Join our daily newsletter At The Bell to receive exclusive market insights
- National Storage REIT (NSR) provides the market with an upgrade to its earning guidance and a fully underwritten $325 million equity raising
- Strong market conditions helped to drive performance for NSR, with a record occupancy across Australia and New Zealand of 86.7 per cent
- The company says in order to replenish the investment capacity it announced a fully underwritten equity raising to raise around $325 million
- NSR upgrades its FY21 underlying earnings per share guidance of 8.5-8.6 cents per stapled security
- NSR shares are unmoved amidst a trading halt, sitting at $2.08
National Storage REIT (NSR) has announced an upgrade to its earning guidance and a fully underwritten $325 million equity raising.
Strong market conditions have helped to drive performance for NSR, with a record occupancy across Australia and New Zealand of 86.7 per cent as of April 30.
The occupied net lettable area has increased 111,000 square metres since June 30, 2020, (excluding FY 21 acquisitions) while revenue per available square meter increased 21.5 per cent.
“All states and territories in which NSR operates continue to perform strongly and all these areas are now trading over 80% occupancy, with over 35 per cent of all centres now operating at over 90% occupancy, and approximately 70 per cent operating at over 85 per cent,” National Storage managing director Andrew Catsoulis said.
“We attribute this strong operational result to a positive macroeconomic environment as well as a number of internal operational improvements over the past 12 to 18 months.
“These enhancements include an updated and fully rebuilt website, the integration of our ‘contact-free move-in’ process, refinements made to our revenue management system, as well as the internalisation of a number of key functions in the business that were previously outsourced.”
The company said in order to replenish the investment capacity and provide funding flexibility it announced a fully underwritten equity raising to raise around $325 million.
“This will enable us to further strengthen our balance sheet in order to facilitate ongoing growth of the business from a development, expansion and centre revitalisation basis, as well as enabling us to undertake continued acquisitions on a selected basis,” Mr. Catsoulis said.
The equity raising will be structured as a 1-for-6.27 accelerated non-renounceable entitlement offer, with the offer price set at $2 per stapled security.
The company has been moving to take advantage of strong market conditions, acquiring 24 self-storage centres and three development sites, totalling $373 million, in FY 21 to date.
NSR has 16 active projects, with six projects under construction as of 30 April 2021, forecasted to add an aggregate net lettable area of approximately 110,000 square metres.
“Given the ongoing compression in yields across the self-storage sector, and our strong growth in rate, REVPAM and occupancy, NSR believes it is an opportune time to expedite the pace of its development, expansion and centre revitalisation programs,” Mr Catsoulis said.
“With 70 per cent of our centres now operating at or nearing stabilised occupancy, it is important that we continue to grow our built capacity in a sustainable fashion so as to generate ongoing opportunities to grow underlying earnings per security and NTA.”
NSR upgraded its FY 21 underlying earnings per share guidance of 8.5 – 8.6 cents per stapled security.
NSR shares are unmoved amidst a trading halt, sitting at $2.08.
