Big Yellow has won planning on appeal for a 58,000 sq ft storage centre on its site in Epsom, south London.
The self-storage group expects the new facility to deliver a circa 8.5% net operating income return at stabilisation on the total capital deployed of £20m.
Chief executive Jim Gibson said: “As we have previously identified, conditions in the construction market have ameliorated significantly and we are therefore motivated to build out these stores, which will generate high cash returns on the incremental construction spend; in this case 13%.”
Big Yellow has planning or resolutions to grant on eight pipeline stores, with a further three of the remaining five sites in the planning system.
It is currently on site in Slough and has committed to build out a scheme in Wapping.
Gibson said: “We will decide the timing of building out the other stores early in the new year.”
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