Self-storage player StoreLocal seeks growth partner; mandates Highbury
Like self-storage businesses? Meet StoreLocal, a privately owned player that’s built a $300 million-plus portfolio across Australia and is kicking off a search for a growth-minded equity partner.
Street Talk can reveal StoreLocal’s co-founders, Rob Mactaggart, Mark Greig and Hans Pearson, have hired boutique corporate adviser Highbury Partners to reassess its capital structure as they seek capital to ramp up the portfolio. The business, founded in 2015, manages more than 30 self-storage assets across NSW, Victoria, Queensland, South Australia and West Australia.
The assets are held in funds for which StoreLocal – via a subsidiary called StoreInvest – acts as the developer and fund manager, in a structure that’s not dissimilar to that of the $3.2 billion ASX-listed National Storage REIT.
Sources said it’s early days and the deal structure is yet to be finalised. However, StoreLocal is said to be seeking incremental growth capital (equity, not debt) to expand its portfolio, suggesting Highbury would seek investors keen to come in via a newly created fund or vehicle. Of note, the shareholder structure at the StoreLocal-level is expected to remain unchanged as part of the deal.
StoreInvest secured a $100 million equity investment from Swiss private capital investor Partners Group in mid-2022, as it sought to add $120 million worth of self-storage sites to meet its target of a $300 million-plus portfolio. With that goal met, the business is seeking another deep-pocketed backer to help with the next leg of its growth.
The deal comes as self-storage businesses prepare to put record-high financing costs in the rearview mirror, with the bond markets expecting the Reserve Bank of Australia to deliver three rate cuts totalling 75bps this year. Although occupancy rates trended down in 2024, average storage fees climbed up on a per square metre basis in all Australian capital cities.
Deals in the sector are being done at cap rates below 5 per cent, well under the disclosed cap rates of listed data centre REITs like National Storage REIT at 5.9 per cent, Morgan Stanley analysts noted said in a January 20 note. “This supports the potential of higher NTA [net tangible assets] per share growth in FY25. NSR currently trades on >8% discount to NTA at current share price,” the note said.
Across the ditch, Auckland’s largest self-storage owner-operator National Mini Storage has tapped KPMG to shop its portfolio of 13 sites, which are understood to be making $25 million and $30 million. In June, Singapore’s sovereign wealth fund – and Aussie real estate junkie – GIC signed a $270 million joint venture with National Storage.
Other players in the sector include Abacus Storage King, spun off on the ASX in 2023, and the family-owned Kennards with over 100 centres. Singapore-headquartered StorHub, which is backed by Warburg Pincus,
