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Move over multifamily. There's a new supermodel walking the runway and her name is self-storage. (All her dresses are from boxes people put in storage.) One Austin deal helped illustrate three facts about this hot sector. 1) Race to Buy  Reliable cash flow and the low overhead associated with the operations make self-storage very attractive, says Marcus & Millichap national self-storage group's Brandon Karr. Bloomberg Markets even named the four publicly traded self-storage REITs as its favorite alternative investment. Brandon says his recent sale of the 78k SF Your Storage Solution in North Austin is a good example. About 15 potential buyers put in bids. Brandon repped the private seller and the buyer, a publicly traded REIT. 2) Hot Austin Market  Brandon tells us Austin is one of the most desirable markets in Texas for self-storage, and this 772-unit deal at 12506 N Lamar Blvd provided the buyer with a stable income stream right out of the gate. With the REIT's management experience and expertise, there's also opportunity for increasing occupancy and revenue. In 2013, Austin self-storage asking rents climbed 4.7% to $136/unit for climate-controlled facilities like this one. Operators will increase climate controlled rents 4.5% this year, Brandon says. (We're one sweat-drenched t-shirt away from just living in a climate-controlled unit.) 3) Rockin' the Rates  The escrow process took five months because the buyer had to assume the existing CMBS loan, Brandon says. The property was sold at a low cap rate based on the trailing 12 month net operating income. The loan comes due in 2023 and has an interest rate in the low 4% range, he tells us. Away from work, Brandon likes to hit the links with his wife, Bridget. They're trying to indoctrinate their 2-year-old son, Stevenson, into a love of the game, too. He's already adept at pulling the pin out of the hole. |
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Retreat at Barton Creek Breaks '80s Stigma |
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 Berkadia VP Jackson Cloak arranged a $57M loan for the acquisition of Retreat at Barton Creek. Jackson tells us the community is '80s vintage, which carries a stigma, but Retreat at Barton Creek has been well-maintained, and rents increased substantially as the deal was marketed and closing. That overcame lenders' fears, and Jackson says the process was highly competitive (even Fannie and Freddie went after each other... but that's sibling rivalry for ya). |
 The borrower (a partnership led by Paydar Cos and Lankford & Associates) originally planned to get on-balance sheet bridge debt while it renovated and raised occupancy, but then the community rapidly leased up to 97% and ended up going right to a Fannie Mae loan. The 10-year money is fixed-rate and includes three years of I/O. Jackson says Retreat at Barton Creek is well-located and offers similar quality and amenities to nearby communities but is much more affordable. (Many of its neighbors top $2/SF.) |
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What You Don't Know About Blake Bonner Position: director of brokerage at REOC San Antonio Background: 30 years of comprehensive commercial real estate experience What Blake's known for: The Bonner Group, a regional full-service commercial real estate firm he founded in 1992 What he's working on now: Active in brokerage as well as new business/broker development Favorite Song: "I Ain't Superstitious" (Jeff Beck/Rod Stewart) Favorite Vacation: Cruising The Baltic Sea with his wife Favorite Food: Comfort Startling Fact: Highly ranked junior tennis player Most adventurous thing he's done: Four-day white water rafting trip with his youngest son in Oregon Proudest moments of his life: Births of his three kids |
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Hunting for the
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