3650 REIT Originates $31M Loan to Acquire Memphis-Area Self-Storage Portfolio

MIAMI–(BUSINESS WIRE)–3650 REIT (“3650”), a nationwide commercial real estate lender originating and servicing portfolio loans for relationship borrowers, is pleased to announce it has originated a $31 million Stable Cash Flow loan for the acquisition of an eight-property self-storage portfolio located throughout multiple submarkets in the Memphis, Tennessee area, which also includes northern Mississippi. The loan carries a term of 120 months and is provided to sponsor Gelt Inc., a strategic owner and operator of multifamily and self-storage assets investing in projects nationwide.

“Self-storage assets backed by national brands are historically well-positioned to weather economic instability, and today’s market environment due to COVID-19 is no exception,” said 3650 REIT Co-Founder and Managing Partner Toby Cobb. “The eight assets that make up this portfolio are well-located and offer high visibility to consumers as well as proximity to logistics, commercial and residential centers. As the nation moves forward with its recovery from the pandemic, we anticipate these factors, in tandem with the portfolio’s strong sponsorship, will allow the properties to continue to perform.”

The eight buildings encompassing the portfolio are located throughout several submarkets in the Memphis metropolitan area and northern Mississippi, including: Memphis, Tenn.; Bartlett, Tenn.; Olive Branch, Miss.; and Nesbit, Miss. Collectively, the properties comprise 3,884 units and reflect strong occupancy and cash flow. The transaction is a pivotal contribution to the area’s economic recovery, as each property’s surrounding trade area has seen limited deliveries amidst the recent market headwinds. The sponsor selected 3650 REIT for its surety of execution following its previous lender’s inability to close on new financing, as well as its relationship focus.

Kartikeya Kejriwal (KK), Associate Director of Gelt Inc., said, “This project has been perhaps our most challenging due to the unprecedented volatility and skittish lending environment due to COVID-19. At a time when many lenders have adopted a ‘wait and watch’ approach, 3650 REIT persisted to fund the loan. The successful close is a testament to the portfolio itself, which has weathered the storm better than most, and to the resolve of everyone involved in the transaction. The 3650 team looked beyond market speculation and analyzed actual portfolio performance to get the loan closed.”

Ken Dickey, Managing Partner and Head of Fixed Rate Lending for 3650 REIT, said, “We are particularly proud that we were able to assist a borrower that had capital at risk and was committed to close despite the volatile market environment. We are grateful that the sponsor trusted us to execute the deal after the withdrawal of their previous lender, and the strength of 3650’s platform allowed us to deliver a competitive loan at 75% of their acquisition price.”

The creativity and flexibility of the loan was an ideal fit for the sponsor’s business plan, which will aim to continue to fulfill local residents’ short- and long-term self-storage needs.

The financing was facilitated by Principal Devin Huber of The BSC Group, a Chicago-based advisory firm specializing in self-storage.

About 3650 REIT

3650 (pronounced “Thirty-Six Fifty”) REIT is a nationwide commercial real estate lender originating and servicing portfolio loans for relationship borrowers. 3650 REIT’s highly differentiated lending process, national scale, vertically integrated platform and Rated Special Servicer status enable it to deliver tailored financing solutions, high-touch service and reliable, customer-focused outcomes. Co-Founders and Managing Partners Toby Cobb, Justin Kennedy and Jonathan Roth have played leading roles in the evolution of the CRE debt markets with track records of success across CRE lending, mortgage banking, capital markets, loan servicing and distressed credit management. Headquartered in Miami, Florida with offices in New York, Los Angeles, Chicago, Dallas, and Nashville, 3650 REIT is well positioned to lend on properties located throughout the country. For more information, visit: www.3650REIT.com.

Contacts

Media Contact:
Greg Michaels, ICR for 3650 REIT

Gregory.Michaels@icrinc.com | 646-677-1836