Barings, Canvass Capital form $250m self-storage joint venture

Barings, Canvass Capital form $250m self-storage joint venture

Barings has formed a joint venture with real estate investment management firm Canvass Capital to acquire and develop self-storage properties throughout the Southeastern United States.

The joint venture seeks to invest up to $250 million of equity into the self-storage space over the next several years.

Barings and Canvass have closed on the acquisition of three self-storage assets in the Lake Norman region, north of Charlotte, NC, comprised of multiple buildings totaling 1,129 units across 163,000 rentable square feet (rsf) on more than 16 acres.

Plans for the portfolio include the select expansion of additional climate-controlled buildings and covered RV and boat storage, and various capital, technological and sustainability-focused improvements.

The joint venture has also acquired a 3.82-acre site in Hilton Head, SC for the development of a new self-storage facility, with plans to break ground this fall on two buildings containing a combined 1,231 self-storage units and totaling nearly 150,000 rsf.

“We are excited to enter into this strategic partnership with Canvass Capital and target the high-growth self-storage market,” said John Ockerbloom, Head of U.S. Real Estate Equity at Barings. “The Lake Norman assets and Hilton Head development will be Barings’ first self-storage assets in the Eastern U.S. We’ve identified a number of additional assets in the Southeast, currently under contract and scheduled to close in the near future, with value-add upside, expansion, or ground-up development potential which will offer attractive risk-adjusted return opportunities for our clients.”

“Partnering with a global real estate leader like Barings reinforces our creative approach to investing and strengthens our reach across the capital structure,” said Pete Campbell of Canvass Capital.

Barings said it has strong conviction in the opportunities available in the fragmented self-storage property sector. The sector’s variety and mix of demand drivers has exhibited strong resiliency through economic cycles, particularly during the pandemic as self-storage needs increased.

The expansion of self-storage on excess land, retail conversions and upside from technological and operational efficiencies present long-term growth potential, according to the company.

Consistent with Barings’ commitment to sustainability, the development and repositioning of self-storage assets will also present the Barings team with opportunities to incorporate ESG-specific features and enhancements including solar paneling and additional energy efficiencies, the company noted.