UNLOCK THE POWER OF THE VAULT

Leitbox Successfully Sells Mixed Use Storage Development

October 15, 2020

Leitbox Successfully Sells Mixed Use Storage Development

October 15, 2020 | James Sprow | Blue Vault

One of the advantages of self-storage as an asset class cited by Bill Leitner, Managing Principal of Leitbox Storage Partners, is the ability to monetize an investment at three different stages:  certificate of occupancy, lease-up, and stabilization at 85% to 90% occupancy.  The certificate of occupancy sales typically requires a bullseye location.  “We often integrate mixed-use to secure a site that’s otherwise unavailable.  Mixed-use helps us overcome that barrier”, says Leitner. One recent example that demonstrates that quality is the sale of Spacebox Nashville, a mixed-use development in Nashville, Tennessee. The three-story climate-controlled self-storage facility integrates street-front retail. It was sold in the first quarter of 2020 at the certificate of occupancy stage, 17 days after receipt of the occupancy certificate.  The transaction garnered a sales price of $241 per square foot, an amount more often achieved for the sale of a stabilized asset and currently holding the price/SF record in Tennessee for a certificate of occupancy sale. 

Leitbox has two properties in its Leitlock I Directed Capital Fund I portfolio that are currently in the lease-up stage: 

Spacebox Lake Park is located in the West Palm Beach trade area near a major retail node consisting of Costco, Lowes, and Kohl’s Department Store. The three-story 74,200 square foot facility incorporates 4th generation technology within a Class A physical plant with high-end exterior finishes.  It benefits from the area’s strong demographics with average household income over $100,000.  Coming off a strong summer of lease-up activity, the property’s current occupancy stands at 57%. The facility has leased up more than 3% of total units per month—outpacing proforma underwriting.

Spacebox Fort Myers is large conversion property with RV and Boat located along six-lane Colonial Boulevard, a primary feeder artery into Fort Myers.  According to its manager, “Had a monster month in September with 71 in.  RV’s are 100% occupied.”  This project had an overall occupancy of 47% as of the developer’s Q3 2020 Investor Update. The fully occupied, outdoor and enclosed parking has outpaced underwritten absorption expectations—corroborating the developer’s conviction in the area’s strong boat/RV demand.

Both properties have experienced steady lease-up, with bad debt below proforma underwriting, despite COVID-19 headwinds.  Overall, according to management, Leitbox’s portfolio of properties has not been materially impacted by Covid related construction site closures, scarcity of labor, or material procurement issues.  “We are fortunate that our projects have been moving ahead as planned,” says Leitner. 

Source:  Leitbox

Go Back
Austin Gross
Blue Vault Broker Dealer Educational Summit
February 23, 2019
    

Blue Vault has been an important partner to Geneos in providing us and our advisors pertinent information about non-traded products and the industry as a whole. The annual BD Summit is a valuable due diligence experience for any broker dealer."