EXTRA LARGE VALUE ADDED (LOT OF ROOM TO MOVE THE NEEDLE) 358 UNIT SELF STORAGE IN ARKANSAS
PURCHASE PRICE PER THE SELLER OF $4,3000,000 PLUS THE BUYER PAID 3% REAL ESTATE COMMISSION
CENTERTON, ARKANSAS 72719
.
Price: $4,300,000
Cap Rate: 5.68%
Number of Units: 358
Occupancy: 93.0%
Rentable SF: 41,200
Price/Rentable SF: $104.37
Year Built: 2003
No seller finance or assumable loan.
Investment Highlights
Stabilized Cash Flow – 90% Physical and 98% Economic Occupancy
5.68% Year-One and 7.35% Pro-Forma Cap Rate
Apx. 0.54-Acres of Raw Land for Future Expansion
7.70% Annual Population Growth - Median Household Income Apx. $87,000 (2023)
Investment Overview
Premium Storage represents a unique opportunity to purchase an economically stabilized asset that still has room for future value-creation. The 41,200 rentable-square foot facility’s impressive financial performance is (among other things) a byproduct of the inherent long-term stability the local market in which it resides has provided for more than two decades. Bentonville, Arkansas is home to Walmart Inc., the largest company in the world according to fiscal year-end 2023 gross revenue ($611 billion), and the fifteenth largest company in the world by 2023 market capitalization. The facility rests upon approximately four-acres of land, and it is comprised of 312 non-climate-controlled drive-up units and 46 uncovered parking spaces. Constructed in 2003 and expanded in 2015 to accommodate excess demand, physical and economic occupancy rates both regularly exceed 95 percent, a byproduct of the facility’s excellent location on Centerton Boulevard (16,601 vehicles per day) and the attractive nature of the demographic profile from which it procures the majority of its tenants. To be sure, between 2010 and 2020 the population within Premium Storage’s three-mile trade area increased by more than 85 percent. This population growth trend does not show any sign of slowing down in the foreseeable future, thus legitimizing occupancy and revenue projections contained on page 16 of this Offering Memorandum. The facility also offers a wide variety of amenities and security features which include a personalized key-pad gate system, surveillance cameras, and perimeter fencing and lighting.
Upon purchase, a new operator could implement modest rental rate increases. Furthermore, aligning street rates with the submarket average could yield a broker-adjusted unleveraged yield approaching 5.68 percent, and the opportunity to generate pro-forma yields of 7.35 percent becomes viable as well. Additionally, constructing new self-storage units and/or covered parking spaces on the unimproved portion of the real estate (approximately 0.55-acres) is a value-creation opportunity worthy of additional consideration, although no assumptions or representations to that effect have been made in the pro-forma operating statement contained herein.
In summary, the Premium Storage facility represents a compelling investment proposition backed by robust historical performance metrics, promising avenues for value enhancement, and a Bentonville submarket in which the prospects for long-term economic stability.
