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Medium Merger & Acquisition

StoreStuff

#Real Estate

Practice this intermediate merger & acquisition case interview question in the Real Estate sector. Includes detailed problem prompt, clarifying questions, structured framework, and expert recommendation. Part of ProHub's 835+ consulting case library.

ProHub Comment

This is a comprehensive M&A case requiring analysis across standalone valuation, synergy identification (both revenue and cost), and market considerations. The case tests problem-solving through structured financial analysis combined with operational insights about box sizing and occupancy optimization. The quantitative section on box conversion adds a real-world operational complexity layer.

Estimated Time 27 minutes
Difficulty Medium
Source IESE
19 / 100
Our Client, StoreStuff, is a successful chain of Self-Storage units, specialized in rental of spaces for both people and companies to store their belongings such as old documents, furniture, and all sort of equipment. A New York based company, StoreStuff is the market leader in the US sector and has grown steadily in the past 10 years, mainly through acquisition of smaller, regional companies. Aiming to increase their presence in the West side of the country, StoreStuff has identified YourPlace, a Self-Storage unit in Nevada, that seems to be a good target for an acquisition. The CEO has hired us to figure if they should move on with this acquisition.

Clarifying Information

  1. The company only provides the space for rental – no additional services such as logistics are provided by StoreStuff. Their buildings are owned and managed by the company.
  2. In the customer journey, a new client goes to the store or on-line, rents a space, and receives a password to access his Box. Contracts are paid, renewed and readjusted on a monthly basis.
  3. StoreStuff has 60% of total market, and the rest 40% is divided among smaller companies
  4. StoreStuff has 20 units mainly located on the East side. Each operating unit has an approximate $5Mi revenue. As Operational Expenses are low (mainly building maintenance and security), StoreStuff enjoys a 40% Net Margin
  5. A typical StoreStuff facility provides two sizes of rental space, called “Box”. The “Large Box” has 10 square meters, and the “Regular Box” has 2.5 square meters. Boxes can be both aggregated to form a larger one, or dismantled, to form small boxes.
  6. The company wants to understand whether this is a good target. So far, they are not worried with the size of the deal
Mock Interview
Interviewer

Our Client, StoreStuff, is a successful chain of Self-Storage units, specialized in rental of spaces for both people and companies to store their belongings such as old documents, furniture, and all sort of equipment. A New York based company, StoreStuff is the market leader in the US sector and has grown steadily in the past 10 years, mainly through acquisition of smaller, regional companies. Aiming to increase their presence in the West side of the country, StoreStuff has identified YourPlace, a Self-Storage unit in Nevada, that seems to be a good target for an acquisition. The CEO has hired us to figure if they should move on with this acquisition.

You

Thanks. Before analyzing, I'd like to clarify a few key questions...

Interviewer

Good question. Let me provide some background information...

You

Based on this, I suggest analyzing from these dimensions...

AI Score
Structure Analysis Communication Business Sense Quantitative
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Practice this case with AI Mock Interview

StoreStuff, a self-storage market leader, is evaluating whether to acquire YourPlace in Nevada. The case requires assessing YourPlace’s standalone profitability, identifying revenue and cost synergies post-acquisition, analyzing market opportunity in Nevada, and quantifying revenue potential from converting underutilized large boxes to regular boxes.

Key Insights:

  1. Normalize financial comparisons using per-square-meter metrics (Sales/Sqm, Cost/Sqm) to fairly compare companies of different sizes
  2. Identify operational synergies by comparing unit economics—YourPlace’s higher operations costs ($475/sqm vs $250/sqm) represent clear cost synergy opportunities
  3. Analyze product mix optimization—low occupancy of large boxes (30% vs 90% for regular boxes) suggests revenue upside from remodeling building configuration
  4. In M&A analysis, structure around: standalone value, revenue synergies, cost synergies, capabilities/risks, and market analysis
  5. Quantify synergies precisely: cost synergies of $450k/year and revenue synergies of $700k/year, plus $1.8M/year from box reconfiguration

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