GE Unit Sells Storage USA for $2.3 Billion in Cash

GE Commercial Finance, the business-to-business financial services unit of General Electric Co., said Thursday that it had agreed to sell Storage USA for $2.3 billion in cash to a joint venture of Extra Space Storage Inc. and Prudential Real Estate Investors, which is acting on behalf of its institutional clients.

The agreement is expected to close in the third quarter, subject to customary closing conditions.

Based in Memphis, Tenn., Storage USA is a self-storage company with more than 450 properties in 30 states and the District of Columbia.

Extra Space Storage is a publicly traded real estate investment trust headquartered in Salt Lake City that owns and operates 148 self-storage properties in 20 states. Prudential Real Estate Investors is the real estate investment and advisory business of Prudential Financial Inc.

Prudential Real Estate said it was acting on behalf of institutional investors in four open-end commingled funds and two single client accounts. The transaction spreads the assets among the six portfolios.

The company has committed more than $1.5 billion in equity to the transaction, which includes joint venture ownership of more than 250 storage facilities, with more than 182,500 units totaling 18.3 million square feet of storage space. The properties are concentrated in California, Florida, the Northeast and the Middle Atlantic regions.

Prudential said Extra Space Storage would manage the properties, in addition to owning 61 other sites, along with Storage USA’s joint venture and franchise facilities.

GE shares fell 35 cents to close at $35.85 on the New York Stock Exchange.