Brisbane-based National Storage is poised to become Australia’s largest dedicated owner and operator of storage businesses through the acquisition of a further four storage centres – two in Adelaide and two in Melbourne.
The four centres, independently valued at approximately $25 million, will form part of a further capital raising by
the APN National Storage Property Trust, via an entitlement issue to existing investors and an offer to new investors.
This acquisition will grow the number of National Storage centres to 29 across Australia and will be funded through the combination of an offer to retail investors and borrowings.
The current portfolio has properties located in Victoria (seven properties), Queensland (ten properties) and Adelaide (three properties) valued at approximately $125 million.
The addition of the further four properties will consolidate and strengthen National’s position as the market leader in the Queensland, Melbourne and Adelaide storage markets.
The highly successful APN National Storage Property Trust was launched in November 2003 with an initial portfolio of 20 storage properties leased to National Storage.
The original Trust closed oversubscribed and the Trust has been performing in line with its original forecasts of a 9.20% return to unit holders for the 12 months ending 30 June 2005.
It is anticipated that the four new properties will be rolled into the existing Trust structure and will offer returns which will not dilute the Trust forecasts going forward.
Mr Howard Brenchley, Executive Director of APN Funds Management, said since the time of the Trust’s launch, APNFM has had a clear strategy to grow the Trust via the acquisition of high quality properties with strong lease covenants which would not dilute distributions or the net asset value of the Trust.
National Storage’s Director of Acquisitions and Development, Mr Andrew Catsoulis, said the group was excited to be able to continue to grow the business in established markets where they were recognised, such as Melbourne and Adelaide.
"We are also seeking to expand into new interstate markets such as Perth, further develop our presence in Sydney, and continue to investigate opportunities in regional areas such as the Gold and Sunshine Coasts," he said.
"Considerable opportunities exist for National Storage to consolidate and grow its position as the only major player in the storage industry dedicated to a model of long term leasehold tenure of purpose built properties, designed to support its storage business operations," he said.
"We have always seen our core business as operators and managers of storage centres and so we will concentrate our efforts in this area.
"Having taken our assets off balance sheet through the establishment of the Trust, we have an excellent opportunity to continue to grow our business via this leasehold model.
In particular we are able to offer a long term tenancy commitment, strong lease covenant and operational expertise which is unrivalled at present in the Australian storage market," Mr Catsoulis said.
Mr Catsoulis said demand for storage for both commercial and domestic uses was growing rapidly and was mirroring the remarkable growth of the industry in the United States and the United Kingdom.
"Population growth, the move towards apartment living, and increasing pressure on commercial office rentals are all playing roles in the gathering momentum behind storage needs and National Storage will be well placed to capitalise on this trend," Mr Catsoulis said.
