STOR-AGE PROPERTY REIT LIMITED
Investment Analysis: Stor-Age Property REIT Limited (JSE: SSS)
Date: 9 January 2026 Share Price: ~R17.80 (1,780c) Analyst Role: Senior Equity Analyst, JSE
Step 1: Data Gathering & Source Verification
I have reviewed the most recent financial disclosures and SENS announcements, noting the release of the interim results in November 2025 and an accelerated bookbuild in December 2025.
- Interim Results: Reviewed the Unaudited Condensed Consolidated Interim Results for the six months ended 30 September 2025 (Released 11 November 2025).
- Annual Financial Statements: Reviewed the Audited Consolidated Financial Statements for the year ended 31 March 2025 (Released 18 June 2025).
- SENS Activity (L12M): Key announcements include the Accelerated Bookbuild Offering (December 2025) to raise capital for acquisitions, the Interim Dividend Declaration (November 2025), and steady director dealings (vesting of shares).
Data Sources:
- Interim Results (Nov 2025):
https://investor-relations.stor-age.co.za/2025-interim-highlights - SENS (Bookbuild):
https://www.sharenet.co.za/v3/sens_display.php?tdate=20251205080000&seq=5
Step 2: Metric Extraction
| Metric | Value | Notes |
| --- | --- | --- |
| Market Cap | ~R9.0 Billion | The dominant self-storage REIT on the JSE. |
| Dividend Yield (L12M) | ~6.37% | Growth Focused. Total L12M dividend of 113.30 cents (Final FY25: 53.56c + Interim FY26: 59.74c).
Note: The payout ratio was adjusted to 90% (from 100%) to retain cash for development, which dampens the yield slightly compared to peers. |
| Liquidity Check | High | Average daily value traded is robust (~R15m+). The December 2025 bookbuild further deepened institutional liquidity. |
| P/E Ratio | ~14.2x (Forward) | Premium Rating. Unlike generalist REITs trading at ~8-9x, Stor-Age commands a premium due to its specialized, defensive niche and growth profile. |
| Net Asset Value (NAV) | 1,725 cents | As at 30 September 2025. The stock trades at a ~3% PREMIUM to NAV (Price/NAV ~1.03x). This is a rarity in the current SA property sector (most trade at discounts), signaling high market confidence. |
Step 3: Operational & Strategic Analysis
Business Overview Stor-Age is a highly specialized REIT focused on the "Self Storage" asset class.
- Geography: Split between South Africa (Dominant market leader) and the United Kingdom (operating under the Storage King brand).
- Strategy: Utilizes a "Capital Light" model by partnering with Joint Ventures (JVs) to fund new developments, earning management fees while reducing balance sheet risk.
Performance Trend
- Consistent Growth: In the latest interims (Sep 2025), Distributable Income per Share grew 4.5% to 65.87 cents. Management reaffirmed full-year guidance of 5-6% growth.
- South Africa: Strong. Rental income grew 11.1%, with occupancies hitting record highs (~92%). The core portfolio is benefiting from urbanization and "life-changing events" (The 4 Ds: Death, Debt, Divorce, Downsizing) which drive storage demand regardless of the economy.
- United Kingdom: Recovering. After a softer patch, the UK portfolio saw a rebound with rental income up 2.5% and occupancy improving to 85.2%.
- Balance Sheet: Prudent. The Loan-to-Value (LTV) ratio is 30.9%, one of the lowest in the sector. The recent bookbuild (Dec 2025) ensures they have firepower for acquisitions without spiking debt.
Sector Context
- Defensive Moat: Self-storage is far less cyclical than office or retail property. Tenants are sticky, and rental increases are easier to pass on because the absolute Rand value (e.g., +R100/month) feels small to the customer.
- Interest Rates: As rates fall in both SA and the UK in 2026, Stor-Age benefits doubly: lower debt costs and increased housing market activity (people moving houses need storage).
Step 4: The Verdict
Bull Case (Why Buy): Quality Compounder. Stor-Age is the "Safe Haven" of the property sector. It offers a unique combination of defensive SA cash flows and hard-currency UK growth. . The JV strategy allows them to scale without blowing up the balance sheet. Unlike office REITs facing vacancies, Stor-Age has pricing power. The premium to NAV is justified by the superior growth visibility (5-6%) compared to the stagnant broader sector.
Bear Case (Why Sell): Valuation Ceiling. You are paying full price (1.03x NAV). The dividend yield of ~6.4% is significantly lower than alternatives like Redefine (~7.3%) or Hyprop (~8%). If the UK economy enters a deep recession, the "Rand Hedge" argument could backfire as UK storage demand is linked to housing turnover. There is little margin for error at this valuation.
Fair Value Estimate: R18.50 - R19.00 Implies a continued premium rating, pricing in the reliability of its cash flows.
Final Rating: BUY / HOLD A core portfolio holding for conservative investors. It won't shoot the lights out, but it won't keep you awake at night.