The fund, which is sponsored by Newport Beach-based CT Realty Corp., has picked up the self-storage property for $6.9 million. Located at 1160 Third Ave., the facility was about 75% occupied at the time of sale, according to Greg Wells of Grubb & Ellis/BRE Commercial, who brokered both sides of the transaction. He tells GlobeSt.com that this 75% occupancy level is "where the upside (in the asset) is," since "the Chula Vista market is 90%-plus."
As Wells explains it, seller CV Storage Holding LLC is not a self-storage owner/operator and actually owns just one other self-storage facility that it is also selling. The LLC was "a very hands-off owner/operator and CT saw the upside in buying a property from somebody that just did not pay attention to the day-to-day management," Wells tells GlobeSt.com.
The property was on the market for approximately a month and had as many as eight offers on it at one point, Wells says, adding that the asset sold for "just above full price." The interest in the Third Avenue property seems to reflect the growth in the self-storage sector across San Diego County. "The storage market, in San Diego in particular, is very strong-–occupancies are very high, rents have trended up over the last several years, and there is very, very little product for sale--so there is just huge buyer interest when something comes up for sale," Wells says.
Commercial real estate investor and developer CT Realty currently has three funds that specialize in self-storage assets: the CT Self Storage Fund that was created in 1999, the CT Self Storage Fund II that was funded in 2001, and the CT Self Storage Fund III that was funded in 2003. Other investors have followed suit, as self-storage product has picked up steam across the Southland over the past several years. "There are a lot of people who weren't in the self-storage business three or four years ago who are now in the business or looking to get into the business," Wells says.
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