Gantry Secures $70 Million To Refinance Trojan Storage Properties

Posted by MSM on Dec 19, 2024 6:50:50 PM

Independent commercial mortgage banking firm Gantry has secured a $70 million structured permanent loan to retire existing construction/bridge debt and re-capitalize four recently completed developments/value add self-storage facilities. The four properties are currently undergoing their initial lease up. Properties are well-located in both Southern and Northern California regions.

Gantry’s Andy Bratt, Principal, Amit Tyagi, Principal, and Sean Kuang, Associate, with the firm’s Irvine and Los Angeles production offices represented the borrower, Trojan Storage, a long-standing Gantry client.

The loan, secured from one of Gantry’s premier life company relationships, features a fixed rate with a lengthy interest only period during the term.

The Trojan Self Storage properties in this loan include:

Trojan Storage San Jose
Trojan Storage Campbell
Trojan Storage Rancho Cordova
Trojan Storage Camarillo

“Our relationship with Trojan is focused on using our resources in the capital markets to deliver solutions that set the stage for our customer’s long-term success," said Gantry’s Andy Bratt. "Trojan Storage is a sophisticated developer/owner-operator that has a unique capital structure, with unique needs. The task here was (once again!) finding a fixed rate permanent financing vehicle for assets that are in their initial lease up periods with minimal, but quickly growing, in-place cash flow. Three of the four assets are large and will require some time to reach stabilization, this financing allows Trojan Storage to comfortably stabilize the portfolio under a low fixed interest rate. This transaction removes the heat of construction or bridge loan pricing and will allow Trojan’s strength as an operator to shine.”

Gantry’s Amit Tyagi added, “These are well-positioned assets in highly desirable California markets that exhibit solid long-term fundamentals. Our experience underwriting self-storage assets was instrumental on this transaction... [and] allowed us to work closely with one of our insurance company relationships to underwrite these assets realistically, for both current and future performance, to come up with an excellent financing structure."

Tyagi says that Gantry was "up against the headlines" and the team had to utilize their collective strengths with Sponsorship to demonstrate the portfolio’s capabilities compared to its competitive set.

"The general cooling of self-storage across the country, uncertainty with the economy, stagnant housing starts, and other headwinds make for a challenging environment," continuted Tyagi. "Gantry was required to use its deep understanding of self-storage, insurance company capital structural requirements and years of experience to negotiate a loan of this nature in this environment. Credit to Sponsorship for the high-quality locations, best-in-class developments and exceptional initial lease up metrics. These assets, although newly completed, are already exhibiting initial performance metrics well above national and local averages."

Trojan is a highly experienced Sponsor, and we approach every financing for them with a holistic perspective tailored precisely to what their assets require in their particular point in the lifecycle. All while continuing to set the stage for Sponsor’s long-term success. This was an excellent execution that highlighted the strengths of both Gantry and Sponsorship, a truly team-oriented approach. We’re proud of the work on this assignment.”