Equity Based Services, Inc. Proves Leveraged Real Estate Acquisitions are Alive and Well

Share Article

EBS announces the acquisition of 2 Self Storage properties in Arlington, TX leveraged with a 5 year loan with Interest-Only payments for the first year.

American Mini Storage Arlington

The difficulty in developing new projects and the difficulty in financing new construction should allow the Self Storage Industry to realize higher returns on existing facilities as they are absorbed and stabilized without diluting the market with unnecessary new product.

Equity Based Services, Inc. ("EBS") announced the purchase of two Self Storage properties in the Dallas suburb of Arlington, TX. The two facilities are Assured "Median" Self Storage at 5500 Highway 287 and Assured "Sublett" Self Storage at 1800 Sublett Road.

Median adds 79,095 Net Rentable Square Feet (NRSF), 738 storage units, and 17 parking spaces to the EBS portfolio and Sublett adds 88,920 NRSF with 728 storage units and 24 parking spaces. The addition of these two properties to the EBS portfolio brings the totals to 62 facilities, 11 states, 34,622 rental units, and 4.31 Million Net Rentable Square Feet.

"These Arlington purchases kick off EBS' aggressive acquisition plan to greatly expand its presence in the Dallas region," states Eric Kaplan, COO, Equity Based Services, Inc.

Equity for the acquisition came from the EBS Income Fund III and from EBS' pool of private client investors. Financing for this deal was facilitated through Tavernier Capital Partners. EBS was able to place a limited recourse mortgage based on WSJ prime with 1 year of Interest-only payments and a 5 year term that amortizes over 25 years.

"Interest-Only, limited recourse debt is not dead," states Troy Downing, Principal, Equity Based Services, inc. "In the last month we have closed on three properties with interest-only periods from one to five years. All of these have been strong, class-A facilities in strong markets."

Average occupancy is approximately 80% giving some upside as EBS increases occupancy through implementation of their multi-tiered management systems. Currently EBS has portfolio occupancy of 85% which includes a number of Value-Add / Lease-Up deals that are on track to projected stabilization.

"Equity Based Services continues to capitalize on its strong Lender relationships, the strength and performance of its debt portfolio, and its dynamic management program to secure favorable financing in today's tight credit markets. The rate and terms obtained for the Assured acquisitions are currently only being made available to the most credit worthy borrowers," states Stephen Kaplan, CEO, Equity Based Services, Inc.

Equity Based Services, Inc. has been one of the few operators able to close leveraged Self Storage deals in 2009. At least one of the large public REITs has halted new construction citing lack of viable credit facilities and the majority of transactions that have changed hands to professional operators in 2009 have been unlevered.

"We see the slowdown in development as a strong positive," states Downing. "The difficulty in developing new projects and the difficulty in financing new construction should allow the Self Storage Industry to realize higher returns on existing facilities as they are absorbed and stabilized without diluting the market with unnecessary new product."

About Equity Based Services, Inc.:
EBS is a Private Real Estate Company specializing in the acquisition and management of self-storage property. EBS currently owns and operates approximately 60 Self-Storage properties in 11 states with a current market value of more than $300 million. EBS also manages a family of Private Equity Funds for institutional and high net worth individual investors. The EBS Income Fund, the EBS Income and Growth Fund II, and the Pilot Equity Value Added Fund all closed in 2007. For more information, contact Kurt Ambrosius at 619-220-6700.

This Press Release is for informational purposes only and does not, in any way, constitute an offering to buy or sell securities.

###

Share article on social media or email:

View article via:

Pdf Print

Contact Author

Kurt Ambrosius
Visit website