Extra Space Storage Inc. (EXR) recently concluded the acquisition of 19 All Aboard Mini Storage properties located in California for around $195.1 million. Another All Aboard property is expected to be acquired by the end of this year for around $11.0 million. Simultaneously, the company disclosed restructuring moves for its top executives.
In aggregate, these 20 properties comprise 14,800 self storage units with 1.5 million square feet of net rentable space. The move will enable this self-storage real estate investment trust to increase its share in the growing California self storage market.
In context of the reshuffle, Extra Space disclosed that its Executive Vice President and Chief Operating Officer, Karl Haas, will retire effective Dec 31, 2013. However, the board of directors plan to appoint him to the board.
On the other hand, the company plans to promote Samrat Sondhi, a key member in the company's senior management team for 8 years, as Senior Vice President Operations, following Haas' retirement. He previously served as Vice President Revenue Management for Storage USA and a consultant with Deloitte Consulting. In addition, Hugh W. Horne will resign from the company's board, effective Dec 31, 2013.
Increasing customer demand, growing rental rates and comparatively lower supply are positively contributing to the underlying fundamentals of the self-storage sector and Extra Space stands to benefit from this. The recent acquisition is a strategic fit and with executive changes, the company continues to capitalize on market consolidation opportunities. This would help the company ride on the growth trajectory going forward.
Extra Space currently carries a Zacks Rank #3 (Hold). Some other stocks worth considering in the same industry include Sovran Self Storage Inc. (SSS) that carries a Zacks Rank #1 (Strong Buy) as well as CubeSmart (CUBE) and Douglas Emmett Inc (DEI), both carrying a Zacks Rank #2 (Buy).
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