UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

 

FORM 10-Q

 

(Mark One)

Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended March 31, 2020

or

Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ____________________ to ____________________

Commission File Number: 001-12681

 

GLOBAL SELF STORAGE, INC.

(Exact name of registrant as specified in its charter) 

 

 

Maryland

 

13-3926714

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification Number)

Global Self Storage, Inc.

11 Hanover Square, 12th Floor

New York, NY 10005

(212) 785-0900

(Address, including zip code, and telephone number, including area code, of Company’s principal executive offices)

Donald Klimoski II, Esq.

Global Self Storage, Inc.

11 Hanover Square, 12th Floor

New York, NY 10005

(212) 785-0900

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading

Symbol(s)

 

Name of each exchange on which registered

Common shares, $0.01 par value per share

 

SELF

 

NASDAQ

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes   No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).   Yes   No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

 

 

 

 

 

Smaller reporting company

 

 

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes   No

The number of shares outstanding of the registrant’s common stock, par value $0.01 per share, as of April 20, 2020, was 9,356,202.

 

 

 

 


 

Table of Contents

 

STATEMENT ON FORWARD LOOKING INFORMATION

 

3

PART I – FINANCIAL INFORMATION

 

5

 

Item 1.

Financial Statements (Unaudited).

 

5

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

21

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

 

34

 

Item 4.

Controls and Procedures.

 

34

PART II – OTHER INFORMATION

 

36

 

Item 1.

Legal Proceedings.

 

36

 

Item 1A.

Risk Factors.

 

36

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

 

37

 

Item 3.

Defaults Upon Senior Securities.

 

37

 

Item 4.

Mine Safety Disclosures.

 

37

 

Item 5.

Other Information.

 

37

 

Item 6.

Exhibits.

 

38

Exhibit Index

 

39

SIGNATURES

 

40

 

2


 

STATEMENT ON FORWARD LOOKING INFORMATION

Certain information presented in this report may contain “forward-looking statements” within the meaning of the federal securities laws including, but not limited to, the Private Securities Litigation Reform Act of 1995. Forward looking statements include statements concerning our plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans or intentions relating to acquisitions and other information that is not historical information. In some cases, forward looking statements can be identified by terminology such as “believes,” “plans,” “intends,” “expects,” “estimates,” “may,” “will,” “should,” or “anticipates” or the negative of such terms or other comparable terminology, or by discussions of strategy. All forward-looking statements by the Company involve known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Company, which may cause the Company’s actual results to be materially different from those expressed or implied by such statements. We may also make additional forward looking statements from time to time. All such subsequent forward-looking statements, whether written or oral, by us or on our behalf, are also expressly qualified by these cautionary statements. All forward-looking statements, including without limitation, management’s examination of historical operating trends and estimates of future earnings, are based upon our current expectations and various assumptions. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them, but there can be no assurance that management’s expectations, beliefs and projections will result or be achieved.

All forward looking statements apply only as of the date made. Except as required by law, we undertake no obligation to publicly update or revise forward looking statements which may be made to reflect events or circumstances after the date made or to reflect the occurrence of unanticipated events.

There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements contained in or contemplated by this report. One of the most significant factors is the ongoing and potential impact of the current outbreak of the novel coronavirus (“COVID-19”) pandemic on the economy, the self storage industry and the broader financial markets, which may have a significant negative impact on the Company's financial condition, results of operations and cash flows. The Company is unable to predict whether the continuing effects of the COVID-19 pandemic will trigger a further economic slowdown or a recession and to what extent the Company will experience disruptions related to the COVID-19 pandemic in the second quarter or thereafter. The current outbreak of COVID-19 has also impacted, and is likely to continue to impact, directly or indirectly, many of the other important factors below and the risks described in “Item 1A. Risk Factors” included in our most recent annual report on Form 10-K and in this quarterly report and in our subsequent filings with the Securities and Exchange Commission (the “SEC”). Such factors include, but are not limited to:

 

general risks associated with the ownership and operation of real estate, including changes in demand, risks related to development or redevelopment (including expansions) of self storage properties, potential liability for environmental contamination, natural disasters and adverse changes in tax, real estate and zoning laws and regulations;

 

risks associated with downturns in the national and local economies in the markets in which we operate, including risks related to current economic conditions and the economic health of our customers;

 

the impact of competition from new and existing self storage and commercial properties and other storage alternatives;

 

difficulties in our ability to successfully evaluate, finance, integrate into our existing operations, and manage acquired and developed properties;

 

risks related to our development of new properties and expansions and related lease up at our existing properties and/or participation in joint ventures;

 

risks of ongoing litigation and other legal and regulatory actions, which may divert management’s time and attention, require us to pay damages and expenses or restrict the operation of our business;

 

the impact of the regulatory environment as well as national, state, and local laws and regulations including, without limitation, those governing the environment, taxes and our tenant reinsurance business and real estate investment trusts (“REITs”), and risks related to the impact of new laws and regulations;

 

risk of increased tax expense associated either with a possible failure by us to qualify as a REIT, or with challenges to intercompany transactions with our taxable REIT subsidiaries;

 

changes in federal or state tax laws related to the taxation of REITs, which could impact our status as a REIT;

 

increases in taxes, fees and assessments from state and local jurisdictions;

 

security breaches or a failure of our networks, systems or technology;

3


 

 

our ability to obtain and maintain financing arrangements on favorable terms;

 

market trends in our industry, interest rates, the debt and lending markets or the general economy and the changes resulting from the COVID-19 pandemic;

 

the timing of acquisitions and our ability to execute on our acquisition pipeline;

 

general volatility of the securities markets in which we participate;

 

changes in the value of our assets;

 

changes in interest rates and the degree to which our hedging strategies may or may not protect us from interest rate volatility;

 

our ability to continue to qualify and maintain our qualification as a REIT for U.S. federal income tax purposes;

 

availability of qualified personnel;

 

difficulties in raising capital at a reasonable cost;

 

fiscal policies or inaction at the U.S. federal government level, which may lead to federal government shutdowns or negative impacts on the U.S economy;

 

estimates relating to our ability to make distributions to our stockholders in the future; and

 

economic uncertainty due to the impact of terrorism, infectious or contagious diseases or pandemics such as the COVID-19 pandemic, or war.

 

 

4


 

PART I – FINANCIAL INFORMATION

Item 1.

Financial Statements.

GLOBAL SELF STORAGE, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

 

 

 

March 31, 2020

 

 

December 31, 2019

 

Assets

 

 

 

 

 

 

 

 

Real estate assets, net

 

$

60,173,297

 

 

$

59,752,153

 

Cash and cash equivalents

 

 

3,069,696

 

 

 

3,990,160

 

Restricted cash

 

 

282,759

 

 

 

263,405

 

Investments in securities

 

 

1,570,907

 

 

 

1,761,312

 

Accounts receivable

 

 

108,655

 

 

 

164,078

 

Prepaid expenses and other assets

 

 

409,549

 

 

 

325,450

 

Line of credit issuance costs, net

 

 

272,037

 

 

 

311,869

 

Intangible assets, net

 

 

261,844

 

 

 

398,795

 

Goodwill

 

 

694,121

 

 

 

694,121

 

Total assets

 

$

66,842,865

 

 

$

67,661,343

 

Liabilities and equity

 

 

 

 

 

 

 

 

Note payable, net

 

$

18,729,152

 

 

$

18,839,787

 

Line of credit borrowing

 

 

4,914,000

 

 

 

4,914,000

 

Accounts payable and accrued expenses

 

 

2,067,528

 

 

 

1,841,640

 

Total liabilities

 

 

25,710,680

 

 

 

25,595,427

 

Commitments and contingencies

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

 

Preferred stock, $0.01 par value: 50,000,000 shares authorized, no shares outstanding

 

 

 

 

 

 

Common stock, $0.01 par value: 450,000,000 shares authorized, 9,356,202 and 9,330,297 issued and outstanding at March 31, 2020 and December 31, 2019, respectively

 

 

93,562

 

 

 

93,303

 

Additional paid in capital

 

 

40,358,405

 

 

 

40,329,502

 

Retained earnings

 

 

680,218

 

 

 

1,643,111

 

Total equity

 

 

41,132,185

 

 

 

42,065,916

 

Total liabilities and equity

 

$

66,842,865

 

 

$

67,661,343

 

 

 

See notes to unaudited consolidated financial statements.

 

 

5


 

GLOBAL SELF STORAGE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended March 31,

 

 

 

2020

 

 

2019

 

Revenues

 

 

 

 

 

 

 

 

Rental income

 

$

2,150,240

 

 

$

2,038,684

 

Other property related income

 

 

71,960

 

 

 

67,827

 

Management fees and other income

 

 

17,344

 

 

 

Total revenues

 

 

2,239,544

 

 

 

2,106,511

 

Expenses

 

 

 

 

 

 

 

 

Property operations

 

 

916,080

 

 

 

913,349

 

General and administrative

 

 

682,623

 

 

 

555,928

 

Depreciation and amortization

 

 

515,937

 

 

 

351,644

 

Business development

 

 

9,240

 

 

 

8,250

 

Total expenses

 

 

2,123,880

 

 

 

1,829,171

 

Operating income

 

 

115,664

 

 

 

277,340

 

Other income (expense)

 

 

 

 

 

 

 

 

Dividend and interest income

 

 

24,100

 

 

 

17,200

 

Unrealized gain (loss) on marketable equity securities

 

 

(190,405

)

 

 

154,449

 

Interest expense

 

 

(305,783

)

 

 

(261,166

)

Total other (expense), net

 

 

(472,088

)

 

 

(89,517

)

Net (loss) income and comprehensive (loss) income

 

$

(356,424

)

 

$

187,823

 

Earnings per share

 

 

 

 

 

 

 

 

Basic

 

$

(0.04

)

 

$

0.02

 

Diluted

 

$

(0.04

)

 

$

0.02

 

Weighted average shares outstanding

 

 

 

 

 

 

 

 

Basic

 

 

9,262,811

 

 

 

7,630,722

 

Diluted

 

 

9,262,811

 

 

 

7,637,733

 

 

See notes to unaudited consolidated financial statements.

 

 

 

 

 

 

6


 

GLOBAL SELF STORAGE, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Common Stock

 

 

Paid in

 

 

Retained

 

 

Stockholders'

 

 

 

Shares

 

 

Par Value

 

 

Capital

 

 

Earnings

 

 

Equity

 

Balances at December 31, 2019

 

 

9,330,297

 

 

$

93,303

 

 

$

40,329,502

 

 

$

1,643,111

 

 

$

42,065,916

 

Restricted stock grants issued

 

 

25,905

 

 

 

259

 

 

 

(259

)

 

 

 

 

Stock-based compensation

 

 

 

 

 

 

29,162

 

 

 

 

 

29,162

 

Net loss

 

 

 

 

 

 

 

 

(356,424

)

 

 

(356,424

)

Dividends

 

 

 

 

 

 

 

 

(606,469

)

 

 

(606,469

)

Balances at March 31, 2020

 

 

9,356,202

 

 

$

93,562

 

 

$

40,358,405

 

 

$

680,218

 

 

$

41,132,185

 

 

See notes to unaudited consolidated financial statements.

 

 

7


 

GLOBAL SELF STORAGE, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

Common Stock

 

 

Paid in

 

 

Retained

 

 

Stockholders'

 

 

 

Shares

 

 

Par Value

 

 

Capital

 

 

Earnings

 

 

Equity

 

Balances at December 31, 2018

 

 

7,692,624

 

 

$

76,926

 

 

$

33,961,903

 

 

$

3,167,047

 

 

$

37,205,876

 

Restricted stock grants issued

 

 

41,343

 

 

 

414

 

 

 

(414

)

 

 

 

 

Stock-based compensation

 

 

 

 

 

 

54,160

 

 

 

 

 

54,160

 

Net income

 

 

 

 

 

 

 

 

187,823

 

 

 

187,823

 

Dividends

 

 

 

 

 

 

 

 

(503,294

)

 

 

(503,294

)

Balances at March 31, 2019

 

 

7,733,967

 

 

$

77,340

 

 

$

34,015,649

 

 

$

2,851,576

 

 

$

36,944,565

 

 

See notes to unaudited consolidated financial statements.

8


 

GLOBAL SELF STORAGE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended March 31,

 

 

 

2020

 

 

2019

 

Cash flows from operating activities

 

 

 

 

 

 

 

 

Net (loss) income

 

$

(356,424

)

 

$

187,823

 

Adjustments to reconcile net (loss) income to net cash provided by operating activities

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

515,937

 

 

 

351,644

 

Unrealized loss (gain) on marketable equity securities

 

 

190,405

 

 

 

(154,449

)

Amortization of loan procurement costs

 

 

50,047

 

 

 

50,298

 

Stock-based compensation

 

 

29,162

 

 

 

54,160

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

 

55,423

 

 

 

(23,736

)

Prepaid expenses and other assets

 

 

(84,099

)

 

 

(19,914

)

Accounts payable and accrued expenses

 

 

224,911

 

 

 

167,521

 

Net cash provided by operating activities

 

 

625,362

 

 

 

613,347

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

Construction

 

 

(746,487

)

 

 

(22,401

)

Improvements and equipment additions

 

 

(53,643

)

 

 

(7,390

)

Net cash used in investing activities

 

 

(800,130

)

 

 

(29,791

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

Principal payments on note payable

 

 

(120,850

)

 

 

(115,898

)

Dividends paid

 

 

(605,492

)

 

 

(499,044

)

Net cash used in financing activities

 

 

(726,342

)

 

 

(614,942

)

Net decrease in cash and cash equivalents

 

 

(901,110

)

 

 

(31,386

)

Cash, cash equivalents, and restricted cash, beginning of period

 

 

4,253,565

 

 

 

1,712,266

 

Cash, cash equivalents, and restricted cash, end of period

 

$

3,352,455

 

 

$

1,680,880

 

Supplemental schedule of cash flow information

 

 

 

 

 

 

 

 

Interest paid

 

$

267,132

 

 

$

207,200

 

 

See notes to unaudited consolidated financial statements.

 

 

 

 

 

9


 

GLOBAL SELF STORAGE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

 

1. ORGANIZATION

Global Self Storage, Inc. (the “Company,” “we,” “our,” “us”) is a self-administered and self-managed Maryland real estate investment trust (“REIT”) that owns, operates, manages, acquires, develops and redevelops self storage properties (“stores” or “properties”) in the United States. Through its wholly owned subsidiaries, the Company owns and/or manages 13 self-storage properties in Connecticut, Illinois, Indiana, New York, Ohio, Pennsylvania, South Carolina, and Oklahoma. The Company operates primarily in one segment: rental operations.

 

 

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

Upon deregistration as an investment company, effective January 19, 2016, the Company’s status changed to an operating company from an investment company since it no longer met the assessment of an investment company under the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946 (“ASC 946”). The Company discontinued applying the guidance in ASC 946 and began to account for the change in status prospectively by accounting for its investments in accordance with other U.S. generally accepted accounting principles (“GAAP”) topics as of the date of the change in status.

The accompanying unaudited consolidated financial statements of the Company are presented on the accrual basis of accounting in accordance with GAAP for interim financial information, and in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they may not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (including normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. The consolidated balance sheet as of December 31, 2019 has been derived from the Company’s audited financial statements as of that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2019.

Risks and Uncertainties — The recent outbreak of the novel coronavirus pandemic (“COVID-19”) around the globe continues to adversely impact global commercial activity and has contributed to significant volatility in financial markets. The global impact of the outbreak has been rapidly evolving and many countries, including the United States, have reacted by, among other things, instituting quarantines, mandating business and school closures and restricting travel. Such actions are creating significant disruption in global supply chains, and adversely impacting a number of industries.

The major disruption caused by COVID-19 brought to a halt most economic activity in most of the United States resulting in a significant increase in unemployment claims and will likely result in a significant decline in the U.S. Gross Domestic Product (“GDP”).

COVID-19 could have a continued and prolonged adverse impact on economic and market conditions and trigger a period of global economic slowdown which could have a material adverse effect on the Company’s results and financial condition.

The full impact of COVID-19 on the real estate industry, the credit markets and consequently on the Company’s financial condition and results of operations is uncertain and cannot be predicted at the current time as it depends on several factors beyond the control of the Company including, but not limited to (i) the uncertainty around the severity and duration of the outbreak, (ii) the effectiveness of the United States public health response, (iii) the pandemic’s impact on the U.S. and global economies, (iv) the timing, scope and effectiveness of additional governmental responses to the pandemic, (v) the timing and speed of economic recovery, including the availability of a treatment or vaccination for COVID-19, and (vi) the negative impact on our properties.

Reclassifications

Certain amounts from the prior year have been reclassified to conform to current year presentation as described below.

Cash, Cash Equivalents, and Restricted Cash

The Company’s cash is deposited with financial institutions located throughout the United States and at times may exceed federally insured limits. Cash equivalents consists of money market fund shares and may include, among other things, highly liquid

10


 

investments purchased with an original maturity of three months or less. Restricted cash is comprised of escrowed funds deposited with a bank relating to capital expenditures.

The carrying amount reported on the balance sheet for cash, cash equivalents, and restricted cash approximates fair value.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash in our unaudited consolidated balance sheets to the total amount shown in our consolidated statements of cash flows:

 

 

 

March 31, 2020

 

 

December 31, 2019

 

Cash and cash equivalents

 

$

3,069,696

 

 

$

3,990,160

 

Restricted cash

 

 

282,759

 

 

 

263,405

 

Total cash, cash equivalents, and restricted cash as shown in our unaudited consolidated statements of cash flows

 

$

3,352,455

 

 

$

4,253,565

 

 

Income Taxes

The Company has elected to be treated as a REIT under the IRC. In order to maintain its qualification as a REIT, among other things, the Company is required to distribute at least 90% of its REIT taxable income to its stockholders and meet certain tests regarding the nature of its income and assets. As a REIT, the Company is not subject to federal income tax with respect to that portion of its income which meets certain criteria and is distributed annually to stockholders. The Company plans to continue to operate so that it meets the requirements for taxation as a REIT. Many of these requirements, however, are highly technical and complex. If the Company were to fail to meet these requirements, it would be subject to federal income tax. In managements’ opinion, the requirements to maintain these elections are being fulfilled. The Company is subject to certain state and local taxes.

The Company has elected to treat its corporate subsidiary, SSG TRS LLC, as a taxable REIT subsidiary (“TRS”). In general, the Company’s TRS may perform additional services for tenants and may engage in any real estate or non-real estate related business. A TRS is subject to federal corporate income tax.

The Company recognizes the tax benefits of uncertain tax positions only where the position is “more likely than not” to be sustained assuming examination by tax authorities. The Company has reviewed its tax positions and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on federal, state, and local income tax returns for open tax years (2016 – 2018), or is expected to be taken in the Company’s 2019 tax returns.

Marketable Equity Securities

Investments in equity securities that have readily determinable fair values are accounted for equity securities measured at fair value. Gains or losses from changes in the fair value of equity securities are recorded in net income, until the investment is sold or otherwise disposed. The specific identification method is used to determine the realized gain or loss on investments sold or otherwise disposed.

Fair value is determined using a valuation hierarchy generally by reference to an active trading market, using quoted closing or bid prices. Judgment is used to ascertain if a formerly active market has become inactive and in determining fair values when markets have become inactive.

Real Estate Assets

Real estate assets are carried at the appreciated value as of January 19, 2016, the effective date of the Company’s change in status to an operating company, less accumulated depreciation from that date. Purchases subsequent to the effective date of the change in status are carried at cost, less accumulated depreciation. Direct and allowable internal costs associated with the development, construction, renovation, and improvement of real estate assets are capitalized. Property taxes and other costs associated with development incurred during a construction period are capitalized. A construction period begins when expenditures for a real estate asset have been made and activities that are necessary to prepare the asset for its intended use are in progress. A construction period ends when an asset is substantially complete and ready for its intended use.

 

Acquisition costs are accounted for in accordance with Accounting Standard Update ("ASU") No. 2017-01 Business Combinations (Topic 805): Clarifying the Definition of a Business, which was adopted on January 1, 2018 and are generally capitalized for acquisitions that qualify as asset acquisitions. When properties are acquired, the purchase price is allocated to the tangible and intangible assets acquired and liabilities assumed based on estimated fair values. Allocations to land, building and improvements, and equipment are recorded based upon their respective fair values as estimated by management.

 

11


 

In allocating the purchase price for an acquisition, the Company determines whether the acquisition includes intangible assets or liabilities. The Company allocates a portion of the purchase price to an intangible asset attributed to the value of in-place leases. This intangible is generally amortized to expense over the expected remaining term of the respective leases. Substantially all of the leases in place at acquired properties are at market rates, as the majority of the leases are month-to-month contracts. 

Internal and external transaction costs associated with acquisitions or dispositions of real estate, as well as repairs and maintenance costs, are charged to expense as incurred. Major replacements and betterments that improve or extend the life of the asset are capitalized and depreciated over their estimated useful lives. Depreciation is computed using the straight-line method over the estimated useful lives of the buildings and improvements, which are generally between 5 and 39 years.

Derivative Financial Instruments

The Company carries all derivative financial instruments on the balance sheet at fair value. Fair value of derivatives is determined by reference to observable prices that are based on inputs not quoted on active markets, but corroborated by market data. The accounting for changes in the fair value of a derivative instrument depends on whether the derivative has been designated and qualifies as part of a hedging relationship. The Company’s use of derivative instruments has been limited to an interest rate cap agreement. The fair values of derivative instruments are included in prepaid expenses and other assets in the accompanying balance sheets. For derivative instruments not designated as cash flow hedges, the unrealized gains and losses are included in interest expense in the accompanying statements of operations. For derivatives designated as cash flow hedges, the effective portion of the changes in the fair value of the derivatives is initially reported in accumulated other comprehensive income (loss) in the Company’s balance sheets and subsequently reclassified into earnings when the hedged transaction affects earnings. The valuation analysis of the interest rate cap reflects the contractual terms of derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate curves.

Accounts Payable and Accrued Expenses

Accounts payable and accrued expenses generally consist of property tax accruals, unearned rental income, and trade payables. 

Revenue and Expense Recognition

Revenues from stores, which are primarily composed of rental income earned pursuant to month-to-month leases for storage space, as well as associated late charges and administrative fees, are recognized as earned in accordance with ASC Topic 842, Leases. Promotional discounts reduce rental income over the promotional period. Ancillary revenues from sales of merchandise and tenant insurance and other income are recognized when earned.

The Company's management fees are earned subject to the terms of the related property management services agreements (“PSAs”). These PSAs provide that the Company will perform management services, which include leasing and operating the property and providing accounting, marketing, banking, maintenance and other services. These services are provided in exchange for monthly management fees, which are based on a percentage of revenues collected from stores owned by third parties. PSAs generally have original terms of three years, after which management services are provided on a month-to-month basis unless terminated. Management fees are due on the last day of each calendar month that management services are provided.

The Company accounts for the management services provided to a customer as a single performance obligation which are rendered over time each month in accordance with ASC Topic 606, Revenue from Contracts with Customers. The total amount of consideration from the contract is variable as it is based on monthly revenues, which are influenced by multiple factors, some of which are outside the Company's control. Therefore, the Company recognizes the revenue at the end of each month once the uncertainty is resolved. No disaggregated information relating to PSAs is presented as the Company currently has only one contract.

The Company accrues for property tax expense based upon actual amounts billed and, in some circumstances, estimates and historical trends when bills or assessments have not been received from the taxing authorities or such bills and assessments are in dispute. Cost of operations and general and administrative expense are expensed as incurred.

Credit Risk

Financial assets that are exposed to credit risk consist primarily of cash and cash equivalents and certain portions of accounts receivable including rents receivable from our tenants. Cash and cash equivalents are on deposit with highly rated commercial banks.

Evaluation of Asset Impairment

The Company evaluates its real estate assets, intangible assets consisting of in-place lease, and goodwill for impairment annually. If there are indicators of impairment and we determine that the asset is not recoverable from future undiscounted cash flows

12


 

to be received through the asset’s remaining life (or, if earlier, the expected disposal date), we record an impairment charge to the extent the carrying amount exceeds the asset’s estimated fair value or net proceeds from expected disposal.

The Company evaluates goodwill for impairment annually and whenever relevant events, circumstances, and other related factors indicate that fair value may be less that carrying amounts. If it is determined that the carrying amount of goodwill exceeds the amount that would be allocated to goodwill if the reporting unit were acquired for estimated fair value, an impairment charge is recorded. As a result of the recent global economic disruption and uncertainty due to the COVID-19 pandemic, the Company concluded a triggering event had occurred as of March 31, 2020, and accordingly, performed interim impairment testing. Based on the quantitative assessment performed, the Company concluded that no impairment existed.

 

Stock-based Compensation

The measurement and recognition of compensation expense for all stock-based payment awards to employees are based on estimated fair values. Awards granted are valued at fair value and any compensation expense is recognized over the service periods of each award. For awards granted which contain a graded vesting schedule and the only condition for vesting is a service condition, compensation cost is recognized as an expense on a straight-line basis over the requisite service period as if the award was, in substance, a single award. For awards granted for which vesting is subject to a performance condition, compensation cost is recognized over the requisite service period if and when the Company concludes it is probable that the performance condition will be achieved.

 

Loan Procurement Costs

 

Loan procurement costs, net are presented as a direct deduction from the carrying amount of the related debt liability. If there is not an associated debt liability recorded on the consolidated balance sheets, the costs are recorded as an asset net of accumulated amortization. Loan procurement costs associated with the Company's revolving credit facility remain in Line of credit issuance costs, net of amortization on the Company's consolidated balance sheets. The costs are amortized over the estimated life of the related debt.

Use of Estimates

The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. The effects of the COVID-19 pandemic may negatively and materially impact significant estimates and assumptions used by the Company including, but not limited to estimates of expected credit losses and the fair value estimates of the Company’s assets and liabilities. Actual results could materially differ from management’s estimates.

Recently Issued Accounting Standards

In August 2017, the FASB issued ASU No. 2017-12 – Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The purpose of this updated guidance is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. The Company adopted this guidance on January 1, 2020, with no material impact on the Company’s consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13 – Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The new guidance changes how entities measure credit losses for most financial assets. This standard requires an entity to estimate its lifetime expected credit loss and record an allowance that, when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. In November 2018, the FASB issued ASU No. 2018-19 – Codification Improvements to Topic 326, Financial Instruments - Credit Losses, which clarifies that receivables arising from operating leases are within the scope of the leasing standard (ASU No. 2016-02), and not within the scope of ASU No. 2016-13. The Company adopted this standard on January 1, 2020, with no material impact on the Company’s consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, "Reference Rate Reform (Topic 848)." ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur.

 

 

13


 

 

 

 

 

 

3. REAL ESTATE ASSETS

The carrying value of the Company’s real estate assets is summarized as follows

 

 

 

March 31, 2020

 

 

December 31, 2019

 

Land

 

$

6,122,065

 

 

$

6,122,065

 

Buildings, improvements, and equipment

 

 

59,505,045

 

 

 

57,178,338

 

Construction in progress

 

 

5,658

 

 

 

1,532,235

 

Self storage properties

 

 

65,632,768

 

 

 

64,832,638

 

Less: Accumulated depreciation

 

 

(5,459,471

)

 

 

(5,080,485

)

Real estate assets, net

 

$

60,173,297

 

 

$

59,752,153

 

 

The Company completed the expansion at its Millbrook, NY property in February 2020, which added approximately 16,500 of gross square feet of all-climate-controlled units.

In the first quarter of 2020, the Company began reviewing plans to convert certain commercially-leased space to all-climate-controlled units at McCordsville, IN. In April 2020, the Company commenced such conversion. We currently anticipate that the conversion project will proceed accordingly, with construction completion expected sometime during the third quarter of 2020, resulting in a total of 544 units and 76,378 leasable square feet at McCordsville, IN. However, there is no guarantee that we will complete this project in this timeframe or at all.    

 

 

4. MARKETABLE EQUITY SECURITIES

Investments in marketable equity securities consisted of the following:

 

 

 

 

 

 

 

Gross Unrealized

 

 

 

 

 

March 31, 2020

 

Cost Basis

 

 

Gains

 

 

Losses

 

 

Value

 

Investment in marketable equity securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stocks

 

$

755,487

 

 

$

815,420

 

 

$

 

 

$

1,570,907

 

Total investment in marketable equity securities

 

$

755,487

 

 

$

815,420

 

 

$

 

 

$

1,570,907

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross Unrealized

 

 

 

 

 

December 31, 2019

 

Cost Basis

 

 

Gains

 

 

Losses

 

 

Value

 

Investment in marketable equity securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stocks

 

$

755,487

 

 

$

1,005,825

 

 

$

 

 

$

1,761,312

 

Total investment in marketable equity securities

 

$

755,487

 

 

$

1,005,825

 

 

$

 

 

$

1,761,312

 

 

 

 

5. FAIR VALUE MEASUREMENTS

The use of fair value to measure the financial instruments held by the Company and its subsidiaries is fundamental to its consolidated financial statements and is a critical accounting estimate because a substantial portion of its assets and liabilities are recorded at estimated fair value. The application of fair value measurements may be on a recurring or nonrecurring basis depending on the accounting principles applicable to the specific asset or liability or whether management has elected to carry the item at its estimated fair value.

The hierarchy of valuation techniques is based on whether the inputs to those techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs create the following fair value hierarchy:

Level 1 — Quoted prices in active markets for identical instruments or liabilities.

Level 2 — Prices determined using other significant observable inputs. Observable inputs are inputs that other market participants would use in pricing an asset or liability and are developed based on market data obtained from sources independent of

14


 

the Company. These may include quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, and market-corroborated inputs.

Level 3 — Prices determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Company’s own assumptions about the factors that market participants use in pricing an asset or liability and are based on the best information available in the circumstances.

This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when estimating fair value. The valuation method used to estimate fair value may produce a fair value measurement that may not be indicative of ultimate realizable value. Furthermore, while management believes its valuation methods are appropriate and consistent with those used by other market participants, the use of different methods or assumptions to estimate the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date. Those estimated values may differ significantly from the values that would have been used had a readily available market for such loans or investments existed, or had such loans or investments been liquidated, and those differences could be material to the financial statements.

 

Fair valued assets consist of shares of equity securities and an interest rate cap. The value of the equity securities is based on a traded market price and is considered to be a level 1 measurement, and the value of the interest rate cap is based on its maturity, observable market-based inputs including interest rate curves and is considered to be a level 2 measurement.

The following table provides the assets and liabilities carried at fair value measured on a recurring basis:

 

March 31, 2020

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Marketable equity securities

 

$

1,570,907

 

 

$

 

 

$

 

 

$

1,570,907

 

Interest rate cap derivative

 

 

 

 

1,474

 

 

 

 

 

 

1,474

 

Total assets at fair value

 

$

1,570,907

 

 

$

1,474

 

 

$

 

 

$

1,572,381

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2019

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Marketable equity securities

 

$

1,761,312

 

 

$

 

 

$

 

 

$

1,761,312

 

Interest rate cap derivative

 

 

 

 

51

 

 

 

 

 

 

51

 

Total assets at fair value

 

$

1,761,312

 

 

$

51

 

 

$

 

 

$

1,761,363

 

 

 

There were no assets transferred from level 1 to level 2 as of March 31, 2020. The Company did not have any assets or liabilities that are re-measured on a recurring basis using significant unobservable inputs as of March 31, 2020.

 

The fair values of financial instruments including cash and cash equivalents, restricted cash, accounts receivable, and accounts payable approximated their respective carrying values as of March 31, 2020. The estimated fair value of the Company’s combined debt was approximately $23,485,425 as of March 31, 2020. This estimate was based on market interest rates for comparable obligations, general market conditions, and maturity. The Company’s debt is classified as level 2 of the fair value hierarchy.

 

6. DERIVATIVES

The Company’s objective in using an interest rate derivative is to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company uses an interest rate cap to manage interest rate risk. The Company carries the premium paid for the interest rate cap as an asset on the balance sheet at fair value. The change in the unrealized gain or loss of the premium is recorded as an increase or decrease to interest expense.

 

The following table summarizes the terms of the Company’s derivative financial instrument:

 

 

 

 

Notional Amount

 

 

 

 

Effective

 

Maturity

Product

 

March 31, 2020

 

 

December 31, 2019

 

 

Strike

 

Date

 

Date

Cap Agreement

 

$

7,500,000

 

 

$

7,500,000

 

 

3.50 % - 4.00%

 

12/24/2018

 

12/20/2021

15


 

The counterparty to this arrangement is SMBC Capital Markets. The Company is potentially exposed to credit loss in the event of non-performance by the counterparty. The Company does not anticipate the counterparty to fail to meet its obligations as they become due.

 

7. NOTE PAYABLE

On June 24, 2016, certain wholly-owned subsidiaries (“Secured Subsidiaries”) of the Company entered into a loan agreement and certain other related agreements (collectively, the “Loan Agreement”) between the Secured Subsidiaries and Insurance Strategy Funding IV, LLC (the “Lender”). Under the Loan Agreement, the Secured Subsidiaries are borrowing from the Lender in the principal amount of $20 million pursuant to a promissory note (the “Promissory Note”). The Promissory Note bears an interest rate equal to 4.192% per annum and is due to mature on July 1, 2036. Pursuant to a security agreement (the “Security Agreement”), the obligations under the Loan Agreement are secured by certain real estate assets owned by the Secured Subsidiaries.

The Company entered into a non-recourse guaranty on June 24, 2016 (the “Guaranty,” and together with the Loan Agreement, the Promissory Note and the Security Agreement, the “Loan Documents”) to guarantee the payment to Lender of certain obligations of the Secured Subsidiaries under the Loan Agreement.

The Loan Documents require the Secured Subsidiaries and the Company to comply with certain covenants, including, among others, a minimum net worth test and other customary covenants. The Lender may accelerate amounts outstanding under the Loan Documents upon the occurrence of an event of default (as defined in the Loan Agreement) including, but not limited to, the failure to pay amounts due or commencement of bankruptcy proceedings.

The Company incurred loan procurement costs of $646,246 and such costs have been recorded net of the note payable on the consolidated balance sheet and are amortized as an adjustment to interest expense over the term of the loan. The Company recorded amortization expense of $10,215 and $10,467 for the three months ended March 31, 2020 and 2019, respectively.

The carrying value of the Company’s note payable is summarized as follows:

 

Note Payable

 

March 31, 2020

 

 

December 31, 2019

 

Principal balance outstanding

 

$

19,217,706

 

 

$

19,338,556

 

Less: Loan procurement costs, net

 

 

(488,554

)

 

 

(498,769

)

Total note payable, net

 

$

18,729,152

 

 

$

18,839,787

 

 

As of March 31, 2020, the note payable was secured by certain of its stores with an aggregate net book value of approximately $34.3 million. The following table represents the future principal payment requirements on the note payable as of March 31, 2020:

 

2020 (9 months)

 

$

412,090

 

2021

 

 

513,857

 

2022

 

 

535,816

 

2023

 

 

558,714

 

2024

 

 

582,591

 

2025 and thereafter

 

 

16,614,638

 

Total principal payments

 

$

19,217,706

 

 

 

Revolving Line of Credit

 

On December 20, 2018, certain wholly owned subsidiaries (the “Subsidiaries”) of the Company entered into a revolving credit loan agreement (the “Agreement”) between the Subsidiaries and TCF National Bank (the “Lender”). Under the Agreement, the Subsidiaries are borrowing from the Lender in the principal amount of up to $10 million pursuant to a promissory note (the “Note”). The Note bears an interest rate equal to 3.00% over the One Month U.S. Dollar London Inter-Bank Offered Rate (effective rate 6.46%) and is due to mature on December 20, 2021. The obligations under the Agreement are secured by certain real estate assets owned by the Subsidiaries.

 

The Company entered into a guaranty of payment on December 20, 2018 (the “Guaranty,” and together with the Agreement, the Note and related instruments, the “Revolver”) to guarantee the payment to Lender of certain obligations of the Subsidiaries under the Agreement.

16


 

 

The Revolver requires the Subsidiaries and the Company to comply with certain covenants, including, among others, customary financial covenants. The Lender may accelerate amounts outstanding under the Loan Documents upon the occurrence of an Event of Default (as defined in the Agreement) including, but not limited to, the failure to pay amounts due to the Lender or commencement of bankruptcy proceedings.

The Company incurred issuance costs of $477,981 and such costs are amortized as an adjustment to interest expense over the term of the loan. The Company recorded amortization expense of $39,832 and $39,832 for the three months ended March 31, 2020 and 2019, respectively. The outstanding loan balance under the Revolver was $4,914,000 as of both March 31, 2020 and December 31, 2019.

 

 

8. LEASES

Global Self Storage as Lessor

The Company's property rental revenue is primarily related to rents received from tenants at its operating stores. The Company's leases with its self storage tenants are generally on month-to-month terms, include automatic monthly renewals, allow flexibility to increase rental rates over time as market conditions permit, and provide for the collection of contingent fees such as late fees. These leases do not include any terms or conditions that allow the tenants to purchase the leased space. All self-storage leases for which the Company acts as lessor have been classified as operating leases. The real estate assets related to the Company's stores are included in "Real estate assets, net" on the Company's consolidated balance sheets and are presented at historical cost less accumulated depreciation and impairment, if any. Rental income related to these operating leases is included in Property rental revenue on the Company's consolidated statements of operations, and is recognized each month during the month-to-month terms at the rental rate in place during each month.

 

Global Self Storage as Lessee

 

The Company is a lessee in a lease agreement for an automobile entered into November 2019 with a lease term of three years. The lease agreement does not contain any material residual value guarantees or material restrictive covenants. As a result of the Company’s election of the package of practical expedients permitted within ASC Topic 842, which among other things, allows for the carryforward of historical lease classification, all of the Company’s lease agreements have been classified as operating leases. Lease expense for payments related to the Company’s operating leases is recognized on a straight-line basis over the lease term.

 

Right-of-use assets represent the Company’s right to use an underlying asset during the lease term and lease liabilities represent the Company’s obligation to make lease payments as specified in the lease. Right-of-use assets and lease liabilities related to the Company’s operating leases are recognized at the lease commencement date based on the present value of the remaining lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available surrounding the Company’s secured borrowing rates and implied secured spread at the lease commencement date in determining the present value of lease payments. The right-of-use asset also includes any lease payments made at or before lease commencement less any lease incentives. The Company had no right-of-use assets and lease liabilities related to its operating leases as of March 31, 2019. As of March 31, 2020, the Company had right-of-use assets and lease liabilities related to its operating leases of $34,575 and $34,575, which are included in Prepaid expenses and other assets and Accounts payable and accrued expenses on the Company’s consolidated balance sheets, respectively, and amortization expense is included in General and administrative expenses in the Company’s consolidated statements of operations. As of March 31, 2020, the Company’s weighted average remaining lease term and weighted average discount rate related to its operating leases were approximately 2.6 years and 4.78%, respectively.

The future minimum lease payments under the automobile lease are $9,502, $14,254, and $11,878 for the years ending December 31, 2020, 2021, and 2022, respectively.

 

 

17


 

9. EARNINGS PER SHARE

Basic earnings per share is computed using the weighted average number of shares outstanding. Diluted earnings per share is computed using the weighted average number of shares outstanding adjusted for the incremental shares attributed to potentially diluted securities. The following table sets forth the computation of basic and diluted earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended March 31,

 

 

 

2020

 

 

2019

 

Net income (loss)

 

$

(356,424

)

 

$

187,823

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

Average number of common shares outstanding - basic

 

 

9,262,811

 

 

 

7,630,722

 

Net effect of dilutive unvested restricted stock awards included for treasury stock method

 

 

 

 

 

7,011

 

Average number of common shares outstanding - diluted

 

 

9,262,811

 

 

 

7,637,733

 

Earnings per common share

 

 

 

 

 

 

 

 

Basic

 

$

(0.04

)

 

$

0.02

 

Diluted

 

$

(0.04

)

 

$

0.02

 

 

As of March 31, 2020, 8,670 shares of common stock from outstanding restricted stock awards were excluded from the computation of diluted net loss per common share since the effect would be anti-dilutive.

 

Common stock dividends totaled $606,469 ($0.065 per share) and $503,294 ($0.065 per share) for the three months ended March 31, 2020 and 2019, respectively.    

 

 

10. RELATED PARTY TRANSACTIONS

Certain officers and directors of the Company also serve as officers and directors of Winmill & Co. Incorporated (“Winco”), Bexil Corporation, Tuxis Corporation (“Tuxis”), and their affiliates (collectively with the Company, the “Affiliates”). As of March 31, 2020, certain of the Affiliates and the Company’s directors and employees may be deemed to own approximately 7.8% of the Company’s outstanding common stock. Pursuant to an arrangement between a professional employer organization (“PEO”) and the Affiliates, the PEO provides payroll, benefits, compliance, and related services for employees of the Affiliates in accordance with applicable rules and regulations under the IRC and, in connection therewith, Midas Management Corporation (“MMC”), a subsidiary of Winco, acts as a conduit payer of compensation and benefits to the Affiliates’ employees including those who are concurrently employed by the Company and its Affiliates. Rent expense of concurrently used office space and overhead expenses for various concurrently used administrative and support functions incurred by the Affiliates are allocated at cost among them. The Affiliates participate in a 401(k) retirement savings plan for substantially all qualified employees. A matching expense based upon a percentage of contributions to the plan by eligible employees is incurred and allocated among the Affiliates. The matching expense is accrued and funded on a current basis and may not exceed the amount permitted as a deductible expense under the IRC. The aggregate rent and overhead accrued and paid by the Company to Winco was $21,328 and $19,338 for the three months ended March 31, 2020 and 2019, respectively. As of March 31, 2020, the Company had reimbursements payable to MMC and Winco for compensation and benefits and rent and overhead of $6,040.

The Company currently reimburses monthly automobile expenses of $1,000 per month to its President, Mark C. Winmill. To the extent that the monthly payment under the Company’s automobile lease exceeds the current monthly reimbursement amount, Mr. Winmill voluntarily reimburses the Company for the excess amount. In this regard, as of March 31, 2020, the Company is due reimbursement of $2,254 for the automobile payments paid and due in 2020. For the three months ended March 31, 2019, Mr. Winmill reimbursed the Company $3,228 for the automobile payments paid and due in 2019.

The Company leases office space and storage to certain Affiliates under rental agreements. The terms of occupancy are month to month and automatically renew unless terminated by either party on ten days’ written notice. The Company earned rental income of $2,001 for each of the three months ended March 31, 2020 and 2019, respectively.

 

 

18


 

11. CAPITAL STOCK

As of March 31, 2020, the Company was authorized to issue 450,000,000 shares of $0.01 par value common stock of which 9,356,202 had been issued and was outstanding. The Company was also authorized to issue 50,000,000 shares of preferred stock, $0.01 par value, authorized, of which none has been issued.     

 

 

12. STOCK-BASED COMPENSATION

On October 16, 2017 (“Effective Date”), the Company’s stockholders approved the Company’s 2017 Equity Incentive Plan (the “Plan”). The Plan is designed to provide equity-based incentives to certain eligible persons, as defined in the Plan, in the form of options, share appreciation rights, restricted stock, restricted stock units, dividend equivalent rights or other forms of equity-based compensation as determined in the discretion of the Board of Directors, the Compensation Committee of the Board of Directors, or other designee thereof. The total number of shares of common stock reserved and available for issuance under the Plan on the Effective Date was 760,000.

 

On March 26, 2020 the Company approved restricted stock awards under the Plan to certain of its officers and employees in the aggregate amount of 25,905 shares, of which 10,880 shares are time-based grants and 15,025 shares are performance-based grants. The Company recorded $29,162 and $54,160  of expense in general and administrative expense in its statement of operations related to restricted stock awards for the three months ended March 31, 2020 and 2019, respectively. At March 31, 2020, there was $153,678 and $105,180 of unrecognized compensation expense related to unvested time-based and performance-based restricted stock awards, respectively. That cost is expected to be recognized over a weighted-average period of 2.56 and 2.95 years for time-based and performance-based awards, respectively. The fair value of common stock awards is determined based on the closing trading price of the Company’s common stock on the grant date.

Time-Based Restricted Stock Grants

These time-based grants vest solely based on continued employment, with 6.25% of the shares eligible to vest on each three- month anniversary of the grant date during the remaining four-year time vesting period. Time-based restricted stock cannot be transferred during the vesting period. These time-based restricted stock grants entitle the holder to dividends paid by the Company on shares of its common stock.

A summary of the Company’s time-based restricted stock grant activity is as follows:

 

 

 

 

 

 

 

Weighted-Average

 

 

 

 

 

 

 

Grant-Date

 

Time-Based Restricted Stock Grants

 

Stock

 

 

Fair Value

 

Unvested at December 31, 2019

 

 

39,932

 

 

$

4.31

 

Granted

 

 

10,880

 

 

$

3.58

 

Vested

 

 

(4,134

)

 

$

4.34

 

Unvested at March 31, 2020

 

 

46,678

 

 

$

4.14

 

 

Performance-Based Restricted Stock Grants

 

Performance-based restricted stock grants vest based on continued employment and the achievement of certain Funds from Operations, as adjusted (“AFFO”) and same store revenue growth (“SSRG”) goals by the Company during 2020. Between 0% and 200% of these shares will be earned based on achievement of the AFFO and SSRG goals in 2020, and the shares which are earned will remain subject to quarterly vesting during the remaining four-year time vesting period. Dividends paid by the Company prior to the determination of how many shares are earned will be retained by the Company and released only with respect to earned shares. If a Change in Control (as defined in the Plan) occurs during 2020, the number of shares earned will equal the greater of the number of shares granted and the number of shares which would have been earned based on the AFFO and SSRG through the date of the Change in Control. If following a Change in Control, a grantee is terminated by the Company without Cause or by the grantee with Good Reason (as each is defined in the Plan), all unvested restricted stock will fully vest.

A summary of the Company’s performance-based restricted stock grant activity is as follows:

 

19


 

 

 

 

 

 

 

Weighted-Average

 

 

 

 

 

 

 

Grant-Date

 

Performance-based Stock Grants

 

Stock

 

 

Fair Value

 

Unvested at December 31, 2019

 

 

27,739

 

 

$

4.21

 

Granted

 

 

15,025

 

 

$

3.58

 

Vested

 

 

(2,667

)

 

$

4.25

 

Unvested at March 31, 2020

 

 

40,097

 

 

$

3.97

 

 

Forfeitures are accounted for as they occur, compensation cost previously recognized for an award that is forfeited because of a failure to satisfy a service or performance condition is reversed in the period of the forfeiture.

 

13. COMMITMENTS AND CONTINGENCIES

The Company enters into contracts that contain a variety of representations and warranties and which may provide general indemnifications. The Company’s maximum exposure under these arrangements is unknown as it involves future claims that may be made against the Company under circumstances that have not occurred.

 

 

14. SUBSEQUENT EVENTS

 

Subsequent to March 31, 2020, the global economy has continued to be severely impacted by the COVID-19 pandemic. The

Company is closely monitoring the impact of the COVID-19 pandemic on all aspects of its business, including how it will impact its tenants, employees, vendors, and lenders. The impact of the COVID-19 pandemic on the U.S. and global economies generally, the extent to which the COVID-19 pandemic impacts the Company in particular, will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the outbreak of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others.

.

 

 

 

 

 

20


 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

CAUTIONARY LANGUAGE

The following discussion and analysis should be read in conjunction with our unaudited “Condensed Consolidated Financial Statements” and the “Notes to Condensed Consolidated Financial Statements (unaudited)” appearing elsewhere in this report. We make statements in this section that may be forward looking statements within the meaning of the federal securities laws. For a complete discussion of forward looking statements, see the section in this report entitled “Statement on Forward Looking Information.” References to the “Company,” “we,” “us,” or “our company” refer to Global Self Storage, Inc., a Maryland corporation, including, as the context requires, its direct and indirect subsidiaries.

On March 11, 2020, the World Health Organization declared the outbreak of the novel coronavirus (“COVID-19”) as a pandemic and on March 13, 2020 the United States declared a national emergency with respect to the COVID-19 pandemic. See the “Management’s Discussion and Analysis Overview,” “Same-Store Self Storage Operations” and “Combined Same-Store and Non Same-Store Self Storage Operations” sections below for a discussion of the impact on our business, including operational changes we have implemented. The current operating environment is changing rapidly. Our future response and the resulting impact on our business is difficult to predict. The extent of the impact that the COVID-19 pandemic will have on our business going forward, including our financial condition, results of operations and cash flows, is dependent on multiple factors, many of which are unknown. We will continue to monitor the effects of the COVID-19 pandemic and will adjust our operations as necessary. For additional details, see Item 1A. Risk Factors.

CRITICAL ACCOUNTING POLICIES

Our discussion and analysis of our financial condition and results of operations are based on our unaudited condensed consolidated financial statements contained elsewhere in this report, which have been prepared in accordance with GAAP. Our notes to the unaudited condensed consolidated financial statements contained elsewhere in this report describe the significant accounting policies essential to our unaudited condensed consolidated financial statements. Preparation of our financial statements requires estimates, judgments, and assumptions. We believe that the estimates, judgments, and assumptions that we have used are appropriate and correct based on information available at the time they were made. These estimates, judgments, and assumptions can affect our reported assets and liabilities as of the date of the financial statements, as well as the reported revenues and expenses during the period presented. If there are material differences between these estimates, judgments, and assumptions and actual facts, our financial statements may be affected.

In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require our judgment in its application. There are areas in which our judgment in selecting among available alternatives would not produce a materially different result, but there are some areas in which our judgment in selecting among available alternatives would produce a materially different result. Please refer to the notes to the unaudited condensed consolidated financial statements that contain additional information regarding our critical accounting policies and other disclosures.

Management’s Discussion and Analysis Overview

The Company is a self-administered and self-managed REIT that owns, operates, manages, acquires, develops and redevelops self storage properties (“stores” or “properties”) in the United States. Our stores are designed to offer affordable, easily accessible, and secure storage space for residential and commercial customers. The Company currently owns and operates, or manages, through its wholly owned subsidiaries, thirteen stores located in Connecticut, Illinois, Indiana, New York, Ohio, Pennsylvania, South Carolina, and Oklahoma.

Our store operations generated most of our net income for all periods presented herein. Accordingly, a significant portion of management’s time is devoted to seeking to maximize cash flows from our existing stores, as well as seeking investments in additional stores. The Company expects to continue to earn a majority of its net income from its store operations as its current store operations continue to develop and as it makes additional store acquisitions. Over time, the Company expects to divest its remaining portfolio of investment securities and use the proceeds to acquire, develop, redevelop, and/or operate additional stores. The Company expects its income from investment securities to continue to decrease as it continues to divest its holdings of investment securities.

Financial Condition and Results of Operations

Our financing strategy is to minimize the cost of our capital in order to maximize the returns generated for our stockholders. For future acquisitions, the Company may use various financing and capital raising alternatives including, but not limited to, debt and/or equity offerings, credit facilities, mortgage financing, and joint ventures with third parties.

21


 

On June 24, 2016, certain wholly owned subsidiaries (“Term Loan Secured Subsidiaries”) of the Company entered into a loan agreement and certain other related agreements (collectively, the “Term Loan Agreement”) between the Term Loan Secured Subsidiaries and Insurance Strategy Funding IV, LLC (the “Term Loan Lender”). Under the Term Loan Agreement, the Term Loan Secured Subsidiaries are borrowing from Term Loan Lender in the principal amount of $20 million pursuant to a promissory note (the “Term Loan Promissory Note”). The Term Loan Promissory Note bears an interest rate equal to 4.192% per annum and is due to mature on July 1, 2036. Pursuant to a security agreement (the “Term Loan Security Agreement”), the obligations under the Term Loan Agreement are secured by certain real estate assets owned by the Term Loan Secured Subsidiaries. J.P. Morgan Investment Management, Inc. acted as Special Purpose Vehicle Agent of the Term Loan Lender. The Company entered into a non-recourse guaranty on June 24, 2016 (the “Term Loan Guaranty,” and together with the Term Loan Agreement, the Term Loan Promissory Note and the Term Loan Security Agreement, the “Term Loan Documents”) to guarantee the payment to Lender of certain obligations of the Term Loan Secured Subsidiaries under the Term Loan Agreement. The Term Loan Documents require the Term Loan Secured Subsidiaries and the Company to comply with certain covenants, including, among others, a minimum net worth test and other customary covenants. The Term Loan Lender may accelerate amounts outstanding under the Term Loan Documents upon the occurrence of an Event of Default (as defined in the Term Loan Agreement) including, but not limited to, the failure to pay amounts due or commencement of bankruptcy proceedings. The Company and the Term Loan Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Term Loan Documents. There is no material relationship between the Company, its Term Loan Secured Subsidiaries, or its affiliates and the Term Loan Lender, other than in respect of the Term Loan Documents. The foregoing description is qualified in its entirety by the full terms and conditions of the Term Loan Documents, filed as Exhibits 10.1, 10.2, 10.3 and 10.4 to the Current Report on Form 8-K filed on June 30, 2016. We used the proceeds of such debt financing primarily in connection with store acquisitions and development.

On December 20, 2018, certain wholly owned subsidiaries (“Credit Facility Secured Subsidiaries”) of the Company entered into a revolving credit loan agreement (collectively, the “Credit Facility Loan Agreement”) between the Credit Facility Secured Subsidiaries and TCF National Bank (“Credit Facility Lender”). Under the Credit Facility Loan Agreement, the Credit Facility Secured Subsidiaries may borrow from the Credit Facility Lender in the principal amount of up to $10 million pursuant to a promissory note (the “Credit Facility Promissory Note”). The Credit Facility Promissory Note bears an interest rate equal to 3.00% over the One Month U.S. Dollar London Inter-Bank Offered Rate and is due to mature on December 20, 2021. The obligations under the Credit Facility Loan Agreement are secured by certain real estate assets owned by the Credit Facility Secured Subsidiaries. The Company entered into a guaranty of payment on December 20, 2018 (the “Credit Facility Guaranty,” and together with the Credit Facility Loan Agreement, the Credit Facility Promissory Note and related instruments, the “Credit Facility Loan Documents”) to guarantee the payment to Credit Facility Lender of certain obligations of the Credit Facility Secured Subsidiaries under the Credit Facility Loan Agreement. The Company and the Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Credit Facility Loan Documents. The Company also maintains a bank account at the Credit Facility Lender. The foregoing description is qualified in its entirety by the full terms and conditions of the Credit Facility Loan Documents, filed as Exhibits 10.1 and 10.2 to the Current Report on Form 8-K filed on December 21, 2018. As of March 31, 2020, we have withdrawn proceeds of $4,914,000 under the Credit Facility Loan Agreement. We currently intend to strategically withdraw proceeds available under the Credit Facility Loan Agreement to fund: (i) the acquisition of additional self storage properties, (ii) expansions at existing self storage properties in our portfolio, and/or (iii) joint ventures with third parties for the acquisition and expansion of self storage properties.

We expect in the near-term there may be a lower volume of acquisition transactions in the self storage sector generally due to uncertainty from the COVID-19 pandemic. However, we continue to actively review a number of store and store portfolio acquisition opportunities and have been working to further develop and expand our current stores. We did not complete any acquisitions in the three months ended March 31, 2020.

We believe that our third-party management platform, Global MaxManagementSM, will provide an additional revenue stream through management fees and tenant insurance premiums and will help expand our brand awareness, and may also allow us to build a captive acquisition pipeline. Despite the challenges presented by the COVID-19 pandemic, we continue to actively market our third-party management platform to developers, single-property self storage operators, and small-portfolio self storage operators, and we believe these discussions may lead to the addition of new properties to our owned and/or third-party management portfolios. In addition, we may pursue third-party management opportunities owned by certain affiliates or joint venture partners for a fee, and utilize such relationships with third-party owners as a source for future acquisitions and investment opportunities. As of March 31, 2020, we managed one property, which was rebranded as “Global Self Storage,” had 136,718-leasable square feet and was comprised of 617 climate-controlled and non-climate-controlled units, located in Edmond, Oklahoma.

We expect we will have sufficient cash from current sources to meet our liquidity needs for the next twelve months. However, we may opt to supplement our equity capital and increase potential returns to our stockholders through the use of prudent levels of borrowings. We may use debt when the available terms and conditions are favorable to long-term investing and well-aligned with our business plan. In light of the current COVID-19 pandemic and its impact on the global economy, we are closely monitoring overall liquidity levels and changes in our business performance (including our properties) to be in a position to enact changes to ensure adequate liquidity going forward.

22


 

As of March 31, 2020, we had capital resources totaling approximately $10.1 million, comprised of $3.4 million of cash, cash equivalents, and restricted cash, $1.6 million of marketable securities, and $5.1 million available for withdrawal under the Credit Facility Loan Agreement. Capital resources derived from retained cash flow have been and are currently expected to continue to be negligible. Retained operating cash flow represents our expected cash flow provided by operating activities, less stockholder distributions and capital expenditures to maintain stores. These capital resources allow us to continue to execute our strategic business plan, which includes funding acquisitions, either directly or through joint ventures; expansion projects at our existing properties; and broadening our revenue base and pipeline of potential acquisitions through developing Global MaxManagementSM, our third-party management platform. Our board of directors regularly reviews our strategic business plan, including topics and metrices like capital formation, debt versus equity ratios, dividend policy, use of capital and debt, funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) performance, and optimal cash levels.

We expect that the results of our operations will be affected by a number of factors. Many of the factors that will affect our operating results are beyond our control. The Company and its properties could be materially and adversely affected by the risks, or the public perception of the risks, related to an epidemic, pandemic, outbreak, or other public health crisis, such as the current outbreak of the COVID-19 pandemic. The outbreak of the COVID-19 pandemic has severely impacted global economic activity and caused significant volatility and negative pressure in financial markets. The global impact of the outbreak has been rapidly evolving and many countries, including the United States, have reacted by instituting quarantines, mandating business and school closures, requiring restrictions on travel, “shelter-in-place” and/or “stay-at-home” orders, and imposing restrictions on the types of businesses that may continue to operate. Such actions are creating disruption in global supply chains, and adversely impacting a number of industries, such as transportation, hospitality and entertainment. The outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of the COVID-19 pandemic.

The containment measures described above generally do not apply to businesses, like ours, but may apply to certain of our tenants, employees, vendors, and lenders. Self storage has been identified by the Department of Homeland Security as a Critical Infrastructure Sector and has been deemed an essential business in all states where we have operations. We believe this is because self-storage facilities play an important role in local supply chains, and are used by residents and businesses to store a variety of critical supplies for residential and commercial use. As such, we are proud to continue to serve our communities in this way and currently expect to remain fully operational for the duration of the COVID-19 pandemic. In addition, we are practicing social distancing and enhanced cleaning and disinfectant activities to protect our employees and tenants. We have long provided online leasing and payment options, as well as on-site contactless solutions using kiosks that can facilitate rentals and even automatically dispense locks. Our kiosks are available 24/7 at each of our stores where prospective tenants can select and rent a unit, or current tenants can pay their rent.

Nevertheless, the COVID-19 pandemic presents material uncertainty and risk with respect to the Company’s business, financial condition, results of operations and cash flows, and our tenant's ability to pay rent. The extent to which our financial condition and results of operations operating will continue to be affected by the COVID-19 pandemic will largely depend on future developments, which are highly uncertain and cannot be accurately predicted.

 

Results of Operations for the Three Months Ended March 31, 2020 Compared with the Three Months Ended March 31, 2019

Revenues

Total revenues increased from $2,106,511 during the three months ended March 31, 2019 to $2,239,544 during the three months ended March 31, 2020, an increase of $133,033, or 6.3%. Rental income increased from $2,038,684 during the three months ended March 31, 2019 to $2,150,240 during the three months ended March 31, 2020, an increase of $111,556, or 5.5%. The increase was primarily attributable to the West Henrietta, NY acquisition and increases in rental rates at our other wholly-owned stores.

 

Other store related income consists of customer insurance fees, sales of storage supplies, and other ancillary revenues. Other store related income increased from $67,827 during the three months ended March 31, 2019 to $71,960 during the three months ended March 31, 2020, an increase of $4,133, or 6.1%. This increase was primarily attributable to increased insurance participation.

 

Income from our third-party management platform consists of management fees and customer insurance fees. Management fees and other income increased from $0 during the three months ended March 31, 2019 to $17,344 during the three months ended March 31, 2020.

23


 

Operating Expenses

Total operating expenses increased from $1,829,171 during the three months ended March 31, 2019 to $2,123,880 during the three months ended March 31, 2020, an increase of $294,709, or 16.1%, which was primarily attributable to increases in certain general and administrative expenses. Store operating expenses increased from $913,349 during the three months ended March 31, 2019 to $916,080 during the three months ended March 31, 2020, an increase of $2,731, or 0.3%.

Depreciation and amortization increased from $351,644 during the three months ended March 31, 2019 to $515,937 during the three months ended March 31, 2020, an increase of $164,293, or 46.7%, which was primarily attributable to depreciation of the building and fixtures and amortization of the in-place leases related to the 2019 store acquisition in West Henrietta, NY.

General and administrative expenses increased from $555,928 during the three months ended March 31, 2019 to $682,623 during the three months ended March 31, 2020, an increase of $126,695, or 22.8%. The increase in the general and administrative expenses during the period are primarily attributable to increased accounting expenses relating to the engagement of our new independent registered public accounting firm and increased expenses associated with federal and state tax liability of our taxable REIT subsidiary. ‬

Business development, capital raising, store acquisition, and third-party management marketing expenses increased from $8,250 during the three months ended March 31, 2019 to $9,240 during the three months ended March 31, 2020. These costs primarily consist of costs incurred in connection with business development, capital raising, and future potential store acquisitions, and third-party management marketing expenses. The increase is primarily attributable to the recording of expenses related to third-party management marketing expenses. Business development costs are typically non-recurring and fluctuate based on periodic business development and acquisition activity.

Operating Income

As a result of the operating effects noted above, operating income changed from $277,340 during the three months ended March 31, 2019 to $115,664‬ during the three months ended March 31, 2020, a decrease of $161,676, or 58.3%. ‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬‬

Other income (expense)

Interest expense on loans increased from $261,166 during the three months ended March 31, 2019 to $305,783 during the three months ended March 31, 2020. This increase was attributable to interest expense on funds drawn on the credit revolver. The cash payments for the $20 million loan remain the same every month until June 2036.

Dividend, interest, and other income was $17,200 during the three months ended March 31, 2019 and $24,100 during the three months ended March 31, 2020.

Unrealized gain on marketable equity securities was $154,449 during the three months ended March 31, 2019 and the unrealized loss on marketable equity securities was $190,405 during the three months ended March 31, 2020.

Net income (loss)

For the three months ended March 31, 2019, net income was $187,823, or $0.02 per fully diluted share. For the three months ended March 31, 2020, net loss was $356,424, or $0.04 per share.

 

Distributions and Closing Market Prices

Distributions for the three months ended March 31, 2020 and 2019 each totaled $0.065 per share, respectively. The Company’s closing market price as of March 31, 2020 and March 31, 2019 were $3.51 and $3.86, respectively. Past performance does not guarantee future results.

 

Non-GAAP Financial Measures

Funds from Operations (“FFO”) and FFO per share are non-GAAP measures defined by the National Association of Real Estate Investment Trusts (“NAREIT”) and are considered helpful measures of REIT performance by REITs and many REIT analysts. NAREIT defines FFO as a REIT’s net income, excluding gains or losses from sales of property, and adding back real estate depreciation and amortization. FFO and FFO per share are not a substitute for net income or earnings per share. FFO is not a substitute for GAAP net cash flow in evaluating our liquidity or ability to pay dividends, because it excludes financing activities presented on

24


 

our statements of cash flows. In addition, other REITs may compute these measures differently, so comparisons among REITs may not be helpful. However, the Company believes that to further understand the performance of its stores, FFO should be considered along with the net income and cash flows reported in accordance with GAAP and as presented in the Company’s financial statements.

Adjusted FFO (“AFFO”) represents FFO excluding the effects of business development, capital raising, store acquisition, and third-party management marketing expenses and non-recurring items, which we believe are not indicative of the Company’s operating results. We present AFFO because we believe it is a helpful measure in understanding our results of operations insofar as we believe that the items noted above that are included in FFO, but excluded from AFFO, are not indicative of our ongoing operating results. We also believe that the investment community considers our AFFO (or similar measures using different terminology) when evaluating us. Because other REITs or real estate companies may not compute AFFO in the same manner as we do, and may use different terminology, our computation of AFFO may not be comparable to AFFO reported by other REITs or real estate companies.

We believe net operating income or “NOI” is a meaningful measure of operating performance because we utilize NOI in making decisions with respect to, among other things, capital allocations, determining current store values, evaluating store performance, and in comparing period-to-period and market-to-market store operating results. In addition, we believe the investment community utilizes NOI in determining operating performance and real estate values and does not consider depreciation expense because it is based upon historical cost. NOI is defined as net store earnings before general and administrative expenses, interest, taxes, depreciation, and amortization.

NOI is not a substitute for net income, net operating cash flow, or other related GAAP financial measures, in evaluating our operating results.

Self Storage Portfolio

The following discussion and analysis of our same-store self storage operations are presented on a comparative basis for the three months ended March 31, 2020.

25


 

GLOBAL SELF STORAGE STORES

 

 

 

 

 

Year Store

 

Number

 

 

Net Leasable

 

 

March 31, 2020 Square Foot

 

 

March 31, 2019 Square Foot

 

Property(1)

 

Address

 

Opened / Acquired

 

of Units

 

 

Square Feet

 

 

Occupancy %

 

 

Occupancy %

 

OWNED STORES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SSG BOLINGBROOK LLC

 

296 North Weber Road, Bolingbrook, IL 60440

 

1997 / 2013

 

 

801

 

 

 

113,700

 

 

 

93.0

%

 

 

91.9

%

SSG CLINTON LLC

 

6 Heritage Park Road, Clinton, CT 06413

 

1996 / 2016

 

 

182

 

 

 

30,408

 

 

 

90.5

%

 

 

93.6

%

SSG DOLTON LLC

 

14900 Woodlawn Avenue, Dolton, IL 60419

 

2007 / 2013

 

 

652

 

 

 

86,590

 

 

 

91.6

%

 

 

94.4

%

SSG LIMA LLC

 

1910 West Robb Avenue, Lima, OH 60419

 

1996 / 2016

 

 

731

 

 

 

98,265

 

 

 

91.9

%

 

 

94.4

%

SSG MERRILLVILLE LLC

 

6590 Broadway, Merrillville, IN 46410

 

2005 / 2013

 

 

568

 

 

 

80,870

 

 

 

90.3

%

 

 

91.8

%

SSG ROCHESTER LLC

 

2255 Buffalo Road, Rochester, NY 14624

 

2010 / 2012

 

 

641

 

 

 

68,116

 

 

 

95.8

%

 

 

92.8

%

SSG SADSBURY LLC

 

21 Aim Boulevard, Sadsburyville, PA 19369

 

2006 / 2012

 

 

690

 

 

 

78,847

 

 

 

92.4

%

 

 

89.5

%

SSG SUMMERVILLE I LLC

 

1713 Old Trolley Road, Summerville, SC 29485

 

1990 / 2013

 

 

567

 

 

 

75,510

 

 

 

85.7

%

 

 

89.4

%

SSG SUMMERVILLE II LLC

 

900 North Gum Street, Summerville, SC 29483