Prudential Real Estate Investors (PREI) has sold its majority interest in a portfolio of 36 self-storage properties spread across 18 states to its minority joint venture partner for approximately $300 million, according to various media reports.
PREI sold its 95 percent interest in the properties to Extra Space Storage, a Salt Lake City-based self-storage real estate investment trust. Extra Space previously had owned just 5 percent of the venture, known as ESS PRISA III, which the two firms had formed in 2005.
Despite PREI being the majority owner prior to the sale, all 36 properties had been operating under the Extra Space brand. They consist of about 2.5 million square feet of rentable space across 23,400 units. As of 31 March, the properties' collective occupancy was 87.8 percent.
Of the 36 self-storage facilities, six are in New York, five are in California and three are in Tennessee. States with two sites include Florida, Maryland, Massachusetts, New Jersey, Ohio, Texas and Virginia. States with only one facility include Alabama, Arizona, Connecticut, Illinois, Michigan, New Mexico, Oregon and Washington.
The $300 million acquisition price consists of $162 million in cash to PREI and the assumption of an existing $145 million loan, of which roughly $138 million relates to PREI's self-storage equity. The loan bears interest at a fixed rate of 4.97 percent and matures in August.