Strategic Storage obtains $135 million of six-month term loans

By Susanna Moon

Chicago, June 7 – Strategic Storage Trust II, Inc. entered into a $105 million secured term loan and a $30 million subordinated loan on June 1 with KeyBanc Capital Markets, LLC as the bookrunner and lead arranger and KeyBank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

Both loans are due Dec. 31, 2016.

Interest is Libor plus 225 basis points for the secured loan and Libor plus 563 bps for the subordinated loan.

Under the terms of the subordinated loan, the company must maintain a total leverage ratio of no than 60%; a tangible net worth of at least $260 million, plus 85% of the net equity proceeds received after the effective date; an interest coverage ratio of at least 1.85 times; a fixed charge ratio of at least 1.6 times; and a ratio of debt that bears interest at a varying rate of interest or that does not have the interest rate fixed, capped or swapped under a hedging agreement to the sum of the debt, not in excess of 30%.

The proceeds of the loans and a $100 million drawdown under the company’s existing credit facility with KeyBank were used to purchase properties.

Strategic Storage is a public non-traded REIT based in Ladera Ranch, Calif., focused on income-producing self-storage facilities and related self-storage real estate investments.

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