UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 14, 2014
Strategic Storage Trust II, Inc.
(Exact name of registrant as specified in its charter)
Commission File Number: 333-190983
| MD | 46-1722812 | |
| (State or other jurisdiction of incorporation) | (IRS Employer Identification No.) |
111 Corporate Drive, Suite 120, Ladera Ranch, California 92694
(Address of principal executive offices, including zip code)
(877) 327-3485
(Registrant’s telephone number, including area code)
None
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 1.01. | Entry into a Material Definitive Agreement. |
Entry into Partial Assignments of Purchase and Sale Agreement for the 26 Property Portfolio
On August 14, 2014, Strategic Storage Trust II, Inc. (the “Registrant”), through 26 wholly-owned subsidiaries of Strategic Storage Operating Partnership II, L.P., the Registrant’s operating partnership (the “Operating Partnership”), executed 26 partial assignments of the purchase and sale agreement originally executed by a subsidiary of the Registrant’s sponsor on July 9, 2014, with unaffiliated third parties (the “26 Property Purchase Agreement”) for the acquisition of a portfolio of 26 self storage facilities (the “26 Property Portfolio”). The 26 Property Portfolio consists of 14 self storage facilities located in California; four self storage facilities located in Michigan; three self storage facilities located in Colorado; two self storage facilities located in Illinois and one self storage facility located in each of New Jersey, Washington and Maryland.
The purchase price for the 26 Property Portfolio is approximately $128.2 million, plus closing costs and acquisition fees. The Registrant expects the acquisition of the 26 Property Portfolio to close in the third or fourth quarter of 2014 in several tranches and to fund such acquisition with a combination of net proceeds from its public offering, a credit facility or other debt financing and other potential financing sources. This discussion of the potential acquisition of the 26 Property Portfolio is qualified in its entirety by the text of the 26 Property Purchase Agreement, attached hereto as Exhibit 10.1
A summary of the properties in the 26 Property Portfolio is as follows:
Property | Address | Purchase Price | Year Built | Approx. Sq. Ft. (net) | Approx. Units | |||||||||||||
Whittier - CA | 10231 S. Colima Rd, Whittier, CA 90603 | $ | 5,870,000 | 1989 | 58,600 | 510 | ||||||||||||
La Verne - CA | 2234 Arrow Hwy, La Verne, CA 91750 | $ | 4,120,000 | 1986 | 49,800 | 520 | ||||||||||||
Santa Ana - CA | 4200 Westminster Ave., Santa Ana, CA 92703 | $ | 9,230,000 | 1978 | 84,500 | 840 | ||||||||||||
Upland - CA | 1571 W Foothill Blvd, Upland, CA 91786 | $ | 6,230,000 | 1979 | 56,500 | 610 | ||||||||||||
La Habra - CA | 580 E Lambert Rd, La Habra, CA 90631 | $ | 4,560,000 | 1981 | 51,400 | 420 | ||||||||||||
Monterey Park - CA | 404 Potrero Grande, Monterey Park, CA 91755 | $ | 4,380,000 | 1987 | 31,200 | 390 | ||||||||||||
Huntington Beach - CA | 7611 Talbert Avenue, Huntington Beach, CA 92648 | $ | 10,830,000 | 1986 | 61,000 | 610 | ||||||||||||
Chico - CA | 3860 Benetar Way, Chico, CA 95928 | $ | 1,780,000 | 1984 | 38,800 | 360 | ||||||||||||
Lancaster - CA | 43745 N. Sierra Hwy, Lancaster, CA 93534 | $ | 1,760,000 | 1980 | 64,700 | 700 | ||||||||||||
Riverside - CA | 6667 Van Buren Blvd, Riverside, CA 92503 | $ | 2,760,000 | 1985 | 61,000 | 570 | ||||||||||||
Fairfield - CA | 2998 Rockville Rd, Fairfield, CA 94534 | $ | 3,880,000 | 1984 | 41,000 | 440 | ||||||||||||
Lompoc - CA | 517 N. 8th Street, Lompoc, CA 93436 | $ | 3,990,000 | 1982 | 46,500 | 430 | ||||||||||||
Santa Rosa - CA | 3937 Santa Rosa Ave, Santa Rosa, CA 95407 | $ | 10,420,000 | 1979-1981 | 116,400 | 1,150 | ||||||||||||
Vallejo - CA | 1401 Enterprise St, Vallejo, CA 94589 | $ | 5,240,000 | 1981 | 54,400 | 510 | ||||||||||||
Federal Heights - CO | 8920 Federal Blvd, Federal Heights, CO 80221 | $ | 4,700,000 | 1983 | 40,600 | 450 | ||||||||||||
Aurora - CO | 435 Airport Blvd, Aurora, CO 80011 | $ | 7,290,000 | 1984 | 87,400 | 890 | ||||||||||||
Littleton - CO | 3757 Norwood Dr, Littleton, CO 80125 | $ | 4,300,000 | 1985 | 45,800 | 400 | ||||||||||||
Bloomingdale - IL | 240 W. Army Trail Road, Bloomingdale, IL 60108 | $ | 4,950,000 | 1987 | 58,200 | 570 | ||||||||||||
Crestwood - IL | 4747 W Calumet-Sag Road, Crestwood, IL 60445 | $ | 2,440,000 | 1987 | 49,300 | 460 | ||||||||||||
Forestville - MD | 4100 Forestville Rd, Forestville, MD 20747 | $ | 6,650,000 | 1988 | 55,200 | 530 | ||||||||||||
WarrenI - MI | 27203 Groesbeck Hwy, Warren, MI 48089 | $ | 3,390,000 | 1996 | 63,100 | 500 | ||||||||||||
Property | Address | Purchase Price | Year Built | Approx. Sq. Ft. (net) | Approx. Units | |||||||||||||
Sterling Heights - MI | 42557 Van Dyke Avenue, Sterling Heights, MI 48314 | $ | 3,810,000 | 1977 | 57,900 | 460 | ||||||||||||
Troy - MI | 262 E. Maple Road, Troy, MI 48083 | $ | 4,770,000 | 1988 | 82,200 | 730 | ||||||||||||
Warren II - MI | 24623 Ryan Road, Warren, MI 48091 | $ | 3,590,000 | 1987 | 52,100 | 490 | ||||||||||||
Beverly - NJ | 4233 Route 130 South, Beverly, NJ 08010 | $ | 2,130,000 | 1988 | 51,000 | 460 | ||||||||||||
Everett - WA | 10919 Evergreen Way, Everett, WA 98204 | $ | 5,150,000 | 1986 | 48,100 | 490 | ||||||||||||
TOTAL | $ | 128,220,000 | 1,506,700 | 14,490 | ||||||||||||||
Pursuant to the 26 Property Purchase Agreement, the Registrant would be obligated to purchase the 26 Property Portfolio only after satisfactory completion of agreed upon closing conditions. The Registrant will decide whether to acquire the 26 Property Portfolio generally based upon:
| • | the ability of the Registrant to raise sufficient net proceeds from its public offering and obtain debt and other financing; |
| • | satisfactory completion of due diligence on the properties and the sellers of the properties; |
| • | satisfaction of the conditions to the acquisition in accordance with the 26 Property Purchase Agreement, including but not limited to, approval of the seller’s investors; and |
| • | no material adverse changes relating to the properties, the sellers of the properties or certain economic conditions. |
There can be no assurance that the Registrant will complete the acquisition of the 26 Property Portfolio. In some circumstances, if the Registrant fails to acquire some or all of the facilities, in addition to the incurred acquisition costs, it may forfeit up to approximately $4.4 million in earnest money on the 26 Property Portfolio.
Other properties may be identified in the future that the Registrant may acquire prior to or instead of the 26 Property Portfolio. Due to the considerable conditions to the consummation of the acquisition of the 26 Property Portfolio, the Registrant cannot make any assurances that the closing of the 26 Property Portfolio is probable.
Entry into Partial Assignments of Purchase and Sale Agreement for the Raleigh/Myrtle Beach Portfolio
On August 14, 2014, the Registrant, through five wholly-owned subsidiaries of the Operating Partnership, executed five partial assignments of the purchase and sale agreement originally executed by a subsidiary of the Registrant’s sponsor on January 21, 2014, with an unaffiliated third party (the “Storkwik Purchase Agreement”) for the acquisition of a portfolio of five self storage facilities, consisting of three self storage facilities located in Raleigh, North Carolina and two self storage facilities located in Myrtle Beach, South Carolina (the “Raleigh/Myrtle Beach Portfolio”).
The purchase price for the Raleigh/Myrtle Beach Portfolio is approximately $22.1 million, plus closing costs and acquisition fees. The Registrant expects the acquisition of the Raleigh/Myrtle Beach Portfolio to close in the third or fourth quarter of 2014 and to fund such acquisition with a combination of net proceeds from its public offering, an assumption of an existing $12.8 million loan encumbering the properties of the Raleigh/Myrtle Beach Portfolio and other potential financing sources. This discussion of the potential acquisition of the Raleigh/Myrtle Beach Portfolio is qualified in its entirety by the text of the Storkwik Purchase Agreement, attached hereto as Exhibit 10.3.
A summary of the properties in Raleigh/Myrtle Beach Portfolio is as follows:
Property | Address | Purchase Price | Year Built | Approx. Sq. Ft. (net) | Approx. Units | |||||||||||||
Morrisville - NC | 150 Airport Blvd, Morrisville, NC | $ | 2,130,000 | 2003 | 38,160 | 310 | ||||||||||||
Cary - NC | 120 Centrewest Ct, Cary, NC | $ | 4,570,000 | 1997 | 62,600 | 320 | ||||||||||||
Raleigh - NC | 5012 New Bern Ave, Raleigh, NC | $ | 3,920,000 | 1999 | 44,930 | 390 | ||||||||||||
Myrtle Beach I - SC | 338 Jesse St, Myrtle Beach, SC | $ | 5,940,000 | 2004 | 96,080 | 730 | ||||||||||||
Myrtle Beach II - SC | 4630 Dick Pond Rd, Myrtle Beach, SC | $ | 5,540,000 | 2006 | 75,370 | 600 | ||||||||||||
TOTAL | $ | 22,100,000 | 317,140 | 2,350 | ||||||||||||||
Pursuant to the Storkwik Purchase Agreement, the Registrant would be obligated to purchase the Raleigh/Myrtle Beach Portfolio only after satisfactory completion of agreed upon closing conditions. The Registrant will decide whether to acquire the Raleigh/Myrtle Beach Portfolio generally based upon:
| • | the ability of the Registrant to raise sufficient net proceeds from its public offering and obtain other financing; |
| • | satisfactory completion of due diligence on the properties and the sellers of the properties; |
| • | approval by the current lender of the Registrant’s assumption of the existing loan encumbering the properties in the Raleigh/Myrtle Beach Portfolio; |
| • | satisfaction of the conditions to the acquisition in accordance with the Storkwik Purchase Agreement; and |
| • | no material adverse changes relating to the properties, the sellers of the properties or certain economic conditions. |
There can be no assurance that the Registrant will complete the acquisition of the Raleigh/Myrtle Beach Portfolio. In some circumstances, if the Registrant fails to complete the acquisition, it may forfeit up to $0.2 million in earnest money on the Raleigh/Myrtle Beach Portfolio.
Other properties may be identified in the future that the Registrant may acquire prior to or instead of the Raleigh/Myrtle Beach Portfolio. Due to the considerable conditions to the consummation of the acquisition of the Raleigh/Myrtle Beach Portfolio, the Registrant cannot make any assurances that the closing of the Raleigh/Myrtle Beach Portfolio is probable.
| Item 9.01. | Financial Statements and Exhibits |
(d) Exhibits
| 10.1 | 26 Property Portfolio Purchase Agreement |
| 10.2 | Partial Assignment of one of the properties of the 26 Property Portfolio |
| 10.3 | Raleigh/Myrtle Beach Portfolio Purchase Agreement |
| 10.4 | Partial Assignment of one of the properties of the Raleigh/Myrtle Beach Portfolio |
| 10.5 | Schedule of Omitted Documents |
Signature(s)
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| STRATEGIC STORAGE TRUST II, INC. | ||||||
| Date: August 19, 2014 | By: | /s/ Michael S. McClure | ||||
| Michael S. McClure | ||||||
| Executive Vice President and Chief Financial Officer | ||||||
