Loan Submission will be processed within 24-48 hours and loan specialist will contact you to discuss funding details. The properties sold for a total price of $26,000,000 which represented an attractive capitalization rate on the current net operating income. 405 Self Storage in Hawthorne contains just over 87,000 net rentable square feet of self storage space demised into approximately 770 units. Reach out to the author: contact and available social following information is listed in the top-right of all news releases. Real estate investment management firm Harrison Street Real Estate Capital is in the process of selling its joint venture stake in a 43-property self-storage portfolio that it owns with Morningstar Properties LLC, The Storage Facilitator has learned. Depending on the winning bid, the deal could mean big changes for Morningstar, which also holds an ownership stake and operates the facilities under the Morningstar Mini-Storage brand. Real estate investment banking firm Eastdil Secured LLC, a New York-based subsidiary of Wells Fargo, is marketing the portfolio.
Although there’s a chance that a buyer might purchase only Harrison Street’s joint venture stake, it’s likely that bidders are seeking to snap up the entire portfolio. A high sale price also could be a big incentive for other owners to put their portfolios on the sale block, experts said. The size of the Morningstar portfolio is whetting investors’ appetites for the ability to substantially expand existing portfolios or to enter the self-storage market with a sizable presence. This deal will be significantly bigger than $50 million—the minimum amount needed to spark interest from a broad array of investors who don’t already have a stake in the self-storage sector, said Aaron Swerdlin, executive managing director at Newmark Grubb Knight Frank (NGKF) Markets in Houston.
Although representatives of Harrison Street couldn’t be reached for comment, sources familiar with the deal say the private equity firm is simply making a move to capitalize on attractive pricing, realize returns for this particular investment and reinvest the capital.
According to the Harrison Street website, the firm owns more than 250 assets valued at more $4.2 billion, including more than 72,000 self-storage units. It’s unclear whether the pending sale will mark an end to the joint venture with Morningstar or whether Harrison Street and Morningstar might work together again on future investments.

On its website, Harrison Street bills itself as the exclusive provider of equity capital for all self-storage acquisition, development and redevelopment opportunities for Morningstar. In September 2008, Morningstar and Harrison Street formed an alliance with 2Guys Storage to invest in self-storage properties in the Southeast. According to the 2013 Self-Storage Almanac, Morningstar was the 17th largest self-storage operator in the U.S. Selling a portfolio and rebuilding a strong base is something that Morningstar has proven it can do—and do well.
Welcome.The Storage Facilitator is the modern self-storage professional's destination for useful education, intriguing news, diverse expert perspectives, technology updates, and beyond. Get our free white paperThe Four Pillars of Profitable Self-Storage Management is an in-depth resource that empowers facility owners and managers to get more out of your business and stay ahead. The information contained herein has been obtained from third parties and we cannot guarantee the accuracy or completeness of the information. We provide self-storage businesses with the debt financing needed to capitalize on new opportunities. The portfolio spans 2.9 million square feet at properties in Texas, North Carolina, South Carolina, Virginia and Georgia. It is a high-quality portfolio with lots of economies of scale,” said Chris Sonne, executive managing director of the Self Storage Industry Group at commercial real estate firm Cushman & Wakefield. As such, the total price tag for the 43 Morningstar properties easily will reach into the hundreds of millions of dollars.
So there is wide, wide interest to see what happens, who ends up with it, what the pricing looks like and how the market reacts to it,” Sonne said.
A number of institutional investors and private equity firms would like to jump into the self-storage niche, but they’ve been unable to enter at the scale they want.
Harrison Street maintains a strong presence in the self-storage sector and continues to make new investments in self-storage properties.

In June, Texas-based Advantage Self Storage said it had formed a joint venture with Harrison Street to buy and develop self-storage properties. At the time, Morningstar released a statement saying the two companies planned to develop and acquire a portfolio of assets valued at more than $200 million over a roughly three-year period. According to a Morningstar statement at that time, the group planned to buy, develop and redevelop a portfolio of assets valued at more than $100 million over a three- to five-year period. In late 2006, Morningstar sold most of its real estate to self-storage REIT Public Storage Inc., and Morningstar’s portfolio shrank from 63 properties to three. They are well-respected, and they are good managers,” Cushman & Wakefield’s Sonne said.
This white paper identifies major trends and best practices in rate management, occupancy analysis, rental contracts and profit management. It’s really sad because all of the employees are being told they need to reapply for their jobs. Based on 43 properties being up for bid now, Morningstar’s facility numbers likely have changed slightly from 2012 to 2013.
Public Storage is a horrid company, they treat their people like dirt, and the fact that so many former managers and employee’s jumped ship to Morning star is a testament to not only how bad of a company Public Storage is, but also how great Morning Star was.
This sellout is going to cause REAL human misery and I hope those who profit understand the real cost of what they are doing.

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