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Public Storage PSA unveiled a new three-story self-storage facility in sync with its plans of expanding in North Carolina. The storage facility was established in Huntersville, a suburb of Charlotte.
Located at 10219 Bryton Corporate Center Dr. Huntersville, NC 28078, this self-storage unit has 900 spaces available. The facility is adjacent to the new Walmart Supercenter, Lake Norman and the Northlake Mall.
Notably, expansion in North Carolina is a strategic fit for the company as many people are shifting to Huntersville and other suburbs. The area is witnessing fast growth as the I-485 beltway was broadened, aiding commuting. Currently, the homes are reasonably priced and provide easy access to people who are traveling to the city for work.
The units boast energy-efficient climate-controlled systems, making it suitable for extreme weathers. They come in a variety of sizes that range from small to extra-large to suit individual requirements. Free car parking is also available in abundance.
Public Storage is one of the largest owners and operators of storage facilities in the United States. The ‘Public Storage’ brand is the most recognized and established name in the self-storage industry with presence in all the major metropolitan markets of the United States. Further, the company managed to create a significant presence in the European markets through the Shurgard Storage Centers’ acquisition in 2006.
Additionally, the company has been capitalizing on growth opportunities. In fact, since January 2015, 345 self-storage facilities have been acquired, developed or expanded by the company. Particularly, during 2017, it acquired 22 self-storage facilities, comprising 1.4 million net rentable square feet, for $149.8 million. Following the quarter end, the company acquired or was under contract to acquire two self-storage facilities, spanning 0.2 million net rentable square feet, for $18 million. Such acquisitions and expansions bode well for long-term growth.
Nevertheless, supply has been high in a number of markets and this adversely affects the company’s pricing power. In fact, Public Storage operates in a highly-fragmented market in the United States with intense competition from numerous private, regional and local operators. This limits its power to raise rents and turn on more discounting.
Shares of Public Storage outperformed the industry it belongs to, in the past three months. This Zacks Rank #3 (Hold) company’s shares inched up 1.1% while the industry edged down 6.4% during the same time period.
Stocks Worth a Look
A few better-ranked stocks from the same space include Arbor Realty Trust ABR, Extra Space Storage Inc. EXR and Sotherly Hotels Inc. SOHO. All three stocks carry a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Arbor Realty Trust’s Zacks Consensus Estimate for 2018 funds from operations (FFO) per share remained unchanged at 90 cents over the past month. Its shares returned 2.7% in three months’ time.
Extra Space Storage’s FFO per share estimates for the current year moved up 1.5% to $4.59 in a month’s time. Its shares gained 4.5% over the past three months.
Sotherly Hotels’ FFO per share estimates for 2018 was revised upward marginally to $1.05 over the past month. The stock gained 7% during the past three months.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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