What does the company do?
Safestore is the UK’s largest self-storage company. The company also has operations in France with a nascent presence in Holland, Belgium and Spain.
Why do we like the investment?
Safestore operates in an attractive industry where supply is constrained (given planning restrictions and the availability of suitable land), the use of the internet as an enquiry channel favours the larger players, there is very low obsolescence risk and the self-storage market is less developed than countries such as the United States and Australia. The relatively low personal consumer awareness of self-storage provides an opportunity for future industry growth while demand from business customers is also increasing driven by the growth of online retailers. Earnings and hence dividend growth should continue to progress as Safestore has the opportunity to increase occupancy and continue to improve pricing which given the relatively fixed nature of the cost base mostly converts to profit. Furthermore, the company has opportunities to open new sites in the UK while the European operations provide a further avenue for growth under the auspices of an entrepreneurial management team that have generated a strong track record.
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In which year did we first invest?
Where is their head office?