Goldman backs $360m self-storage bet by Angelo Gordon and Andover Properties

Newmark arranges debt for 50-asset portfolio in burgeoning lending niche.

Goldman Sachs is supplying $360 million of debt financing to Angelo Gordon and Andover Properties for the acquisition of a 50-asset, 3.9 million square foot self-storage portfolio. 

The New York-based bank closed on the Newmark-arranged financing on November 7 as part of the borrowing duo’s focus to expand their self-storage presence in primary markets and submarkets across the US.

Goldman’s bet on self-storage is in line with the wider commercial real estate lending landscape, which has increased its focus on the niche as the subsector has gained more institutional attributes.

The Newmark team working on the deal included Jordan Roeschlaub and Dustin Stolly, the vice-chairs and co-heads of Newmark’s debt and structured finance division; senior managing director Nick Scribani; vice-chair Aaron Swerdlin; and senior managing director of the New York-advisory’s self-storage group, Taucha Hogue.

Stolly said the sponsorship between Andover, with its Storage King USA operating platform, and Angelo Gordon, with its sector experience and large equity commitment to the portfolio, were critical to the transaction.  

“The sponsorship’s ability to drive cashflow growth by institutionalizing mom-and-pop assets speaks to the strength of their operations and ability to execute on the business plan,” Roeschlaub added.

Andover works as an owner-operator on more than 152 self-storage facilities across the US, totaling 12.1 million square feet of space under management in 18 states. The New York-based investment firm said it takes a value-add approach through the acquisition of sub-performing real estate properties as part of its strategy, which looks at a broad range of geographic markets and product types. 

Allocating toward self-storage opportunities has been top of mind for a solid portion of market participants in recent quarters because of the sector’s resilience to adverse market and recessionary conditions. MSCI data showed $24.1 billion of new volume originated in the niche in 2021 compared with $8.4 billion in 2020.