Imperial Valley Value-Add Portfolio

Imperial Valley Value-Add Portfolio2020-03-13T12:45:05-04:00

Project Description

The Self-Storage Advisory Group of Cushman & Wakefield has been selected to exclusively market for sale the Imperial Valley Value-Add Self Storage Portfolio.

NRSF – 169,968

Multiple Locations (4)

The Imperial Valley Value-Add Portfolio is comprised of four facilities across 169,968 net rentable square feet. The portfolio offers 1,474 non-climate-controlled and drive-up units, 224 boat/RV parking spaces, 104 mailboxes, three billboards and two cell towers for a total of 1,807 units. Each property consists of an on-site managers apartment. The subject offers room for expansion and an opportunity to purchase a fifth facility from a separate owner. The portfolio is nearly stabilized with a physical occupancy of 81.1 percent. Each site utilizes electronic gating and 24-hour video surveillance to ensure secure self-storage. An investor has the unique opportunity to profit from a distinct market footprint; all facilities have a strong presence in their respective regions of Southern California.

The portfolio covers several major divisions of Imperial Valley, asserting market dominance throughout the corresponding cities of Brawley, Calexico and El Centro. Advantageously, the region has a low supply of 4.17 rentable square feet per person. The maximum driving distance between facilities is approximately 25 miles, allowing a regional manager to operate these sites seamlessly. Each property offers convenient access to the region’s major thoroughfares, including U.S. Highway 86, U.S. Highway 98 and Interstate 8. Each location is within close proximity to Imperial Avenue; this thoroughfare leads directly to the United States/Mexico border and has heavy traffic counts exceeding 30,000 daily.Imperial Valley is well-renowned for its agricultural prowess; the region has one of the largest growing seasons in the United States. It is a major source of winter fruits and vegetables, cotton, alfalfa and grain for U.S. and international markets. Imperial Valley is also a major center for the United States Military; the region is home to the U.S. Navy Flight Demonstration Squadron’s Blue Angels.

Acquisition of the Imperial Valley Value-Add Portfolio secures four assets in an undersupplied market with multiple upsides. The financial projections include a proforma cap rate of 6.56 percent in year one and 7.01 percent in year three. This capitalization rate is combined with overall strong forward-looking financials: in years five and seven are projected leveraged IRRs of 22.0 percent and 20.4 percent and cash-on-cash returns in years one and two are anticipated at 14.7 percent and 15.6 percent. An investor can capitalize by continuing to raise occupancies, in addition to implementing new management to establish systematic operations at each site. The portfolio represents a prime opportunity to invest in a market with minimal supply within a three-mile radius at all locations. Additionally, there is expansion opportunity at the Calexico-Highway 98 site to accommodate for the high demand for storage. Furthermore, a new owner will have the ability to scale revenue and leverage expenses with each property being situated within the Imperial Valley region of Southern California.

Investment Highlights:

  • Prime Opportunity to Acquire Four Storage Assets with a Significant Market Footprint in Southern California
  • Current Low Supply of 4.17 Rentable Square Feet Per Person
  • Implement Kiosk Service to Drastically Reduce On-Site Management Costs
  • 11.82 Acres of Expansion Potential Adjacent to the Calexico-Highway 98 Site Available Separately
  • Proforma Cap Rates of 6.56 Percent in Year One and 7.01 Percent in Year Three
  • Years 5 & 7 Leveraged IRRs of 22.0 Percent and 20.4 Percent
  • Years 1 & 2 Cash-on-Cash Returns of 14.7 Percent and 15.6 Percent
  • Heavy Traffic Counts Throughout the Area With Close Proximity to the United States/Mexico Border
  • Maximum Driving Distance of 25 Miles Between Facilities
  • Ability to Gain Immediate Scale in the Imperial Valley Region of Southern California
  • Sign CA to View Offering Memorandum

  • Confidentiality and Buyer Registration Agreement

    Cushman & Wakefield U.S., Inc. ("Broker") has been retained as the exclusive advisor and broker regarding the sale of the property known as the Imperial Valley Self Storage Portfolio.

    To receive an Offering Memorandum ("Offering Memorandum") please read, sign and return this completed Confidentiality Agreement to Broker. The Offering Memorandum has been prepared by Broker for use by a limited number of parties and does not purport to provide a necessarily accurate summary of the property or any of the documents related thereto, nor does it purport to be all-inclusive or to contain all of the information which prospective Buyers may need or desire. All projections have been developed by Broker and designated sources and are based upon assumptions relating to the general economy, competition, and other factors beyond the control of the Seller and therefore are subject to variation. No representation is made by Broker or the Seller as to the accuracy or completeness of the information contained herein, and nothing contained herein shall be relied on as a promise or representation as to the future performance of the property. Although the information contained herein is believed to be correct, the Seller and its employees disclaim any responsibility for inaccuracies and expect prospective purchasers to exercise independent due diligence in verifying all such information. Further, Broker, the Seller and its employees disclaim any and all liability for representations and warranties, expressed and implied, contained in or omitted from the Offering Memorandum or any other written or oral communication transmitted or made available to the Buyer. The Offering Memorandum does not constitute a representation that there has been no change in the business or affairs of the property or the Owner since the date of preparation of the Offering Memorandum. Analysis and verification of the information contained in the Offering Memorandum are solely the responsibility of the prospective Buyer. Additional information and an opportunity to inspect the property will be made available upon written request to interested and qualified prospective Buyers.

    By accepting the Offering Memorandum, you agree to indemnify, defend, protect and hold Seller and Broker and any affiliate of Seller or Broker harmless from and against any and all claims, damages, demands, liabilities, losses, costs or expenses (including reasonable attorney's fees, collectively "Claims") arising, directly or indirectly from any actions or omissions of Buyer, its employees, officers, directors or agents.

    By accepting the Offering Memorandum, you acknowledge that you are a principal and not an agent of or acting on behalf of any other party in connection with the acquisition. Buyer acknowledges that it is aware that any Agent/Broker other than Cushman & Wakefield, must be compensated by Buyer as Cushman & Wakefield is not cooperating on fees. Furthermore, Buyer acknowledges that it has not had any discussion regarding this Property's Sale with any other broker or agent other than Broker or an agent/broker properly identified through this registration process, including but not limited to, resolutions of incomplete, conflicting or duplicate registrations. Buyer shall indemnify and hold Seller and Broker harmless from and against any claims, causes of action or liabilities, including, without limitation, reasonable attorney's fees and court costs which may be incurred with respect to any claims for other real estate commissions, broker's fees or finder's fees in relation to or in connection with the Property to the extent claimed, through or under Seller.

    The Seller and Broker each expressly reserve the right, at their sole discretion, to reject any or all expressions of interest or offers regarding the Property and/or to terminate discussions with any entity at any time with or without notice. The Seller shall have no legal commitment or obligations to any entity reviewing the Offering Memorandum or making an offer to purchase the Property unless a written agreement for the purchase of the Property has been fully executed, delivered, and approved by the Seller and its legal counsel, and any conditions to the Seller's obligation thereunder have been satisfied or waived.

    The Offering Memorandum and the contents, except such information which is a matter of public record or is provided in sources available to the public, are of a confidential nature. By accepting the Offering Memorandum, you agree that you will hold and treat it in the strictest confidence, that you will not photocopy or duplicate it, that you will not disclose the Offering Memorandum or any of the contents to any other entity (except to outside advisors retained by you, if necessary, for your determination of whether or not to make an offer and from whom you have obtained an agreement of confidentiality) without prior written authorization of the Seller or Broker, and that you will not use the Offering Memorandum or any of the contents in any fashion or manner detrimental to the interest of the Seller or Broker.

    No employee of seller or at the subject property is to be contacted without the written approval of the listing agents and doing so would be a violation of this confidentiality agreement.