Salt Lake City-based Extra Space Storage Inc., an owner and operator of self-storage properties nationwide, has made a $300 million investment in the preferred stock of Jernigan Capital Inc. of Memphis, Tennessee, in connection with the acquisition of Jernigan by NexPoint Advisors LP that closed on Nov. 6. The stock consists of two tranches with a blended yield of 10.7 percent annually. The deal includes prepayment penalties as well dividend increases if not retired by Jernigan.

The investment also gives Extra Space certain rights of refusal with respect to purchasing the properties of JCAP. Extra Space will also assume management of 37 Jernigan self-storage properties in connection with the investment, according to Joe Margolis, CEO of Extra Space.

“Our $300 million preferred equity investment in the acquisition of Jernigan Capital is another example of innovative capital investment in the storage sector, with attractive returns for our shareholders and an appropriate risk profile,” said Margolis. “We are excited to add 37 newly built, high-quality storage assets to our platform, and more importantly, to begin new relationships with NexPoint and the JCAP management team.”

Extra Space Storage owns or operates 1,906 self-storage properties in 40 states; Washington, D.C.; and Puerto Rico. Extra Space’s properties comprise approximately 1.4 million units and approximately 147.5 million square feet of rentable space, making it the second-largest owner and/or operator of self-storage properties in the United States.

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