Extra Space Storage has agreed to buy its smaller rival, Life Storage, for $12.7 billion in a deal that will create the most significant operator renting out storage space in the United States by the number of locations. The combined company, a real estate investment trust, will have over 3,500 locations and two million customers. The deal, which challenges industry leader Public Storage, is expected to generate at least $100 million annually in savings and improved property revenue.
Extra Space Storage is one of the largest self-storage companies in the United States, operating over 1,900 locations nationwide. The company’s mission is to provide reliable, convenient, and secure storage solutions for customers seeking to store their belongings, whether short-term or long-term. With its acquisition of Life Storage, Extra Space Storage will expand its reach and further strengthen its position in the industry.
Life Storage will become part of a larger audience
On the other hand, Life Storage has a smaller footprint, operating just over 900 locations across 30 states. The company has been in the self-storage business for over 30 years and has a reputation for providing high-quality storage services to its customers. With the acquisition, Life Storage will become part of a larger organization with the resources and expertise to serve its customers better.
The deal is expected to close in the second half of 2022, pending regulatory approval. Once completed, the combined company will have a market capitalization of approximately $25 billion, making it one of the most prominent players in the real estate investment trust (REIT) industry.
The self-storage industry has grown rapidly in recent years, driven by urbanization, downsizing, and e-commerce. According to IBISWorld, the sector generates annual revenues of over $40 billion and is projected to grow at a yearly rate of 2.6% over the next five years. With the acquisition of Life Storage, Extra Space Storage is well-positioned to capitalize on this growth trend and further expand its market share.
The acquisition By Extra Storage could challenge its position as a leader
The acquisition of Life Storage is a strategic move for Extra Space Storage and a significant development in the self-storage industry. The deal creates a new industry leader better positioned to compete with Public Storage, which operates over 2,500 locations across the United States.
Public Storage has been the dominant player in the self-storage industry for years, but the acquisition of Life Storage by Extra Space Storage could challenge its position as the leader. With more locations and customers, the combined company will be better able to offer competitive pricing, better services, and more convenient storage solutions to customers across the country.
