Andover And Heitman Grow Self Storage Portfolio

Andover Properties has launched joint ventures with Heitman to build a diversified U.S. self-storage portfolio. The ventures begin with more than 106 properties across 16 states. They cover value-add and core-plus strategies and are expected to expand into markets across the country. The firms see current conditions as an opportunity to acquire high-quality assets at discounted valuations.

A New Acquisition Platform

The partnership combines Andover’s operating platform with Heitman’s long record of self-storage investing. The firms cited declining new supply, strengthening demand and fragmented ownership as factors supporting their plans.

Brian Cohen, President and CEO of Andover Properties, said:

“We are excited to partner with Heitman, whose experience in self-storage investing dates back to 1996. We believe the self-storage sector is at an inflection point and represents an attractive opportunity in commercial real estate today. Following a period of normalization in the wake of COVID-19, we believe a recovery in rents and occupancy may be driven by declining new supply and strengthening demand. Further, the sector's fragmented ownership presents an opportunity to create value through our vertically-integrated operating platform. We therefore believe the current market environment presents an exceptional buying opportunity. Our joint ventures with Heitman help position us for these opportunities.”

Experience Across Self Storage

Heitman began investing in self-storage properties for clients in July 1996. Since then, the firm has invested more than $15 billion in 1,600 self-storage properties across 14 countries and acquired more than 1,200 stores in over 140 U.S. markets.

Storage King USA.

Doug Gurr, Head of U.S. self-storage acquisitions at Heitman, said:

“We are focused on markets with strong fundamentals, which we believe, should benefit from demographically-driven demand and limited new supply. Today's entry point provides the opportunity to acquire assets well below replacement cost.”

Storage King USA.

Building Long Term Value

Andover’s portfolio exceeds 15 million square feet across more than 180 facilities in 20 states. The new ventures are intended to pair its property-level operating capabilities with Heitman’s self-storage investment experience as the partners pursue further acquisitions.

Zach Harding, CIO of Andover Properties, said:

“Our joint ventures with Heitman represent a significant milestone for our platform and enhances the strength of our operating capabilities, investment strategy, and portfolio. We believe that Heitman's long-standing expertise in the self-storage sector coupled with Andover's ability to source opportunities and drive operational improvements at the property-level will help maximize the value of the investments.”