Five Questions for H. Michael Schwartz, Founder and CEO of SmartStop Self Storage REIT

For the latest installment of “Five Questions for…,” the AltsWire editorial team sat down with H. Michael Schwartz, founder, chairman, chief executive officer, and president of SmartStop Self Storage REIT. Schwartz richly discussed a variety of topics, centering around SmartStop’s management of both publicly traded and nontraded companies and what sets it apart from other sponsors.

AltsWire: SmartStop Self Storage REIT listed its common stock on the New York Stock Exchange in April 2025. Prior to doing so, the company acquired two related nontraded REITs — Strategic Storage Growth Trust II and Strategic Storage Trust IV — in exchange for SmartStop shares that are now publicly tradable. Can you walk us through the strategy behind that approach and share your long-term vision for the company?

H. Michael Schwartz: The NYSE listing was years in the making. We looked at a public offering more than once and chose to wait, including during COVID, until we believed the conditions were right for our investors and the long-term health of the platform.

Before we listed, we completed the consolidation work that would put us in the right position. We acquired Strategic Storage Trust IV in an all-stock transaction valued at approximately $370 million, and Strategic Storage Growth Trust II in a transaction that delivered a premium of approximately 37% to SSGT II’s estimated NAV per share. Those mergers built the scaled, institutional-quality platform we needed. By consolidating those vehicles into SmartStop Self Storage REIT prior to the initial public offering, we created a well-capitalized company positioned to compete at the institutional level from day one.

The April 2025 offering raised approximately $875.6 million in net proceeds. We used that capital to strengthen the balance sheet, retire preferred stock, and position the company for accretive acquisitions. It also gave us something we had not had before: a public-company cost of capital. We never had that as we grew this company to roughly $3 billion in total capitalization. The NYSE listing changed that. Additionally, the listing gave nontraded legacy investors the continued ownership of a growing enterprise, with more liquidity and independent market validation behind it than a nontraded structure can provide.

Looking to the future, we believe the self-storage market has bottomed. The COVID demand surge happened, the oversupply correction followed, and that cycle has largely run its course. SmartStop delivered sector-leading same-store revenue growth of 1.6% and sector-leading funds from operations as adjusted per share growth of 10% in 2025. As new supply moderates, we are seeing rates from new customers strengthen in many markets.

SmartStop’s path to long-term growth runs through on-balance sheet acquisitions in top-25 markets, growth in third-party management through our Argus platform, continued Canadian development with SmartCentres, expansion of managed REIT assets under management, bridge lending, and our unsecured credit facility, which is structured at $500 million with an accordion feature of up to an additional $1.1 billion.

Growth for its own sake is not the goal. Acquisitions need to be accretive on a per-share basis. We have issued 2026 guidance of $1.93 to $2.05 per diluted share, and we’re mindful of meeting the expectations we set on the street. The institutional investors who followed us into the initial public offering, including some of the largest REIT institutional buyers in the U.S., represent an ongoing vote of confidence in how we are running the company.

AW: Although SmartStop Self Storage REIT is publicly traded, the company directly or indirectly continues to sponsor Delaware statutory trusts and nontraded REITs. Why are you choosing to stay in the illiquid alternative investing channel? What is compelling about the market and its private placement vehicles?

HMS: The alternative investment channel is a core part of SmartStop’s platform and always has been. Being publicly traded does not change that.

Nontraded REITs serve a real investor need. There are retail investors who want exposure to institutional-quality real estate, the potential for income and diversification, without the day-to-day volatility of the public markets. SmartStop currently sponsors three nontraded REITs through its managed REIT platform: Strategic Storage Trust VI, a publicly registered nontraded REIT; Strategic Storage Growth Trust III, a private REIT focused on growth-oriented and non-stabilized assets; and Strategic Storage Trust X, a perpetual NAV REIT launched in January 2025. Together, those three vehicles had a combined portfolio of 52 operating properties, approximately 41,000 units, and 4.5 million rentable square feet as of year-end 2025, with AUM of approximately $1.1 billion. Since 2005, our management team has raised approximately $2.4 billion across 10 self-storage programs.

Each vehicle is structured for a different investor profile. SST VI recently launched a Series E Preferred Stock offering targeting $75 million, expandable to $100 million, carrying an 8% annualized cash dividend paid monthly when authorized and declared, and backed by a portfolio of more than $500 million in self-storage assets across the United States and Canada. SSGT III targets growth-oriented and development-stage assets. SST X, the newest vehicle, is structured as a NAV REIT designed for investors seeking a lower-volatility, continuously offered product.

DSTs address a different but equally specific need. They offer the potential for tax-advantaged income and access to institutional-quality assets with passive ownership. They are also eligible for Section 1031 exchanges on both entry and exit, which makes them well suited for investors managing real estate capital gains. SmartStop’s Blue Door DST program has demonstrated consistent demand. Blue Door Property I, DST, an all-cash offering, raised $29.75 million. Blue Door III, our current offering, is a leveraged program targeting approximately $28.4 million in equity across three properties in Orlando, Dallas, and Phoenix.

We have made meaningful investments in this channel. We rebuilt the securities and wholesale team, adding Timothy Cronic, Christine Vandrovech, and Tim Riddle. We also entered a distribution partnership with Orchard Securities to lead retail distribution of SmartStop’s investment programs. Ensuring that broker-dealers and RIAs have a full picture of what SmartStop offers across its alternative programs is an ongoing priority.

What distinguishes our offerings across the board is that they are backed by a publicly traded, institutionally vetted company. The same financials, disclosures, and analyst coverage available on SmartStop’s NYSE-listed shares are available to every adviser evaluating a Blue Door DST or a nontraded REIT sponsored by SmartStop.

AW: SmartStop Self Storage REIT closed two Canadian Maple Bonds totaling CAD $700 million in 2025, and has a portfolio of approximately 50 Canadian self-storage properties in operation. What is the strategy behind SmartStop Self Storage REIT’s Canadian foothold and what are your future plans in the country?

HMS: SmartStop’s Canadian presence goes back more than 15 years. Today, SmartStop and its affiliates own or manage 50 operating self-storage properties across four Canadian provinces, totaling approximately 43,000 units and 4.3 million rentable square feet. We are the largest self-storage operator in the Greater Toronto Area.

One of the key factors of our Canadian growth is a 50/50 joint venture with SmartCentres REIT (TSX: SRU.UN), one of Canada’s largest retail REITs. The partnership, in place since 2018, works as follows: SmartCentres identifies and entitles sites within or adjacent to its retail centers and builds the facilities; SmartStop operates them. In March 2026, we opened our 50^th Canadian property, a five-story, Class A facility in Toronto.

In 2025, SmartStop completed two Maple Bond offerings totaling CAD $700 million: Series A, CAD $500 million of senior unsecured notes due June 2028, and Series B, CAD $200 million of senior unsecured notes due September 2030. Issuing Maple Bonds, which are Canadian-dollar-denominated bonds in the Canadian domestic market, requires recognition and trust from Canadian institutional investors. Closing both offerings reflects the standing SmartStop has built in that market. Borrowing in Canadian dollars also naturally hedges SmartStop’s Canadian revenue stream against currency fluctuation.

Several of SmartStop’s Canadian properties are held within Strategic Storage Trust VI and Strategic Storage Growth Trust III, so the Canadian platform supports both our alternative investment programs and our publicly traded REIT.

AW: SmartStop Self Storage REIT is a publicly traded company with full disclosure requirements it must adhere to – far different from what typical private placement sponsors without a publicly traded affiliate must follow. How is it different to approach it this way? How does this set you apart from other sponsors?

HMS: As a company listed and traded on the NYSE, SmartStop Self Storage REIT is required to file 10-Ks, 8-Ks, supplementals, earnings releases, and related disclosures. The majority of alternative investment sponsors, particularly those operating solely in the DST market, are not held to equivalent standards. That difference is meaningful for advisers and investors evaluating who is behind a program.

The same financials that institutional investors use to evaluate SmartStop separately managed account shares are available to a financial adviser recommending a Blue Door DST to a client completing a Section 1031 exchange. The information is public, audited, and updated regularly. That level of transparency is not standard in the DST market.

Prior to the April 2025 initial public offering, SmartStop’s investor base was entirely retail. Today it is approximately 20% retail and 80% institutional. Institutional investors conduct rigorous due diligence before committing capital and monitor their holdings on an ongoing basis. Their continued ownership represents an independent, ongoing assessment of SmartStop’s management, operations, and financial discipline.

SmartStop is also subject to Regulation Fair Disclosure (Reg FD). SmartStop cannot selectively share material non-public information with any investor or analyst before it is available to the general public. Everyone operates from the same information base. That standard of transparency is a structural advantage in the markets SmartStop serves.

AW: How do your alternative investments offerings impact the public company?

HMS: SmartStop’s alternative investment offerings, including the nontraded public REITs and the Blue Door DST programs, run in parallel with SmartStop Self Storage REIT. Growth in one channel supports the other.

SmartStop earns fees as sponsor and manager of its nontraded REITs and DST offerings, including asset management fees, property management fees, acquisition fees, and performance fees. That income flows to SMA without requiring us to deploy SMA’s balance sheet capital. For public shareholders, it represents recurring, non-dilutive revenue that carries strong margins and supports key earnings metrics including funds from operations and earnings before interest, taxes, depreciation, and amortization.

The nontraded alternative channel also provides a capital source that is largely uncorrelated to public equity and debt markets. It is not subject to the same volatility and sentiment shifts that affect the publicly traded side of the business.

There is also a familiarity effect. When a retail investor participates in a Blue Door DST or a nontraded REIT program, they develop direct familiarity with the SmartStop name, management team, and platform. That awareness carries over to the public company.

SmartStop’s NYSE listing, quarterly earnings disclosures, analyst coverage, and institutional ownership also serve as independent verification of the platform’s operational quality and financial integrity, which supports the alternative programs in turn. Growth in one channel supports growth in the other.

H. Michael Schwartz is founder, chairman, CEO, and president of SmartStop Self Storage REIT. He has more than 33 years of experience in real estate, securities, and corporate financial management. During the last 22 years, he has transacted more than $6.5 billion in commercial real estate.

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