment Trust entered into a joint venture agreement for a tract of land owned by SmartCentres and located in East York, Ontario in Canada. Upon closing, the land in East York will be owned by a limited partnership, in which SST II and SmartCentres, both through respective subsidiaries, will each be a 50 percent limited partner and each have an equal ranking general partner in the limited partnership. It is intended that the limited partnership develops a self storage facility on the land.

At closing, SST II will subscribe for 50 percent of the units in the Limited Partnership at an agreed upon subscription price of approximately $3.8 million CAD, representing a contribution equivalent to 50 percent of the agreed upon fair market value of the land. SST II expects the acquisition of the land in East York to close in the third quarter of 2018 after the land has been zoned so as to permit the self storage facility.

Strategic Storage Trust II focuses on stabilized self storage properties and oversees a portfolio of 83 self storage facilities 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.

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