Mele Storage Group Closes Three-Property Deal in Florida
- TAMPA, FL, February 12, 2007 - When Marcus & Millichap"s Mele Storage Group lists a new property, its goal is to close the deal at the highest possible yield for its clients - ASAP. The self-storage real estate broker did just that with the sale of a three-property portfolio along Florida"s Gulf Coast.
The Mele Storage Group listed ASAP Storage"s portfolio at $30.5 million. Mele"s efforts yielded $26.534 million sale for the seller on January 25, 2007. One of the most unique aspects of this deal was the seller"s requirement: The trio of properties had to be sold as a complete portfolio. ASAP Storage would not break up its holdings for sale to individual buyers.
"ASAP Storage wasn"t willing to compromise on the portfolio requirement. The owners wanted to sell all three properties in one deal. Our team tapped into our network of ready investors to find a buyer who was willing to meet those terms. Our resources and experience brokering mega deals like this one paid off for the seller and the buyer," says Michael A. Mele, Senior Investment Associate at Marcus & Millichap"s Mele Storage Group and President of the Florida Self Storage Association.
The ASAP Storage portfolio presented an attractive opportunity for the right buyer. The three properties have a total of 1,992 units and 230,862 rentable square feet. The Class A facilities sit on a collective 25 acres of real estate in strategic Gulf Coast Florida locations with high visibility in rapidly growing communities. All three properties have stable occupancies and include amenities that are appealing to investors, such as standing seam steel roof, a manager"s apartment and office, state-of-the-art security, climate controlled units and roll-up doors. What"s more, the Lehigh and Fort Meyers properties are in the midst of expanding, with an additional 23,740 rentable square feet and 183 units planned for the sites.
Although the property had all the earmarks of an investment-class portfolio, there were still obstacles to finding a suitable buyer. Besides the all-or-nothing sales approach that required one investor to purchase all three properties in the ASAP Storage portfolio, there were three additional key challenges The Mele Group navigated to successfully close the deal: an assumable mortgage, the recent expansions that had not yet reached stabilization, and obtaining insurance for the properties during the height of the Florida insurance crisis.
As Mele was putting the deal together, all parties involved thought the insurance policy would be assumable but soon discovered that wasn"t the case. When the investor shopped around for bids, the rates were prohibitive and it looked like a deal killer.
"Having done many large deals in the past, we understood the obstacles up front and were able to approach them strategically," says Scott Rutherford, an Investment Associate at Marcus & Millichap"s Mele Storage Group. "For example, by tapping into our extensive database of investors, we were able to identify a buyer who had the expendable capital necessary to cover the large down payment and who was willing to accept and overcome the insurance hurdle. Our underwriting expertise and our relationships with industry stakeholders allowed us to price the property with pro forma expectations the market would withstand despite escalated insurance costs."
12.02.2007 - 21:48 Source: 24-7pressrelease.com | Read: 371 X
