If anyone needed further proof that the industry has been growing at a rapid rate, then TPG's latest cash infusion may very well serve as that. The Fort Worth based global private investment firm recently invested $120 million into LifeStorage.
With $66 billion worth of capital currently under its management, the 22-year old company has quite a bit of experience handling multimillion deals and companies. TPG has invested in industries ranging from financial services, travel and entertainment, technology, retail, consumer products to media and communication and healthcare. Now, the company has its sights set on self storage.
LifeStorage LP will use the cash infusion to purchase property in the 50 largest metropolitan areas in the U.S. According to XWO Mark Good, “It’s an industry that has just grown phenomenally over the last 15 years.”
“We think our model will appeal both to consumers and potential sellers of self-storage properties,” he continued.
Founded in 2011, LifeStorage is headquartered in Roseville, California and operates 78 properties in nine states. The investment by TPG will allow LifeStorage to expand its reach even further. More importantly, this investment signifies the growth and success of the self storage industry. According to Self Storage Association, the self storage industry brought in more than $24 billion last year.
“Not only is there strong continued demand for self- storage, but the industry also remains very fragmented, which should provide opportunities for further consolidation,” Avi Banyasz, partner and co-head of TPG Real Estate, said in a statement.
In addition to the $120 million commitment by TPG, Jasper Ridge Partners LP also made an additional investment of an undisclosed amount. These investments follow a $100 million credit line that was recently issued by CitiGroup Inc.
"Citi's credit facility confirms our success in selectively acquiring institutional quality properties and significantly improving operating results,” said Good. “It will provide us with the flexibility to expand our portfolio opportunistically.”
With millions of dollars worth of capital already invested in this venture, LifeStorage may just be the next big thing in self storage in the upcoming years.
