Värde Provides $185 Million Refinancing for 20-Property Self-Storage Portfolio

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June 24, 2024

Firm sees favorable market dynamics and demand trends for self-storage sector

MINNEAPOLIS — Värde Partners, a leading global alternative investment firm, today announced that it has provided a $185 million loan for the refinancing of a multi-state self-storage portfolio to a joint venture between Metro Storage and Fremont Realty Capital. 

The portfolio comprises 20 state-of-the-art, Class A self-storage facilities in mature markets across six states: Illinois, New Jersey, Pennsylvania, Minnesota, New York, and Wisconsin. With 14,215 units in total, the assets include over 1.55 million net rentable square feet. 

The floating-rate bridge loan, structured by Talonvest Capital, has a three-year initial term with two one-year extension options. It will be used to refinance the existing debt on the portfolio, allowing the joint venture time and flexibility to capitalize on the portfolio’s growth potential. 

“Värde welcomed the opportunity to partner with deeply experienced, institutional companies in the self-storage industry as a trusted provider of capital,” said Jon Miller, Managing Director at Värde. “This significant transaction underscores the strength and continued growth of our platform and the range of compelling opportunities to lend in sectors with strong fundamentals.”  

Building on a period of increased demand during the pandemic, Värde sees the self-storage sector as positioned to continue benefitting from current market dynamics such as population growth and higher home prices. With younger generations renting for longer due to higher interest rates and property costs, self-storage fills an important need. Lower sensitivity to economic downturns as well as generally low maintenance and capex needs add to the appeal of the asset class.  

Värde has 30 years of experience investing in real estate and has originated over $7 billion in commercial real estate loans since 2017. Through its CRE lending program, Värde is a non-recourse, balance sheet lender financing all major asset classes. Värde focuses on providing flexible capital and certainty of execution to meet the needs of experienced real estate investors. 

About Värde Partners
Värde Partners is a leading global alternative investment firm specializing in credit and credit-related assets. Founded in 1993, the firm has invested more than $100 billion across the credit quality and liquidity spectrum in both public and private markets. Värde currently manages approximately $13 billion in assets with teams in North America, Europe, and Asia Pacific focused on Corporate & Traded Credit, Real Estate, and Financial Services & Diversified Private Credit. For more information, please visit www.varde.com. 

About Fremont Realty Capital
Fremont Realty Capital is the real estate private equity business unit of the Fremont Group, the investment office of the Bechtel family of San Francisco. Since formation in 1997, Fremont Realty Capital has provided investors with superior risk-adjusted returns and value-creation through investments in non-traditional and traditional real estate sectors, both domestically and abroad. Our success results from a disciplined investment strategy, enduring relationships with best-in-class operating partners, and the collective experience of the firm’s principals. The firm has made investments in more than 13 countries across the United States and Europe over 25 years totaling more than $5 billion of total capitalization. 

About Metro Storage
Metro Storage, based in the Chicago area, is a privately owned, fully integrated, international self-storage company specializing in the development, construction, acquisition, and management of self-storage facilities in the USA and Central America. Metro operates under the trademark “Metro Self Storage” in the US, and is one of the top 10 largest owner/operators of self-storage facilities in the United States with over 85 stores covering 12 states, representing over 6.1 million rentable square feet. Metro Storage International (MSI) has an affiliate/partner in Central America which operates under the trade name “Mr. B,” and is Central America’s leading self-storage operator with locations throughout Guatemala, El Salvador, and Costa Rica. More information about the firm is available at www.metrostorage.com. 

About Talonvest Capital
Talonvest Capital leverages their extensive industry experience to source cutting-edge lending programs and advise on capital market trends for self-storage, industrial, multifamily, office and retail owners. They have negotiated over $11B in capital for clients and their properties across the country.