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Self-Storage Portfolio 3


Investment Highlights


Inland Self Storage Portfolio 3 is an investment into 4 self storage properties. These properties are all located in Houston, Texas. 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 93.60%
  • Est. Time Horizon 7 years
  • Yr 1. Cap Rate to Investors 4.60%
  • Investor Purchase Price $35,176,613
  • Total Offering Size $20,001,613

Loan Information

The total loan is $15,175,000 and is from Santander Bank. The term is for a total of 7 years with the first 3 years being interest only. When amortization beings it will be based on a 30 year schedule. The interest rate is 2.5% + one month LIBOR. The rate has been capped at 3.5% for a portion of the loan. The other portion of the loan has been hedged by a SWAP which creates an effective fixed rate of 4.49%.

  • Yr. 1 DSCR 2.26
  • Loan-to-Value 43.14%
  • Hold Period DSCR 2.33

Key Benefits

There is a potential for a value-add opportunity at the property due to its age and the fact that a larger operator may enter as a partner.

The average occupancy at the properties is high (93.6%).

There is strong growth of population in the 5-mile radius. The total population in this radius ranges from 297,000 to 530,00 and has a growth rate of over 1.30%.

Key Risks

The loan term is only for a period of 7 years which may not allow enough time to exit for a profit.

The cap rate to investors is low (4.6%).

About Inland

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.