The Mele Group of Marcus & Millichap has been selected to exclusively market for sale the Northwest Arkansas Self-Storage Portfolio.
Acquisition of the self-storage portfolio demonstrates a rare opportunity to acquire three well-maintained facilities in the growing region of Northwest Arkansas. The portfolio has significant growth potential through lease-up activity. The Centerton facility is currently undergoing expansion, while the Farmington property recently completed expansion within the past year. The expansion is indicative of the need for self-storage among several growing residential developments within the region. The portfolio boasts strong cash-on-cash returns of 11.0 and 10.6 percent in years two and three, in addition to a physical occupancy of 70.3 percent. An investor can enhance returns by raising rental rates to the comparable averages upon stabilization; the climate-controlled rates for the Centerton and Van Buren facilities are currently below market. Additionally, an investor can bolster revenue by implementing a robust tenant insurance program. Northwest Arkansas offers a wide array of recreational activities, resources and amenities, including the University of Arkansas in Fayetteville. Northwest Arkansas is the 14th fastest-growing metropolitan statistical area in the country and is home to several national headquarters, including three fortune 500 companies; Walmart, Tyson Foods and J.B. Hunt. Overall, the portfolio offers assets ideally positioned for significant growth, resulting in a proforma net operating income increase of 60.1 percent.
The portfolio has 1,888 total units among its 282,980 rentable square feet. Combined, the subjects feature 529 climate-controlled units, 1,210 non-climate-controlled units, 147 boat/RV parking spaces and two office spaces. The three properties utilize professional on-site management and are secured with 24-hour computerized video surveillance, fencing, electronic gate access and optimal lighting. Furthermore, the facilities offer excellent ingress and egress, in addition to drive-up units with wide aisles for consumer convenience.
- Rare Opportunity to Acquire a Portfolio in Northwest Arkansas, One of the Top 20 Fastest-Growing Metropolitan Statistical Areas in the United States; the Region is Projected to Join the Top 100 Metropolitan Statistical Areas in the U.S. by 2019
- Cash-On-Cash Returns of 11.0 and 10.6 Percent in Years Two and Three
- Raise Returns by Increasing Rental Rates to the Comparable Averages; the Centerton and Van Buren Climate-Controlled Rates are Currently Below Market
- Substantial Revenue Growth by the Implementation of a Strong Tenant Insurance Program and the Continuation of Lease-Up Activity; the Centerton Facility has Expansion Currently Underway, While the Farmington Facility Recently Completed Expansion Within the Last 10 Months
- Van Buren Facility Features Excellent Physical and Economic Occupancies of 91.5 and 87.0 Percent, Respectively
- Significant Projected Net Operating Income Increase from Current to Proforma of 60.1 Percent