Hines, Trez Capital score $108M loan on DFW self-storage portfolio

Metroplex will see most-ever self-storage deliveries this year with 2.2 million sf; expected to add 3% more to market as demand levels out to 2019 pace

Hines, Trez Capital Score $108M Loan on Self-Storage Portfolio
From left: Hines' Jeffrey Hines, Trez Capital’s Morley Greene and Hines' Laura Hines-Pierce (Getty, Hines, Trez Capital)

A joint venture of two real estate heavyweights secured nine-figure financing for a 13-property self-storage portfolio across Dallas-Fort Worth, spotlighting an asset class that’s enjoyed surging demand in recent years.

Houston-based Hines and Canada-based Trez Capital received a $108 million loan from New York Life Real Estate Investors, with JLL brokers facilitating the deal, the Dallas Morning News reported

Most of the properties are in suburbs like Wylie, Carrollton, Lancaster and Duncanville, although some are located in cities like Dallas and Arlington. 

The loan entails a five-year, fixed-rate arrangement with early rate lock, interest-only payments, plus prepayment flexibility in the early part of the loan term. 

Separately, Hines is developing two DFW self-storage facilities, in Frisco and Garland. The firm launched a self-storage development program in 2018 amid growing demand.

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As in the greater industrial market, self-storage development is booming.

DFW is on track to see its largest-ever delivery of self-storage developments by year end, with over 2.6 million square feet expected to be completed, increasing the region’s overall stock by 3 percent, according to Marcus & Millichap. About two-thirds of the new supply will be concentrated in the Dallas area.

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“The Metroplex’s economy has soared following the pandemic, with local job creation and retail sales growth ranking among the strongest in the nation, backed by a number of high-profile corporate relocations and expansions,” Marcus & Millichap analysts wrote.

More than 80,000 people are expected to relocate to DFW this year, and that continued migration is what keeps self-storage demand high, they said. However, “​the market’s vacancy rate continues to normalize this year,” and the average rent is expected to drop to $1 per square foot for the first time since 2021.

—Quinn Donoghue