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After 2 years of dramatic growth, Montreal Mini-Storage has new focus

Quebec-based self-storage firm almost quadrupled in size, with 23 facilities and 10,000+ units

Entreposage Montreal Mini-Storage is Quebec's largest self-storage brand. (Courtesy Montreal Mini-Storage)
Entreposage Montreal Mini-Storage is Quebec's largest self-storage brand. (Courtesy Montreal Mini-Storage)

Fresh from securing $185 million in revolving credit, Entreposage Montreal Mini-Storage (MMS) plans to focus on organic growth and on facility upgrades, says CEO Simon Berman.

When opportunities for acquisitions come, “we will capitalize, but we’re not hunting as hard as we used to,” he told RENX.

MMS has gone through “tremendous growth” over the past two years, almost quadrupling the size of its portfolio, said CFO Igor Bernadski.

Established in 2004, MMS owns and operates more than 10,000 self-storage units at 23 facilities in Quebec and is the province's largest self-storage brand. 

“We do want to grow, but we’re being extremely disciplined (given uncertainty about the economy and consumers’ pocketbooks),” Berman explained.

“We’re competing with some really essential items out there and as much as storage is very important, we do believe there is a discretionary element there.”

The credit facilities and forward planning

The revolving credit consists of $150 million from a syndicate of underwriters led by Scotiabank and $35 million from Roynat.

It gives MMS liquidity to do several things, including to invest capital organically in the business, increase its number of units and improve its bottom line, Bernadski said.

Berman says MMS will take advantage when presented with “exceptional deals,” but “we have no need to go out and prove ourselves. We have a wonderful business as it is.”

With the economy hitting tailwinds, MMS must plan for a possible reduction in the quality of its receivables, he said.

Occupancy rates for its storage units are about 90 per cent and delinquencies, at about 1.5 per cent, “are very well-controlled,” Bernadski noted. 

Even if delinquencies double, there will not be a material impact on earnings, Berman added. “But at the same time, every dollar counts. We’re renting units for 100 or 80 bucks, so we have to be very careful with each of those dollars.” 

Upgrades for facilities it has acquired

Berman says there is a need to “bring some love” to the many properties it has acquired from a disparate set of sellers, primarily family businesses. 

MMS plans to install biometrics and other tech features to make its facilities safer and to attract the best possible clients as it competes with players like Depotium (StorageVault Canada), U-Haul and Public Storage, which Berman describes as “the 20,000-pound gorilla in our industry.” 

In addition, gates and fences will be upgraded, units will be reconfigured and energy-saving initiatives will be instituted.

“We're going to upgrade considerably to make sure units are secure and that people can get in and out easily 24/7 with seamless contact.”

He added that the next evolution will be the ability to talk live by video 24 hours a day to customer service representatives. 

While MMS has a major presence in Greater Montreal, the city is far from saturated, he said, noting the company has only one location in Laval where it could easily have 10, while the South Shore “is wide open and growing rapidly.”

During the summer, the company added more than 300 units to its flagship location at 5260 Ferrier St. As well, MMS recently opened a new location in Saint-Laurent and plans to add about 500 units in the Montreal borough in the next few months. 

Berman says Saint-Jean sur Richelieu and Mascouche, both about 40 kilometres from Montreal, have been targeted for future locations.  

Trois Rivières and Quebec City are other growth targets, “but we're going to do it in a very meticulous pattern,” he said. “We only open new markets when we are confident that we can command a premium price and have scale in that market.”

$40M in acquisitions during 2022

Last year, MMS spent $40 million to acquire five facilities in Saint-Jérôme, Sainte-Adèle, Val Morin and Rawdon in the Laurentians area.

The company now has six locales in the Laurentians and growth there isn’t over as people discover the lifestyle and work from home becomes more prevalent, Berman said.

“That’s why I’ve placed my bets on the Laurentians densifying over time.”

Although people in the Laurentians are more price-sensitive than in Montreal, units skew much larger than in the city as clients store bulky items like snowmobiles and Sea-Doos and rent outdoor storage for items like RVs.

MMS has 80 employees and is a subsidiary of Avenir Properties, formed in 2017. 

Avenir owns 9200 Meilleur and 1 Chabanel – two industrial buildings in the city’s traditional garment district that have been converted primarily into loft offices. Among the amenities of 1 Chabanel is a rooftop terrace with basketball court.

AEDN, which is an investor in Avenir, handles property management of the two properties. 

MMS, Avenir and its other businesses

Avenir also operates ClickSpace, a hub for e-commerce entrepreneurs at 9320 St-Laurent Blvd., that offers co-working spaces and other services, and The Hive, which provides flexible office space in four locations.

Berman said there are plans to brand Avenir as a tool for talent recruitment.

“It's hard to attract people to a self-storage company or a co-working space, but when you say you're really innovative, forward thinking and quite significant as far as a real estate group, you’re going to attract talent. That's why we have the brand.”

He believes MMS will eventually have more than one brand in Quebec, depending on storage usage. New brands are being considered that would cater to everything from business users to wine storage. 

Berman said the focus of MMS will remain on Quebec, a market it knows well.

Expansion outside the province will happen only “when we're done here and I have a feeling it's going to take us many generations to finish our work here. We’re open, but it's not something that we're actively pursuing.”

Meanwhile, there are no plans to sell.

“We love this business. We've got a lot of growth ahead of us, so we really have no intention of selling.” 

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