Extra Space Storage
October 26, 2023
Sponsor Executing on Strategic Lease Up with Clear Path to Stabilization; Select Lenders Working with Gantry’s Self Storage Experts to Fund Permanent Loans for Qualifying Assets Still in Lease Up
Chicago, Il. – Gantry, the largest independent commercial mortgage banking firm in the U.S., has secured an $8 million permanent loan to refinance existing debt on a South Loop self storage facility converted from a former parking structure. Located at 605 S. Wabash Ave, the 95,000-square foot facility encompasses 1,184-units across five-stories. The property is now under new onsite management, operating as an Extra Space Storage, and making rapid progress towards stabilization in programmatic fashion.
Gantry’s Andy Bratt, Principal, and Sean Kuang, Associate, with the firm’s dedicated Self Storage Financing production team secured the loan on behalf of the borrower, a private real estate investor. The five-year, fixed rate permanent loan was secured from an insurance company with terms including an initial interest only period, no recourse, and stepdown prepayment penalty.
According to Gantry’s Andy Bratt, “Over the past decade, the self-storage industry has attracted sophisticated capital and evolved into an institutional asset class. During that time, Gantry focused on educating capital sources, particularly Gantry’s correspondent life insurance companies, on the sector’s performance and market dynamics, which has allowed us to create custom programs to meet market needs. This includes providing permanent fixed rate debt solutions for pre-stabilized or value-add properties moving towards stabilization. In today’s volatile market, Sponsors are looking for alternatives to high cost of capital bridge loans and we have been successful in identifying lenders with flexible balance sheet capital to achieve lower fixed rates with flexible prepayment penalties. This allows Sponsors to continue their business plan to stabilize assets, avoid interest rate volatility, and still have the ability to exit the loan upon stabilization all while reducing their interest costs.”