CubeSmart closes three deals in Brooklyn and Queens in year-end splurge

Building purchases and new ground lease are part of the company’s $540 million acquisition play in NYC

Self-storage giant closes on two building purchases and new ground lease. (Getty, CubeSmart)
Self-storage giant closes on two building purchases and new ground lease. (Getty, CubeSmart)

 

Self-storage giant CubeSmart purchased two buildings in Brooklyn and Queens for a combined $125 million and secured a new ground lease valued at $50 million, according to property records filed Thursday.

The self-storage sector has proven to be among the most resilient to the pandemic, as economic headwinds tend to bolster demand for storage space.

CubeSmart paid $77 million to acquire a 79,000-square-foot storage facility at 338 3rd Avenue in Gowanus — where the city is proposing a rezoning project expected to add thousands of new residential units — and $48.5 million for a building of nearly the same size at 33-24 Woodside Avenue in Woodside.

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CubeSmart also took over a ground lease at 163 6th Street in Gowanus, where a 76,000-square-foot building sits just a few blocks away from the 3rd Avenue property.

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The three properties, currently managed and operated by the real estate investment trust, are part of its recent agreement to purchase an eight-building portfolio from Storage Deluxe for $540 million. CubeSmart announced the deal in October.

To finance the acquisitions, the company said it will pay just over $200 million in cash and more than $180 million in ownership units that are convertible to stock, while assuming roughly $155 million of existing debt.

CubeSmart is one of the country’s largest owners and operators of self-storage space, with more than 1,200 properties throughout the U.S. in its portfolio.