SmartStop Self Storage REIT, Inc.

Key Company Facts

Founded	2008
Headquarters	Ladera Ranch, US
Sector	Real Estate
Industry	Self Storage REIT
Founders	H. Michael Schwartz
Number of employees	450 approximately
IPO Date	2023 (expected)
Number of investors	N/A
Total funding	$992.5 million USD
Valuation estimate	$3.0 billion USD

Company Overview & History

SmartStop Self Storage REIT, Inc. is a technology-driven self-managed Real Estate Investment Trust (REIT) that specializes in the provision of self-storage services.

The company manages a fully integrated operations team of approximately 450 self-storage professionals.

SmartStop is one of the largest self-storage companies in North America, with a growing portfolio in Canada and high-growth markets in the United States​​.

The company operates hundreds of convenient locations throughout the United States and Canada, which are supported by world-class customer service.

With over 170 locations, the company understands self-storage across a broad range of customer groups.

SmartStop builds its facilities, trains its team members, and designs its service offerings based on its experience with a large portfolio that spans diverse communities.

This approach impacts everything the company does, from making hiring decisions to interacting with and serving others.

Financial Performance

SmartStop Self Storage REIT, Inc.’s financial performance can be gauged by its first-quarter results for the year 2023.

The company’s same-store revenue increased by approximately $3.7 million, or about 8.9%, for the three months ended March 31, 2023, compared to the same period in 2022.

This was due to higher annualized rent per occupied square foot, which was slightly offset by a roughly 1.9% decrease in average occupancy.

The increase in property operating expenses is mainly attributable to compensation-related expenses, property insurance, property tax, and to a lesser extent, advertising. SmartStop reported total revenue of $51,538,015, a 19.1% increase from the previous year, and a net operating income of $35,004,563, a 16.0% increase from the previous year.

The company had a total of 153 facilities, up from 140 the previous year, and the rentable square feet also increased to 11,794,730 from 10,696,785 the previous year.

Revenue

Year	Revenue (USD)
2019	$109.5 million
2020	$124.0 million
2021	$168.8 million
2022	$200.2 million

Business Model

SmartStop is a technology-driven self-managed REIT (Real Estate Investment Trust) with a fully integrated operations team of approximately 450 self storage professionals.

The company is one of the largest self storage companies in North America and operates in 22 U.S states and Canada.

SmartStop’s business model involves owning and managing self-storage properties, which total 15.2 million square feet of rentable space.

The company has a total capitalization of $3.0 billion and is the 11th largest self-storage company in the U.S.

In addition to its direct operations, SmartStop also sponsors Strategic Storage Growth Trust III, Inc. and Strategic Storage Trust VI, Inc., which had a combined portfolio of 21 operating properties with approximately 16,500 units and 1.9 million rentable square feet at the end of Q1 2023.

SmartStop receives advisory fees and property management fees from these Managed REITs, expanding its revenue streams beyond direct storage rentals.

The company also periodically makes investments in these Managed REITs in the form of mezzanine loans and preferred limited partnership interests​.

Estimated Valuation

Year	Valuation (USD)
2021	$2.56 billion
2022	$3.0 billion

Risk Factors

SmartStop Self Storage REIT has identified several risk factors that could impact its operations.

These include the risks related to disruption of management’s attention from ongoing business operations due to the merger with Strategic Storage Growth Trust, Inc. (“SSGT”), the merger with Strategic Storage Trust IV, Inc. (“SST IV”) and other business matters; significant transaction costs, including financing costs, and unknown liabilities.

These risks also include failure to realize the expected benefits and synergies of the SSGT merger, the SST IV merger or the self administration transaction in the expected timeframes or at all; and costs or difficulties related to the integration of acquired self storage facilities and operations, including facilities acquired through the SSGT merger, the SST IV merger and operations acquired through the self administration transaction.

Other risk factors include changes in the political and economic climate, economic conditions and fiscal imbalances in the United States, changes in tax and other laws and regulations, and difficulties in SmartStop’s ability to attract and retain qualified personnel and management​.

Market Opportunity

SmartStop Self Storage REIT is a premier owner and operator of self-storage facilities in the United States and Canada.

They are the eleventh largest owner and operator of self-storage properties in the United States based on the number of properties, units, and rentable square footage.

They have a pro forma portfolio of 159 owned properties across 19 states and the Greater Toronto Area (GTA) in Canada, comprising approximately 108,200 units and 12.3 million net rentable square feet.

Upon completion of an offering, they will be the only U.S. listed self-storage REIT with meaningful asset ownership in Canada or the GTA, one of the fastest growing and undersupplied markets in North America.

They believe the GTA presents a compelling market opportunity, highlighted by low supply per capita, increasing product utilization, high barriers to entry and limited institutional competition

Competitors

• National Storage Affiliates Trust
• Life Storage
• CubeSmart
• Extra Space Storage
• Public Storage Inc.
• U-Haul International
• Prime Group Holdings LLC
• StorageMart
• Merit Hill Capital
• SROA Capital