By Meghan Hall
Another asset class that has experienced successful growth during the pandemic are self-storage facilities; as home became a catch-all for work and play, and as populations sought to move, demand for self-storage has increased. Traditionally a niche asset class, institutional investors are now looking to acquire self-storage real estate. In a recent deal, independent management company Invesco purchased Storage Court of Mill Creek for about $28.26 million. The seller, according to public documents, is affiliated with Mercer Island-based Azose Commercial Properties.
The asset is located at 17811 Bothell Everett Highway and was first constructed in 1989. The facility features storage units as little as 25 square feet all the way up to 300 square feet, according to StorageCafe. Snohomish County Assessor’s data shows that the buildings sit on about 4.34 acres.
Invesco has been working to expand its investment into the self-storage sector over the past several years.
“There is strong demand and a favorable outlook for student housing, industrial and self-storage, and we believe these sectors will continue to perform well,” said R. Scott Dennis, President and Chief Executive Officer for INREIT in a recent statement. “INREIT remains nimble, which allows us to execute on our best ideas within our highest conviction sectors.”
In September of this year, the firm announced that Invesco had passed half a billion dollars in gross investments thanks to several acquisitions in growing sectors, including student housing and self-storage. The company also reported $1,528.6 billion of assets under management and net long-term inflows of $3.2 billion in September.
As of July 2021, fundamentals within the self-storage sector remained strong, and continued to prove its resilience, according to a report by Yardi Matrix. Street rates and development activity continued to grow. Rents for climate-controlled, 100 square foot units rose 12.7 percent, and in Seattle, climate-controlled storage properties saw rent growth of about eight percent. Nationwide, there were 2,303 self-storage properties under development. 564 of those are currently under construction. Growth in the industry is expected to continue as supply increases moderately among surging demand.