Self-Storage Portfolio 2
Inland Self Storage Portfolio 2 is an investment into 8 self storage properties. These properties are all located in Knoxville, Tennessee. The operator of these facilities is Metro Storage LLC, which is a privately held real estate company that specializes in self storage facilities.
- Year 1 Cash Flow 5.00%
- Initial Occupancy 92.20%
- Est. Time Horizon 10 years
- Yr 1. Cap Rate to Investors 5.46%
- Investor Purchase Price $40,802,931
- Total Offering Size $21,827,931
The total loan is $18,975,000 and is from First Merchants Bank. The total loan term is 10 years with the first 5 years being interest only. When amortization begins it is based on a 30 year schedule. The interest rate is fixed at 4.00%.
- Yr. 1 DSCR 2.74
- Loan-to-Value 46.50%
- Hold Period DSCR 2.57
The sponsor has underwritten the year 1 performance of the portfolio very conservatively. EGR growth is 1.26%, while OpEx grows 7.73% compared to the trailing 12. This leads to a decrease in NOI of 3.37% allowing the property the potential to outperform its projections.
The portfolio is moderately leveraged and the sponsor is utilizing an LTV of 46.5%.
The population in the area around these properties is expected to underperform the average growth rate of the nation. This growth rate in the 5-mile radius is projected to be 0.54%.
The cap rate to investors is low (5.46%).
The Inland Real Estate Group of Companies, Inc. ("Inland"), is an industry leader and one of the nation's largest commercial real estate and finance organizations. As a business incubator, we specialize in creating, developing and supporting Inland member companies that provide commercial real estate-related services and alternative investment funds, including limited partnerships, institutional funds and non-listed and listed REITs.