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JV Finds Safety in Storage Units

CHICAGO-Holliday Fenoglio Fowler arranges a $350-million joint venture involving Investcorp that debuts with a $39.2-million acquisition of four StorageMart properties totaling 377,121 sf and 3,017 units. Self-storage assets have one of the lowest default rates among sectors, says senior managing director Mike Kavanau.

By Mark Ruda | Updated on November 29, 2004

CHICAGO-Four self-storage properties totaling 377,121 sf in the city and suburbs have been acquired for nearly $40 million, the first purchases for a $350-million joint venture sponsored by Murney and Partners and involving Investcorp. The properties, newly built or recently converted, were sold by StorageMart and will now be managed by Scottsdale, AZ-based Storage Today.

In addition to setting up the joint venture, Holliday Fenoglio Fowler, LP’s offices here and in Los Angeles arranged a three-year, $28.2-million loan through Lehman Brothers as well as equity through Investcorp. The loan covers properties at 2647 N. Western Ave. and 419 E. 25th St. in the city, as well as 565 W. Boughton Rd. in Bolingbrook and 9801 W. 55th St. in Countryside. In the shadow of McCormick Place, the 25th Street property fetched $14.3 million alone while the Western Avenue asset commanded $10 million, according to property records. The Countryside StorageMart was worth $9.3 million while the Bolingbrook piece of the deal was the smallest at $5.6 million.

“The asset class has many attractive operational and financial characteristics that make it a compelling new investment alternative for Investcorp,” says Investcorp managing director John Fraser.

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