27 Feb 2019
For 35 years, David Rogers has played an integral role of the Buffalo, New York-based self storage REIT, Life Storage. He joined during the early 1980’s to help grow the company with its three other co-founders; Robert J. Attea, Charles Lannon and Kenneth F. Myszka.
Life Storage, Inc. is a fully integrated, self-administered and self-managed real estate investment trust (REIT) that acquires and manages self storage properties throughout the United States. The company employs over 1,600 people and operates approximately 750 self storage facilities in 28 states. Life Storage was originally known as Sovran Self Storage, Inc., operating under the brand name Uncle Bob’s Self Storage for more than 30 years.
Founded in 1982, the company was originally a financial planning firm but opened its first self storage facility in Florida in 1985 (and still operates this facility today). Within three years, it owned approximately 30 facilities along the East Coast and added 62 facilities over the next decade. In 2016, it began acquiring properties on the West Coast.
Life Storage went public on the New York Stock Exchange in 1995, trading under the name Sovran Self Storage. Within a year, it doubled its portfolio of 111 self storage facilities along the East Coast and Texas to 222 facilities.
On July 18, 2016, Sovran Self Storage completed the acquisition of an 84-property, Class-A self storage portfolio, and on August 16, 2016, the company officially rebranded itself to the progressive name, Life Storage – an investment totaling $1.3 billion. The total cost of the rebrand for its existing facilities? $22 million.
On February 25, 2019, Life Storage reported on its fourth quarter earnings for 2018. On March 1, Rogers will officially hand over the reins to Incoming Chief Executive Officer, Joseph V. Saffire. Saffire began the call by acknowledging Rogers for his exemplary contributions to the company.
Saffire joined the company on November 1, 2017 as its Chief Investment Officer and brings more than 25 years’ experience in commercial banking and executive leadership, working with companies such as Wells Fargo, HSBC and First Niagara Financial Group.
Acquisitions
During Q4, and with the revamping of its acquisitions team, the company added six wholly owned properties for $58 million. It has traded stores that were on average 27 years old for stores that are on average seven years old. With this, the rent per square foot has increased from less than $12 to nearly $17. These fully-matured stores with plus 90-percent occupancy are now traded with ones that are roughly 65-percent occupied.
Saffire said they expect to continue to capitalize on favorable market conditions in 2019 and project sales of up to another $225 million of mature assets with the expectation that those proceeds will be reinvested in properties with improved growth prospects.
The company continues to identify and act upon opportunities to upgrade its portfolio. The desire is newer facilities through acquisitions achieving higher rental rates, lower occupancy and revenue per store greater than $1 million.
Operations
Saffire highlighted that the company’s view of supply remains generally unchanged.
Third-Party
The company wrapped up a record year with the successful on-boarding of 42 high-quality stabilized stores in the southeast. In 2018 collectively, it added 69 stores and has an additional 22 under contract.
Rent Now
Rent Now is a fully digital rental platform for customers who prefer to self-serve and skip the counter (digital lease).
Warehouse Anywhere
Warehouse Anywhere, a supply-chain logistics company utilizing technology to deliver commercial strategy for B2B and B2C customers.
In summary, Saffire said that he's excited for 2019. The company’s balance sheet remains very solid, and it continues to have significant flexibility to capitalize on attractive investment opportunities when they meet the company’s return requirements.
