Self Storage Reit Smartstop Climbs After Its $810 Million U.S IPO

SmartStop Self Storage REIT Inc. saw its stock rise in its market debut after securing $810 million through an initial public offering (IPO). The self-storage real estate investment trust (REIT) priced its shares in the lower half of its projected range, reflecting a cautious approach amid a challenging IPO market.

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The company's shares opened at $32.40 on Wednesday, surpassing the IPO price of $30 per share. On Tuesday, SmartStop had sold 27 million shares at that price. Initially, the Ladera Ranch, California-based firm marketed the offering with a price range of $28 to $36 per share but later adjusted it slightly to $28 to $35 on Friday.

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A Challenging IPO Market

SmartStop’s public debut comes at a time when the broader U.S. IPO market has struggled to generate excitement. Investor enthusiasm for new offerings has been subdued, with several high-profile debuts failing to meet expectations.

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For instance, cloud-computing firm Coreweave Inc. faced a lackluster reception during its own IPO on Friday, underscoring the broader challenges facing newly listed companies.

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Founded in 2009, SmartStop operates and manages more than 200 self-storage facilities across the U.S. and Canada, encompassing over 16.7 million rentable square feet. According to its filings, the company ranks as the tenth-largest self-storage provider in the United States.

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In terms of financial performance, SmartStop reported a net loss of $18.4 million in 2024, despite generating $237 million in revenue. This marks a wider loss compared to the previous year when the company posted a net loss of $2.7 million on revenue of $233 million.

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Before its public listing, SmartStop’s shares were traded over the counter. The company has indicated plans to grant its underwriters a 30-day option to purchase an additional 4 million shares at the IPO price, potentially increasing the offering’s total proceeds.

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JPMorgan Chase & Co., Wells Fargo & Co., KeyBanc Capital Markets, BMO Capital Markets, and Truist Securities served as lead underwriters for the IPO. SmartStop’s shares are now trading on the New York Stock Exchange under the ticker symbol SMA.

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Despite market headwinds, SmartStop’s successful debut signals that investors still see opportunities in the self-storage sector, a segment that has demonstrated resilience even in uncertain economic conditions.

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