Shurgard Self Storage Limited · EURONEXT:SHUR
Shurgard Self Storage — Investor Presentation (November 2023)
48 slides from Shurgard Self Storage's investor presentation, November 2023
Slide 1: Europe's Leading Brand of Self-Storage Solutions
November 2023 EUROPE’S LEADING BRAND OF SELF-STORAGE SOLUTIONS
Slide 2: Agenda
AGENDA 1. YTD Sep 2023 Performance and Strategy Review 2. Key Strategic & Operational Highlights 3. Financial Review 4. Outlook and Medium-Term Guidance 5. Appendices
Slide 3: YTD Sep 2023 Performance and Strategy Review
1| YTD SEP 2023 PERFORMANCE AND STRATEGY REVIEW
Slide 4: Shurgard - Unique Platform and Runway
SHURGARD - UNIQUE PLATFORM AND RUNWAY • Strong expansion pipeline • Robust balance sheet, • Another solid representing 14.5% of our disciplined capital performance net rentable sqm allocation & returns • Proven benefits from • 5 stores acquired in • Shurgard has been a UK geographic spread Germany (
Slide 5: YTD Sep 2023 Strong Execution and Growth
YTD SEP 2023 STRONG EXECUTION AND GROWTH €483.0m planned investment in 1.4m rentable sqm Sector sustainability leader5 projects2 +194,258 sqm Property Operating +9.4% € 4.2 bn €265.0m 41 projects c. 14.5% of 5 star GRESB score with a leading Revenue yoy growth1 net rentable sqm Enterprise Value3 sco
Slide 6: Proven Model, Best in Class Self-Storage Platform
PROVEN MODEL, BEST IN CLASS SELF-STORAGE PLATFORM Supportive Customer Resilient Model Strong Branding Prop-Tech Platform Dynamics4 90.5% +0.0pp #1 brand recognition2 Driving digital data • 63 month average stay • 90% of prospects connecting via digital • Increasing revenue through price Same store i
Slide 7: Long Term Growth Prospects Unchanged
LONG TERM GROWTH PROSPECTS UNCHANGED Shurgard’s footprint spans the largest European markets – leading position in capital cities Industry fuelled by positive 2022 self storage area (sq ft. per capita) Self storage sq ft. per capita in structural drivers our 7 markets versus the US 1 Self Storage Ca
Slide 8: Successfully Implementing Our ESG Strategy
SUCCESSFULLY IMPLEMENTING OUR ESG STRATEGY ESG Priorities Strong Ratings Our Commitments Invest to reduce our carbon footprint Green certified buildings, LED, heat pumps, solar panels, Net Zero by 2030 water flow reduction (operational NZC) Strong ESG governance 10.8 Low Risk ISO-aligned EMS, ESG Co
Slide 9: Key Strategic & Operational Highlights
2| KEY STRATEGIC & OPERATIONAL HIGHLIGHTS
Slide 10: Unique Prime Portfolio
UNIQUE PRIME PORTFOLIO 187 Focus on capital cities and major cities • Markets chosen for their demographics and urban density 274 • 93% of properties are in capital and major cities stores across 7 countries1 • Growth focused on residential housing and commercial mobility • Accelerated strategy base
Slide 11: Highest Occupancy Rates in Europe
HIGHEST OCCUPANCY RATES IN EUROPE Strong average same store 1 occupancy growth… Strong Occupancy growth 90.4% 90.5% 90.5% • Average same store occupancy rate rose 2.5pp since 2019 88.9% • 10 year all store average occupancy rate c.88%, highly resilient through crises 88.0% • Trends towards longer te
Slide 12: Strong Rental Growth Across All Markets
STRONG RENTAL GROWTH ACROSS ALL MARKETS Same store average in-place rent by country (€ at CER per sqm/year) Rental Growth YTD Sep 2023 YTD Sep 2022 370 +9.5% • Portfolio average +6.8% YoY growth in Same Store Average In-Place Rent 350 330 • Germany saw the largest increase this year at +11.8% 310 +5
Slide 13: Optimized Digital Platform
OPTIMIZED DIGITAL PLATFORM Enhancing the customer proposition… …while driving margin expansion Web Leads & Mobile Share Customer Centric Digitalization Better operating efficiency 160,000 80% 140,000 70% 120,000 60% 100,000 50% • Improved customer service: Google • Increased data for revenue 80,000
Slide 14: 3 Levers to Accelerate Our Portfolio Expansion
3 LEVERS TO ACCELERATE OUR PORTFOLIO EXPANSION LEVER 1 LEVER 2 LEVER 3 Re-developments New Developments Market Consolidation (expand existing buildings) (purpose built and conversion) (bolt-on acquisitions) Increase our footprint by 90,000 sqm p.a.: • Invest €170 million p.a. • Doubling our footprin
Slide 15: Total Footage Growth Trend: Largest sqm Expansion p.a. in the Industry
TOTAL FOOTAGE GROWTH TREND: LARGEST SQM EXPANSION P.A. IN THE INDUSTRY 120 6.0% 100 5.0% 90.0 80 75.6 4.0% Sqm total 65.4 Sqm acquisition 60 55.3 3.0% Sqm (re)development 47.1 As % of FBO 40 2.0% 20 1.0% 0 0.0% A 2020 A 2021 A 2022 F 2023 F 2024 A = Actuals F = Forecast FUELING OUR GROWTH WITH 90,00
Slide 16: Redevelopments: Leveraging Our Freeholds
REDEVELOPMENTS: LEVERAGING OUR FREEHOLDS LEVER 1 LEVER 2 LEVER 3 2022 2023 2024 1 5 3 building buildings buildings Total cost: Total cost: Total cost: €0.9 million €9.6 million €21.4 million Total additional Total additional Total additional sqm: 967 sqm: 11,564 sqm: 13,421 BEFORE REDEVELOPMENT • 94
Slide 17: New Developments: Key Growth Lever
NEW DEVELOPMENTS: KEY GROWTH LEVER LEVER 1 LEVER 2 LEVER 3 Potential additional properties based on London penetration in Shurgard countries FR - Paris 143 DE - NRW1 Koln-Dusseldorf-… 133 Typical process UK – FR – DE – NL: NL - Randstad 2 49 From agreement with seller on price DE - Berlin 33 + 6 mon
Slide 18: Market Consolidation: Our Targeted Approach
MARKET CONSOLIDATION: OUR TARGETED APPROACH LEVER 1 LEVER 2 LEVER 3 Note: All data presented are 2015 – Present Unique & Disciplined 2022 2023 …targeting a fragmented market with multiple opportunities M&A Strategy… achievements achievements FOCUS AREA 64 “ BOLT ON” Large & ACQUIRED STORES 7 STORES
Slide 19: Significant Secured Short-Term Pipeline (2023–2026)
SIGNIFICANT SECURED SHORT-TERM PIPELINE (2023–2026) Figures listed in net sqm (000,s) Total +194.3 A flexible and low risk growth plan DE 10.1 64.8 17.1 +90.8 • Pipeline (acquired, developed, under construction or signed) represents: UK 7.5 49.2 +56.7 - a total investment of €483.0m - 14% expansion
Slide 20: Sustainability at the Core of Our Buildings Lifecycle
SUSTAINABILITY AT THE CORE OF OUR BUILDINGS LIFECYCLE Other Investments ISO 14001 aligned EMS, Building Management Systems (BMS): sensors, computers, … Customer safety Lobbies protection Access control Improved CCTV Access via App Reduce electricity and gas consumption LED lighting Heating optimizat
Slide 21: Commitment to Our Stakeholders
COMMITMENT TO OUR STAKEHOLDERS Social Governance Board Diversity Focused on Employee 6+ Global charity ESG is in our DNA Welfare partners • ESG commitment is driven from 55% • 4.7/5.0 Glassdoor review 9 Board 33% the Board and the CEO members score throughout the organization 67% • Growing a diverse
Slide 22: Financial Review
3| FINANCIAL REVIEW
Slide 23: Income Statement
INCOME STATEMENT Q3 YTD Sep23 2023 2022 % var. % var.CER 2023 2022 % var. % var.CER REAL ESTATE OPERATING REVENUE 90.7 85.1 6.7% 8.3% 265.1 246.6 7.5% 9.4% Real estate operating expenses (27.9) (26.5) 5.3% 6.6% (91.8) (86.2) 6.5% 8.2% NET INCOME FOR REAL ESTATE OPERATIONS 62.8 58.6 7.3% 9.0% 173.3 1
Slide 24: Same Store Property Operating Revenue
SAME STORE PROPERTY OPERATING REVENUE In € millions Q3 YTD Sep 23 (at actual exchange rate) 2023 2022 % var. % var.CER 2023 2022 % var. % var.CER France 19.8 19.0 4.1% 4.1% 58.4 55.9 4.5% 4.5% The Netherlands 18.2 16.8 7.7% 7.7% 53.0 48.6 8.9% 8.9% UK 16.5 15.7 5.4% 5.8% 47.7 45.6 4.6% 7.5% Sweden 1
Slide 25: YTD Sep 2023 NOI Evolution
YTD SEP 2023 NOI EVOLUTION YTD Sep 2022 ⎯ YTD Sep 2023 NOI1 bridge (€m) NOI margin improvement: +0.3pp NOI growth (at CER): +10.1% NOI growth: +8.0% Linked to SEK and GBP 3.4 (4.3) 265.0 5.1 14.4 246.4 Ramp-up phase of our non same store portfolio Addition of 8 properties versus Opex under c
Slide 26: Cash Flow
CASH FLOW In € millions YTD Sep 2023 YTD Sep 2022 % var At actual exchange rate Cash: beginning balance 87.3 219.2 -60.1% TOTAL CASH FROM OPERATIONS 145.7 125.6 16.0% €82.8m Acquisitions -0.2 -18.0 -98.9% Net Cash end of September 2023 Developments, redevelopments and other -63.3 -64.7 -2.2% Other c
Slide 27: Balance Sheet
BALANCE SHEET In € millions Sep 2023 Dec 2022 % var. €800m 4.7 years At actual exchange rate Investment property 4,737.9 4,523.8 2.36% Other assets (1) 37.3 30.0 100% USPP indebtness Weighted average Weighted average Trade and other receivables 27.3 18.7 No encumbered assets interest rate maturity F
Slide 28: Outlook & Medium-Term Guidance
4| OUTLOOK & MEDIUM-TERM GUIDANCE
Slide 29: 2023 Outlook: Confirmed
2023 OUTLOOK: CONFIRMED • Total store revenue growth above 8% versus 2022; • NOI margin growth 0.2pp for all stores; • For all investment decisions taken as from 2023, increasing property yield to c. 8-9% at maturity; • Average effective tax rate expected to be 18% (based on Adj. EPRA earnings befor
Slide 30: Medium Term Guidance
MEDIUM TERM GUIDANCE • c. 6% growth p.a. for all store revenue; • 0.2pp NOI margin growth per year for all stores; • As of 2024, we plan to add c. 90,000 sqm per year; • Property yield c. 8-9% at maturity; • LTV at c. 25% and 4.0x to 5.0x Net debt/ EBITDA, with a short- to mid-term maximum of 35% or
Slide 31: Conclusion
CONCLUSION Strong business model & Large pipeline for unique platform future growth Diversified asset base and prime locations Investing €170m per year, +90,000 sqm from 2024 Resilience of our business model 3 Levers of growth times 7 countries Investments in value creating opportunities Extensive d
Slide 32: Appendices
5| APPENDICES
Slide 33: Key Patterns: Same Across Countries
KEY PATTERNS: SAME ACROSS COUNTRIES What is self storage Why do they need self storage? Where are they? for our customers? “My attic or basement in a remote location” • Life events (birth, death, divorce, mobility) Close property catchment areas • Short distance catchment combined with • 10min drive
Slide 34: Store Portfolio Segmentation
STORE PORTFOLIO SEGMENTATION STORE PORTFOLIO SEGMENTATION # OF STORES Stores developed by Shurgard in operation for more 2018 2019 2020 2021 2022 2023 than three full years as of January, 1st Same-stores Stores acquired by Shurgard in operation for more 214 than one full year as of January, 1st
Slide 35: All Store Revenue Growth: 2018 to 2023 Actuals
ALL STORE REVENUE GROWTH: 2018 TO 2023 ACTUALS All Store All Store : quarterly yoy growth 15% 14% 13% 12% 11% 10% 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% 2018 2019 2020 2021 2022 -1% 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 All Store 3.9% 5.4% 5.5% 9.5% 11
Slide 36: Same Store Revenue Growth: 2018 to 2023 Actuals
SAME STORE REVENUE GROWTH: 2018 TO 2023 ACTUALS Same Store Same Store : quarterly yoy growth 9% 15% 8% 13% 7% 11% 6% 9% 5% 7% 4% 5% 3% 3% 2% 1% 1% 0% -1% 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2018 2019 2020 2021 2022 Same Store 1.2% 1.4% 2.8%
Slide 37: Customer Dynamics
CUSTOMER DYNAMICS Average length of stay of our exis�ng customers (in months) Average length of stay of our exis�ng customers (in months) 42 68% 42 66% 41 66% 41 65% 40 40 64% 39 39 64% 62% 38 38 63% 60% 37 37 62% 36 58% 36 35 61% 56% 35 34 60% 54% 33 34 32 33 59% 52% 32 50% Ja n-19 Feb-19 Jul -19 S
Slide 38: Monthly Move Out Ratio by Month Since 2014
MONTHLY MOVE OUT RATIO BY MONTH SINCE 2014 c. 85% Move out ratio1 7.5% 7.1% 7.0% 6.9% 6.9% 6.7% 6.5% 6.3% 6.1% 6.0% c. 66% 5.7% 5.6% 5.6% 5.5% 5.5% 5.0% 2014 (178 SS) 2015 (187 SS) 2016 (192 SS) 2017 (213 SS) 2018 (214 SS) 2019 (217 SS) 2020 (225 SS) 2021 (228 SS) 2022 (234 SS) Q3 2023 (240 SS) 1. S
Slide 39: Same Store Average Occupancy by Country
SAME STORE AVERAGE OCCUPANCY BY COUNTRY Q3 YTD Sep 2023 2022 Diff. 2023 2022 Diff. France 89.8% 89.7% 0.1pp 89.5% 89.4% 0.1pp The Netherlands 92.0% 91.6% 0.4pp 91.6% 90.6% 1.0pp UK 88.5% 89.7% -1.2pp 87.9% 88.5% -0.6pp Sweden 91.1% 92.4% -1.3pp 91.2% 92.0% -0.8pp Germany 91.1% 91.2% -0.1pp 91.1% 91.
Slide 40: Same Store Property Average In-Place Rent by Country
SAME STORE PROPERTY AVERAGE IN-PLACE RENT BY COUNTRY In € per sqm/year Q3 YTD sep 2023 2022 % var. % var. CER 2023 2022 % var. % var. CER France 272.4 262.6 3.8% 3.8% 269.4 256.7 5.0% 5.0% The Netherlands 234.5 217.6 7.7% 7.7% 229.2 211.3 8.5% 8.5% UK 371.8 345.0 7.8% 8.2% 360.3 338.2 6.6% 9.5% Swed
Slide 41: Platform Scalability: Same Store NOI Margin
PLATFORM SCALABILITY: SAME STORE NOI MARGIN At constant exchange rates Excluding leasehold expense Changing SS pool 68% 66.9% 66% 65.9% 64% 64.4% 63.7% 62% 62.0% 60% 60.8% 60.1% 58% 58.1% 57.7% 56% 2014 (178 SS) 2015 (187 SS) 2016 (192 SS) 2017 (213 SS) 2018 (214 SS) 2019 (217 SS) 2020 (225 SS) 2021
Slide 42: Platform Scalability: Same Store Revenue and Opex per sqm
PLATFORM SCALABILITY: SAME STORE REVENUE AND OPEX PER SQM At constant exchange rates Excluding leasehold expense Changing SS pool in €/sqm 288.3 290 CAGR: +2.6% 266.1 260 249.0 252.9 244.5 248.4 244.2 234.8 236.1 230 200 170 140 110 89.9 90.6 90.2 93.9 89.3 88.3 86.7 89.6 89.2 CAGR: +0.5% 80 2014 (1
Slide 43: Expansion Pipeline 2023-2026 (14.5% of Rentable sqm)
EXPANSION PIPELINE 2023-2026 (14.5% OF RENTABLE SQM) In € millions Number of Direct project cost At closing rate June 2023 Property Region Country Completion date Net sqm (000's) properties /Acquisition cost (1) Scheduled to open in 2023 17 72.7 165.4 Major redevelopments Unterfoehring Munich German
Slide 44: Occupancy Ramp Up: 2015 to Current Developments
OCCUPANCY RAMP UP : 2015 TO CURRENT DEVELOPMENTS Occupancy 100% 2018 openings 90% 2016 openings 2015 openings 2020 openings 80% 2019 openings 2021 openings 2017 openings 70% 60% 50% 2022 openings 40% 30% 20% 10% 0% M1 M2 M3 M4 M5 M6 M7 M8 M9 M10 M11 M12 M13 M14 M15 M16 M17 M18 M19 M20 M21 M22 M23 M2
Slide 45: Example of Our Proven Strategy in London
EXAMPLE OF OUR PROVEN STRATEGY IN LONDON: (M25) 2014-2022 Number of stores 2014: 17 2014 pool 1 2022: 38 2014 pool 4 9 12 x 2.2 (+11% CAGR) Sqm rentable 2014: 76.4 2014 pool (in sqm '000) 2022: 189.1 2014 pool 7 68 37 x 2.5 (+12% CAGR) Rented sqm 2014: 69.5 2014 pool (in sqm '000) 2022: 162.8 2014 p
Slide 46: NTA, LTV, Net Debt/EBITDA, ICR Evolution Since IPO
NTA, LTV, NET DEBT/ EBITDA, ICR EVOLUTION SINCE IPO (OCT 2018) At actual exchange rate LOAN -TO-VALUE (LTV) EPRA NET TANGIBLE ASSETS (NTA) In € millions 3,770.9 18.1% 17.4% 18.0% 17.5% 3,638.9 16.9% 3,112.6 13.9% 2,517.9 2,146.7 2,260.4 2018 2019 2020 2021 2022 Q3 2023 2018 2019 2020 2021 2022 Q3 20
Slide 47: Shurgard is a UK REIT
SHURGARD IS A UK REIT • Shurgard Self Storage Limited is a UK REIT since March 1, 2023; • The Group’s shares are still listed and traded on Euronext Brussels, with strong governance and financial reporting obligations; • Exemption from UK corporation tax on rental profits and capital gains arising f
Slide 48: Legal Disclaimer
LEGAL DISCLAIMER All statements in this presentation, other than statements of historical facts, are forward-looking statements. These statements are based on the current expectations and views of future events and developments of the management of Shurgard and are naturally subject to uncertainty a
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