JLL Arranges Construction Loan for Hillsborough Self-Storage

Hillsborough is getting a new self-storage facility, and the financing just closed, with JLL Capital Markets arranging a construction loan for a 709-unit development on Bedle Street that’s set to open in 2027.

JLL secured the five-year construction and bridge loan through Provident Bank on behalf of Shadowbrook Capital, the borrower behind Extra Space Hillsborough. The single-story, temperature-controlled facility will sit on 8.64 acres at 35 Bedle St., with direct frontage on Route 206. At 105,663 square feet total, the project will offer 76,119 rentable square feet when it opens.

Extra Space Storage will manage day-to-day operations and handle the lease-up once construction wraps.

The deal, reported by ROI-NJ, closed April 20. JLL’s Capital Markets team was led by Michael Klein, Nazario Paragano and Michael Donohoe.

“Shadowbrook Capital presented a compelling opportunity by identifying a clear need for high-quality self-storage in this underserved market,” Paragano said. “The combination of a premier sponsor, a strategic location with direct frontage on Route 206 and robust market fundamentals generated significant interest from the lending community. We are pleased to arrange the financing with Provident Bank for this project.”

The Hillsborough site isn’t a random pick. Somerset County is the fifth-fastest growing county in New Jersey, adding residents at roughly 3% to 4% annually and hitting 357,000 people by year-end 2025. More people, more stuff. That’s the math.

And Central Jersey, broadly, is dramatically undersupplied. According to JLL’s own research, the region offers just 3.96 square feet of storage per person, compared to the national average of 6.32 square feet. That’s a gap of more than 2.3 square feet per resident, multiplied across a dense, growing population. For developers and lenders, that’s not a problem. That’s an opportunity.

Several forces have pushed self-storage demand higher across New Jersey in the past few years. Urban areas like Newark, Jersey City and Trenton see constant turnover, driven by renters moving between small apartments with limited closet space. Work-from-home arrangements didn’t help, either. Spare bedrooms became home offices, and closets got converted into storage for monitors and filing cabinets, pushing more households to rent external units for everything else they own.

New Jersey’s construction environment doesn’t make it easy to build, either. Permitting is slow, available land is scarce, and zoning fights can drag projects out for years. That means fewer new facilities get built relative to demand, and the ones that do get financed tend to pencil out well for investors.

Hillsborough, which sits along Route 206 in Somerset County, checks the boxes that lenders and developers want to see: a growing local population, highway access, and a submarket that doesn’t already have a glut of competing storage space. The Somerset County Planning Board oversees development in the area, and projects along Route 206 have generally benefited from the corridor’s commercial infrastructure and steady traffic counts.

For the workers who’ll eventually staff the facility, Extra Space Storage is a national operator with a track record in New Jersey. The company runs properties across the state, and its presence here means Hillsborough residents can expect a professionally managed operation rather than a mom-and-pop outfit.

The loan structure, a five-year construction and bridge facility, gives Shadowbrook Capital time to build, stabilize occupancy, and then refinance into permanent debt. That’s a standard playbook for a development of this type, and Provident Bank, a New Jersey-based lender, has been active in commercial real estate deals across the region.

Construction is expected to begin in the near term, with the facility targeting a 2027 completion. For Somerset County residents who’ve been stacking boxes in their garages or driving to the next town over to find a storage unit, that timeline can’t come fast enough.