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Stor-Age Property REIT has agreed to acquire a portfolio of 10 income-generating self-storage properties from Xtraspace Properties for a purchase consideration of R387.0 million. Alongside the acquisition, the company will also manage six additional Xtraspace facilities under a separate management agreement, creating a new source of recurring fee income. The transaction will strengthen Stor-Age's presence across South Africa's key metropolitan markets, while supporting its strategy of expanding both its owned property portfolio and third-party management business. The acquisition remains subject to regulatory approvals before completion.
Stor-Age Property REIT has entered into agreements to acquire 10 established, income-producing self-storage properties from Xtraspace Properties for a total purchase consideration of R387.0 million. The acquisition forms part of the company's strategy to expand its self-storage portfolio through operational assets that meet its long-term investment criteria.
As part of the same transaction, Stor-Age has also signed a management agreement to operate six additional Xtraspace self-storage properties that will continue to trade under the Xtraspace brand. The arrangement is expected to generate management fee income while expanding the company's third-party property management platform.
The acquired portfolio comprises 10 operating self-storage facilities with a combined gross lettable area of 51,878 square metres. Stor-Age also expects to invest an estimated R38.0 million towards capital improvements across the properties after the acquisition.
According to the company, the portfolio's presence across the Western Cape, Gauteng and KwaZulu-Natal will complement its existing footprint and provide greater geographic diversification across South Africa's major economic centres. Xtraspace, established in 2007, currently operates a portfolio of 16 self-storage properties in these regions.
The purchase will be funded through Stor-Age's existing senior debt facilities. The company said its loan-to-value ratio is expected to remain within its target range after the transaction and indicated that the acquisition is expected to enhance earnings on a per-share basis.
The proposed acquisition is subject to customary conditions, including approval from South Africa's competition authorities. The company expects the transaction to become effective during the second half of its 2027 financial year. Under the JSE Listings Requirements, the acquisition has been classified as an uncategorised transaction and was announced voluntarily.
Stor-Age is South Africa's largest specialist self-storage REIT and has steadily expanded through a combination of acquisitions, new developments and third-party management contracts. The company manages a portfolio of more than 100 self-storage properties across South Africa and the United Kingdom, making acquisitions such as the Xtraspace portfolio an important part of its long-term growth strategy.
Source Reuters
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