NexPoint Advisors has acquired Jernigan Capital, a large owner of and capital provider to self-storage facilities, for about $900 million in an all-cash transaction. The deal signals the growing interest from institutional investors in the sector.
The newly acquired company will be known as NexPoint Storage Partners.
Extra Space Storage, a self-storage REIT, provided about $300 million to finance the acquisition by purchasing preferred stock.
JPMorgan Chase provided about $512 million of additional financing for the acquisition and future growth. Walker & Dunlop’s Aaron Appel, Keith Kurland, Adam Schwartz, Jonathan Schwartz and Stephen Farnsworth arranged financing deal.
The new company will continue to acquire self-storage facilities in growing markets and provide financing to other storage companies, according to a release. The sale was first announced in August.
Jernigan Capital owns $514 million worth of self storage real estate properties, according to its most recent quarterly report with the SEC.
NexPoint Advisors is an alternative investment platform with $7.8 billion in assets under management.
The self-storage sector has proven to be among the most resilient to the coronavirus pandemic, and large investors have taken notice. Last month, a Blackstone fund purchased Simply Self Storage from Brookfield Asset Management for about $1.2 billion, giving it a portfolio of 8 million square feet.