SmartStop Self Storage REIT has made $140m (€123m) worth of investments across the US and Canada, as it begins a non-core asset disposal plan to recycle capital into higher-density markets.
The NYSE-listed REIT is investing C$74m ($46m) for a 50% general partner and 34% limited partner stake in Strategic Storage Canada, a joint venture that owns 14 assets across key Canadian markets, with options to invest up to C$228m further.
SmartStop is also investing $37m to acquire two US facilities in Las Vegas and Asheville, alongside a $48m to $53m programmatic preferred equity and mezzanine lending partnership with AXCS Capital to back class-A self-storage developments.
SmartStop said it has launched an asset management programme to sell $75m to $125m of non-core properties starting in early 2027, to recycle capital into its primary markets.
H Michael Schwartz, founder, chairman and CEO of SmartStop, said: “We are significantly expanding our footprint in Canada, adding high-quality assets on balance sheet in core US markets, and growing a new programmatic investment relationship with an exceptionally high-quality sponsor, all while funding this growth on a leverage-neutral basis.
“The addition of 25 class-A self-storage properties increases clustering and operating efficiencies in many of our core markets.”
Schwartz said the transactions and the associated financing are expected to be materially accretive to the firm’s 2027 funds from operations, as adjusted per share on an approximately leverage-neutral basis.
“We believe the Strategic Storage Canada portfolio will see meaningful embedded net operating income upside as the properties lease up over the coming years, with an anticipated stabilised yield over 6%.”
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