Stor-age Property Reit Ltd. · JSE:SSS
Stor-age Property Reit — H1 FY2025 Earnings Presentation
73 slides from Stor-age Property Reit's earnings presentation, November 2024
Slide 1: FY25 Interim Results Presentation
STOR-AGE PROPERTY REIT FY25 INTERIM RESULTS PRESENTATION FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2024 STOR-AGE PROPERTY REIT LIMITED 1
Slide 2: Presentation Outline
PRESENTATION OUTLINE Page Introduction 4 Financial review 13 Joint venture partnerships 24 Acquisitions and developments 29 Third-party management 33 Environmental, social and governance 35 Outlook 38 STOR-AGE PROPERTY REIT LIMITED 2
Slide 3: Annexures
ANNEXURES Page A: Key financial and operational highlights 40 B: Share price performance 41 C: Investment case 43 D: The market 44 E: Strategy and portfolio 49 F: SA property 54 G: UK property 60 H: Operations 63 I: Environmental, social and governance 70 STOR-AGE PROPERTY REIT LIMITED 3
Slide 4: Introduction
INTRODUCTION STOR-AGE PROPERTY REIT LIMITED 4
Slide 5: Highlights
HIGHLIGHTS Interim distributable income per share up 3.5% to 63.51 cents Interim dividend of 57.16 cents per share based on a 90% payout ratio Total return of 10.9%¹ Same-store rental income up 10.8% SA and 6.8% UK Same-store net property operating income up 12.0% SA and 7.4% UK Same-store occupancy
Slide 6: Snapshot
SNAPSHOT Listing date November 2015 JSE sector Speciality REITs Profile Highly specialised, low risk, income paying self storage REIT Self storage 11 publicly traded self storage REITs universe (US: 5, UK: 2, EU: 1, Aus: 2, SA: 1) Market R7.2 billion1 capitalisation Total South Africa United Kingdom
Slide 7: Why Self Storage?
WHY SELF STORAGE? Resilient Diversified Stable cash Growth Attractive sector and customer and flows opportunity shareholder increasing asset base returns and demand diversification benefits • Needs-based • No material tenant • Attractive • Development • Self storage – sector and concentration risk o
Slide 8: Why Stor-Age?
WHY STOR-AGE? Experienced Diversified Flexible Operational Robust management and growing structure and excellence balance sheet team portfolio partnerships • Executive team • Consistent • Executing growth • Highly sophisticated • GCR Ratings co-founded growth of our strategy through dual-market plat
Slide 9: Granular and Stable
GRANULAR AND STABLE Properties Customers Markets Revenue 81 / 5% 52 000 + R12.8bn / 107¹ R643m / 20% With 81 properties classified 52 000 + customers across Portfolio value² R12.8 billion Property operating revenue as owned, no property is all demographics (SA 47%; UK 53%) and total of R643 million
Slide 10: Flexible Ownership Structure
FLEXIBLE OWNERSHIP STRUCTURE Country Brand Wholly-owned 55 81 26 Joint venture¹ 7 20 13 Managed 1 6 5 Total properties¹ 63 107 44 1. Includes Leyton phase I, which opened for trading in October 2024 STOR-AGE PROPERTY REIT LIMITED 10
Slide 11: Growth Channels
GROWTH CHANNELS Building out / Acquiring Developments Third-party expanding properties in joint venture management properties partnerships • Portfolio growth y-o-y: 10 properties, increasing from 97 to 107 stores › Five new developments in our JV partnerships (SA 2, UK 3) › Four third-party managed
Slide 12: Committed to Sustainability
COMMITTED TO SUSTAINABILITY Social Environmental 12 60% Third year supporting 12 previously disadvantaged 60% of owned properties have solar PV systems installed learners in a 12-month learnership programme 215m² R8.5 million ‘Community investment’: Approximately 16 R8.5 million invested in renewabl
Slide 13: Financial Review
FINANCIAL REVIEW STOR-AGE PROPERTY REIT LIMITED 13
Slide 14: Financial Metrics
FINANCIAL METRICS 63.51 8.2% SA 92.0% SA 12.0% SA cents 2.4% UK 85.3% UK 7.4% UK Distributable Achieved rental Closing Net property income per share rate growth occupancy operating income Up 3.5% year-on-year Same-store year-on-year Same-store year-on-year Same-store year-on-year growth occupancy ga
Slide 15: Trading Results
TRADING RESULTS 30 Sep 24 30 Sep 23 SA UK SA UK SA UK Rm £’000 Rm £’000 +/- +/- Rental income Self storage 309.0 11 789 278.9 11 036 10.8% 6.8% SA: Other 5.5 458 5.2 438 5.4% 4.6% Occupancy +2.4% and rental +8.2% Ancillary income 13.2 1 212 11.5 1 144 14.3% 5.9% = 10.8% increase in rental income y-o
Slide 16: Occupancy Summary
OCCUPANCY SUMMARY 30 Sep 24 30 Sep 23 Occupancy OWNED PORTFOLIO GLA m2 Occupied m 2 % Occupied GLA m2 Occupied m 2 % Occupied growth m 2 SA Same-store 391 900 360 200 91.9% 387 800 351 300 90.6% 8 900 Non same-store 7 600 7 200 95.0% - - - 7 200 Total SA 399 500 367 400 92.0% 387 800 351 300 90.6% 1
Slide 17: Portfolio Analysis and Customer Profile
PORTFOLIO ANALYSIS AND CUSTOMER PROFILE Portfolio analysis (number of properties) SA UK Total Freehold 52 18 70 Leasehold 3 8 11 Total – own properties 55 26 81 Managed properties 8 18 26 Total – trading properties 63 44 107 Under development - 1 1 Total – including properties under development 63 4
Slide 18: Distribution Analysis
DISTRIBUTION ANALYSIS 30 Sep 24 30 Sep 23 Total Total SA UK SA UK Total SA UK Total +/- +/- +/- +/- Rm £m Rm Rm £m Rm Rm % % % Net property operating income 253.0 9.6 477.5 226.0 8.9 435.9 41.6 +9.5% +11.9% +7.4% Waterfall – loss of revenue claim 3.0 - 3.0 5.3 - 5.3 (2.3) -43.4% -43.4% - Management
Slide 19: Balance Sheet – Summarised
BALANCE SHEET – SUMMARISED 30 Sep 31 Mar 30 Sep 31 Mar R million 2024 2024 2024 2024 ASSETS LIABILITIES Non-current assets Non-current liabilities Investment properties 11 458 11 310 Bank debt 4 035 3 887 SA Freehold 5 521 5 243 ZAR 1 687 1 426 SA Leasehold 170 169 GBP 2 348 2 461 UK Freehold 5 315
Slide 20: Property Valuations
PROPERTY VALUATIONS VALUATION BREAKDOWN Average value Rm % of portfolio per m² Discount rate Exit cap rate SA Freehold and long leasehold 5 520.7 97.0% Short leasehold 170.5 3.0% Total 5 691.2 100.0% 13 846 14.28% 8.63% Trading properties 5 572.6 97.9% Held for development 118.6 2.1% Average value p
Slide 21: SA REIT Net Asset Value per Share
SA REIT NET ASSET VALUE PER SHARE Rm 30 Sep 24 31 Mar 24 Reported net asset value (NAV) 8 034.2 7 534.0 Derivatives MTM (35.2) (43.1) Goodwill and intangible assets (160.4) (160.9) Deferred tax 0.1 425.0 SA REIT NAV 7 838.7 7 755.0 Shares in issue + dilutive instruments (million) 485.6 480.5 SA REIT
Slide 22: Treasury Dashboard
TREASURY DASHBOARD ZAR GBP GBP Total Rm £m Rm Rm Total debt facilities 2 375.0 113.5 2 610.7 4 985.7 Undrawn debt facilities 621.6 10.2 235.5 857.0 Gross debt 1 753.4 103.3 2 375.2 4 128.6 Secured 1 253.4 92.4 2 125.5 3 378.9 Unsecured 500.0 10.9 249.7 749.7 Cash on hand 151.3 5.2 120.6 271.9 Net de
Slide 23: Treasury Dashboard (continued)
TREASURY DASHBOARD (CONTINUED) Asset and debt ratios Sep 24 Sep 23 ICR 3.3x 3.5x Unencumbered assets R1.540 bn R1.049 bn Unencumbered asset ratio 14.0% 9.3% Unsecured debt ratio 18.1% 12.2% Ratio of secured borrowings to encumbered assets 35.4% 35.4% Ratio of unsecured borrowings to encumbered asset
Slide 24: Joint Venture Partnerships
JOINT VENTURE PARTNERSHIPS STOR-AGE PROPERTY REIT LIMITED 24
Slide 25: Joint Ventures – The Model
JOINT VENTURES – THE MODEL Several JV partnerships have been established in SA and the UK in recent years to acquire and develop new properties. Overview • At year end › JV investments value: R681.2 million (FY23: R705.9 million), with R141.0 million in SA and R540.2 million in the UK › Trading prop
Slide 26: Joint Ventures – South Africa
JOINT VENTURES – SOUTH AFRICA JV with Nedbank (NPP) established in FY22 • Five new developments completed and trading • Kramerville opened in July 2024, with the first four properties opening in FY24 Nedbank Property Partners • Total GLA: 29 200m² upon full fit-out • Estimated development cost: R450
Slide 27: Joint Ventures – UK
JOINT VENTURES – UK JV portfolio overview (established 2021) • Focus areas: London (and commuter towns), South East, and key regional towns/cities • Stor-Age equity interest: 24.9%, with the exception of Acton (15%) • Total JV commitments: Approximately £125.0 million for acquisitions and new develo
Slide 28: Joint Ventures – Portfolio Summary
JOINT VENTURES – PORTFOLIO SUMMARY The table below summarises the JV property portfolio: New developments New developments Acquired GLA on full Total Trading In progress¹ Trading fit-out (m²) SA NPP 5 - - 5 29 200 Garden Cities 1 - - 1 6 300 Rabie 1 - - 1 6 100 Total 7 - - 7 41 600 UK Moorfield 4 1
Slide 29: Acquisitions and Developments
ACQUISITIONS AND DEVELOPMENTS STOR-AGE PROPERTY REIT LIMITED 29
Slide 30: Acquisitions and Developments
ACQUISITIONS AND DEVELOPMENTS SA Extra Attic acquisition • In September 2024 we acquired Extra Attic in Airport Industria, Cape Town for a purchase consideration of R73.0 million › Comprises 7 600m² GLA of ground floor drive-up access and 180m² of office space › Funded by the issue of 4.978 million
Slide 31: New Developments
NEW DEVELOPMENTS Project Completion Property Region Country Status GLA² Cost¹ date³ De Waterkant Cape Town SA In planning TBC 6 600m² TBC Sandton Johannesburg SA In planning TBC 6 200m² TBC JHB 1 Johannesburg SA Secured, subject to town planning TBC 5 700m² TBC JHB 2 Johannesburg SA In planning TBC
Slide 32: Extensions and Redevelopments
EXTENSIONS AND REDEVELOPMENTS Project Completion Property Region Country Status GLA Cost date Parklands Cape Town SA Expansion – under construction R50.3m 3 200m² Q1 FY26 Huddersfield North East UK Expansion – planning permission received TBC 22 000 sqf TBC Wakefield Yorkshire UK Expansion – plannin
Slide 33: Third-Party Management
THIRD-PARTY MANAGEMENT STOR-AGE PROPERTY REIT LIMITED 33
Slide 34: Third-Party Management
THIRD-PARTY MANAGEMENT Overview • Allows for growth in revenue with minimal capital investment and is key to our growth strategy • Platform includes 26 properties¹: 18 in the UK and eight in South Africa • Total management fees for the period: R35.2 million › Recurring: R23.8 million › Non-recurring
Slide 35: Environmental, Social and Governance
ENVIRONMENTAL, SOCIAL AND GOVERNANCE STOR-AGE PROPERTY REIT LIMITED 35
Slide 36: ESG
ESG Strategy and framework • Aligns our Vision and Core Values with relevant UN Sustainable Development Goals (SDGs) • Takes guidance from the Task Force on Climate-related Financial Disclosures (TCFD) • ESG framework: Facilitates monitoring of our impact on the economy, workplace, social environmen
Slide 37: Typical Property
TYPICAL PROPERTY Stor-Age develops environmentally-friendly buildings with low environmental impact. ESG and sustainability remain key areas of focus. Solar PV & battery energy storage systems Properties with solar capacity – 64 Properties with hybrid solar PV systems – 27 Solar power generated to d
Slide 38: Outlook
OUTLOOK • Trading results › SA: Continued strong performance › UK: Robust performance delivered • Macro environment › While initial interest rate cuts have occurred – rates remain high › Geopolitical tensions and conflicts persist › SA coalition government – positive impact on confidence • Positioni
Slide 39: Annexures
ANNEXURES A. Key financial and operational highlights B. Share price performance F. SA property G. UK property C. Investment case H. Operations D. The market I. Environmental, social and governance E. Strategy and portfolio STOR-AGE PROPERTY REIT LIMITED 39
Slide 40: Key Financial and Operational Highlights
KEY FINANCIAL AND OPERATIONAL HIGHLIGHTS Annexure A 30 Sep 30 Sep +/- 2024 2023 Property operating revenue1 Group (R million) 643.0 591.9 +8.6% SA (R million) 326.8 294.2 +11.1% UK (£ ‘000) 13 522 12 674 +6.7% Net property operating income (NPOI) 2 Group (R million) 477.5 435.9 +9.6% SA (R million)
Slide 41: Share Price Performance – Relative to SAPY
SHARE PRICE PERFORMANCE – RELATIVE TO SAPY Annexure B Significant outperformance of the listed property index and SA REITs since listing in 2015 Multi-year performance1: Positive divergence relative to SAPY, outperforming by 150% 170 45 40 150 150 Number of shares (Millions) 35 130 30 Indexed price
Slide 42: Share Price Performance – Relative to UK Peers
SHARE PRICE PERFORMANCE – RELATIVE TO UK PEERS Annexure B Share price performance in GBP since listing in 2015 Stor-Age has a c.50% exposure to GBP assets through Storage King Stor-Age is entrenched in the UK market. This geographic underpin is coupled with an attractive yield spread relative to UK
Slide 43: Investment Case
INVESTMENT CASE Annexure C • Resilient and growing › Niche growth sector driven by societal trends such as consumerism, e-commerce growth, urban Global growth densification, and an increasingly mobile population opportunities in the › Primary demand drivers include life-changing events and dislocati
Slide 44: The Market
THE MARKET STOR-AGE PROPERTY REIT LIMITED 44
Slide 45: The Market
THE MARKET Annexure D UK self storage market overview¹ • Less developed: Compared to the United States and Australia 2 050 83.3% 3 375 • Supply: Estimated at 0.9 sqf per head of population in the UK, versus 7 sqf in the US, 2 sqf in Self storage properties, Occupancy on current Self storage properti
Slide 46: The Market (continued)
THE MARKET (continued) Annexure D Institutional interest Increased since 2021, with many changing strategies to enter the fragmented market Market sentiment Positive in the UK due to inflation-linked characteristics, structural undersupply, and sector maturity offering investable assets of suitable
Slide 47: UK and European Self Storage Industry – Overview
UK AND EUROPEAN SELF STORAGE INDUSTRY – OVERVIEW Annexure D UK self storage industry¹ European self storage industry (excluding UK)³ 2 706 77.5% c. 5 000 Self storage properties, Occupancy on current Self storage properties³ includes 1 012 container lettable area operators 116 million sqf Population
Slide 48: UK Self Storage Industry – Rate and Occupancy
UK SELF STORAGE INDUSTRY – RATE AND OCCUPANCY Annexure D Source: The Self Storage Association UK annual industry report, May 2024 STOR-AGE PROPERTY REIT LIMITED 48
Slide 49: Strategy and Portfolio
STRATEGY AND PORTFOLIO STOR-AGE PROPERTY REIT LIMITED 49
Slide 50: Strategy
STRATEGY Annexure E Strategic planning to 2025 • Highly strategic in planning – completed in 5-year cycles • Successful track record of executing 5-year strategies to 2015 and 2020 • Business strategy traditionally led by property strategy – now complemented by digital strategy • Multiple research p
Slide 51: Strategy (continued)
STRATEGY (continued) Annexure E Stor-Age is a sector specialist with deep product understanding, significant emerging and first-world market experience, and boasting a successful track-record of managing self storage assets. The business benefits from outstanding real estate expertise, an excellent
Slide 52: Portfolio Overview
PORTFOLIO OVERVIEW Annexure E 107 The portfolio comprises 63 properties in SA and 44 properties in the UK, with 81 properties classified as owned and 26 as managed SA PORTFOLIO UK PORTFOLIO¹ 63 properties 44 properties R6.04bn² R6.7 bn² (£291.8 million) 429 300m² GLA³ 179 100m² GLA³ 32 700 tenants³
Slide 53: Portfolio Analysis
PORTFOLIO ANALYSIS Annexure E Total property value¹ Total number of tenants² Total GLA² Total number of properties³ R12.8bn 52 800 608 400m2 107 Value of properties Number of tenants GLA Number of properties 38% 29% 41% 47% 53% 62% 71% 59% South Africa UK 1. Total net investment property value, incl
Slide 54: SA Property
SA PROPERTY STOR-AGE PROPERTY REIT LIMITED 54
Slide 55: Extra Attic – Acquisition
EXTRA ATTIC – ACQUISITION Annexure F In September 2024 we acquired Extra Attic in Airport Industria, Cape Town for a Borcherds Quarry Road purchase consideration of R73.0 million. Cape Town Int ernationa l Extra Attic is a single-storey self storage property that has been trading since 1998 and To C
Slide 56: Parklands – Expansion Underway
PARKLANDS – EXPANSION UNDERWAY Annexure F In November 2022, we acquired Think Secure Self Storage in Parklands, a suburb N7 located on Cape Town’s west coast. The property enjoys high visibility and presence on Sandown Road, with good access Sandow n Roa d off Koeberg Road from a nearby intersection
Slide 57: Sunningdale – Expansion (In Planning)
SUNNINGDALE – EXPANSION (IN PLANNING) Annexure F To Melkboss tra nd In April 2021, our Sunningdale property, developed in a 50:50 JV with Garden Cities, commenced trading. Since opening, the property has delivered an exceptionally strong Table Bay trading performance, underpinned by healthy levels o
Slide 58: Century City – Completed Development
CENTURY CITY – COMPLETED DEVELOPMENT Annexure F Located prominently on Edison Way just off Bosmansdam Road in Century City, the Monta gue property enjoys high visibility to passing traffic with good access. Ga rdens Edgemead The property will comprise an estimated 6 100m² GLA on full fit-out and was
Slide 59: Kramerville – Completed Development
KRAMERVILLE – COMPLETED DEVELOPMENT Annexure F Sandton South Roa d Located in Kramerville (Sandown), the property is situated on the corner of Dartfield Road and Commerce Crescent. The property benefits from having access on grade to all levels and will comprise an Dartfield Bow ling Roa d estimated
Slide 60: UK Property
UK PROPERTY STOR-AGE PROPERTY REIT LIMITED 60
Slide 61: Leyton – Current Development
LEYTON – CURRENT DEVELOPMENT Annexure G Storage King Leyton is a brownfield development (building conversion) located on Aldi Golden Business Park, at the intersection of Orient Way and the A104, which lies 1.5 miles from Leyton and 2 miles from Walthamstow underground stations and is easily ASDA ac
Slide 62: Acton – Current Development
ACTON – CURRENT DEVELOPMENT Annexure G Storage King Acton is a brownfield development (building conversion) located on A2020 The Vale Stanley Gardens just off the The Vale (A4020), a busy main arterial in Acton in West Shepherd’s London. Acton Bush Acton, which sits in zone 3, is a large residential
Slide 63: Operations
OPERATIONS STOR-AGE PROPERTY REIT LIMITED 63
Slide 64: The Platform
THE PLATFORM Annexure H Highly scalable platform Can be leveraged into new markets Unique benefit Sophisticated Cost-effective South African head office infrastructure, homogenous product, shared language and similar timelines dual-market platform Experienced, hands-on management teams Highly experi
Slide 65: Platform Overview
PLATFORM OVERVIEW Annexure H STOR-AGE PROPERTY REIT LIMITED 65
Slide 66: Our Customers
OUR CUSTOMERS Annexure H GEOGRAPHIC REPRESENTATION1 RESIDENTIAL / COMMERCIAL TENANT MIX BY GLA2 Gauteng Residential 26 Western Cape 36 32 Commercial Eastern Cape 1 KwaZulu-Natal 6 Free State 68 3 United Kingdom 28 GEOGRAPHIC FOCUS RESIDENTIAL vs COMMERCIAL Primary focus = high profile locations in J
Slide 67: Our Customers (continued)
OUR CUSTOMERS (continued) Annexure H AVERAGE LENGTH OF STAY – SA AVERAGE LENGTH OF STAY – UK < 6 Months 30 < 6 Months 24 27 31 6 - 12 Months 6 - 12 Months 14 1 - 2 years 9 1 - 2 years 12 18 2 - 3 Years 2 - 3 Years 19 16 > 3 Years > 3 Years DEMAND PROFILE – SA DEMAND PROFILE – UK Two significant user
Slide 68: Business Customers – Adding Value to SA Economy
BUSINESS CUSTOMERS – ADDING VALUE TO SA ECONOMY Annexure H Our commercial customers¹ 50% + 18% + 65% + 80% + c. 40% SMMEs Entrepreneurs Operational Inventory Within 5kms of requirements and stock their store Contribution to the local economy¹,² Considering that we had approximately 8 600 commercial
Slide 69: Digital First – Digital Marketing Platform
DIGITAL FIRST – DIGITAL MARKETING PLATFORM Annexure H Key features EUROPEAN CASE STUDY¹ • Full service digital marketing agency, focused on the self storage Sustained impact on enquiry generation sector, launched in July 2020 and significant increase in paid traffic • Stor-Age: Accredited Google and
Slide 70: Environmental, Social and Governance
ENVIRONMENTAL, SOCIAL AND GOVERNANCE STOR-AGE PROPERTY REIT LIMITED 70
Slide 71: Social
SOCIAL Annexure I Social and economic development initiatives • Commitment: Stor-Age remains dedicated to social and economic development initiatives, utilising operational and marketing resources along with the core self-storage product • Objectives: Initiate and contribute to projects benefiting p
Slide 72: Social (continued)
SOCIAL (continued) Annexure I Stor-Age Business Hub and economic development • Commitment: Stor-Age remains committed to social and economic development initiatives, actively supporting the sustainability of commercial customers' businesses Support for SMMEs • Majority of our commercial customers ar
Slide 73: Disclaimer and Confidentiality
DISCLAIMER AND CONFIDENTIALITY This document does not constitute or form part of any formal proposal or offer or solicitation to sell, or offer for sale or investment, or for the issue or sale of securities. This document does not (and nor does any part of it) constitute any contract, commitment or
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