South Africa, UK Self-Storage Operator Stor-Age Posts Financial Results for Six Months Ended Sept. 30

Stor-Age Property REIT, which operates self-storage facilities in South Africa and the United Kingdom, has released its interim earnings report for the six months that ended Sept. 30. The company reported gains in occupancy and rental rates. Property revenue nearly doubled, while operating profit increased 86 percent to R166 million year over year.

The company continued to perform well despite a “a tough macro landscape,” driven by organic growth, expansion and strong operating numbers in its South Africa and U.K. portfolios, CEO Gavin Lucas said in a press release.

Rental income for same-store facilities, which excludes the U.K. Storage King brand and recent acquisitions in South Africa, increased 9.4 percent, driven by a .7 percent increase in average occupancy and an 8.7 percent increase in average rental rate.

Rental income and net operating income (NOI) for the company’s South Africa portfolio were up 17.4 percent and 14.2 percent, respectively.

Stor-Age recently acquired 13 properties, including a 12-property portfolio subsequent to the period that had been under its management. It also opened one new location during the period and began work on a new development.

The U.K. portfolio increased occupancy by 4,000 square meters year over year, with same-store occupancy growing 1,300 square meters. Overall, Storage King contributed R64 million to the company’s NOI.

“The U.K. self storage industry experiences a more marked degree of seasonality, with occupancy peaking in the spring and summer months,” Lucas said. “Accordingly, we anticipate some occupancy loss to come through over the U.K. winter months but remain on track to meet our full-year expectations.”

Though short-term forecasts for the South Africa economy haven’t been positive, Lucas believes Stor-Age is positioned to perform well. “We do not expect the [South African] economy to show significant signs of improvement in the short-term,” he said. “However, we believe Stor-Age will continue to demonstrate its resilience through the downcycle.”

Headquartered in Cape Town, Stor-Age was established in 2005 by Stor-Age Property Holdings Pty. Ltd. to acquire, develop and manage self-storage assets. Today, Stor-Age operates a 63-property portfolio, primarily in four South African metropolitan areas, that comprise approximately 414,000 square meters. It also has 10 projects under development. The company was listed on the Johannesburg Stock Exchange in November 2015. It acquired the U.K. Storage King portfolio in 2017.

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