Self-Storage Investing In a Syndicated / Private Placement Deal

[Barry Dameshek]

I've mostly been an investor in multi-family and would like to enter the self-storage arena. I'm considering a private placement / syndicated deal since I don't really have the time to actively manage or oversee a project right now. I am interested to hear from those who have any knowledge syndicated deals in the self-storage space and if you are aware of any reputable operators who have exhibited solid returns for investors. I've invested in PP's in multifamily so I know it's imperative to trust the sponsor as an operator. I'm looking at a deal right now for one with the 27th largest SS operator in the country. The deal involves 10 properties with a $30MM raise from investors. Projected returns in years 1 & 2 are 4% & 6% respectively while the properties are enhanced and occupancy is increased. The preferred return for investors is 8% cash on cash and a projected 16% IRR post sale / exit, with an estimated hold of 6 years (though it sounds like historically this sponsor sells or refinances within roughly 3.5 years).

Thanks in advance for any thoughts you may have on this opportunity and syndicated self-storage deals in general.