Stor-Age continues to trade resiliently in SA and the UK, delivering robust performance
STOR-AGE, South Africa’s leading and largest self-storage property fund, continued to deliver a robust operating performance for the first five months of its 2023 financial year, as well as the 12-month trading period ending August 31, 2022. Across the portfolio of 85 trading properties in South Africa and the UK, Stor-Age delivered growth in occupied space of 57 600m² yearon-year. Increases in the average rental rate of 6.7% were achieved in South Africa and 10.8% in the UK.
In South Africa, total occupied space, including new developments and acquired trading properties, increased by 28 700m². The growth in closing occupancy includes 9 200m² in the same-store portfolio, 9 700m² of gains at the newly opened Tyger Valley and Cresta properties, as well as a further 9 800m² of gains at recently acquired Silver Park and Green Cube properties in Cape Town.
In the UK, total occupied space, including acquired trading properties, increased by 28 900m², with the growth including 28 400m² of gains from the recently acquired McCarthy’s Storage World and Storagebase portfolios, with the latter being part of the Moorfield JV in which Stor-Age holds a 25% interest.
Chief executive Gavin Lucas said in a statement: “We are pleased to, once again, report another set of positive trading results. The self-storage sector in South Africa and the UK continues to benefit from structural tailwinds, evidencing itself at the property level in the form of high levels of demand.”
He said their operating model allowed them to deliver excellent same-store gains in occupancy in South Africa, alongside very healthy average rental rate increases.
“In the UK, we’ve been able to maintain the excellent levels of occupancy that we started the year with, alongside achieving a very attractive level of same-store average rental rate growth in excess of 10%.”
In May 2022, the company secured a self-storage property in Parklands in Cape Town for a purchase consideration of R65 million. The company continues to benefit from a significant in-place development pipeline, which at March 31 comprised fourteen properties in both markets, which will add in excess of an estimated 80 000m² gross letting area on completion.
This is split between ten properties in South Africa, at an approximate total development cost of R900 million, and four properties in the UK, at an approximate total development cost of £45m (R867.65m). Four of the ten properties in South Africa were progressing well. In Johannesburg, construction is under way at Morningside and Bryanston, while in Cape Town, construction is currently under way at Pinelands and Paarden Eiland.
Stor-Age continued to seek opportunities to unlock value in the existing portfolio, with a number of town planning applications either currently in hand and approved or which have recently been submitted for properties in Milton Keynes, Huddersfield, Wakefield and Blackpool. These extensions were planned to add more than an estimated 6 000m² gross leasable area to the portfolio.