Nuveen Closes $166M Self Storage Fund
The financing adds to a portfolio worth $2.7 billion.
Nuveen has closed on a $166.6 million fund for investing in self storage assets across the U.S. A $150 million equity commitment came from the California State Teachers’ Retirement System, and the TIAA General Account contributed an additional $16.6 million to the investment vehicle.
“The account is targeting a two-to-three-year deployment window,” Melissa Reagen, portfolio manager of real estate alternatives at Nuveen, told Multi-Housing News. “The account targets self-storage acquisitions and development projects in secondary and tertiary U.S. submarkets with strong demographics and limited in-place and new supply, with a particular focus on the Sun Belt and the Midwest.”
Nuveen has been investing in self storage since 2003. The firm’s current portfolio is worth $2.7 billion, and spans 170 facilities across the U.S. About two years ago, the company invested in MyPlace, a vertically integrated self-storage platform launched by Kurt O’Brien, the founder and former CEO of Simply Storage.
MyPlace will manage the asset purchased by the new fund.
Institutional interest growing
It’s not surprising to see the growing institutional interest in self storage, a sector that has consistently outperformed other commercial real estate asset classes over the past four decades, DXD Capital’s managing director of strategic relationships Andrew Tuthill, told MHN.
“Today, the real opportunity lies in the sharp decline in new supply—a response to higher interest rates and tighter capital markets—which addresses the industry’s historic challenge of oversupply,” Tuthill said.
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Since its founding in 2020, DXD has secured over $230 million in equity commitments and manages $294.7 million in assets across 22,000 self storage units nationwide.
“What truly excites DXD Capital in today’s environment is not just past performance but the shifting dynamics of current market fundamentals,” Tuthill said.
According to Tuthill, chief among these concerns is a notable decline in new supply, which historically has been the Achilles’ heel of the self storage industry. But today, rising interest rates and tightening capital markets apply natural brakes to new development.
Second half of 2025 could pick up
The self storage sector struggled in 2024 and looks to pull itself out by the second half of 2025.
According to Yardi Matrix’s March 2025 Self Storage Report, drops in occupancy and street rates are driving the overall decline. On a year-over-year basis, street rates fell by 0.8 percent.
Still, the forecast shows some improvement coming this year. In February, the national average advertised rates per square foot increased by 0.3 percent, as the nation’s new square footage is expected to drop 15 percent this year.
