State of Self-Storage | Q2 2022

With continued market volatility and interest rate hikes from the Federal Reserve approaching, the self-storage industry, alongside other asset classes, is bound to face some headwinds in the months ahead.

This uncertain period may be unnerving for many, but Spartan Investment Group is excited for what is to come. Episodes of market volatility are a normal feature of long-term investing and even provide many opportunities for our investors.

With Spartan Storage Fund 1, SIG has the opportunity to use the funds we have accumulated to buy assets with ease during a time when we are potentially facing a recession. The current volatility of the market also allows us to buy assets at prices adjusted for the future.

Always working in the best interest of our investors, our team has the ability to take advantage of the market and submit offers on properties that may have not had a realistic price point, but are now a good bargain. For example, an asset we are currently pursuing is now available to us at a 40% market discount with rents that are 30% below the market.

In addition to helping us make purchases at the right price, the recession-resistant fund repositions assets for cash flow and success, giving us a greater level of optionality to continue holding the asset long-term or sell if we get a great rate.

Moving forward, our team is expecting to see some incredible deals and we expect to only get better opportunities over the next few months.

The deals we are seeing now are coming in with high capitalization rates, giving us the ability to increase property value and exit these projects at a lower rate.

Published by Ryan Gibson on Jun 29, 2022 10:44:43 AM