The Millbrook Expansion Creates Appreciable Value For Shareholders Of Global Self Storage

Summary

• In February of this year, Global Self Storage added 11,800 square feet of valuable climate-controlled units at the Millbrook Store.
• As of October 31, 96.3% of the Millbrook Store space was fully leased.
• The associated implied incremental accrual in shareholder economic value is impressive.

By how much did the shareholders benefit?

As reported in the Q3 Press Release for Global Self Storage (NASDAQ:SELF), the Millbrook facility was expanded by 11,800 square feet of climate-controlled units to a total of 24,472 leasable square feet. Based upon the best information we have available, let's make reasonable assumptions and perform a simple and straight-forward best estimate of the intrinsic value boost that redounded to SELF shareholders.

First, there is no reason to expect any differential between the occupancy proportions of the previously existing 12,672 square feet and the incremental 11,800 square feet, at least in the sense of on-going equilibrium as of October 31^st. Hence, we could expect that the 96.3% occupancy is reliable for application to the 11,800 square-foot addition on October 31^st.

Next, let's try to find some proxy for the prevailing monthly rent. Some time ago, before the expansion was even commenced, I was able to observe that the then-current rates per square foot were consistent across all the product offerings. However, up until just this morning, the SELF website had asserted for each and every sized unit offered "Limited Availability" and to call a designated phone number for a quote. By a stroke of luck, just this morning, I was able to obtain the below quote for a 5 X 4 unit. See Exhibit One below.

Exhibit One

I guess that this one became available overnight. At the $85.00 price, we would have $4.25 per square foot per month. Not bad! That is rather close to the $3.90 that I do best recall as the previously tendered standard for climate-controlled units at Millbrook. If it is still available, you can see for yourself here.

For the next piece of information, we refer to the Q3 10-Q for SELF. There we note a total of $ 2,328,322

Analyst’s Disclosure:I am/we are long SELF. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.