| SAO PAULO
SAO PAULO Jan 11 Real estate tycoon Sam Zell
and investment firm Pátria Investimentos Ltda have combined two
leading Brazilian self-storage firms in a joint venture that
aims to more than double their capacity by 2020, the companies
said on Wednesday.
Under their plan, the entity resulting from the merger of
Zell's GuardeAqui and Pátria's Kipit will open 30 storage
facilities in Brazil over the period, an investment that could
reach 600 million reais ($187.76 million) based on the average
cost to build a unit.
Each unit costs about 20 million reais to set up, Fauze
Antun, real estate partner at Pátria, said in an interview. He
declined to quantify the investments of each of the companies,
but said that most of the funds should come from Pátria, since
Kipit is the smaller partner.
With about 20 units, the joint venture will comprise
one-third of Brazil's leasable self-storage area, the partners
said in a statement. The venture, which will operate under the
GuardeAqui brand, is roughly 50-50 owned by the partners, Antun
The goal is to expand GuardeAqui's leadership in Brazil's
fragmented self-storage market, which gained steam in last the
decade on buoyant demand for housing, the companies said.
Self-storage gives individuals a way to keep belongings as they
move into smaller apartments and homes.
Once the venture reaches its target of opening 50
self-storage sites, Zell and Pátria will start considering a
potential exit for GuardeAqui, through an initial public
offering, a sale to another investor, or another option, Antun
While self-storage offers some of the most stable returns in
real estate, the segment has remained underdeveloped in Brazil
because of scarce financing, GuardeAqui Chief Executive Allan
Paiotti said in an interview.
The sector has a crisis-resilient reputation due to the
flexible nature of self-storage leasing contracts and the fact
that corporate clients account for half of the business of
GuardeAqui and Kipit, Paiotti added.
In the last few years, Brazil's self-storage industry has
attracted names such as São Paulo-based Hemisfério Sul
Investimentos Ltda and U.S.-based Evergreen Investment Corp,
which committed $150 million to create GoodStorage in 2013.
Also, Goldman Sachs Group Inc's special situations unit last
year provided an undisclosed amount of expansion capital to
privately owned MetroFit, marking the bank's first investment of
that kind in Brazil.
Zell's Equity International entered GuardeAqui in 2011,
investing $58 million. Kipit is part of the investment portfolio
of Pátria's roughly three-year-old Real Estate Fund III.
($1 = 3.1955 reais)
(Reporting by Ana Mano; Editing by Guillermo Parra-Bernal and