Tag Archives: self-storage

Stor-Age Property REIT Limited – 1H 26 Results – Still Steady with Growth Ahead

Share Code: SSS – Market Cap: R8.7bn – P/B: 1.0x – DY: 6.3%

Stor-Age – 1H 26 – Results NoteDownload

1H 26 Results: Well Run, Well Positioned & Globally Competitive

  • Stor-Age REIT owns a well-managed, growing self-storage property portfolio that was built out of a strong SA base (that remains robust & growing) & is increasingly allocating capital towards the UK (offering Rand Hedge benefits) while cleverly leveraging the capital-light JV structures to build what could become a substantial portfolio.
  • The Group’s 1H 26 rental income growth has been strong (+6% annualised) & has historically outpaced inflation; occupancies remain high in owned properties. 1H 26 EBITDA and NPOP grew by 5% and 6% respectively, with distributable earnings increasing by 8% with stable profit margins.
  • From FY 25, the Group adjusted its distribution payout ratio from 100% to 90% of distributable income—retaining some capital for growth.
  • 1H 26’s Net Asset Value (NAV) per share increased by 2% (annualised).
  • The Group remains comfortably geared, though comparable international peers do have somewhat lower average gearing.
  • Stor-Age’s Total Return (in Rands) has outperformed all listed global self-storage companies over 3, 5, & 10 years.

Stor-Age – Total Return of Listed Self-Storage REITs

Source: Koyfin (18/11/2025)

Valuation and 12m TP: Relative Model & Dividend Discount Model

  • Stor-Age’s share price has fallen behind its NAV growth, leading to a Price/Book (“PB”) ratio range of 0.8~0.9x (to 1H 26). The Group’s quality, its potential for Rand Hedge benefits from its UK portfolio, optionality from organic and acquisitive growth, and the fact that the properties are fairly valued (on quite reasonable assumptions), informs our view that the share should (at least) track its historic 1.0x PB over time, if not at a premium to book. The share currently has a PB fractionally higher than 1.0x, having strongly re-rated over the last six months.

Stor-Age – Price/Book (x) History

Source: Koyfin (18/11/2025)

  • We have updated our Relative Valuation Model and Dividend Discount Models to arrive at an equal-weighted average valuation of R18.50 per share (FY 25: R16.71).
  • Rolling this fair value forward at our Cost of Equity, we arrive at a 12m Target Price—factoring in dividends—of R19.70 (Previously: R17.80); we expect this to generate a 12m (total) return of c.16%.
  • The Group’s next five-year plan (FY 26 to FY 30) sees a 50% growth in number of properties (SA and UK combined) & could drive a re-rating in the Group’s listed size (it is currently a small cap) that could support increasing institutional appetite as self-storage remains an attractive growth market in both SA and the UK and a sought-after property class. See the Group’s recent oversubscribed bookbuild as evidence of this.
Stor-Age – 1H 26 – Results NoteDownload

Stor-Age Property REIT Limited – Initiation of Coverage – Good Stor(e) of Capital

Share Code: JSE: SSS – Market Cap: R7.2b – PE: 17.0x – DY: 7.9%

Stor-Age Property REIT – Initiation of CoverageDownload

Business Overview:

  • Stor-Age is an integrated & internally managed REIT that owns & operates self-storage properties in South Africa and the United Kingdom with a portfolio comprising of 103 properties (60 in SA operate under Stor-Age brand & 43 in the UK operate under the Storage King brand).
  • Stor-Age is the largest, market-dominant self-storage brand in SA whilst ranking 6th in the UK (the UK is an under-penetrated Developed Market based on self-storage space per capita versus other DMs).

Key Upsides & Downsides:

  • The current interest rate-cutting cycle may lower finance costs, boost valuations & increase the attractiveness of the property sector.
  • Furthermore, Stor-Age has a highly defensive product (self-storage), and the share price has been resilient through economic downturns with an excellent track record of operating and dividend growth.
  • Self-storage has high barriers to entry that includes long lease-up periods for newly developed properties and limited available properties in high-density, visible urban nodes.
  • The Group has a fast-growing, high-margin income stream of management fees from third-party property management and digital marketing platform that offer its shareholders exciting optionality.
  • Management has a pipeline of 13 properties that are expected to add 60,000m2 of GLA to its portfolio in the near term.
  • Management has decided to decrease its distributable income payout ratio from 100% to a more sustainable 90~95%, thus resulting in some downward pressure on short-term distributions per share despite expected growth in forecast distributable income.

Forecast, Valuation and Implied Return:

  • We see Stor-age as having a fair value of c.R15.50 per share based on a blended average of a discounted cash flow valuation (R15.92) and relative valuation model (R15.08); the latter is based on the valuation multiples of comparable listed self-storage peer companies.
  • Rolling forward our fair value by 12 months at our Cost of Equity (less our expected dividend) gives us a 12m TP of R15.97 per share, implying a total return of c.14% based on the current share price (R15.02).
  • We see a c.14% total return in the stock as comprising a forecast price return of c.6% and forecast dividend yield of c.8%.
Stor-Age Property REIT – Initiation of CoverageDownload