Strategic Storage Trust VI, Inc. Reports First Quarter 2025 Results

Business Wire

16-05-2025

LADERA RANCH, Calif.--(BUSINESS WIRE)--Strategic Storage Trust VI, Inc. ('SST VI') announced operating results for the three months ended March 31, 2025.
"This quarter marks an important milestone for our company as we report our first same-store results." commented H. Michael Schwartz, President and CEO of Strategic Storage Trust VI, Inc. "I'm pleased to share that these results exceeded our expectations and reflect the underlying strength and quality of our portfolio across both the United States and Canada. In addition, we completed the refinancing of all our Canadian debt at significantly lower interest rates. This strategic move enhances our financial flexibility and positions us well for continued operational and capital efficiency moving forward."
Key Highlights for the Three Months Ended March 31, 2025:
Total revenues were approximately $7.3 million, an increase of approximately $0.7 million when compared to the same period in 2024.
Increased same-store revenues and NOI by 6.8% and 13.6%, respectively, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024.
Increased same-store average physical occupancy by approximately 2.1% to 92.0% for the three months ended March 31, 2025 from 89.9% for the three months ended March 31, 2024.
Increased same-store annualized rent per occupied square foot by approximately 3.7% to $17.01 for the three months ended March 31, 2025 from $16.40 for the three months ended March 31, 2024.
Capital Transactions:
Debt Transactions
On January 8, 2025, we entered into a CAD $64.0 million financing with National Bank of Canada (the 'National Bank of Canada — Four Property Loan'). The National Bank of Canada — Four Property Loan has a term of three years, maturing on January 8, 2028. Payments consist of both principal and interest, calculated using a 25-year amortization, and are payable monthly. Amounts outstanding bear an interest rate equal to CORRA, plus a CORRA adjustment of approximately 0.30%, plus 2.25%. In addition, we entered into an interest rate swap agreement with a notional amount of CAD $64.0 million, whereby CORRA is fixed at approximately 3.03% that fixes the all in interest rate at 5.58% through the maturity of the loan. This addressed the upcoming 2025 maturities and will effectively reduced this portfolio's interest rate by approximately 100 basis points as compared to the previous financing arrangements.
On March 6, 2025, we entered into a credit agreement with Meridian Credit Union Limited (the 'Meridian Credit Agreement') with a maximum borrowing capacity of approximately CAD $16.0 million (the "Meridian Loan"). At close, we borrowed approximately CAD $2.1 million. The Meridian Loan is secured by a first mortgage on our development property in Etobicoke, Ontario Canada (the "Etobicoke Property"). The proceeds of the Meridian Loan will be used to fund development of a self storage facility on the Etobicoke Property. As of March 31, 2025 we had approximately CAD $2.1 million outstanding and approximately CAD $13.9 million of available capacity.
Pursuant to the Meridian Credit Agreement, amounts outstanding under the Meridian Loan bear interest at an annual rate equal to the Canada Prime Rate plus 1.50%, subject to a minimum all-in floor rate of 6.70% per annum. The Meridian Loan has an initial term of three years, maturing on March 5, 2028, with two six-month extension options. Payments under the Meridian Loan are payable monthly and interest-only.
On March 7, 2025, we entered into a CAD $164.5 million financing with QuadReal Finance, LP (the 'QuadReal — Seven Property Loan'). The QuadReal — Seven Property Loan has an initial term of five years, maturing on April 1, 2030. Payments under the QuadReal — Seven Property Loan are interest only during the term of the QuadReal - Seven Property Loan, payable monthly, with the full amount of the outstanding balance of the QuadReal - Seven Property Loan due on the maturity date. Upon the closing of the QuadReal - Seven Property Loan, we drew approximately CAD $147.0 million as the Initial Advance. The interest rate on the Initial Advance bears interest at an annual fixed rate equal to 5.59%. This strategic move addressed the upcoming 2025 maturities and will effectively reduced this portfolio's interest rate by approximately 170 basis points as compared to the previous financing arrangements.
About Strategic Storage Trust VI, Inc. (SST VI):
SST VI is a public non-traded REIT that elected to qualify as a REIT for federal income tax purposes. SST VI's primary investment strategy is to invest in income-producing and growth self-storage facilities and related self-storage real estate investments in the United States and Canada. As of May 16, 2025, SST VI has a portfolio of 13 operating properties in the United States comprising approximately 9,015 units and 1,079,395 rentable square feet (including parking); 11 properties with approximately 10,205 units and 1,067,715 rentable square feet (including parking) in Canada, joint venture interests in two operational and three development properties in two Canadian provinces (Ontario and Québec) and one wholly owned development property in Ontario.
About SmartStop Self Storage REIT, Inc. (SmartStop):
SmartStop Self Storage REIT, Inc. ('SmartStop') (NYSE:SMA), is a self-managed REIT with a fully integrated operations team of approximately 590 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 May 16, 2025, SmartStop has an owned or managed portfolio of 220 operating properties in 23 states, the District of Columbia, and Canada, comprising approximately 157,100 units and 17.7 million rentable square feet. SmartStop and its affiliates own or manage 41 operating self-storage properties in Canada, which total approximately 34,400 units and 3.5 million rentable square feet. Additional information regarding SmartStop is available at www.smartstopselfstorage.com.
STRATEGIC STORAGE TRUST VI, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended March 31,
2025
2024
Revenues:
Self storage rental revenue
$
7,303,641
$
6,577,587
Ancillary operating revenue
45,717
39,324
Total revenues
7,349,358
6,616,911
Operating expenses:
Property operating expenses
2,939,080
2,928,714
Property operating expenses – affiliates
1,240,267
1,280,595
General and administrative
1,703,808
1,554,738
Depreciation
3,118,402
3,175,232
Intangible amortization expense
—
1,039,598
Acquisition expense – affiliates
107,876
178,423
Other property acquisition expenses
14,020
54,041
Total operating expenses
9,123,453
10,211,341
Operating loss
(1,774,095
)
(3,594,430
)
Other income (expense):
Interest expense
(4,107,295
)
(4,710,295
)
Interest expense – debt issuance costs
(488,397
)
(276,258
)
Derivative fair value adjustment
(531,449
)
1,616,316
Other
79,014
187,818
Equity in loss of unconsolidated real estate venture
(222,528
)
—
Foreign currency adjustment
(195,936
)
(2,206,103
)
Net loss
(7,240,686
)
(8,982,952
)
Less: Distributions to preferred stockholders
(3,088,356
)
(3,166,042
)
Net loss attributable to the noncontrolling interests in our Operating Partnership
152,735
225,373
Net loss attributable to Strategic Storage Trust VI, Inc. common stockholders
$
(10,176,307
)
$
(11,923,621
)
Net loss per Class P share—basic and diluted
$
(0.40
)
$
(0.55
)
Net loss per Class A share—basic and diluted
$
(0.40
)
$
(0.55
)
Net loss per Class T share—basic and diluted
$
(0.40
)
$
(0.55
)
Net loss per Class W share—basic and diluted
$
(0.40
)
$
(0.55
)
Net loss per Class Y share—basic and diluted
$
(0.40
)
$
(0.55
)
Net loss per Class Z share—basic and diluted
$
(0.40
)
$
(0.55
)
Weighted average Class P shares outstanding—basic and diluted
11,331,153
11,137,137
Weighted average Class A shares outstanding—basic and diluted
3,389,986
3,351,907
Weighted average Class T shares outstanding—basic and diluted
5,386,419
5,302,182
Weighted average Class W shares outstanding—basic and diluted
707,444
690,352
Weighted average Class Y shares outstanding—basic and diluted
4,372,891
940,270
Weighted average Class Z shares outstanding—basic and diluted
366,596
86,161
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STRATEGIC STORAGE TRUST VI, INC. AND SUBSIDIARIES
COMPUTATION OF SAME-STORE OPERATING RESULTS
(UNAUDITED)
Same-Store Facility Results - three months ended March 31, 2025 and 2024
The following table sets forth operating data for our same-store facilities (stabilized and comparable properties that have been included in the consolidated results of operations since January 1, 2024) for the three months ended March 31, 2025 and 2024. We consider the following data to be meaningful as this allows for the comparison of results without the effects of acquisition, lease up, or development activity.
Same-Store Facilities
Non Same-Store Facilities
Total
2025
2024
%
Change
2025
2024
%
Change
2025
2024
%
Change
Revenues (1)
$3,466,639
$3,246,360
6.8%
$3,882,719
$3,370,551
N/M
$7,349,358
$6,616,911
11.1%
Property operating expenses (2)
1,425,618
1,450,018
(1.7)%
1,958,894
1,871,202
N/M
3,384,512
3,321,220
1.9%
Net operating income
$2,041,021
$1,796,342
13.6%
$1,923,825
$1,499,349
N/M
$3,964,846
$3,295,691
20.3%
Number of Facilities
12
12
12
12
24
24
Rentable square feet (3)
892,610
892,665
1,254,500
1,204,615
2,147,110
2,097,280
Average physical occupancy (4)
92.0%
89.9%
2.1%
87.0%
80.6%
N/M
89.0%
84.6%
4.4%
Annualized rent per occupied square foot (5)
$17.01
$16.40
3.7%
N/M
N/M
N/M
$16.29
$15.92
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N/M Not meaningful
(1)
Revenue includes rental revenue, ancillary revenue, administrative and late fees.
(2)
Property operating expenses excludes corporate general and administrative expenses, asset management fees, interest expense, depreciation, amortization expense and acquisition expenses, but includes property management fees.
(3)
Of the total rentable square feet, parking represented approximately 199,780 and 247,900 square feet as of March 31, 2025 and 2024, respectively. On a same-store basis, for the same periods, parking represented approximately 43,000 square feet.
(4)
Determined by dividing the sum of the month-end occupied square feet for the applicable group of facilities for each applicable period by the sum of their month-end rentable square feet for the period.
(5)
Determined by dividing the aggregate realized rental income for each applicable period by the aggregate of the month-end occupied square feet for the period. Properties are included in the respective calculations in their first full month of operations, as appropriate. We have excluded the realized rental revenue and occupied square feet related to parking herein for the purpose of calculating annualized rent per occupied square foot.
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Our increase in same-store revenue of approximately $0.2 million was primarily the result of increased average physical occupancy of approximately 2% and an increase in revenue per occupied square foot of approximately 3.7% for the three months ended March 31, 2025 over the three months ended March 31, 2014.
Our same-store property operating expenses decreased by approximately $24,000 for the three months ended March 31, 2025 compared to the three months ended March 31, 2014.
Net Operating Income ('NOI')
NOI is a non-GAAP measure that SST VI defines as net income (loss), computed in accordance with GAAP, generated from properties, before corporate general and administrative expenses, asset management fees, interest expense, depreciation, amortization, acquisition expenses and other non-property related expenses. SST VI believes that NOI is useful for investors as it provides a measure of the operating performance of its operating assets because NOI excludes certain items that are not associated with the ongoing operation of the properties. Additionally, SST VI believes that NOI is a widely accepted measure of comparative operating performance in the real estate community. However, SST VI's use of the term NOI may not be comparable to that of other real estate companies as they may have different methodologies for computing this amount.
The following table presents a reconciliation of net loss as presented on our consolidated statements of operations to NOI, as stated above, for the periods indicated:
(1)
Asset management fees are included in Property operating expenses – affiliates in the consolidated statements of operations.
(2)
Includes amortization of Advisor contract of approximately $0.2 million for each of the three months ended March 31, 2025 and 2024.
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