Crystal View Capital Fund II Refinances AAA Platte Self Storage in Colorado Springs, CO Loan Generating Substantial Savings for Investors
LAS VEGAS, July 14, 2021 /PRNewswire/ -- Crystal View Capital Fund II, LLC (the "Fund") is pleased to announce that AAA Platte Self Storage in Colorado Springs, CO has refinanced its $8.6 million loan that carried a 6.35% interest rate to a new $9.5 million loan at a 3.32% fixed interest rate. By closing on this refinance, we were able to generate substantial savings and enhance cash flow to investors by reducing debt service by over $20,000 per month and obtaining 10 years of interest only debt payments.
AAA Platte Self Storage was acquired by the Fund in November 2019 and consists of 878 storage units and parking spaces and over 80,000 square feet of distribution space. Since acquisition, we have executed on several initiatives to increase the value of the asset:
- As previously communicated in January of 2021, we entered into a new 5-year lease agreement with a large privately held logistics company for 50,000 square feet of warehouse space. This new lease is expected to generate incremental Net Operating Income ("NOI") of over $300,000 annually, generating an estimated increase in value of $4.6 million assuming a 6.5% cap rate.
- Leased up a total of over 80,000 square feet of industrial space that was vacant at acquisition.
- Replaced previous management with an experienced self-storage management team that was able to increase occupancy from 78% to 88%.
- Completed a subdivision allowing us to unlock the value of the site by separating the self-storage and industrial space from a retail space. The retail space is currently under contract to be sold, and we are optimistic that the sale will close within the next 60 days. If successful, the sale of the retail space will allow us to extract substantially all of the equity invested in the asset while retaining the strong cash flowing self-storage and industrial components of the property.
- Our in-house marketing department was able to eliminate a third-party vendor that resulted in substantially decreasing marketing expenses while continuing a strong online marketing presence.
- Estimated monthly free cash flow (cash flow after operating expenses and debt service) to the Fund is now approximately $51,000
By achieving these value-add strategy, the asset has surpassed its initial projections of a 32% Internal Rate of Return ("IRR") and a 2.2x Multiple on Invested Capital ("MOIC") on a levered basis to our revised return estimates of a 47.6% IRR and a 3.7x MOIC assuming an additional 27 month hold period and assuming we are successful in completing the sale of the retail space mentioned above.
Crystal View Capital is a private equity real estate firm that specializes in the acquisition and management of self-storage facilities and manufactured housing communities.
For more information about the Fund, please visit our website: www.crystalviewcapital.com
Matthew Ricciardella, Principal and Managing Partner
Crystal View Capital
Allie Hunsaker, Investor Relations Manager
Crystal View Capital
T: (702) 570-3956
SOURCE Crystal View Capital
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