The promote crystallizes on refi in this 22-facility storage LPA

Refi crystallization is the one I'd fight, and I'd fight it with a clawback that has teeth rather than by trying to delete the clause. Most sponsors won't delete it because their whole model is buy, stabilize, cash out, recycle. A clawback with an escrow behind it gets you most of the protection. A clawback with no escrow and a GP entity that dissolves at wind-up gets you a lawsuit.

On the affiliate PM at 6% of gross, that's inside the normal band for storage third-party management, and the onboarding fee is normal too. The reason you want the actual agreement is termination. If the fund can only fire the affiliate for cause, and cause is defined narrowly, you've locked in the manager for the hold no matter how the revenue optimization performs. That clause is worth more to you than the fee number.

One more thing on the cap. A cap expiring fourteen months before maturity on a cross-collateralized bridge facility means the fund has to buy a new cap at whatever it costs then, out of reserves, or refinance early into whatever the market gives them. Ask what the reserve line for cap replacement is and whether it's funded or just modeled. I've seen it modeled at the original cap cost, which is not a number anyone should rely on.

Naive question from someone still learning how these vehicles actually work. If the promote can be taken at refi, does the LP capital get returned first at that event, or does the sponsor take carry while your money is still outstanding? Because those read like very different deals to me and I can't tell from what you quoted.

@sable that's the whole question fathom is asking, and the answer is in the distribution waterfall section, not the promote section. Worth reading them together.

I passed on something with a similar shape last year and the reason was the summary instead of the exhibit. Not because the affiliate agreement was necessarily bad. A sponsor who hands you a summary at the diligence stage, when you are the one deciding whether to wire, has told you what document access looks like for the next five years.

On the substance, I'd add one thing to what sextant said. Ask how the affiliate PM gets paid on a facility in lease-up. Six percent of gross on a facility running 40% occupied is almost nothing, so some platforms carry a minimum monthly fee per facility during lease-up. If the development side is 40% of the plan, those minimums are a real drag on early distributions and they usually sit in the exhibit you haven't been given.

The cross-collateralization is what I'd underwrite before any of the fee stuff. Six facilities on one bridge facility means one bad lease-up drags the covenant test for the whole pool. Ask for the covenant package in writing, specifically the debt yield test and the cure rights, and ask whether the lender's consent is required to add or release a property. Bridge lenders on storage have been extending rather than foreclosing, and that's shaped a lot of behavior, but an extension usually comes with a fee, a paydown, or a new cap requirement. Confirm the actual terms and the extension conditions in writing with the lender before you decide the cap gap is a small problem.