South Africa’s Stor-Age Property REIT has completed a deal to acquire four self-storage properties in the North East of England from McCarthy’s Storage World.
The REIT, which is South Africa’s largest self-storage fund, acquired the Storage World portfolio for £37.5m through its UK operator Storage King.
The facilities have a combined lettable area of more than 200,000 sq ft. The shareholders of McCarthy’s Storage World will retain the brand, along with their flagship store in Leeds.
Stor-Age raised R575m (£27.6m) last month to help fund its acquisitions pipeline. Gavin Lucas, chief executive of the listed landlord, said at the time that the raise will bolster its strategy to grow its portfolio in both South Africa and the UK. It has identified a further four properties in the UK worth around £46m, measuring some 220,600 sq ft.
Tom Caines, EMEA alternative capital markets director at JLL, which advised McCarthy’s on the deal, said: “It’s exciting to start the year with another sizeable portfolio transaction, with McCarthy’s representing one of the largest quantum deals to have concluded in the past few years.
“The McCarthy’s portfolio provided the perfect mix of high-quality new-builds, supplemented by well-located income-generating conversions. The sector continues to perform in much the same way as 2021, with clear appetite from operators and funds alike.
“Pricing was aggressive over multiple rounds of bidding, with the result demonstrating the further yield compression we have seen in regional markets in the past 18 months.”
Mike McCarthy, owner and managing director of McCarthy’s Storage World, said: “We are already looking at some exciting new opportunities and will continue working with JLL to build a new platform. This will focus on developing new build assets in strategic locations with strong ESG credentials.”
Robin Greenwood, chief executive at Storage King, said: “This acquisition forms part of our growth strategy to increase the footprint of our portfolio across the UK, and we are excited to welcome the existing staff into our group.”
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