Mini Mall Storage Leverages Avenue Living Platform
The Canadian self-storage industry is fragmented, especially across the Prairies. Less than 15 per cent of the 4,500 facilities across Canada have been consolidated by large companies. Storage facilities are mostly owned and operated by individuals, spread out across the towns and centres of the Prairies. This fragmentation is even further pronounced with Class B and C assets – ones that could be categorized as mom and pop type facilities.
Consolidating such a fragmented industry is a challenge few companies can rise to without a robust infrastructure supporting it. But a new fund, Mini Mall Storage Properties, is tapping into the Avenue Living advantage, leveraging the company’s established platform to fast-track acquisitions across the country, with a goal of 50 properties by the end of 2020.
Avenue Living, one of the fastest-growing multi-family real estate companies in Canada, has been consolidating real estate since 2006. Currently the owner and operator of $1.6 billion in assets across 19 centres in the Prairies, the company has 10,000 units in its residential rental division, 400,000 square feet of commercial real estate space and 37,000 acres of agricultural land. The company also has 300 field employees and a staff of 100 people at its head office.
With its well-developed systems and infrastructure firmly in place to manage real estate assets, Avenue Living’s business approach and operational organization translates almost seamlessly when applied to Mini Mall.
“The similarities between multi-family and storage create a powerful synergy,” said Adam Villard, CEO, Mini Mall Storage Properties.
Self-storage has remarkably similar characteristics to multi-family. Avenue Living, with its established platform, offers a clear advantage. There’s a similar acquisition process and setup. Mini Mall Storage Properties targets the same demographic as Avenue Living: B and C-class assets.
Avenue Living’s residents also fit the profile of the typical self-storage user. The company now has the option of cross marketing to residential tenants.
“Self-storage and Avenue Living Communities share very similar demographics,” said Villard. “The average income of the largest group of storage renters is in the $20,000 – 60,000 range, similar to ALC residents, and about 45% of those storage renters are long-term residential tenants.”
Beginning early June, Mini Mall customers will benefit from the resources of the existing Avenue Living Communities call centre. On the topic, Villard said, “Mini Mall customers will be given access to knowledgeable representatives when inquiries, questions and concerns arise about storage units. At less than a year since inception, this puts us well ahead of what we’d be able to achieve if we were a regular startup without the backing of the larger platform.”
Self-storage consolidation is an opportunity that is only possible with a fully developed platform. Avenue Living’s platform offers access to 20 field offices and staffing, access to the Asset Management team that comprises legal, accounting, underwriting and more.
“We have access to debt markets that small owners wouldn’t normally have, with better rates and terms.”
Simply put, Mini Mall Storage Properties is leveraging the process and structure developed over the last 13 years at Avenue Living.
“An entire machine has been built for owning and operating multi-family residential real estate,” said Villard. “Now, utilizing the parallels between the asset classes of multi-family and self-storage, the benefits of Mini Mall being part of the Avenue Living Group of Companies are tremendous.”