Kalikow Group in joint venture with self-storage REIT Shurgard.

The Kalikow Group, through its affiliate K&S Storage, LLC, has closed its first transaction with Shurgard Storage Centers, Inc., a leading self-storage REIT, for the purchase of a 76,000 square-foot self-storage facility in Melville, NY. Edward Kalikow, president of Kalikow Development, made the announcement.

"This venture partnership benefits both sides, as Shurgard is able to expand it's capital sources and we are able to forge a relationship with a major REIT which has been expanding rapidly in the past few years. This symbiotic relationship with Shurgard should supply Kailkow with the opportunity for additional investment opportunities in the future," said Kalikow. "Deals such as this one extend Kalikow Development's ability to provide this off-balance sheet financing to publicly traded companies trying to expand their capital sources during a time when the public equity markets for REITs has been closed."

The property is located at 965 Walt Whitman Road. Shurgard owns or manages more than 350 storage-centers in the U.S. and Europe. This deal represents the third such joint venture into which Shurgard has entered in order to secure equity for purchase of a storage facility or block of facilities.

The arrangement with Shurgard adds to Kalikow Development's growing "land banking" and off-balance-sheet financing business. Earlier in 1999, Kalikow Development closed two residential land sale transactions in East Orlando, FL with Centex Corporation, one of the largest single-family home builders in the U.S., and Morrison Homes, a subsidiary of George Wimpley PLC, a British-based, publicly held company and another of the country's largest home builders. With the signing of Shurgard, Kalikow's ability to provide off-balance-sheet financing has now extended itself to the REIT market, where it can be especially helpful in furthering these public corporations' goals of maintaining a diversified capital base and the emphasis on growth through the development of high quality assets.

Mortgage financing for the deal was provided by Heller Financial, Inc. and the loan was placed through the Manhattan office of Holliday, Fenoglio and Fowler, LLP. A consulting firm, Fredric Stephens & Company, Inc., also assisted The Kalikow Group in this acquisition.