Shurgard Self Storage Limited · EURONEXT:SHUR
Shurgard Self Storage — Investor Day (September 2024)
34 slides from Shurgard Self Storage's investor day presentation, Sep 17, 2024
Slide 1: Shurgard Investment Strategy in Germany
Berlin Neukölln September September17,17,2024 2024 SHURGARD INVESTMENT STRATEGY IN GERMANY
Slide 2: Agenda
AGENDA 1. History 2. Acceleration of growth 3. Operational efficiency 4. Conclusion 5. Q&A 2
Slide 3: 1 | History
1| HISTORY 3
Slide 4: Key Criteria for Self Storage Industry
KEY CRITERIA FOR SELF STORAGE INDUSTRY What is self storage for our customers? Why do they need self storage? Where are they? “My attic or basement in a remote location” • Life events (birth, death, divorce, mobility) Close property catchment • Short distance catchment combined with areas • Low freq
Slide 5: Germany
GERMANY GDP of EU states in 2023 (in trillion €) Total population in EU states in 2022 (in m) Unemployment rate in the EU 2024 (in %) 4.5 4.1 90.0 83.3 7.0 4.0 80.0 5.7 65.8 6.0 5.3 5.3 5.5 5.5 3.5 70.0 58.9 2.8 5.0 4.4 4.5 4.5 3.0 60.0 4.1 4.3 47.4 4.0 3.4 3.6 2.5 2.1 50.0 38.0 3.0 3.1 3.1 2.0 40.0
Slide 6: Importance of the "Big 7" Cities
IMPORTANCE OF THE “BIG 7” CITIES Area Population Density Purchase Power (millions of inhabitants) (number of inhabitants per (euros per year per inhabitant on square kilometer) average) Cologne & Dusseldorf 11.1m 900 26,700€ (incl. other cities in NRW) Berlin 4.7m 1,550 25,700€ Frankfurt 3.9m 830 29
Slide 7: Shurgard History in Germany
SHURGARD HISTORY IN GERMANY September 2003 December 2014 January 2015 May 2020 2020- 2022 December 2022 1st store opened 11 stores Secur M&A Zeitlager M&A Organic growth 25 stores 5 stores opened 11 stores added via 5 stores acquired, 4 stores acquired for organically in Berlin, €434m assets value d
Slide 8: Competition Landscape in 2022: A Fragmented Industry
COMPETITION LANDSCAPE IN 2022: A FRAGMENTED INDUSTRY Region Shurgard Lagerbox MyPlace Other competitors Berlin 6 5 18 28 Munich 3 0 8 6 Hamburg 3 0 5 19 Cologne & Dusseldorf 6 6 1 11 Frankfurt 0 0 5 5 Stuttgart 0 1 2 0 Cities outside the big 7 7 21 3 361 Total Germany 25 33 42 430 (operating stores)
Slide 9: Shurgard Germany – All Store Revenues
SHURGARD GERMANY – ALL STORE REVENUES In € millions 35 35.0 30 30.0 CAGR: +10% 25 26.2 22.8 20 18.9 17.8 15 16.7 15.6 14.9 10 2015 2016 2017 2018 2019 2020 2021 2022 2023 Property Operating Revenue (all stores) ACCELERATION OF GROWTH AS THE PORTFOLIO MATURE AND NEW SQM RAMPED UP 9
Slide 10: Shurgard Germany – Same Store Occupancy
SHURGARD GERMANY – SAME STORE OCCUPANCY 91% Average: c. 90% 91.1% 90.9% 90% 90.3% 90.1% 89.4% 89% 89.0% 88.9% 88% 88.2% 87% 86.9% 86% 2015 2016 2017 2018 2019 2020 2021 2022 2023 Occupancy (same stores) Note: occupancy 2016 impacted by a redevelopment in one of our stores in Hamburg STABLE OCCUPANCY
Slide 11: Shurgard Germany – Same Store In-Place Rent
SHURGARD GERMANY – SAME STORE IN-PLACE RENT In € per sqm per year 290 282.7 270 250 254.7 CAGR: +5% 230 232.1 223.2 210 218.0 209.6 190 199.9 192.4 182.0 170 2015 2016 2017 2018 2019 2020 2021 2022 2023 In-place rent (same stores) STRONG PRICING POWER AS THE GERMAN SELF STORAGE MARKET IS MATURING 11
Slide 12: Shurgard Germany – Same Store NOI Margin
SHURGARD GERMANY – SAME STORE NOI MARGIN 72% 71.3% 68.7% 67% +2pp / year 65.1% 65.5% 63.9% 62% 62.3% 60.8% 57% 56.7% 54.8% 52% 2015 2016 2017 2018 2019 2020 2021 2022 2023 % NOI margin (same stores) Excluding leasehold expense Changing SS pool Note: 2021 excluding €0.5m exceptional repair and mainte
Slide 13: 2 | Acceleration of Growth
2| ACCELERATION OF GROWTH
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 C. €200M P.A. DELIVERING A 8% TO 9% YIELD AT
Slide 15: Real Estate Organigram
REAL ESTATE ORGANIGRAM Chief Investment Officer Isabel Neumann Director of Real Estate Director of Design & Director of Sustainability Director of Development Director of M&A UK Southeast & Manchester Construction & Facility 13 FTE 3 FTE 13 FTE 1 FTE 10 FTE Maintain Develop and acquire SQM existing
Slide 16: Lever 1 – Redevelopments
LEVER 1 – REDEVELOPMENTS Unterfohring Munich From 2018 to 2026 • 6 projects Unterfohring Munich • c. 14,500 sqm • Total investment: c. €16.1 million • Yield at maturity above 10% GETTING THE BENEFIT OF OUR FREEHOLDS 16
Slide 17: Lever 2 – New Developments
LEVER 2 - NEW DEVELOPMENTS Düsseldorf Rath From 2018 to 2022 From 2023 to 2026 • 6 projects • 13 projects • c. 34,300 sqm • c. 83,700sqm Berlin Oberschöneweide • Total investment: c. €72.4m • Total investment: c. €222.2m • Yield at maturity c. 8% • Yield at maturity c. 8% DEVELOP PURPOSE BUILT BUILD
Slide 18: Lever 3 – "Secur" Acquisition
LEVER 3 - “SECUR” ACQUISITION Yield (NOI %) 12.0% 10.6% • Acquisition in 2015 10.0% 9.2% 8.0% 8.0% 6.9% 7.4% • 5 stores 5.9% 6.3% 6.0% 4.6% 4.0% • 30,000 sqm 2.0% • Total investment: c. €68.7m 0.0% 2016 2017 2018 2019 2020 2021 2022 2023 CREATE VALUE THROUGH M&A DISCIPLINE AND OPERATIONAL EFFICIENCI
Slide 19: Lever 3 – M&A: 19 Stores, c. 90,000 sqm Added for c. €342M
LEVER 3 - M&A: 19 STORES, C. 90,000 SQM ADDED FOR C. €342M 3 stores 2 stores Top Box Oct-2023 3 stores Pickens Mar-2024 4 stores 1 store Mietlager Jul-2024 3 stores 3 stores Prime Sep-2024 FOCUSED M&A STRATEGY TO CREATE EFFICIENT SCALE IN EACH TARGET AREA 19
Slide 20: Lever 3 – M&A: Topbox, a NRW Portfolio in Rent-Up
LEVER 3 - M&A: TOPBOX, A NRW PORTFOLIO IN RENT-UP Acquisition October 2023 Essen • 5 operating stores • 2 developments to be open in 2025 • c. 32,800 sqm Wiesbaden • Total investment: c. €97.6m • Yield at maturity c. 8% HIGH-QUALITY FREEHOLD PORTFOLIO, COMBINING 5 OPERATING PROPERTIES AND 2 DEVELOPM
Slide 21: Lever 3 – M&A: Pickens, a Mature Portfolio in Berlin & Hamburg
LEVER 3 - M&A: PICKENS, A MATURE PORTFOLIO IN BERLIN & HAMBURG Berlin Lichtenberg Acquisition February 2024 • 6 operating stores • c. 31,300 sqm Tempelhof • Total investment: c. €131.8m • Yield at maturity c. 7% HIGH-QUALITY FREEHOLD PORTFOLIO OF 3 PROPERTIES IN BERLIN AND 3 IN HAMBURG 21
Slide 22: Lever 3 – M&A: Prime, a Mature Portfolio in Hamburg & Frankfurt
LEVER 3 - M&A: PRIME, A MATURE PORTFOLIO IN HAMBURG & FRANKFURT Hamburg Acquisition September 2024 • 5 operating stores • c. 25,000 sqm Mainz • Total investment: c. €108.6m • Yield at maturity c. 7% HIGH-QUALITY FREEHOLD PORTFOLIO OF 2 PROPERTIES IN HAMBURG AND 3 IN FRANKFURT REGION 22
Slide 23: Doubling Our Size Strategically in Germany
DOUBLING OUR SIZE STRATEGICALLY IN GERMANY 2022 Organic Topbox Pickens Prime Mietlager Total Region Existing development M&A M&A M&A M&A 2026 Berlin 6 3 0 3 0 0 12 Munich 3 0 0 0 0 0 3 Hamburg 3 0 0 2 2 0 7 Cologne & Dusseldorf 6 2 2 0 0 0 10 Frankfurt 0 2 3 0 3 0 8 Stuttgart 0 3 0 0 0 0 3 Cities ou
Slide 24: German Growth Strategy: Double Our Size
GERMAN GROWTH STRATEGY: DOUBLE OUR SIZE From 25 stores (or c. 130,000 sqm) end-2022 to 3 stores to 7 stores 54 stores (or c. 295,000 sqm) by end 2026 Growth Acceleration in Germany 6 stores to 12 stores 3 stores • c. 80% in “Big Seven” cities, with strong demographics and urban to 4 stores Cities ou
Slide 25: Evolution Versus Competition
EVOLUTION VERSUS COMPETITION Region Shurgard Lagerbox * MyPlace * Berlin 12 5 26 Munich 3 0 11 Hamburg 7 0 10 Cologne & Dusseldorf 10 6 1 Frankfurt 8 2 7 Stuttgart 3 1 3 Cities outside the big 7 11 23 9 Total Germany 54 37 67 Note: Big 7 cities include Berlin, Munich, Hamburg, Frankfurt, Stuttgart,
Slide 26: 3 | Operational Efficiency
3| OPERATIONAL EFFICIENCY
Slide 27: Operational Efficiency: Evolution of Our Network Management
OPERATIONAL EFFICIENCY: EVOLUTION OF OUR NETWORK MANAGEMENT Stand 1 SM alone On site managed (OSM) Service 2.5 1 SM store FTE 1 SM + 1-2 ASM RM Cluster Store 2 District 1 SM District District RM Store 1 20 FTE c. 14 FTE (-30%) OUR DEVELOPMENT POLICY (ORGANIC AND M&A) REINFORCES OUR OPERATIONAL EFFIC
Slide 28: Dusseldorf Region Demonstrates the Efficiency of Our Strategy
DUSSELDORF REGION DEMONSTRATES THE EFFICIENCY OF OUR COMMERCIAL AND REAL ESTATE STRATEGY Remotely managed store Service store Cluster Cluster Stand alone store TOPBOX Acquisition Duisburg Opening 2022 Essen Westviertel Cluster Cluster Stand alone Düsseldorf Rath Cluster E-RENTAL PENETRATION (50%), T
Slide 29: Winning Strategy
WINNING STRATEGY In € millions More than triple the NOI from €19m in 2022 to €67m in 2030 CAGR: +15% 24 67 16 9 19 €564M INVESTED GENERATED €40M OF ADDITIONAL NOI WITH A NOI YIELD OF C. 8% 29
Slide 30: Conclusion
4 | CONCLUSION —
Slide 31: Conclusion
CONCLUSION • Germany is a clear example of our strategy • Significant value creation • Strong balance sheet, with a modest level of gearing and significant liquidity • First European self-storage operator awarded a BBB+ (stable outlook) • Optional scrip dividend offered to shareholders SHURGARD HAS
Slide 32: 5 | Q&A
5| Q&A
Slide 33: 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
Slide 34: Thank you for your attention
Thank you for your attention
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