Thursday, Nov 21st – On October 29, 2019, SmartStop Self Storage REIT, Inc. entered into a preferred stock purchase agreement with Extra Space Storage LP, a subsidiary of Extra Space Storage, Inc. (NYSE: EXR), in which EXR committed to purchase up to $200 million in a new Series A Convertible Preferred Stock.

This has been a transformational year for SmartStop and this investment solidifies their balance sheet for maximum flexibility in the future. EXR is the 2nd largest self storage operator in the U.S., with a market capitalization of more than $14 billion. The investment, which we can draw up to $200 million, is affirmation of the quality of SmartStop’s portfolio and its self storage platform. This transaction is unique in both the self storage and non-traded REIT industries, and speaks to the relationship between SmartStop and EXR.

Joseph D. Margolis (CEO – Extra Space), described the investment during the EXR Q3 earnings call,”We’ve had a good and long relationship with SmartStop…we bought the large portfolio from them in 2015 and in connection with that transaction, we made a loan to them, which they fully paid back and without default. We managed almost 100 stores for them until they internalized management. So we know this company and these properties very, very well. This was a good investment for us, (an) accretive investment. We are in a very comfortable position from a risk standpoint and we also feel it strengthens our relationship with the company, and hopefully we’ll do more with them in the future.”

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Full Extra Space Storage Inc (EXR) Q3 2019 Earnings Call Transcript Click Here.

SmartStop Stockholder Letter Announcement Click Here.