SmartStop Self Storage REIT Announces Pricing of Underwritten Public Offering

Rhea-AI Summary

SmartStop Self Storage REIT has announced the pricing of its public offering of 27,000,000 shares of common stock at $30.00 per share. The company has granted underwriters a 30-day option to purchase up to an additional 4,050,000 shares.

Trading is expected to begin on April 2, 2025, on the NYSE under the ticker symbol SMA. The offering is anticipated to close on April 3, 2025. The net proceeds will be used to:

• Redeem 100% of issued Series A Preferred Stock
• Pay down existing credit facility debt
• Repay an acquisition facility
• Fund property acquisitions
• Support general corporate purposes

The offering is led by joint book-running managers including J.P. Morgan, Wells Fargo Securities, KeyBanc Capital Markets, BMO Capital Markets, and Truist Securities.

Positive

• Significant capital raise through 27M share offering at $30.00 per share
• NYSE listing provides increased visibility and trading liquidity
• Strategic debt reduction and preferred stock redemption improves capital structure
• Funding available for property acquisitions and growth

Negative

• Substantial shareholder dilution from 27M new shares
• Additional dilution possible from 4.05M share underwriter option

Insights

Financial Analyst

SmartStop's pricing of 27 million shares at $30.00 per share represents a substantial capital raise of approximately $810 million, potentially reaching $931.5 million if underwriters exercise their option for additional shares. This IPO marks a significant milestone as the company transitions to NYSE trading under ticker symbol "SMA".

The capital allocation strategy is strategically sound, focusing on three key areas: balance sheet optimization through preferred stock redemption and debt reduction, portfolio expansion via property acquisitions, and operational flexibility with funds for general corporate purposes. This balanced approach should strengthen SmartStop's financial position while providing growth capital.

The self-storage REIT sector has traditionally offered defensive characteristics with recurring revenue streams and relatively low operational costs. By reducing leverage and creating acquisition capacity, SmartStop positions itself to potentially capitalize on growth opportunities in the fragmented self-storage market.

The impressive lineup of underwriters, led by top-tier firms including J.P. Morgan and Wells Fargo Securities, suggests strong institutional confidence in SmartStop's business model and growth prospects. This broad syndicate of financial institutions indicates robust demand for the offering.

This transaction represents a pivotal financing event that should enhance SmartStop's financial flexibility while providing a pathway for portfolio expansion in its core self-storage business across the U.S. and Canada.

LADERA RANCH, Calif.--(BUSINESS WIRE)-- SmartStop Self Storage REIT, Inc. ("SmartStop" or the "Company"), an internally-managed real estate investment trust and a premier owner and operator of self storage facilities in the United States and Canada, announced today the pricing of its public offering of 27,000,000 shares of common stock at a price to the public of $30.00 per share.

SmartStop has granted the underwriters a 30-day option to purchase up to an additional 4,050,000 shares of its common stock at the public offering price, less underwriting discounts and commissions.

Shares of SmartStop’s common stock are expected to begin trading on April 2, 2025 on the New York Stock Exchange under the ticker symbol “SMA,” and the closing of the offering is expected to occur on April 3, 2025, subject to the satisfaction of customary closing conditions.

SmartStop intends to use the net proceeds from the offering to redeem 100% of its issued and outstanding Series A Preferred Stock, pay down existing debt under its credit facility, repay an acquisition facility, fund external growth with property acquisitions, and fund other general corporate uses.

J.P. Morgan, Wells Fargo Securities, KeyBanc Capital Markets, BMO Capital Markets and Truist Securities are acting as joint book-running managers for the offering. Baird, Stifel, National Bank of Canada Financial Markets, Raymond James and Scotiabank are acting as bookrunners for the offering. BTIG, M&T Securities and Fifth Third Securities are acting as co-managers for the offering.

A registration statement on Form S-11 (File No. 333-264449) relating to these securities was declared effective by the Securities and Exchange Commission on April 1, 2025. The offering is being made only by means of a prospectus. Once available, copies of the final prospectus may be obtained from J.P. Morgan Securities LLC, c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717 or by email at prospectus-eq_fi@jpmchase.com and postsalemanualrequests@broadridge.com; Wells Fargo Securities, 90 South 7th Street, 5th Floor, Minneapolis, MN 55402, at (800) 645-3751 (option #5) or email a request to WFScustomerservice@wellsfargo.com; KeyBanc Capital Markets, Attention: Equity Syndicate, 127 Public Square, 7th Floor, Cleveland, OH 44114 or by fax at 1.216.689.0845; BMO Capital Markets Corp., Attention: Equity Syndicate Department, 151 W 42nd Street, 32nd Floor, New York, NY 10036 or by email at bmoprospectus@bmo.com; or Truist Securities, Inc., Attention: Equity Capital Markets, 3333 Peachtree Road NE, 9th Floor, Atlanta, GA 30326 at (800) 685-4786 or by email to truistsecurities.prospectus@truist.com.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy these securities, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

About SmartStop Self Storage REIT, Inc. (SmartStop):

SmartStop Self Storage REIT, Inc. (“SmartStop”) is a self-managed REIT with a fully integrated operations team of approximately 560 self-storage professionals focused on growing the SmartStop® Self Storage brand. SmartStop, through its indirect subsidiary SmartStop REIT Advisors, LLC, also sponsors other self-storage programs. As of December 31, 2024, SmartStop has an owned or managed portfolio of 208 operating properties in 22 states, the District of Columbia, and Canada, comprising approximately 148,000 units and 16.7 million rentable square feet. SmartStop and its affiliates own or manage 38 operating self-storage properties in Canada, which total approximately 33,000 units and 3.4 million rentable square feet.

Forward-Looking Statements

Certain statements contained in this press release, including statements relating to the Company’s expectations regarding the completion, timing and size of its proposed public offering and listing as well as the expected use of proceeds of the offering may constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements can generally be identified by our use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “anticipate,” “estimate,” “believe,” “continue,” or other similar words. Readers are cautioned not to place undue reliance on these forward-looking statements, which are based on management's current expectations and are inherently subject to various risks, uncertainties, assumptions, or changes in circumstances that are difficult to predict or quantify. These risks and uncertainties include, but are not limited to, risks and uncertainties associated with the consummation of the offering and other risks described in SmartStop's registration statement on Form S-11, as it may be amended from time to time. Except as required by law, SmartStop expressly disclaims a duty to provide updates to forward-looking statements, whether as a result of new information, future events or other occurrences.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250401225980/en/

David Corak

SVP of Corporate Finance & Strategy

SmartStop Self Storage REIT, Inc.

IR@smartstop.com

Source: SmartStop Self Storage REIT, Inc.

FAQ

What is the size and price of SmartStop's (SMA) public offering in 2025?

SmartStop is offering 27 million shares at $30.00 per share, with an additional 30-day option for underwriters to purchase 4.05 million more shares.

When will SmartStop (SMA) begin trading on the NYSE?

SmartStop shares are expected to begin trading on the New York Stock Exchange under ticker SMA on April 2, 2025.

How will SmartStop use the proceeds from its 2025 public offering?

Proceeds will redeem Series A Preferred Stock, pay down credit facility debt, repay acquisition facility, fund property acquisitions, and support general corporate purposes.

Which investment banks are leading SmartStop's (SMA) 2025 public offering?

J.P. Morgan, Wells Fargo Securities, KeyBanc Capital Markets, BMO Capital Markets, and Truist Securities are acting as joint book-running managers.