Insider 133 by Self Storage Association of Australasia

Insider

133

NOVEMBER 2023

MAGAZINE OF THE SELF STORAGE ASSOCIATION OF AUSTRALASIA

REAL ESTATE

This could be your last issue. Renew your membership by 31 October 2023

G’DAY USA: SSAA ON TOUR

AWARDS FOR EXCELLENCE WINNERS

Annual Report highlights Self storage shines brightly INDUSTRY NEWS | HUMAN RESOURCES | OH&S | LEGAL | TRADE DIRECTORY

JOIN THE MARKET LEADER

Visit Janus Australia at the 2023 Convention in Melbourne to find out how we can take your self storage business to the next level. www.janusintl.au sales@janusintl.au +61 (07) 3865 1600 PRINCIPAL PARTNER OF

CONTENTS 3

SSAA BOARD OF DIRECTORS

Chairman – Michael Alafaci Storage King Group, New South Wales Aaron Alsweiler Safe Store Self Storage, New Zealand Ned Coten City West Storage, Victoria

David Daddow Able Self Storage, South Australia

Brent Hayes Store and More Self Storage, Victoria

Sam Kennard Kennards Self Storage, New South Wales Anthony Regis Regis Built, Victoria

Thomas Whalan Rent a Space, New South Wales

Adrian Wylde All-Bay Mini Storage, Queensland

LIFETIME MEMBERS Mark Bateman David Blackwell Frank Cooney Elaine Coote Liz Davies Dallas Dogger John Eastwood Simone Hill Neville Kennard Sam Kennard Bob Marsh Jim Miller Jon Perrins Phil Robbie Mark Snooks Richard Whalan

SSAA STAFF

Makala Ffrench Castelli CEO Sandra Evans Office Manager

Priscilla Lee Member Relations

Georgia Dogger Marketing/Member Relations

www.selfstorage.org.au TOLL FREE – AUS: 1800 067 313 TOLL FREE – NZ: 0800 444 356

T: +61 3 9466 9699

Address: Unit 4/2 Enterprise Drive, Bundoora Vic 3083 E: admin@selfstorage.com.au Connect with us online!

28 30

REGULARS 4

Chairman’s Report

CEO’s Report

35 OH&S 37 HR Help Desk 38 Legal Help Desk 40 Trade Directory 42 New members 8 BUSINESS BASICS

Fundamentals in focus

10 INVESTMENT

Introducing Abacus Storage King

25 SECURITY

Boosting the real estate value of self storage facilities with an integrated security system

12 SSAA ANNUAL REPORT

26 AGREEMENTS

14 COMMERCIAL REAL ESTATE

28 AWARDS FOR EXCELLENCE

16 INTERNATIONAL

30 CYBER GUIDELINES

18 FINANCE

31 DIGITAL

2022-2023 Highlights

Self storage shines brightly G’Day USA: SSAA on tour

Why are capitalisation rates not softening in self storage?

20 AWARDS FOR EXCELLENCE Manager of the Year

22 ENVIRONMENT Go Green

24 FACILITY VALUE

Redrafted Agreement Facility of the Year

Stay cyber-secure

How software affects self storage business valuations

32 PARKING

The value of client parking services

36 NEW SERVICE MEMBER

Security Distributors Australia

How to maximise facility value

Insider is published and edited by: Social Ties / E: vforbes@socialties.com.au

Printed by: Homestead Press / E: printing@homesteadpress.com.au Insider magazine (Insider) is published bi-monthly by the Self Storage Association of Australasia Limited (ABN 23 050 341 725). This publication may not be reproduced or transmitted in any form, in whole or in part, without the express, prior written permission of the publisher. While every care has been taken in the preparation and publication of Insider, none of the Insider’s publisher, editor nor any of the publisher’s employees, subcontractors or contributors give any warranty as to the completeness or accuracy of the publication’s content, nor do any of them assume any responsibility or liability for any loss, damage or expense which may result from, or arise in connection with, any inaccuracy or omission in the publication. The views or opinions expressed in Insider are not necessarily those of Insider’s publisher or editor. Furthermore, Insider has the right to accept or reject any editorial and advertising material. All letters addressed to Insider will be regarded as ‘for publication’ unless clearly marked ‘Not for Publication’. All submissions to Insider may be edited for reasons of space or clarity and opinions expressed in letters published in Insider are those of the author, not of Insider’s publisher or editor.

NOVEMBER 2023 INSIDER 133

4 CHAIRMAN'S REPORT

Michael Alafaci Chairman SSAA

his edition of Insider is focused on real estate, which underpins the success of our sector. From a strategic perspective, the SSAA Board remains focused on investing in industry research that maps and measures our sector from both the property and operational perspective. At MEL23 we’ll be releasing the 2023 SSAA Industry Snapshot which will highlight market activity, demand drivers, operational performance and the future outlook for the sector. As we quickly head towards the end of the year we’re looking to our strategic milestones earmarked for 2024, which includes an investment in technology and research to bring our real estate and operational insights to members in a more digitally interactive and accessible way. You can expect to hear more on this early next year (and maybe a little at MEL23 too!). As the traditionally busier months in self storage are now upon us, I’d urge you and your teams to stay vigilant. We have seen a rise in criminal activity and customs-related infringements across the industry. Protect yourself, your team, your assets and our borders by reporting suspicious behaviour, activities or goods to Border Watch, the NZ Customs

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At MEL23 we’ll be releasing the 2023 SSAA Industry Snapshot which will highlight market activity, demand drivers, operational performance and the future outlook for the sector.

Service or the relevant government authority. Once reported, make sure you add the details to StorerCheck so we can all make informed decisions about prospective storers. Finally, this year we farewell SSAA Director David Daddow after serving his full six year term on the SSAA Board, representing independent operators. David’s dedication to self storage, his long term commitment to SSAA and his encouragement and support of independent operators new to industry must be commended. Thank you for your service, David. I look forward to seeing many of you at MEL23! l

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6 CEO’S DINK REPORT

Makala Ffrench Castelli CEO SSAA This edition, I’m pleased to share my letter to members from our 2023 Annual Report. FY23 saw our industry come together once again Member engagement was a strong focus across FY23, with the SSAA delivering the inaugural SSAA Ski Summit, the long-awaited return to Convention on the glittering Gold Coast and a series of capital city networking events. The broad smiles and resounding cheers from a record attendance at GC22 were clear indicators that members enjoyed reconnecting after the pandemic hiatus. The sector continued to outperform, with State of the Industry 2022 mapping the success of the sector, highlighting consumer perspectives and considering the future outlook. SSAA’s investment in research on behalf of members further promotes the self storage as a standalone asset class, with the landmark report now widely cited within and outside the membership. Turning to other advocacy projects, the SSAA joined with Stantec to modernise the Parking & Traffic Study and achieved a reduction in parking rates for the sector. Work continues sourcing alternative solutions for customer goods insurance in an increasingly challenging environment. The SSAA reinforced its commitment to supporting members with operational resources, delivering a revised self storage agreement suite,

updated CSA guidelines and a range of online training modules from legal understanding to domestic family violence and occupational health & safety. FY23 saw further investments in technology to streamline member experiences and internal operations. From additional functionality for StorerCheck to the refreshed StorageFinder website and updated member portal, the SSAA continues to invest in platforms. Despite ongoing industry consolidation, membership continues to grow. Across FY23 the SSAA welcomed 48 new members, including 12 new suppliers, and enjoyed a membership renewal rate of 92%. The SSAA team is proud to have delivered another significant program of work for members this financial year. Many of the investments made in FY23 will benefit members well into the future. Importantly, these achievements have all been delivered while strengthening the financial sustainability of the association. These outcomes would not be possible without the support of our directors, members, major partners and of course your dedicated SSAA team. Thank you for supporting us, so we can continue to support you. l

JANUS: PROUD PRINCIPAL PARTNERS OF THE SSAA We are thrilled to announce Janus International Australia Pty Ltd as a new Principal Partner of the Self Storage Association of Australasia. Janus Australia is a longstanding supplier to and value creator for the self storage industry across Australia and New Zealand. Established under the Steel Storage brand in Brisbane in the

1990s, the SSAA originally enjoyed a long history with Steel Storage. To now welcome Janus Australia to the SSAA partnership program exemplifies how Janus honours local heritage underpinned by global support. In addition to Principal Partner, Janus Australia will feature as Platinum Sponsors of industry

conventions, including the upcoming MEL23. The SSAA is grateful for the support of all our partners who help us deliver advocacy, education and support to industry. We’re excited to continue our work now with the support of Janus Australia and look forward to working closely with the experienced Janus team.

8 BUSINESS BASICS

Fundamentals in focus

The lesson for any successful business is to pay attention to the basics.

his year’s SSAA Conference theme is appropriate for the times we live in as an industry. Fundamentals are defined as a central or primary rule or principle on which something is based and is of central importance. From experience, these fundamentals are always apparent in successful stores regardless of size.

Management

Management can make or break a facility. SSAA-educated, welltrained and proactive staff make a fundamental difference in overall performance. Despite the arrival of all things AI and digital, human connection and direct retailing of space have not yet been overtaken in their contribution to bottom-line performance. Adopting digital tools has cut costs and improved customer experience. The next big thing to confront is the balance between the human worth of staff to clients and owners compared to the supposed major cost reductions and trading benefits promised with AI. However, the value of small, regional versus large, urban stores is yet to be measured.

Ownership

Whether 100 or 1000 units are involved, a local owner or a brand facility of any capacity trades best with proactive, astute owners and quality staff, operating systems, digital assets and modern premises. The saleability of a facility depends fundamentally on its ownership ethos to create a presence and amenity that drives cash flow.

Opportunity

Well-managed self storage is a resilient asset class producing consistent cashflow, business and capital value growth well above an alternate property use in good and bad times. While the broader economy will always affect client use, demand and affordability, operators large and small continue to create

INSIDER 133 NOVEMBER 2023

“

Well-managed self storage is a resilient asset class producing consistent cashflow, business and capital value growth.

access to industry knowledge and well-researched comments focused on the property. On the customer side, providing detailed and realistic financial modelling for start-ups or dependable operational and financial performance data as a going concern to a financier is crucial.

opportunities in urban and country areas where scale and pricing are the significant differences in trade profiles.

Valuation

Operations

Dynamic operators create measurable worth by taking advantage of local opportunities that a potential purchaser will recognise and pay for. Maximising revenue and minimising expenses using a transparent management system directly affect bottom-line results, creating higher capital value.

Catchments

Catchments vary in population numbers, demographics, growth rates, affordability, and funding issues. Catchment competition need not concern good operators. Providing the client base and future growth supports store numbers. Wellmanaged facilities can trade off competitors and prosper in good or bad times, providing fundamental market research is undertaken first.

Finance

Despite increased institutional awareness of the asset class, banks are still wary of going concerns. Alternate means of finance are available. Fundamental risk issues revolve around greenfield or immature developments where the initial value gap between underlying property worth and mature self storage going concern value is greatest, which can remain a sticking point when seeking funding. A fundamental need for development or purchase financiers must be

Whether your property is a freehold going concern, a leasehold or partial interest and at a greenfield, immature or mature stage, an industry expert should value your self-storage property. The need for impartiality as an expert reporter for mortgage finance and any asset reporting purposes is a necessity. Self storage is a specialised asset class calling for deep industry knowledge. Interpreting evidence for application in the valuation process requires that knowledge and understanding to be applied to sales data, most of which occurs off-market these days, especially for significant transactions. Particular issues must be recognised and reported on, including a facility’s operational model, trading data, management, costs, pricing and unit mix, occupancy, staging and expansion potential – an expert valuer must consider these matters. Your property value is at stake, and that’s a fundamental consideration to you. l

Thanks to Malcolm Collins from Collins and Associates for this contribution. E: malcolm@malcolmcollins.com W: www.malcolmcollins.com Liability limited by a Scheme approved

under Professional Standards Legislation

www.selfstorage.org.au

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10 INVESTMENT

Chg photo

ASK: Introducing Abacus Storage King

In August 2023, Abacus Property Group successfully destapled its self storage platform into a standalone self storage real estate investment trust.

023 marks a transformational year for Abacus Group and Storage King. Earlier this year, experienced retail leader Nikki Lawson joined Abacus Group as Group General Manager, Self Storage and Fund Manager ASK, to work closely with Michael Tate, Chief Executive Officer of Storage King as the group embarks on its next phase of growth. The FY23 reporting season provided the first look at the portfolio and performance metrics for the newly formed Abacus Storage King (ASK). Insider caught up with Nikki recently for her take on the sector, operating insights and future outlook.

Insider: What was the rationale for the destapling of ASK? NL: Over the last five years, Abacus Property Group has

achieved significant success in its self storage platform and has invested over $1.4 billion into self storage assets. The Board determined that the portfolio reached a scale where it justified being separately listed with its own capital structure and our investors agreed to this proposal. This new structure will maximise the potential to unlock material value for investors and enhance the strategic growth outlook for Abacus Storage King, whilst providing the opportunity for a more focused strategy for Abacus Group.

Insider: The past few years have seen exceptional performance right across the sector. What have been the highlights for the portfolio this past year? NL: It’s a privilege to share what we’ve achieved as a

result of the significant investments made in our self storage portfolio and platform. We delivered 19% growth on FY22 in self storage net property rental income contribution to funds from operations at $147.5 million. Across our established store portfolio, we’ve maintained our industry-leading RevPAM at $319 per sqm, with average rental rates at $349 per sqm and occupancy of 91.3%. There were four new stores and two expansions delivered from our development pipeline across the year

INSIDER 133 NOVEMBER 2023

Abacus Group | FY23 Results Presentation Storage King Pre

and we remain on track to deliver 18 new stores in the short-medium term. Over the past two years, more than $450 million of value has been created for our investors which is a testament to the quality of our portfolio and the management platform.

Insider: What’s your view on the demand drivers for self storage in the current landscape? NL: The balance of the strength of today combined with the growth upside of tomorrow is what makes our self storage business so strong. Self storage is a sector that has a combination of resilience, due to the granularity of its customer base, and longer term macroeconomic tailwinds. In the short term, we are seeing both headwinds and tailwinds against the key demand drivers. Population growth is strengthening, though discretionary spending has been hit by inflation. Housing densification is set to continue, as is the growth of e-commerce. I think COVID really helped moved self storage up the maturity curve, educating a whole group of new consumers on the benefits of self storage.

Insider: Looking ahead, what is ASK focused on? NL: We continue to see healthy demand in the sector.

We’re focused on our portfolio growth engines of acquisitions and developments, as well as our valued third party licensee network. Operationally, we’re nearing the completion of our brand refresh program and we’re investing in a new data and analytics platform. Under Michael’s leadership, we’re doubling down on our strengths, improving our people capability and culture, increasing our operating discipline whilst retaining our entrepreneurial spirit. On a personal level I have appreciated the warm welcome from the SSAA community and as ASK we look forward to continuing to contribute to this valuable association. It’s an exciting time to have joined ASK and I’m looking forward to what’s ahead. l www.selfstorage.org.au

SELF STORAGE: SNAPSHOT DINK 11

Self Storage portfolio valued at $3.1 billion

ASK: By the numbers KEY METRICS

Established portfolio3

Acquisitions4

Stabilising portfolio5

Assets1

Value2

$1,667m

$378m

$608m

Net lettable area

396,000 sqm6

100,000 sqm

92,000 sqm

1 SELF STORAGE: STORAGE KING TORAGE: ASK STORE NETWORK Occupancy7

91.3%

90.9%

67.2%

SELF STORAGE: STORAGE KING SELF STORAGE: STORAGE KING SELF STORAGE: STORAGE KING RevPAM SELF STORAGE: STORAGE KING Nurturing and strengthening our brand value Average rent psm7

$349

$336

$319

$305

urated portfolio with a metro and a pipeline of newbrand developments Nurturing andfocus strengthening our value 7

$306

1.1 million $206

Nurturing and brand Nurturing and7strengthening strengthening our our brand value value RevPAM growth 9.2% N/A N/A Nurturing and strengthening our brand value Total land area (sqm) 1. 127 freehold assets and 4 leasehold assets. 2. As at FY23. Excludes investments in cash and other assets. 3. Established portfolio: 76 mature 1 stores open at 1 July 2021. 4. Acquisitions portfolio: 19 mature stores acquired post 1 July 2021. 5. Stabilising portfolio: 36 stores. Includes KAGE: STORE NETWORK 1 ASK STORE NETWORK 16 trading stores and 20 development sites not captured in these trading metrics. 6. Includes acquisition of satellite assets. 7. Average over

90,000+

1. 127 freehold assets and 4 leasehold assets.

136 1.1 mil1li.o1 nmillion

financial year (by area) excluding one established and one acquisition store due to Storage King Robina, QLD mixed site use composition. QLD

2. As at Excludes in cash and other assets. ro focus and a FY23. pipeline of investments new developments 2new 52021. 3. Established portfolio: 76 and matureastores open atof 1 July portfolio with a metro focus pipeline developments 4. Acquisitions portfolio: 19 mature stores acquired post 1 July 2021. 1 Total units2 sites not 5. Stabilising portfolio: 36 stores. Includes 16 trading stores and 20 development captured in these trading metrics.

90,000+ 90,000+ 90,000+ 90,000+ Total units Total units Total units

SUNSHINE COAST

6. Includes acquisition of satellite assets. 2 BRISBANE 16 2 Assets owned by Abacus Storage King 7. Average over financial year (by area) excluding one established and one store 2 acquisition Abacus Group | FY23 Results Presentation 8 due to mixed site use composition. GOLD COAST

1963 196

Total units2

196 196 196 SA

49,000+ 49 49,000+ 49,000+

Storage King

Storage KingKing 1 Storage network stores Storage King QLD 1 network stores QLD Storagestores King 11 25network network stores 1 25 network stores 3 ADELAIDE

H 12

SUNSHINE COAST

NSW

49,000+ Customers 49,000+ Customers Customers Customers

ACT

NEWCASTLE

11 AUCKLAND

REGIONAL NZ

Customers

VIC

136 13666%

CENTRAL COAST 2 3 SYDNEY 4 1 WOLLONGONG / 4 3 SUNSHINE COAST 1HIGHLANDS SOUTHERN

CANBERRA 6

113 trading stores Total land area (sqm) 23 future stores Total land areaTotal (sqm) land area (sqm)

REGIONAL VIC 3 ofofAustralian BRISBANE 16 Assets owned by AbacusAssets Storageowned King by AustralianSelf Self 2COAST 6 8 MELBOURNE 2BRISBANE 16 GOLD 3 Assets owned by Abacus Storage Kingassets 113 owned stores 113Abacus Abacus owned stores Abacus Storage King Storage Storage located 113 Abacus owned stores 113 trading stores assets located GOLD COAST 8 SA 113 Abacus owned stores 113 trading stores 54 Licensed and managed stores 113 trading stores in Top 3 Significant 23 future stores in Top 3 Significant SA Licensed andmanaged managed 5454 Licensed and stores 113 Abacus owned stores stores 3 NZ stores 54 Licensed and managed stores 2 2 3 stores 4 4 Urban Areas 23 future stores 23 future Urban Areas 29 Licensed NSWmanaged stores Average length of stay 1 5 Licensed stores 4 54 and Average length of stay 2929 Licensed stores 4 stay Average length of NSW 29 Licensed stores 1 ACT Average length of stay 49 AUCKLAND 4 ACT anged but not yet settled. 29 411 9Average length of stay 6Licensed stores 11 AUCKLAND

3.2 years 3.2 years 3.2 years 3.2 3.2 years years

SELF STORAGE: DEVELOPMENT PIPELINE 1. Includes 5 assets exchanged but not yet settled. 2. Significant Urban 6 owned and managed stores. 3. Abacus owned stores. exchanged but not yet settled. All Abacus 1Areas, as defined by the Australian Bureau of Statistics. Top 3 markets Development pipeline to2.deliver 18 stores in the short to medium term SELF STORAGE: DEVELOPMENT 4. For existing customers in the Established Portfolio of 76 mature stores open at 1 July 2021.PIPELINE by population are Sydney, Melbourne and Brisbane.

1. Australian All AbacusBureau ownedofand managed as well as Storage licensed stores.and AlsoBrisbane. includes assets s, as defined by the Statistics. Topstores, 3 markets by population areKing Sydney, Melbourne NEWCASTLE 2 CENTRAL COAST 2 SYDNEY 4 1 CANBERRA 6 3 ADELAIDE WOLLONGONG / 4 CANBERRA 6 SOUTHERN HIGHLANDS

3 ADELAIDE

4 NEWCASTLE

CENTRALREGIONAL COAST 2 SYDNEY 4 1 NZ WOLLONGONG / 4 SOUTHERN HIGHLANDS

VICDevelopment pipeline to deliver 18 stores in the short to medium term REGIONAL VIC 3 VIC 26 3

66% 66%

Abacus Group | FY23 Results Presentation

REGIONAL NZ

of Australian Self

REGIONAL VIC Expansion opportunities MELBOURNE 2 3 of Australian DEVELOPMENT PIPELINE: SET TO DELIVER 18 STORES IN THE SHORT MEDIUM TERM Self 26 Storage assetsTO located MELBOURNE 2 3

Spent to date

Cost to complete2

Est. completion value

cost to complete Expansion NLA Storage assets located

NLA

in Top 3 Significant 1. All1.Abacus owned and managed stores, as well Storage King King licensed stores. AlsoAlso includes assets exchanged but not Expansion opportunities All Abacus owned and managed stores, as as well as Storage licensed stores. includes assets exchanged but yet not settled. yet settled. NZ in Top 3 Significant All Abacus owned and managed stores, as well as Storage King licensed stores.NZ Also includes assets exchanged but not2 yet settled. 2. All1. Abacus owned and managed stores. Urban Areas 2.Spent All Abacus owned and managed stores. 2 1 5 2 cost to complete to date Cost to complete Est. completion value NLA Expansion NLA 1. Abacus owned and managed stores, as well as Storage King licensed stores. Also includes assets exchanged but not yet settled. 2. All stores. Urban Areas 1. All Abacus owned and managed stores, as well as Storage King licensed stores. Also includes assets exchanged but not yet settled. 3. Abacus owned stores. 3. Abacus owned stores. 1 5 2. existing All Abacus owned and managed stores. 3. Abacus owned stores. 4. customers in the Established Portfolio of 76 mature stores open at 1 July 2021. 2. For All Abacus owned and managed stores. 4. For existing customers in the Established Portfolio of 76 mature stores open at 1 July 2021. 3.population Abacus owned stores. 4. For existing customers in the 2021. yet settled. tics. Top 3 markets are Sydney, Melbourne andEstablished Brisbane. Portfolio of 76 mature stores open at 1 July 23 Abacus Group | FY23 Results Presentation 3. byAbacus owned stores. by the Australian Bureau Statistics. 3 markets by are Sydney, Melbourne and Brisbane. 23 4. of For existingTop customers in population the Established Portfolio of 76 mature stores open at 1 July 2021. Abacus Group | FY23 Results Presentation

$211m $268m $579m 117,000sqm $211m $268m $579m 117,000sqm 4. For existing customers in the Established Portfolio of 76 mature stores open at 1 July 2021. NLA breakdown by market Sydney 53% Brisbane 12%53% Sydney Melbourne 12% Brisbane 12% Other 23% Melbourne 12% Other 23%

1. Includes assets exchanged but not yet settled. 2. Includes development management fees payable to ABG.

www.selfstorage.org.au

18,400sqm 18,400sqm

NLA development pipeline (sqm)

NLA breakdown by market

1. Includes assets exchanged but not yet settled. 2. Includes development management fees payable to ABG. 1. Includes assets exchanged but not yet settled. 2. Includes development management fees payable to ABG.

$41m $41m

60,000

NLA development pipeline (sqm)

50,000 60,000

48,000

47,000

40,000 50,000

48,000

47,000

30,000 40,000 30,000 20,000 20,000 10,000

22,000

Sydney Brisbane Sydney Melbourne Brisbane Other Melbourne

22,000

Other

10,000 0 0

FY24

FY25

FY26+

FY24

FY25

FY26+ Abacus Group | FY23 Results Presentation Abacus Group | FY23 Results Presentation

22 22

NOVEMBER 2023 INSIDER 133

12 SSAA ANNUAL REPORT

FY23 FY23Highlights Highlights FY23 Highlights Membership Membership

SSAA FY23 Highlights FY23 Highlights Membership Total Members Total Facilities

The SSAA had 873 members as at The SSAA had 873 members as at 30 June 2023 (FY22: 825) representing 30 June 2023 (FY22: 825) 1562) representing The SSAA had 873 members as at a record 1603 facilities (FY22: a record 1603 facilities (FY22: 1562) 30 June 2023 (FY22: 825) representing across Australasia. a record 1603 facilities (FY22:as 1562) across Australasia. The SSAA had 873 members at

Membership Membership

Total Members

873 825

Additional Facilities

864

Total Facilities

despite industry consolidation

6663

220 AUS Facility Under 50 217 Service/Supplier/Industry 7555 Provisional Service/Supplier/Industry 63 30 68 NZ Facility Over 50 66 55 Provisional Provisional NZ Facility Under 50 3031 7535 Service/Supplier/Industry 63 31 NZ Facility 50 Under 50 NZUnder Facility 35 55 Provisional

(FY22: 1.4%). (FY22: 1.4%). YoY membership AU5.8% Members 88% (FY22:growth 86%) despite industry consolidation NZAU Members 12% 88% (FY22: 14%) AU Members 88% (FY22: 86%) Members (FY22: 86%) (FY22: 1.4%). NZMembers Members 12% (FY22: 14%) NZ 12% (FY22: 14%)

AU Members 88% (FY22: 86%) NZ Members 12% (FY22: 14%)

Member Engagement

NZ Facility Under 50

Member Engagement

Member Engagement MemberEngagement Engagement 520 35k 1345 Member 520 35k 1345 Portal 520 Member 35k Sessions

864

1603 833 1562

75 63 55 30

Jun-23

Jun-22

31 Jun-23 35

31 35

46k

Jun-22 Jun-23

Jun-23

3989

713

46k

713

3989

LinkedIn Impressions

Facebook Followers

Facebook 3989 Reach

LinkedIn 3989 46kFacebook 1345Impressions 713Facebook Followers Reach

LinkedIn LinkedIn Followers

Attendances

520

1345 Followers

Event Attendances Attendances

Member Portal Sessions Sessions

LinkedIn Facebook Followers Facebook Followers LinkedIn Impressions Followers Impressions Followers Reach

Event

Member Portal

Member MemberBenefits Benefits

Jun-22

Member Portal Sessions

35k

1603 1562

873 1603 1562 825

873 833 Total Members Facilities Additional 825 424 Total Facilities AUS Facility Over 50 864 414 Additional Facilities 833 424 AUS Facility Over 50 873 Total Members 414 220 AUS Facility Under 50 825 424 AUS Facility Over 50 217 414 220 864 AUSFacilities Facility Under6850 Additional 217 833 220 NZFacility Facility Over50 50 AUS Under 66 217 424 68 AUS FacilityNZ Over 50 Facility Over 50 6875 414 66 Service/Supplier/Industry NZ Facility Over 50

across Australasia. 5.8% YoY growth 30 Junemembership 2023 (FY22: 825) representing despite industry consolidation a record 1603 facilities (FY22: 1562) 5.8% YoY membership growth 5.8% YoY membership growth across Australasia. (FY22: 1.4%). despite industry consolidation

Event Event Attendances

1603 1562

Total Facilities

Member Benefits TheThe SSAA supported members SSAA supported memberswith with Member Benefits Member Benefits a range of resources and services a range of resources and services throughout FY23. throughout FY23.

The SSAA members with with The SSAAsupported supported members a range of resources and services aSome range of resources and services Some notable highlights include: notable highlights include: throughout FY23. throughout • AnsweredFY23. more than 1200 member

46k

713

The SSAA delivered a record number of number of The SSAA delivered a record strategic initiatives for members in FY23:

strategic initiatives for members in FY23:

State Stateof ofthe the Industry Industry2022 2022

Answered more than 350 enquiries •• Answered more than 1200 member • Answered more than 350 enquiries via the SSAA Help Desks enquiries over the phone the SSAA Help Desks •viaAnswered more than 1200 member

State of the Industry 2022

Facilitatedmore morethan thanphone 10,000 checks •• enquiries Answered 350 enquiries over the • Facilitated more than 10,000 checks and the reporting of more than viathe thereporting SSAA HelpofDesks more350 thanenquiries •and Answered more than 950 incidents on StorerCheck 950 incidentsmore on StorerCheck • Facilitated than 10,000 checks the SSAA Help training Desks modules • via Launched 39 online and the reporting of more than • Launched 39 online training modules 950 incidents on StorerCheck • • Facilitated more than 10,000 Filmed and released more than checks

• Filmed and released more than 26 hours of content the reporting of more than • and Launched 39video online training modules 26950 hours of video content incidents on StorerCheck

Published thanmore 70+ articles •• Filmed andmore released than • •Published more than 70+ articles 26 hours of video content 39YoY online training modules • Launched 22% increase in member portal

Facebook Reach

The SSAA SSAAdelivered delivereda a record number The record number of of strategicinitiatives initiativesfor for members in FY23: strategic members in FY23:

• Answered more than 1200 member enquiries over the phone Some notable highlights include: enquiries over the phone

Some notable highlights include:

Facebook

Storage Parking && Traffic Storage Parking Traffic SelfSelf Agreements Study Agreements Study

Parking & Traffic State of theStudy

Self Storage Agreements

Self Storage Parking & Traffic Industry 2022 Agreements StorerCheck StorageFinder Study SIP Updates StorerCheck

StorerCheck

StorageFinder

SIP Updates

Insider Self Storage CSA StorerCheck Insider StorageFinderCSA Self Storage Supplier Guide Magazine Guidelines

Supplier Guide

Self Storage Supplier Guide

Magazine

Insider Magazine

SIP Updates

Guidelines

CSA Guidelines

online engagement • 22% increase YoY than in member portal • Published more 70+ articles • Filmed and released more than online engagement • Offered access to Family Business

GC22 SSAA Ski Networking Insider Self Storage Convention Summit NZ Series GC22 SSAA Ski Networking

•

Convention GC22

• 26 22%hours increase YoY in member of video contentportal Australia’s education and resources online engagement Offered access to Family Business

•Australia’s Published more than articles education and70+ resources

• Offered access to Family Business Australia’s education resources 133 NOVEMBER 2023 • INSIDER 22% increase YoY inand member portal

online engagement

Supplier Guide

Convention

Magazine

Summit SSAA Ski NZ Summit NZ

Series Networking Series

CSA Guidelines

www.selfstorage.org.au

GC22

SSAA Ski

Networking

FY23 Highlights FinancialPerformance Performance Financial

The FY23 financial statements report: FY23 Highlights

Total Revenue $2,116,066 Financial Performance (FY22: $1,204,628)

Total Revenue for FY23 increased by 75% due to Convention and the Ski Summit being held in the same financial year.

75% The FY23 financial statements report: Total TotalRevenue Expenses

$2,116,066 $2,082,392 (FY22: $1,204,628)

(FY22: $1,194,792) 75%

74%

Total Expenses

Net Profit

$2,082,392

$28,684 (FY22: $1,194,792)

(FY22: $7,836) 74%

Net Profit

Net Assets Net Assets

266%

$28,684

Total Revenue for FY23 increased 75% due Expenses increased by by 74%, though this to Convention and the Ski Summit being held expenditure included event costs plus several in the same financial year.

strategic project investments, demonstrating prudential management. Expenses increasedfinancial by 74%, though this expenditure included event costs plus several Asproject a non-profit entity, the SSAA seeks to strategic investments, demonstrating prudential financial management. invest the majority of available funds into

projects and services for the benefit of

As a non-profit entity, the SSAA seeks to members. A modest profit of $28,684 has $1,518,232 invest the majority of available funds into 266% been retained for future requirements. (FY22: $1,489,548) projects and services for the benefit of 1.9% members. A modest profit of $28,684 has $1,518,232 been retained for future requirements. (FY22: $1,489,548) Revenue Diversification Expense Distribution 1.9% (FY22: $7,836)

Events Income e 37.6% Revenue Diversification Marketing Income o 5.4% Events Income e 37.6% Membership Income n 51.4% co Marketing Income 5.4%

Other 5.6%

n Membership Income 51.4% Other 5.6%

Administration 8.4% Expense Distribution Events 40.7% Administration Marketing 8.4% 7.3% Events 40.7%

Member Services 9.4%

Marketing 7.3%

Staff Costs 23.3%

Member Services 9.4%

Strategic Initiatives 5.1%

Staff Costs 23.3%

Other 5.8% 5.1% Strategic Initiatives Other 5.7%

Governance Governance

The Strategic Direction was delivered to FY23 saw SSAA farewell five longstanding FY23saw sawSSAA SSAA farewell longstanding a directors The2023-2025 2023-2025 Direction was FY23 farewell fivefive longstanding anding The 2023-2025 Strategic Strategic Direction was members mid-2023, outlining the key priorities for in line with rotational requirements. directorsinin line with rotational requirements. i tdeli delivered d li members dbers tto members b id 2023 tli i th the directors line with rotational require requirements. ents. delivered d tto mid mid-2023, 2023, mid-2023, outli outlining i theoutlining Prior to their departure, the directors held a strategic advocacy, engagement and support for the SSAA in Priortototheir their departure, directors key priorities for advocacy, engagement and Prior departure, the the directors held aheld akey priorities for advocacy, engagement and the coming years. workshop to transition their extensive knowledge to strategic workshop to transition their support for the SSAA in the coming years. strategic workshop to transition their informed support for the SSAA in the coming years. the new Board. These workshop outcomes The Board met six times in FY23. The Audit, Finance extensive knowledge to the new Board. These the basis of the 2023 strategic planning workshop. extensive knowledge to the new Board. These & Risk Committee met fourThe times in FY23 and workshop outcomes informed the basis of the The Board six times in workshop outcomes informed thedirectors basis ofinthe Themet Board met an sixFY23. timesrole inAudit, FY23. The Audit, continues to play active in budgeting, Following the appointment of five new 2023 strategic planning workshop. Finance & Risk Committee met four times in financial risk management oversight. November 2022, including 2023 strategic planningrepresentatives workshop. Financeand & Risk Committee met four times in FY23 and continues to play an active role in for regular operator, service member and FY23 and continues to play an active roleat in The SSAA Office at Bundoora, Melbourne is held Following the appointment of five new budgeting, financial and risk management major operator, the Board met in March 2023 a value of $738,746. During the year, part of the Following the appointment of five new budgeting, financial and risk management directors in November including oversight. to undertake strategic 2022, planning for the next office was sub-let which generated income of directors in November 2022, including oversight. representatives for regular operator, service three years. $21,665 in at FY23. member and major operator, Board met The SSAA Office Bundoora, Melbourne is representatives for regularthe operator, service in March 2023 undertake strategic held at The a value of $738,746. the year, member andtomajor operator, the Board met SSAA Office atDuring Bundoora, Melbourne is planning for the next three years. part of the office was sub-let which The SSAA acknowledges the ongoing support of industry,held including major partners VISY Boxes & More, in March 2023 to undertake strategic at a value of $738,746. During the year, income ofand $21,665 in FY23. innovation partner Southwell Lifts & Hoists, Storman, Storco, Universalgenerated Storage Containers PTI Security,

planning for the next three years.

part of the office was sub-let which

Janus International Australia, Convention sponsors, advertisers and all those who contributed their expertise generated income of $21,665 in FY23. for the benefit of members throughout the year. The SSAA acknowledges the ongoing support of industry, including major partners VISY Boxes & More, Southwell Lifts & Hoists, Storman, Storco, Universal Storage Containers and PTI innovation partner International Convention sponsors, advertisers www.selfstorage.org.au NOVEMBER 2023 INSIDER 133 TheSecurity, SSAA acknowledges theJanus ongoing supportAustralia, of industry, including major partners and all those who contributed their expertise for the benefit of members throughout the year.

VISY Boxes & More, Southwell Lifts & Hoists, Storman, Storco, Universal Storage Containers and

14 COMMERCIAL REAL ESTATE

SELF STORAGE SHINES BRIGHTLY Once ignored as a property asset class, self storage has now become a competitive commodity.

he nature of the property cycle generally means every asset class get its time in the sun. Historically, there has been a lack of understanding of self storage, with many wider groups labelling it as part of the industrial sector. However, this has changed in recent years, with the sector well and truly standing on its own as it always has with the sector experts. Nowadays, the self storage sector has seemed to shine bright in recent times, and it has many asking two simple questions, “Why?” and “How do I get my piece of the pie?”.

The Why: The past three years have presented many

obstacles for the property sector. First, COVID then the emergence of inflation and the corresponding interest rate rises. While for many asset classes, these events negatively affected the operational and investment performance of most assets, it has largely been quite the opposite for the self storage asset class, which has led to it being coined “recession-proof”. While the effects of COVID on the Australian property sector have been dissected at length, it does represent the start of the light for self storage’s growth as an attractive asset. Initially, as people attempted to figure out what COVID meant for them, there was a lull across the sector from an operational and investment perspective. However, this was short-lived. Similarly, the current economic climate has affected global markets. One of the biggest challenges is high inflation, which peaked in Australia in the December 2022 quarter (a 30-year high of 7.8%) and, while generally trending downward since, has still affected consumer confidence and, therefore, the operations of many businesses. The corresponding rise in interest rates has created uncertainty in property markets from an investment perspective, affecting demand and value. However, these impacts have seldom been felt in the self storage sector. To delve more deeply from an operational perspective, the disruptive nature of COVID for many Australians was a key driver of demand across the self storage sector, which soon saw the asset classing thriving. Operational performance increased significantly beyond pre-COVID levels evident by the around 30% growth in revenue that

INSIDER 133 NOVEMBER 2023

“

The disruptive nature of COVID for many Australians was a key driver of demand across the self storage sector.

occurred throughout this period. More recently, rental growth has continued as typical in high inflationary cycles. Commercial real estate services and investment firm, CBRE Group’s analysis of more than 200 self-storage facilities in the 2023 calendar year has showcased growth in the Average Rental Rate (ARR) of around 8%. The ARR is defined as the total passing storage income divided by the occupied area expressed as a $rate/ sqm. Although discretionary spending is becoming tighter for many Australians, this has ultimately affected occupancy levels in some markets, albeit in the vicinity of 1-3% for facilities already sitting at the 90% and above mark. CBRE views this as the market returning to stabilised levels rather than a downturn in performance. Many experienced operators are finding the balance between ARR growth and occupancy levels to maintain stable revenue. From an investment perspective, the market has experienced strong demand over the past three years. Blackstone’s entrance to the market in early 2020 was the first major show of offshore institutional investment into the sector. This has had a knock-on effect, which, on an overall basis, has increased market demand and pricing significantly. In the 2022 calendar year, transactions slowed as many participants adopted a ‘sit and wait’ approach until the full impacts of economic conditions were realised. However, 2023 has showcased increased activity due to increased confidence and the introduction of new market entrants. CBRE Alternative Assets team has compared the self storage asset class against the other core property classes along with other alternative asset classes over the past four years and YTD period. Notably, self storage has recorded the strongest growth being the only sector in CY23 which has showcased yield compression. The graph is provided opposite. www.selfstorage.org.au

OVERVIEW

ison

The below graph depicts the Self-Storage asset class against other core property asset classes over the last 4 calendar years and the current year to date. 8%

4% CY19 Self-Storage

CY20 Industrial

Office

CY21 Retail

LLC

CY22 Child Care

YTD (6 months) Service Station

Hotels

Source: CBRE Valuations – Alternative Assets 14

The Pie: Over the past five years, the market has grown from two-to-three active buyers to around 10. All these participants want to grow their existing portfolio through acquisition and development. Notably, five of these participants have raised in excess of $750 million combined in capital over the past 12 months, while the other core buyers also have large war chests enabling them to execute their growth plans. Essentially, the sector has been experiencing unprecedented levels of investor demand. In addition to the existing market participants, many others are watching from the sideline, looking for their chance to enter the market. However, the predominately off-market nature of the sector acts as a barrier to many as they do not get an opportunity to compete. Further, the fragmented nature of the sector makes it difficult for any participant, new or otherwise, to gain scale and understanding. There are currently around 2200 selfstorage facilities across Australia and New Zealand, with the major 14 operators in the sector only accounting for around 31% of the total facilities. CBRE anticipates transactions to continue, although some transactions will not be purchased solely on yield but rather because they present significant redevelopment/ reconfiguration opportunities as the quality of available stock is limited. CBRE also expects the portfolios to remain the target of many in an attempt to gain scale. It’s clear that self storage no longer remains the secret weapon it perhaps once was. As the sector continues to grow in its sophistication, the sun may keep shining on self storage a little longer. l

Thanks to Dylan Adams and Emily Quick from CBRE | Valuation & Advisory Services – Alternative Assets Website: www.cbre.com.au www.selfstorage.org.au

NOVEMBER 2023 INSIDER 133

16 INTERNATIONAL

G’DAY USA:. SSAA ON TOUR. This September more than twenty SSAA members attended the SSA Fall Show in Las Vegas. Makala Ffrench Castelli shares some of the highlights.

t was a warm and blustery Monday morning flying into Las Vegas – a strange time for some to arrive in a city well known for its night life, but perfectly acceptable when you’re there on business! The week ahead would hold plenty of self storage insights, global connections, new faces and some old friends. It’s impossible to fit five very full days into two short pages, so here are just some of the highlights. We’ll continue to share more in the coming months.

Facility Tour

SSAA arranged a facility tour for Australasian members to see self storage facilities in real-world USA. Principal Partner Janus International generously hosted us for the morning, showcasing three facilities across Las Vegas - Epic Storage, Golden State Self Storage and a newly opened Public Storage facility. Notable differences included enormous driveway units for RV storage and a climate-controlled all-weather loading/unloading bay at Public Storage. David Edward of Golden State shared market insights for Nevada and California, highlighting their focus on technology and customer experience which was more akin to facilities in Australasia.

Economic Summit

Robert Kaplan, Former President and CEO of the Federal Reserve Bank of Dallas, led the Economic Summit with his reflections on the current challenges of the US economy including nominal GDP growth and narrowly avoiding recession. His advice was to monitor five structural

INSIDER 133 NOVEMBER 2023

drivers: demographics (including the challenges of an aging population and debates on immigration); striking the right balance between globalisation and reshoring certain products or industries; the push for a more strategic energy transition; the potential disinflationary aspects of technology and AI; and the end of the debt super cycle where he cautioned taking undue risk at a time when the government has limited ability to cut taxes or increase spending. Workforce growth and improved productivity will be key to future economic success. A panel of US self storage experts, including Cris Burman, CEO of StorageMart and Noah Springer, Chief Strategy Officer of ExtraSpace Storage, shared their views on the current environment. It was a timely reminder that it was no longer 2021, so expectations should moderate across all aspects of the sector – facilities are taking longer to rent up, unit mixes need reviewing, operators should think carefully about revenue management and the mismatch in buyer/seller expectations needs to moderate. The cost of debt has slowed market activity in the main, but as organic growth returns, acquisition activity will ramp up.

Large Operator Council

One of the highlights of the SSA program is the Large Operator Council, a membership group where operators with more than 10 facilities gather for dedicated speakers and networking sessions. The council heard from global futurist and economist Shawn DuBruvac who delivered a thought-provoking session on how the mass adoption www.selfstorage.org.au

Above: SSAA members tour Golden State Self Storage.

Left: Joe Shoen, CEO - U-Haul.

Below: Outdoor RV units at Epic Storage, Las Vegas.

for the customer were the seeds of U-Haul’s beginnings and those pillars remain nearly 80 years on, where the name has become synonymous with moving and storing across the USA. Contrary to other major operators, U-Haul doesn’t subscribe to dynamic pricing and cautions operators about listening to capital markets over customers. Joe is so earnest about being entrusted with a customer’s business that he shares his email address publicly. 10 years from now he expects to see more technology, more consolidation, more containerised storage – and he hopes that U-Haul will be in the hands of the next generation of the Shoen family.

SSA Trade Show of digital technologies marks the beginning of a new era for humanity. He posited that those who excel in capturing, collecting and organising data will derive the most benefits from predictive and autonomous decisionmaking in future.

Young Leaders Group

A vibrant group of young self storage leaders gather at each SSA Show for leadership programming and networking events. The room soon fell silent as Jimmy Blackmon, a decorated military leader, shared his stories of survival, leadership and strategy. Stepping the group through a real-life combat scenario in Iraq, Jimmy brought to life the battle and demonstrated how key aspects of leadership impacted every twist and turn. Not just an engaging storyteller, Jimmy encouraged everyone to reflect on their own leadership styles and decisions throughout, leaving the aspiring young leaders with plenty to think about.

It’s a challenge to comprehend the size of the SSA Trade Show (and to make it around in a few short hours!). More than 200 exhibitors showcased their self storage expertise, with the majority in construction, financing and software. I am pleased to report that Australasian suppliers would comfortably hold their own in this market – our focus on customer experience, technology and automation easily places us atop the innovation adoption curve. l

Global Perspectives

It was a pleasure to spend time with global self storage executives, including Tim Deitz of SSA, Andrew Work of SSAAsia, Rennie Schafer of FEDESSA and Sue Margeson of the Canadian Self Storage Association. In addition to Tim hosting Rennie, Andrew and I on a panel where we compared and contrasted our respective markets, we also had time to meet and foster strong collaborations across the sector.

U-Haul and the Shoen Legacy

U-Haul CEO Joe Shoen is a billionaire with a blue-collar business and perhaps the most humble self storage operator you’ll ever meet. Family, hard work and respect www.selfstorage.org.au

NOVEMBER 2023 INSIDER 133

18 FINANCE

Why are capitalisation rates not softening in self storage?

“

s we wrap up the financial reporting season Self storage continues to show for 2022/2023, minimal capitalisation resilience in investment metrics; movement was reported by the two self storage Real Estate Investment Trusts (REITs), driven by a strong, competitive National Storage REIT (NSR) and Abacus market and healthy revenue growth. Storage King (ASK). This follows 12 increases to the official cash rate by the Reserve Bank of Australia and the Both self storage investment vehicles experienced Reserve Bank of New Zealand. The Australian cash rate less movement to the reported weighted average has been lifted from 0.10% in May 2022 to 4.10%, while the 0% 10.00% capitalisation rate than REITs weighted towards New Zealand rate shifted from 0.25% in October 2021 to traditional asset classes, such as Goodman Group (GMG) 5.50% as of September 2023. 10.00% 0% 9.00% -50 basis points; Centuria Capital Group (CNI) -107 basis A capitalisation rate (or cap rate) is the rate of return on 8.50% 10.00% 8.00% 8.20% 9.00% points; Dexus (DXS) -47 basis points; GPT Group (GPT) -25 an investment. It is calculated by dividing net operating 7.75% 0% 8.00% 10.00% 7.25% 00% basis points; Charter Hall (CHC) -39 basis points; Scentre income by the asset’s value/price. In valuations, it 9.00% 7.20%7.75% 8.00% 6.75% 10.00% 0% 7.00% Group (SCG) -26 basis points; and Vicinity Centres (VCX) determines the asset’s value as an9.00% inverse multiple of 6.50% 7.25% 6.50% 8.00% 6.00% expect 6.75% 10.00% -17 basis points over the 2022/2023 Financial Year. net income. At the high level, real estate investors 7.00% 25% 5.75% 5.75% 6.50% 9.00% 5.60% 0% 6.00% The weighted average capitalisation rate movement the rate of return on their investment to demonstrate a 5.40% 6.75% 6.00% 8.00% 7.00% 6.50% 9.00% 5.75% 5.20% 5.60%rate.5.75% 6.00% was a mere -5 basis points for National Storage REIT (NSR) premium to the risk-free8.00% rate – ie, the official cash A 6.00% %0% 5.40% 4.90% 5.00% 7.00% 5.75% 5.75% 6.50% higher return demonstrates and only -12 basis points for Abacus Property Group / a greater spread from the risk5.60% 6.00% 5.20% 4.60% 8.00% 5.40% 6.00% 7.00% 4.90% 5.00% 0% 4.00% Abacus Storage King (APG / ASK). free rate. Assets demand will often sell on lower 5.75% in strong 5.75% 5.60% 6.00% 5.20% 4.60% 6.00% 5.40%of investing In a rising cost of debt environment, it is expected cap rates,7.00% with the basic principle suggesting 4.90% 5.00% 5.75% 5.75% 4.00% 5.60% 6.00% 5.20% 0% 3.00% 4.60% that returns need to increase to cover the higher cost of that these assets have profiles. 5.40%lower risk 5.00% In simplistic 4.90% % 5.75% 4.00% 5.60% 5.20% 3.00% 4.60% investing. So why is self storage resisting the pressure of terms,5.40% the6.00% spread between the asset’s cap rate from the 5.00% 4.10% 0% 2.00% 4.90% 4.00% 5.20% interest rate rises? risk-free rate represents level of risk. 4.60% the asset’s perceived3.00% 5.00%

CAPITALISATION RATE / RISK RATE SPREAD TALISATION RATE / RISK RATE SPREAD ON RATE / RISK RATE SPREAD ATE / RISK RATE SPREAD RISK RATE SPREAD ATE SPREAD

CAPITALISATION RATE / RISK RATE SPREAD

4.10% 2.00% 4.00% 1.00% 1.75% 3.00% 1.50% 10.00%1.50% 1.35% 4.10% 2.00% 1.00% 4.00% 1.00% 00% 0.25% 1.75% 3.00% 0.10% 0% 0.00% 1.50% 1.50% 1.35% 2.00% 1.00% 4.10% 9.00% Q2 2014 Q2 2015 3.00% Q2 2016 Q2 2017 Q2 0.25% 2018 Q2 2019 Q21.00% 2020 Q2 2021 Q2 2022 Q2 2023 0.10% 50% 1.50% 0.00% 4.10% 8.50% 2.00% 1.35% 1.00% 8.00% 8.20% 1.00% 2015 Q2 2016 Q2 2017Rate Q2 2018 Q2 2019 Q2 2020 Q2 2021 Q2Office 2022 Q2 2023 10.00% Cash Self Storage Retail Industrial Other 7.75% 0.25% 0.10% 0.00% % 8.00% 4.10% 1.35% 2.00% 1.00% 1.00% Q2 2022 Q2 2023 7.25% Other 2017 Rate Q2 2018 0.25% Q2 2019 Q2 2020 Q2 2021 Cash Self Storage Retail Office Industrial 7.20% 0.10% 0.00% 1.35% akefield, MSCI 9.00% 6.75% 1.00% 7.00% 18 0.25% Q2 2019 0.10% Q2 2020 2021Office Q2 20228.50% Q2 2023 6.50% elf Storage RetailQ2 Industrial Other 0.00% 1.35% 8.00% 6.50% 8.20% 6.00% 7.75% Q2 2020 Q2 2021 Q2 2022 Q2 2023 8.00% % Retail Office0.00% Industrial Other 6.00% 7.25% 1 Q2 2022 Q2 2023 7.20%

2.50%

4.90% 2.00% 4.60%

10.00%

CAPITALISATION RATE / RISK RATE SPREAD

Office Industrial

Industrial Other

Other

6.75%

7.00% 5.00% 6.50%

9.00% 10.00% 8.00% 9.00% 7.00% 8.00% 5.75% 6.00% 5.40% 5.20% 7.00% 4.90% 5.00% 4.60% 5.75% 5.60% 6.00% 4.00% 5.40% 5.20% 5.00% 4.90% 3.00% 4.60% 4.00% 4.10% 2.00%

5.75%

5.60%

6.50% 6.00%

6.00% 4.00%

5.75%

5.00% 3.00% 4.00% 2.00% 3.00% 2.50% 1.00%

2.00%

1.75%

2.00% 0.00%

1.50%

1.00%

1.35% 0.25%

0.10% Q2 2021

2.50% Q2 2017 Q2 2018 Q2 2019 Q2 2020 1.00% Q2 2014 Q2 2015 2.00% Q2 2016 1.75% 1.50% 1.50% 1.00% Cash Rate Self Storage Retail Office 0.25% 0.00%

Q2 2014 Source: Cushman & Wakefield, MSCI

Source:133 Cushman & Wakefield, MSCI INSIDER NOVEMBER 2023

Q2 2015

Q2 2016

Cash Rate

Q2 2017

Q2 2018

Self Storage

Q2 2019

Retail

Q2 2020

4.10%

Q2 2022 Q2 2023 1.35%

Industrial

0.10% Q2 2021

Office

3.00% 1.00%

Q2 2022

Industrial

2.00% 0.00%

Other

Q2 2023

1.00% 0.00%

Other

www.selfstorage.org.au

Increased investor appetite and a lack of opportunities

The self storage investment market is no longer a two-horse race between the two self storage REITs. Since 2019, we have witnessed two major overseas investors enter our market and significantly increased demand from local major and second tier owners. The market became highly competitive across the second half of 2020 and 2021. Record transaction volumes set new benchmarks for acceptable rates of return (cap rates), particularly in core capital city markets. Two things have occurred due to the increased activity in 2020/2021: 1) assets that were available for acquisition were snapped up, and 2) investors that missed out became increasingly hungry.

A competitive storage landscape

Self storage has become a target asset class for many new and emerging investors. Simultaneously, established self storage investors have strong growth strategies. Over the peak transaction period of 2020 and 2021, we observed heightened competition between major self storage investors for prime assets in core markets. We see this as established self storage investors seeking to defend their market from new entrants and protect their opportunities from one another.

A wave of new capital turning to ‘inflation-proof’ income streams

In addition to new entrants, we have recently observed heightened interest from major global capital funds seeking to “get a piece of the revenue pie” attracted by higher levels of return when compared to traditional asset classes. Self storage took centre stage for being a defensive asset class throughout the Pandemic, riding out the storm, and more recently, shining as an inflation-proof income stream. Much of this capital has sought to partner with existing owners, offering a means to grow and add to the active investor pool. Even at the peak of transaction activity, the sharpest (lowest) capitalisation rates in the Australasia

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market continue to look attractive when compared to traditional asset classes and overseas self storage markets such as the US and Asia.

Reduced upside being factored into purchaser’s pricing

A change we have been observing is less ‘upside’ being factored into the price being paid for transacting assets. This relates to the adopted stabilised revenue and/or any expansion upside. With subdued revenue growth expected in the near term, major and emerging investors are reluctant to factor in uncertain upside, particularly in secondary markets, or for secondary assets. Investors may apply the same or similar cap rate to what has been achieved in the past, but noticeably, the variance we observe is in the adopted stabilised revenue. This has the result of maintaining capitalisation rates but naturally reducing achieved prices.

Conclusion

The “risk spread” between the cash and cap rates has narrowed across the property market. While cap rates have been softening across most property sectors, self storage continues to show resilience in investment metrics; driven by a strong, competitive market and healthy revenue growth. There are many drivers of value and facets to the ever-changing investment market. No market is immune to the macro-environment. We are fortunate that the fundamentals of self storage remain healthy. Wherever you are in the investment cycle, seeking advice and staying informed is worth the investment. l

Thanks to Linda Sharkey Divisional Director ANZ Self Storage, Cushman & Wakefield for this contribution . cushmanwakefield.com

Member Since 1999

112 Wollongong Street, Fyshwick ACT 2609 PO Box 115 Fyshwick ACT 2609 t 02 6299 4500 e printing@homesteadpress.com.au www.homesteadpress.com.au

20 AWARDS FOR EXCELLENCE

Manager of the Year WINNER

Apryl Hawker A thirst for knowledge and innovation helped Apryl Hawker of Stax of Storage Portland, Victoria win SSAA Manager of the Year.

pryl Hawker, the driving force behind Stax of Storage in Portland, Victoria, was the recipient of the 2022 Manager of the Year. Apryl’s career started as an accountant, but after having children, she took on short-term contract roles in local government, finance, local laws and customer service. These varied experiences laid the foundation for her versatility and comprehensive skill set. An opportunity arose to work as an office manager with a furniture retailer, but when the owners decided to semi-retire and close the business, Apryl’s self storage journey began. Apryl was given the opportunity to take over management of their storage business which needed some attention.

INSIDER 133 NOVEMBER 2023

Sponsored by Storman

Initially, the business was primarily word-of-mouth with a fairly dormant Facebook page and no Google listing. The change in management in 2019 led to a change in business name. Apryl’s first project was to create a brand and develop an online and social media presence. Apryl developed the brand J&D Self Storage, created the logo and chose the main colours for the business, which were used across all areas – from business cards to uniform, store signage and social media. This was the first time Apryl managed business content, so she dove head-first into research. The business owners supported her in attending the 2019 SSAA Convention with seminars pointing her in the right direction and business connections who were happy to share information. This led to an online presence and an increase in business as a result. Leads came in at a rapid pace and 50 additional units were built to meet demand, and rates increased.

This success led to an opportunity for the owners to fully retire. In December 2020, the property and the business were purchased by Con and Anita Frances and re-branded Stax of Storage Portland. However, the success with the J&D brand was not lost when changing to Stax. As manager of Stax there was more autonomy in setting the business direction. Apryl researched competitors’ pricing and availability. In line with high occupancy she increased rates significantly for all new sign-ups, as well as rolling out regular small increases for existing customers, quickly improving the revenue and cash flow of the business. In that financial year, this strategy increased the yield per square metre by over 27%. In addition, expenses were reviewed, and cost-saving measures adopted, including an upgraded phone system that resulted in 40% savings and upgrading the office heating, which not only improved staff and customer comfort but was also energy efficient, delivering further savings on electricity.

www.selfstorage.org.au

Initially, only three types of boxes, some bubble wrap and a handful of padlocks were stocked. Box sales were nearly exclusive to storage customers. In 2021, Apryl increased the range of stock and achieved a growth in sales of 136%. Even with COVID affecting customer’s ability to get in-store, Stax of Storage offered touch-free collection and local delivery and saw non-storage customers coming in just for boxes and moving supplies. In the 2022 financial year, the company achieved an additional year-on-year increase in merchandise of 112%. In addition, it actively advertised locally on Facebook, Google, newspapers, etc, had custom Tea chests printed and now carries more than 45 product lines. Stax of Storage also offers custom orders to meet specific customer needs. Boxes and moving supplies are now sold throughout the region, and around 30% of sales go to nonstorers, which also continues to build brand awareness. One of Apryl’s standout attributes is her insatiable appetite for

knowledge. This appetite, evident through her commitment to ongoing learning, saw her participating in SSAA courses, and webinars and diligently reading Insider magazine. Her dedication to self-improvement extended to her team, ensuring all members complete the Self Storage Fundamentals course. Her unwavering focus on teamwork and open communication is at the core of Apryl’s leadership ethos. She empowers her team members to excel and fosters an environment where each member’s strengths are celebrated. This approach has forged a cohesive team that enhances internal dynamics and radiates customer positivity. Beyond the realms of business, Apryl’s commitment to preserving the historical 70-year-old, three-

storey former wool store while embracing modernisation and now further expansion is commendable. Her influence extends beyond a single site, as Apryl now oversees multiple Stax of Storage locations, including the newly opened Yarraville enclosed parking site. Drawing on her accounting background, she efficiently manages diverse financial aspects, underscoring her versatility and comprehensive approach to business management. Apryl’s journey from accountant to the revered SSAA Manager of the Year exemplifies a remarkable narrative of leadership, innovation, and unrelenting commitment. Her ability to harness various skills and her thirst for knowledge and strategic foresight has irrevocably reshaped the self storage industry. l

22 ENVIRONMENT

GO GREEN

Green space at your self storage facility benefits staff, customers and the neighbourhood.

cademic research has confirmed the benefits of green space. An article published by the National Academy of Sciences from a Danish study found that people who used green space in their community were 55% less likely to develop mental illness, including depression and anxiety. Looking at green space through the lens of the self storage industry, it’s easy to imagine how adding green to your storage facility site will make customers feel different about visiting your facility. Traditionally, self storage facilities have a reputation of being cold, isolated, and somewhat unnerving. If plants and a green environment boost psychological restoration for your customers and employees, the biggest question would be, “Why not?” We don’t need to look at the research to see how green space improves our lives. Green space means socialising, exercising, higher air quality, decreased noise and less overstimulation.

The cost of commercial landscaping

Undoubtedly, the first question is, “How much is commercial landscaping for my self storage facility?” As with any development, the costs can be as low or as high as your budget and space will allow. As most

INSIDER 133 NOVEMBER 2023

self storage facilities consist of concrete and metal, commercial landscaping may be on the lower end of the cost spectrum. Then, you must factor in the ongoing maintenance with a gardener or landscaper to perform basic upkeep. Obtaining several quotes for the installation and ongoing maintenance is recommended. By adding green space to your self storage facility site, it will have a positive impact on new and existing customers, employees, and the neighbourhood.

Green space strengthens social connection

Green places are universally attractive and increase social connections between people on site. Even if your green space is primarily used as a place to have breaks, you’ve created an opportunity for people to gather and connect.

Green space increases work productivity

Studies have shown that employees with access to or a view of green spaces are far more productive than desk employees who are isolated without a view. While self storage facilities typically don’t have a large group of employees, they do deal with the same issues of employee reliability and staffing shortages. If a garden www.selfstorage.org.au

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Green space means socialising, exercising, higher air quality, decreased noise and less overstimulation. or a few trees is what it takes to give your staff and customers peace of mind and promote productivity, then they are a worthwhile investment.

Green space closely linked with long-term economic growth

Green spaces are proven to generate income for nearby businesses. In the US some self storage operators have used their green spaces to create places to put on outdoor events such as festivals, markets or concerts. Many self storage owners would be glad of a way to use their unused acreage in a responsible and economical way.

Green space encourages safer driving

According to studies, roadside greenery and parkway architecture significantly lower drivers’ hostility and fear, resulting in safer and more conscientious drivers. Customers coming to self storage facilities are more often than not driving large moving trucks or their personal cars or SUVs loaded with treasures. Not only does green space reduce stress, but nothing will slow down a driver faster than an immovable tree. Consider using trees and bushes to soften otherwise stressful driving areas. Remember to keep greenery trimmed regularly to avoid creating invisible or blind spots for drivers.

than in other open areas. Adding green space to your self storage facility will reduce the impact of the heat on your facility, making it a more pleasant place to visit.

Green spaces reduce stress and violence

In Chicago, after adding more greenery in an area, self storage operators saw a reduction in the amount of graffiti and vandalism, and storers reported an increase of trust in the facility to store their goods, which also reduced the amount of stress and anxiety when arriving at the facility. If vandalism or theft is an issue at your self storage facility, or if you just want to head it off before it begins, green spaces are proven to be an excellent way to start reducing your risk of being a victim of a crime. Investing in green space is one of the best ways you can show customers that you care about their well-being and that you care about the well-being of your facility and all those who visit it. As self storage facility owners and operators, this is exactly the feeling you want to cultivate with your customers. After all, they’re trusting you with their precious, storable treasures. l Thanks to: Greta Tasedan, Product Ambassador: Radius+ and ManageSpace

Green spaces moderate temperature

The more highly concentrated the structures are in urban areas, the more intense the heat becomes. You’ve probably noticed at your self storage facility that, due to the structure and design, it can be a bit hotter

Considering selling now or in the future? Call for a confidential chat regarding the potential realisation level of your self storage facility. ■ Financial ■ Property

■ Compliance ■ Upside

Matt Walsh

Highway Frontage Real Estate

0411 880 054 156 Bay Street, Port Melbourne, VIC 3207

matt@highwayfrontage.com.au www.selfstoragerealestate.com.au HIGHWAY FRONTAGE ARE SSAA MEMBERS

www.selfstorage.org.au

NOVEMBER 2023 INSIDER 133

24 FACILITY VALUE

General building maintenance: Enhancing your facility’s appeal

Apart from compliance maintenance, several general building maintenance tasks can help maintain or even improve your facility’s value.

Repair and maintenance sinking fund: Many facility owners allocate

How to maximise facility value Effective maintenance is essential to maximising the value of self storage facilities. Maximising the value of your self storage facility: Maintenance strategies for pre-sale Preparing your self-storage facility for sale is a complex task involving various aspects, but maintenance can significantly impact the sale’s success. Effective maintenance strategies can enhance your facility’s value, attract more potential buyers, and ensure a smoother transaction process. In this article, we’ll explore the importance of compliance maintenance and general building maintenance when preparing your self-storage facility for sale.

Compliance maintenance: Ensuring safety and attracting buyers Compliance maintenance encompasses a range of crucial factors, including fire and safety measures and mechanical systems. Ignoring these aspects can jeopardise the safety of your customers and staff and deter potential buyers from investing in your facility. Let’s delve into the specifics of compliance maintenance.

Fire and safety inspections:

Regular maintenance of fire safety equipment is paramount. This includes fire hydrants, hoses, sprinkler systems (if installed), and inspections of fire doors. Ensure that

INSIDER 133 NOVEMBER 2023

the paths of access and egress are clear and unobstructed. Emergency and exit lighting should be in optimal working condition, and fire and smoke alarms must be inspected and tested periodically. Qualified consultants should conduct these inspections as required, as outlined in your building permit or advised by specialists. Lift maintenance: Regular inspections and maintenance of lifts are crucial. Manufacturers typically provide guidelines for these procedures, and adherence is essential. A well-maintained lift ensures safety and reflects positively on your facility’s overall condition. Documentation: Maintaining detailed records of compliance inspections is vital. Increasingly, buyers request log books and inspection reports spanning several years. Incomplete or missing records can discourage potential buyers from proceeding with a purchase. A robust maintenance documentation system is essential to maximise interest from prospective buyers. Consultant engagement: While some maintenance tasks can be handled in-house, it is advisable to engage qualified consultants for certain equipment, such as airconditioning units and electric gates. Their expertise ensures that critical components remain in excellent condition.

a portion of their revenue to a repair and maintenance sinking fund. This dedicated fund allows owners to budget for routine building maintenance tasks, ensuring they are addressed promptly. This proactive approach prevents minor issues from escalating into costly repairs and demonstrates a commitment to facility upkeep. Doors and paint: Regular maintenance of door opening mechanisms can extend the life of your doors and enhance the facility’s aesthetics. A fresh coat of paint can breathe new life into the property’s appearance, leaving a positive impression on potential buyers.

Landscaping and gardening:

Well-maintained landscaping and gardens improve the overall appeal of your facility. A visually pleasing environment can attract more customers and impress potential buyers.

Roof and drainage inspections:

Regular inspections and preventative repairs of the roof and drainage systems are wise investments. Concurrently, ensure that your plumber clears the gutters to prevent water damage and maintain the property’s structural integrity. By implementing these maintenance strategies, you ensure the safety and satisfaction of your current customers and increase the attractiveness of your selfstorage facility to potential buyers. Comprehensive documentation, proactive maintenance, and a well-kept property can significantly maximise the value of your facility and lead to a successful sale transaction. Ultimately, the effort you invest in maintenance will pay off in the form of a higher selling price and a smoother sales process. l Thanks to Highway Frontage for this contribution. E: mwalsh@highwayfrontage.com.au W: highwayfrontage.com.au www.selfstorage.org.au

SECURITY 25

Boosting the real estate value of self storage facilities with an integrated security system

elf storage facilities have gained significant popularity among real estate investors due to their potential for generating consistent rental income. However, what sets apart an average self storage facility from an exceptional one in the eyes of potential buyers and investors often comes down to the presence of a well-designed and maintained integrated security system. Such a system safeguards the facility’s assets and can significantly increase its overall value, making it an enticing prospect for investors. First and foremost, investors are constantly seeking opportunities that offer both a reasonable return on investment and a lower level of risk. A self storage facility equipped with a comprehensive security system ticks both boxes. The presence of state-of-the-art perimeter deterrence, intrusion detection, access control measures, and alarm systems reduces the risk of theft, vandalism, and unauthorised access. Consequently, potential investors perceive such facilities as safer, less prone to disruptions, and more reliable sources of rental income. But an integrated security system isn’t just about keeping the facility safe - it also allows for the establishment of premium rental rates. Tenants are often willing to pay more for storage units within secure facilities. This increased revenue from higher rental rates translates into greater cash flow, a key factor that investors consider when assessing the potential profitability of a selfstorage facility. Additionally, a secure environment attracts new tenants and encourages existing ones to renew their contracts. Reduced instances of theft and damage to stored belongings create happier, more loyal customers. Consequently, www.selfstorage.org.au

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In an increasingly competitive real estate market, integrated security systems can help self storage facilities achieve more than just site security.

well-maintained security systems contribute to higher occupancy rates, ensuring a steady stream of rental income. As a result, the property’s value appreciates. Beyond attracting and retaining tenants, integrated security systems can help reduce overall costs associated with maintaining a property. For example, insurance companies often offer lower premiums to facilities with robust security measures in place. A welldesigned security system minimises the likelihood of incidents and provides evidence in case of claims. This lowers the facility’s insurance costs, which directly adds to its profitability and, consequently, its value. And because integrated

systems enable owners to manage access permissions from anywhere, admin costs can be further reduced while also increasing site security and control. But perhaps most importantly of all, integrated security systems can help a self storage facility’s reputation in the market. Wordof-mouth recommendations and positive online reviews are often influenced by the perception of safety and security. Facilities with well-designed security systems enjoy a better reputation, which can lead to increased interest from investors and a more competitive position in the market. A well-designed and maintained integrated security system is more than just a means of protecting assets; it’s a strategic investment that can increase the overall value of a self storage facility in the eyes of potential buyers and investors in the real estate sector. l Thanks to Baden Foster from Gallagher Security for this contribution. E: baden.foster@gallagher.com W: security.gallagher.com

NOVEMBER 2023 INSIDER 133

26 AGREEMENTS

Fair warning

The Australian standard self storage agreement has been redrafted in light of upcoming unfair contract terms legislation.

ew unfair contract terms legislation comes into effect from November 2023, and while the SSAA standard agreement suite was reviewed in line with these draft requirements last year, the legislation has now passed, and we have a better understanding of what constitutes an unfair term. The Australian standard self storage agreement has been redrafted in light of these changes. The tenets of the agreement remain the same, but the agreement has been streamlined and restructured to make for easier reading. The agreement now lays out a clearer order of each party’s obligations, warranties and acknowledgments, with specific sections now explicitly outlining important topics such as grant of licence, fees and risks.

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What’s changed?

Below is an overview of some of the key changes that have been implemented in the updated agreement suite.

Facility Rules

We have introduced a new concept of Facility Rules so operators can adjust operational or procedural requirements based on their needs without adding bulk/specific terms to the agreement. This makes the agreement shorter and more flexible and enables operators to provide a clear list of rules/obligations to storers and others using the facility (including OHS and other requirements). A template will be provided for operators to tailor to their needs. Previously, operators have contacted the SSAA team seeking to modify their agreements to include terms that describe specific business practices, such as the facility’s access hours and consequences of security call out, etc. The agreement covers a range of operational variations, meaning that the Facility Rules allow facilities to communicate their specific operational requirements to their storers. The Facility Rules are also intended to replace presenting ‘main points of the agreement’ on the front page of

the agreement schedule, as having these points can create ambiguity, increase risk and encourages the customer to only review the main points, not the full terms. We understand operators like having the main points to draw customer attention to some aspects of the agreement, so we recommend that the Facility Rules document be used in this manner instead upon move-in.

Storage options alternative to standard storage is now referred to as ‘Services.’ We now refer to various storage agreement types as Services (eg, managed or mobile agreements) with specific terms that operators can add/delete as required for their specific storage type.

Recitals section added

A Recitals section has been added to the beginning of the agreement to provide context to the reader and address the reason behind certain terms, particularly in light of unfair contract terms legislation changes.

Interpretation clauses added

An interpretations clause to assist with interpreting the agreement more clearly has been added to provide further clarity from a legal perspective. www.selfstorage.org.au

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The updated agreement seeks to provide an appropriate balance of rights and protections between the operator and the storer.

Storer warranties

Under the new agreement, part of the storer’s obligations is that they now cannot store goods worth more than AUD $1000 (in total) unless they are itemised and covered by insurance, in light of the current availability of insurance.

Expansion of the definition of ‘Default.’

To be more aligned with legal terminology, a Default now constitutes any breach of this agreement, not just non-payment of fees.

Update to termination terminology

There are now four ways that have been outlined for the storage agreement to be terminated: l Termination Without Cause – can be initiated by either party by providing written notice that adheres to the number of days required under the Termination Notice Period. l Termination for Cause – can be initiated by either party where either a Default cannot be remedied (eg, it is determined that the storer’s use of the space is illegal). This can also be initiated if a written notice has been provided to the storer requesting a remedy to the Default and they have failed to act within 14 days of receiving notice. l Termination due to Variation – where the storer has received notice of a variation of the agreement terms and conditions and chooses to terminate with no less than 24 hours’ notice of the Variation taking effect.

l Termination due to an

Unforeseen Event –

(eg, natural disaster). Much of the operational procedures that facilities are familiar with remain the same. However, the updated agreement seeks to provide an appropriate balance of rights and protections between the operator and the storer. SSAA members are strongly encouraged to transition all storers onto this updated agreement before the new unfair contract legislation terms take effect in November 2023, or they may leave themselves open to unnecessary liabilities. l Visit the SSAA Member Portal to learn more. For any questions, please reach out to the SSAA team at membership@selfstorage. com.au. Our SSAA Understanding Storage Agreements training course will also provide updated content to align with the new agreement.

AIM QUICK BUILD CONTAINERS: when every bit of space counts Aim Quick Build Containers are the most versatile, quality solution for self-storage, warehousing or extra storage anywhere. The containers come flat packed and can be assembled anywhere. Unlike shipping containers, Aim Quick Build Containers can be delivered to the back of a site, to an underground warehouse or assembled in a tight location. They can be joined, stacked, dismantled and relocated to suit your space requirements and changing needs.

Made with hot-dipped galvanised steel, Aim Quick Build Containers promise long-lasting quality. They come standard with oriented strand board floors, crane lifting lugs and forklift skids for easy movement. They also come with a rain gutter system to prevent water pooling on the roof, and with a key locking system with a separate T-Bar for a security padlock.

For more information or a quote, call Aim Hire on 03 9720 4455 email jdillion@aimhire.com.au or visit www.aimsitesolutions.com.au

Aim Quick Build Containers come in a range of sizes including 1x2m; 2x2m; 2x3m and 2x4m. Visit our website to download the exact dimensions.

28 AWARDS FOR EXCELLENCE

Facility of the Year Sponsored by VISY Boxes & More

WINNER Rent a Space, Marsden Park, Sydney

n exceptional commitment to providing top-notch storage solutions and customer experiences was behind Rent a Space’s 2022 Facility of the Year award. The company’s winning combination of state-of-the-art facilities, innovative technology integration, and a customer-centric approach set it apart. Rent a Space opened its 14th facility at Marsden Park in December 2020 (now 16 operating facilities at time of print), consisting of 852 storage units housed in two buildings with 70 driveway units and 782 internal units, accessed by oversized fast lifts for convenience and to strengthen customer satisfaction. Award-winning architect firm SJB was commissioned to design a concept that elevated the standard of self storage design and delivered

new facilities of which the company, industry, customers and local community could be proud. Harding Architects translated this to deliver a state-of-the-art facility prioritising convenience, safety and security. This facility provides functional yet inviting, safe and secure spaces and enhanced amenities such as large undercover driveways and a customer meeting room with service amenities. The retail office is large, bright, and welcoming and includes a Box Shop stocked with a large range of packing and moving supplies. There are 25 people employed at the facility.

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Sustainable building practices are a hallmark of this facility.

The facility was opened in a staged approach. Stage 1 opened December 2020 with Building A partially fitted. Stage 2 completed the top floor fit out and Stage 3 (opened July 2022) was the construction and complete fitout of Building B; a twin of the first building. The facility now boasts more than 870 units with excess land available for future expansion. Sustainable building practices are a hallmark of this facility, including using energy-efficient materials, bioretention/water capture, treatment and recycling for irrigation and cleaning purposes, solar panels, passive daylighting and eco landscaping. The minimal use of lighting via sensor LED lights combined with solar panels minimised the carbon footprint of Marsden Park’s operational facilities. Water capture and storage means negligible external water is used. These sophisticated features are acknowledged by the customers regularly and are reflected by the high-quality Google reviews and ratings.

Safety and security

High-quality construction materials and industrial-grade locks, good lighting, coded entry doors and alarm systems and secure perimeter fencing are the sophisticated and security hallmarks of the Marden Park facility. Storage customers today expect more accessibility, security and additional amenities, high-quality construction materials, industrial grade locks, good lighting, encoded entry doors and alarm systems, and secure perimeter fencing.

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www.selfstorage.org.au

The safety and security features include: l Security fencing, including barbed wire and spearhead fences. l Security gates controlled by PIN pad (first security checkpoint). l Electronic sliding doors for building entry controlled by PIN pad (second security checkpoint). l Digital secure access control systems installed for customer access. l Individually alarmed units. l RFID/coded access for staff access into office areas. l 4K CCTV system featuring 40 cameras, including in hoists. l Back to Base monitored alarms. l Fire sprinkler-fitted property with Direct to-brigade fire monitoring. l PA system throughout. l Restricted key systems in use. l Fully enclosed storage units with wire mesh ceilings. l Security lighting.

Marketing objectives

The marketing objectives for the launch of the Marsden Park facility were to maximise brand and location awareness. The marketing campaigns feature how the facility is family-owned and operated and is simple to deal with. This underpins the marketing philosophy of the entire company. The value of integrity, and respect shape the tone of the messaging that goes above and beyond is a point of difference that they bring. The overall approach to marketing this site was fourfold. l Integrated strategy to position Rent a Space as one of the most modern, secure state-of-the-art self storage facilities in Sydney. l Improve and enhance the brand image identity with personal www.selfstorage.org.au

and business storers through consistent marketing messages across a variety of channels. l Build long-term customer and community engagement through awareness, marketing and educational content. l Local community sponsorship to attract, engage, convert and retain customers. The aim is to offer customers great value for money as opposed to the cheapest space. The exceptional Marsden Park team is one of the factors that have driven the growth and provided the backbone for the success of this facility along with the training. All team members know that while customer service is important, ultimately, their role is to sell storage. They are trained on how to meet and greet, sell on the benefits, give a store tour, provide a recommendation, ask for the sale and handle objections. The underlying philosophy is that the customer needs a solution, and Marsden Park is the best in the market. The team is also trained in providing care in customer service, during which they learn the importance of empathy, reliability, customer convenience, active listening, and trust. The facility is well-presented as dry, secure, well-maintained, and clean. The team takes pride in the company, the brand, and the uniform and presents a wellgroomed appearance, along with a warm, enthusiastic welcome and service with a smile. They consistently demonstrate exemplary customer-first values that reflect the family-centric culture, empathy, honesty, humility, courtesy,

professionalism, commitment to excellence and service that goes beyond. In doing so, they surpass traditional perceptions of self storage through their commitment to customers, community, innovation, and excellence. The customer experience involves all touch points from the website to the call centre team, from the managers who call before the visit for a meet and greet.

Outstanding customer service

The store is managed by the store manager, who’s responsible for the day-to-day operations, staff, store presentations and financial results. The store is visited regularly by the Head of Revenue Management, who reviews performance with the manager and discusses pricing, services, and sales strategies. The general performance of the store is monitored through performance reports, financial metrics, KPI targets, customer feedback, Google reviews, and how well the store operates. As a management team, there’s an open and transparent communication style that seeks feedback from all team members for most company initiatives. This feedback is considered when rolling out new initiatives or training. As a company, there are several Key Performance Indicators that are monitored and reported every month. Rent a Space, Marsden has created an unparalleled storage solution, which positioned it as a standout choice for the Facility of the Year award, showcasing their industry leadership and commitment to excellence. l

NOVEMBER 2023 INSIDER 133

30 CYBER GUIDELINES

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The SSAA has been working to prepare a set of cyber security guidelines for Australia and New Zealand, fit for industry purposes.

Stay cyber secure

Industry cyber guidelines for members now available.

ith digitalisation and automation significantly affecting work and personal lives, cyber security and staying safe online has become incredibly important. This urgency around cyber security solutions has increased for businesses and individuals, mainly due to recent data breaches that have affected large corporations that historically held longstanding customer trust. The SSAA has been working to prepare a set of cyber security guidelines for Australia and New Zealand, fit for industry purposes with the help of cyber security experts and government resources. These industry guidelines aim to build operator confidence across areas such as maintaining secure software systems, approaches to customer data collection and storage, and their online practices, as personal cyber security hygiene often directly impacts their business’ security hygiene. This new resource will provide information and guidance around the following topics:

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1 Common cyber security

threats to businesses and individuals including malware and ransomware, business email compromise fraud and identity theft.

For each of these common cyber security threats, this chapter will highlight warning signs, tips for mitigating the risk and steps to take if you have been targeted.

2Protection measures can be

taken to secure user accounts, devices, email and general online security. This chapter contains helpful guidance around specific tips such as software updates and password recommendations, network management and identifying spam emails.

3Information on security

measures taken by industryspecific software providers.

This chapter provides an overview of infrastructure, product security and incident response measures in place from our industry-specific software providers.

4How to handle customer

information, including privacy requirements, managing and retaining personal data and handling financial information. This chapter will provide industry guidelines on how to protect customer data.

5Practical advice around

managing people and procedures for topics such as facility access control, password management and training.

With an operational perspective in mind, this chapter seeks to provide guidance around best educating staff on cyber security practices and adopting a unified approach to maintaining security for individuals and businesses.

6If a cyber security incident

occurs, steps for incident management include how to report the incident, recovery steps to follow and disaster recovery planning guidelines. This includes the differing reporting avenues for Australia and New Zealand and also provides incident-specific response plan outlines.

These cyber guidelines are now available on the Member Portal and ready for use. These guidelines have been formulated in response to member feedback, which will set a foundation for facility operators to build from when it comes to structuring their own cybersecurity safety and response plans. l If you have any questions, please reach out to membership@selfstorage.com.au. www.selfstorage.org.au

DIGITAL 31

How software affects self storage business valuations

he value of self storage businesses is typically based on the value of the real estate and revenue/profits being generated. However, software can significantly affect the operational efficiency and scalability of a self storage business. The landscape has significantly evolved in self storage business valuations. Beyond traditional methods, software integration has become a pivotal factor in determining the worth of self storage ventures. Let’s explore the dynamic connection between self storage software and business valuation.

How can software improve the efficiency of self storage businesses?

The introduction of advanced self storage software solutions has transformed the self storage industry, offering streamlined management, real-time insights, and enhanced customer experiences. Some of the ways software can help improve efficiency include: l Self storage software can automate tasks such as rent collection and maintenance scheduling. l Task automation can free up time for employees to focus on other important tasks, such as improving customer service. l The software can also help self storage businesses track inventory and occupancy levels, which can help them make better decisions about pricing and self storage marketing. l The quality of software can influence tenant experiences, automate administrative tasks, and even optimise unit occupancy rates. www.selfstorage.org.au

l It helps reduce errors and improve efficiency. With increased efficiency comes reduced costs and higher profits. Investors and potential buyers of your self storage business will love to see these characteristics because they’ll get a better return on their investment. On the other side, businesses with high costs, operational inefficiencies and poor customer experience are red flags for investors, reducing the valuation of your business.

Impact of software on self storage business valuation

In the highly competitive self storage market, adopting cutting-edge software can make a real difference. Businesses that leverage software for online rentals, personalised customer interactions, and efficient facility management gain a competitive edge. Here is how software may impact a self storage business valuation: l The value of a self storage business is typically determined by a number of factors, including the location of the property, the size of the facility, and the occupancy rate. However, software can also play a role in determining the value of a self storage business. l Businesses that use software to improve operational efficiency and scalability are typically worth more than those that do not. This

is because software can help businesses to save money, reduce errors, and grow their operations. Investors and potential buyers recognise the value of a business that seamlessly integrates innovative technology to drive performance and customer satisfaction. l The valuation of a self storage business is not a one-size-fitsall equation. Different software solutions can significantly affect valuation based on factors such as operational efficiency, customer engagement, and data management.

Wrapping up

The right software can play a dynamic role in self storage business valuations. It can make a self storage investment opportunity attractive for the investors. It may not be a dealbreaker, but it serves as the icing on the cake and can change the overall attractiveness of the business. As a self storage business owner you must stay updated about the latest trends in self storage software and align your business accordingly to stay on top of valuation. l

Thanks to Storganise for this contribution. storeganise.com/ self-storage-software

NOVEMBER 2023 INSIDER 133

32 PARKING

sumptions

ing what happened at each device. From this list, two sets describing people arriving, and the second being the list of the entries were administrative events that had been s were ignored.

of this

e is no tween

The value of parking services contemporary study justify reducing the parking provision rates from the 2009 and 2016 study to meet current transport conditions. It is worth considering the additional benefits for customers when there are dedicated parking services for dropping off or picking up goods.

e that has

ber of not e imate er of

Navigating a storage facility with belongings in tow can be daunting for customers. You transform their experience into a seamless and hassle-free process by offering designated customer parking areas. Customers can park their vehicles near their storage unit, eliminating the need for long walks or heavy lifting. This convenience creates a positive impression and encourages customer loyalty.

itor

apture vious mal.

or arrive tomer,

ded red. d other a given erver on

Streamlined convenience.

torage facility owners aim to deliver a comprehensive and hassle-free experience to customers. Ease of access and car parking have a role to play in customer experience, so don't overlook the benefits of including an appropriate allocation of customer parking at your facility. The SSAA 2022/2023 Parking and Traffic Study is designed to inform members, councils and other self storage stakeholders about the unique parking, traffic and transport requirements for self storage. This study provides parking requirements for the whole facility and considers that members are best placed to determine the appropriate placement of parking spaces. The outcomes of this larger and more

Recommended Parking Rate Provision Facility Size

Number of Parking Spaces

Under 3,000 m2

5 spaces

3,000 to 6,000 m2

7 spaces

6,000 m2 +

7 spaces

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Time efficiency for busy customers. Modern life is fast-

paced, and storers’ time is precious. By providing easily accessible customer parking, you acknowledge their need for efficiency. Quick and convenient access to their storage units means they can complete their tasks swiftly, maximising their productivity and leaving them satisfied.

Weather protection for goods and customers. Inclement

weather can be a significant inconvenience when visiting a storage facility. Offering covered or sheltered customer parking spaces ensures that storers and their belongings remain protected from all weather conditions. This added layer of care demonstrates your commitment to their wellbeing.

Positive first impressions.

First impressions matter. When customers step into your facility, they assess its accessibility and user-friendliness. Offering wellmarked, easily accessible parking for customers conveys professionalism and consideration. A positive first impression can lead to lasting customer relationships.

Enhancing security for customers and belongings.

Strengthening customer engagement. The convenience

Showcasing commitment to customer experience. Customer-

Offering designated customer parking areas within the facility extends your security measures beyond storage units. Customers can confidently leave their vehicles while attending to their storage needs, knowing that your facility’s security protocols are in place.

of customer parking services provides an opportunity for engagement. As customers visit your facility, your staff can offer assistance, answer questions, and ensure a smooth experience. This personalised touch creates a sense of belonging and builds a stronger customer-facility relationship.

focused services such as dedicated parking spaces demonstrate your commitment to optimising their experience. People appreciate when businesses go the extra mile to ensure their comfort and convenience. This commitment can translate into long-term loyalty and positive wordof-mouth recommendations.

Fostering repeat business.

Repeat business is the hallmark of a successful storage facility. The ease and efficiency of your parking services can become a key factor in their decision to choose your facility again. Providing for adequate parking at your facility is a strategic move that elevates the overall customer experience. By recognising and addressing customer’s needs beyond storage units you’re not just providing a service but cultivating lasting relationships and positioning your storage facility as a trusted partner in their storage journey. Members are encouraged to consider local market and operating conditions, their prospective customer base and desired amenity, and the surrounding built environment when determining parking and transport requirements for any new self storage facility. l www.selfstorage.org.au

Building Self Storage for over 20 years

regisbuilt.com.au

Æ Storage Unit Construction

Æ Permits

Æ Architectural Design

Æ Turn Key Solutions

Æ Engineering

Æ Building Structures

Æ Building Conversions

Æ Warehouse Construction

1300 388 224

info@regisbuilt.com.au

Freestanding Goods Hoist Our Freestanding Goods Hoist gives you the capability to lift goods of up to 3000 kg, to fifth floor heights. Our flexible design capabilities and local manufacturing means we can provide goods-only as well as goods and personnel hoists in a variety of platform finishes and other options, including custom designs for special applications.

Features and Benefits Goods only or goods and personnel

Vertically opening doors offering clear access for any load

Cost effective alternative to a traditional lift

Low maintenance costs

No lift shaft required

Self diagnostic programmable logic control (PLC)

Installed external or internal to the building

Internal power pack

1 day installation (clear access required)

Fully Compliant with AS 1418 Parts 1 & 8, AS 5246 Part 1, Classification A6, and all WHS regulations

Minimal pit and overrun required

Main Dimensions Model

SGH-1515

SGH-2018

Platform L x W

1.5m x 1.5m

Capacity

SGH-2418

SGH-2422

SGH-2424

SGH-3024

2.0m x 1.8m 2.4m x 1.8m

2.4m x 2.2m

2.4m x 2.4m

2.98m x 2.4m

1500kg

Enclosure Length

1720mm

2220mm

2620mm

3200mm

Enclosure Width

2165mm

2465mm

2915mm

3065mm

Pit Depth

125mm

The above dimensions are based on doors same side. Measurements and finishes may vary depending on options. Contact Southwell for details. *Finishes shown are not Standard. WARRANTY 1 year full warranty.

36 Edward St, Camden NSW Australia 1300 793 793 southwell.com.au

OH&S 35

Beyond health and safety compliance

A good safety management system keeps staff and visitors safe, but also helps with the bottom line. By Tim Callinan.

ignificant workers’ compensation insurance increases affect most businesses across Australia (especially Victoria). A major contributor to this increase is the increase in the number and cost of claims. There are ways to reduce the cost of claims through strategic management. However, the best way to reduce the cost is to not have the injury in the workplace, and one of the best ways to reduce injuries is to ensure that your safety management system is compliant with the law. Meeting your legal obligations is achieved through being diligent about implementing hazard identification and risk management, consultation and communication, incident and injury management, and training and supervision within your business. So, how do businesses ensure that they are legally compliant?

safety. This involves staying updated on WHS/OHS, understanding the hazards within your self-storage business, allocating adequate resources to control the risk created by these hazards, ensuring compliance and verifying actions.

Work Health and Safety (WHS/OHS) obligations

Incident and injury management

Self storage businesses are bound by WHS/OHS laws to ensure the safety of workers, visitors and customers. Businesses must adhere to state-specific WHS/OHS regulations and consider industryspecific risks.

Due diligence

Employers, including self-employed individuals and officers, are required to exercise due diligence to ensure www.selfstorage.org.au

Hazard identification and risk management

Self storage businesses must systematically identify hazards, assess risks and implement controls. This prevents injuries, enhances worker wellbeing, and improves overall work quality.

Consultation and communication

Effective consultation with workers is crucial for identifying hazards and implementing safety measures. Communication of policies, procedures and standards ensures everyone is informed and aware of safety protocols.

Self storage businesses must have a robust incident reporting and response system. Prompt reporting, investigation and corrective actions following incidents or injuries are essential.

Training and supervision

Adequate employee training is imperative to ensure everyone understands safety protocols and can perform their tasks safely.

Tim is an experienced Health and Safety Practitioner, OHS and Environmental systems Auditor and Tertiary Qualified Engineer. He has held operational and consulting roles, being responsible for Health and Safety and developed, implemented, and maintained OHS and Environmental Management Systems of global organisations in the manufacturing, construction, and logistics industries.

Regular supervision helps enforce safety measures and address concerns in real time. The SSAA provides some essential resources and guidelines to support businesses. Overall, not only is a comprehensive safety management system vital for a self-storage business to maintain a safe and secure environment for employees and customers while complying with legal requirements and industry best practices, it can also save you money and make your business more profitable and successful. Reach out to the Action OHS Consulting team to discuss how they can help your business achieve operational excellence to meet your safety program, along with the legal obligations that improve your bottom line. l

The OH&S Help Desk has been established by the SSAA to support its members. This advisory service is free. Free call 1800 067 313 (Australia); 0800 444 356 (New Zealand); or email admin@selfstorage.com.au.

NOVEMBER 2023 INSIDER 133

36 NEW SERVICE MEMBER

Security Distributors signs on SSAA welcomes electronic security equipment provider Security Distributors Australia.

ecurity Distributors is a prestigious Australian-owned wholesale provider of electronic security equipment that specialises in catering to the needs of the self storage industry. Its primary objective is to furnish top-tier security solutions characterised by innovation and reliability, thereby granting their clients a competitive edge. The sales and technical team harness its specialised expertise in electronic security, communications, networking, installation, and system design to offer comprehensive solutions that align with the diverse requirements of clients across various sectors. It firmly believes in staying abreast of the rapid and ever-evolving technological advancements to deliver the latest security products and technology to valued customers. A notable example of this commitment to cutting-edge solutions is its partnership with the UK-based Access Control manufacturer, Paxton Access Control, which seamlessly integrates with Storman Software. Notably, Paxton Access Control is exclusively available through Security Distributors Australia. Security Distributors Australia stands as a prominent Australian distributor of electronic security systems, offering an extensive array of solutions, including Access Control systems, CCTV systems, Intruder detection systems and intercom systems. One of its standout offerings is the Paxton Net2 system, meticulously designed to simplify the management of any building. Net2 is a networked access control system that can be administered using one or more PCs and can be centrally monitored and managed, constituting a holistic security solution. For further details on how to efficiently manage access to your storage facility, please reach out to Security Distributors Australia or Storman at the following contact information: info@securitydistributors.com.au.

Insurance. Uncomplicated. As a full-service brokerage, we can provide you with a full review of your storage facility, meet with you face to face, simplify the insurance jargon, and manage your claims. 1300 306 571 midlandinsurance.com.au

SIP update

The Storage Interactive Platform (SIP) was established in conjunction with Urbis to help industry better understand self storage supply and local market activity. All regions across Australia and New Zealand have recently been updated, including the details of more than 150 new proposed self storage facilities (either at development application or construction stage). Members can access SIP via the SSAA Member Portal. Take the time to understand your local self storage market. If you note a variance in your facility details or activity in your local area, please email the details to admin@selfstorage.com.au.

HR 37

HR fundamentals – what you need to know

The basics of human resources management gives you a solid base to build your business.

uman resource (HR) management success is based on understanding legal obligations and sourcing the best tools to support this key business function. HR administration can be timeconsuming, and mistakes can affect culture, reduce productivity, limit the applicant pool and cause employee disputes. This is not what any business owner wants, so let’s look at key HR fundamentals required to support good HR in your workplace. The fundamentals that you CAN NOT AVOID: 1. The Fair Work Act (Cth) 2009 governs the employee and employer relationship for most Australians. Consider it the foundation legislation for employment, and it also creates the National Employment Standards (NES). You must be across the NES as they govern: • maximum weekly hours of work; • flexible working arrangements; • casual conversion; • parental leave and related entitlements; • annual leave; • personal/carers leave, compassionate and bereavement leave and family and domestic violence leave; • community service leave; • long service leave; • public holidays • notice of termination and redundancy pay; and • Fair Work Information Statement and Casual Employment Information Statement. 2. Modern awards. These are the additional minimum employment standards that are industry or occupation-based. Think General Retail Industry Award 2010, Storage Services and Wholesale Award 2010, Clerks Private Award 2020, as examples. Awards set rules and minimum entitlements around: www.selfstorage.org.au

• pay rates; • overtime; • penalty rates; • hours of work; • allowances; and • minimum shifts. Good HR also includes setting clear expectations around: l Job advertisements. Make them honest and clearly define roles and responsibilities. They also include ensuring that the salary offered is in accordance with the minimum rates. l Document suite. Employment contracts (compliant with the key fundamentals), policies (outlining workplace expectations and behaviours), position descriptions, and a wide range of HR templates. It is best practice to explain the employment contract to the candidate, both sign and keep a copy. Securely store the employer copy in an easily accessible location. Maintaining a current job description enables both the employee and employer to be very clear about what the role entails and the KPIs and deliverables. A current Policy Suite is essential for laying out your business expectations and expected behaviours, procedures and standards. Policy acknowledgement can protect the employer and employee by holding each party accountable. l Create good process. From sending out offers and collecting data, process is key regarding effective HR. But it is not just the “signing up” aspect that requires a process. Include processes around these key areas: l Induction: Welcome and embed your recruit into their new role as smoothly as possible. l Probation periods: Meet often, don’t have too high expectations and rectify any issues promptly – proper training,

Cath Nicholson, Chief Communications Officer, HR Central. open communication, and relationship building with the team/colleagues.

l Performance management: Underperformance is a major business concern and a challenging aspect of people management. Keep these key points in mind: • Identify the issue • Analyse the issue – what factors are involved • Meet as soon as you can, have an honest discussion and create a mutual performance improvement plan • Monitor performance – inform employees if they improve and give praise • Move on from the issue If poor performance continues, meet again, provide concrete examples, and set a new timeframe for improvement. Inform the employee that disciplinary action may result should the behaviour continue. Signed policies can be referred to if the behaviour doesn’t meet the standard outlined. Continued poor performance may result in disciplinary action, including verbal and written warnings. When a situation gets to this point, it is always best to seek HR advice from a professional to ensure you follow the correct process. l

If you would like any further information call the SSAA

HR HELP DESK 1300 01 SSAA / 1300 017 722

NOVEMBER 2023 INSIDER 133

38 LEGAL HELP DESK

Are you looking to expand or construct a new facility? Here is our Sale of Land 101. By Hunt & Hunt Lawyers.

he self storage industry is experiencing rapid growth, and changes in circumstances drive the demand for individuals and businesses to store their goods. Consequently, significant interest has been generated in purchasing existing self storage facilities or commercial or vacant land to repurpose into a self storage facility. However, before you sign the dotted line, it is helpful to understand the basics of purchasing a self storage property. Prospective or existing facility owners should be aware of construction and planning requirements should they purchase, expand, or construct a new facility.

Obtaining finance

The first step in purchasing any property, unless you are paying cash in full, is to obtain finance. You should start this process by speaking to mortgage brokers or lenders specialising in the self storage sector. It is important to remember that some costs and fees go beyond the initial deposit and purchase price for land transactions. These include stamp duty, transfer registration fees, adjustments for outgoings (eg, council rates and land tax), legal fees, insurance costs, costs to obtain a quantity surveyor, pest or building report, etc. These should all be factored in to assess the commercial viability of the transaction. Once finance has been secured, you can start exploring opportunities and confidently place an offer once a suitable property is located.

Due diligence

This article focuses on due diligence considerations specific to the land use for self storage. Suppose you are also considering purchasing a self storage business. In that case, there will be additional due diligence considerations to consider, such as

INSIDER 133 NOVEMBER 2023

earnings potential, profit and loss statements and employee contracts. Due diligence involves investigating all things that may be relevant to assessing the value of a property and identifying potential risks associated with purchasing the property. The purchaser’s representative performs due diligence checks to ensure that the parties, the land, and the processes undertaken meet the required standard. It also reduces the risk of financial loss as the property’s condition, location, building and planning concerns have been evaluated. Due diligence is particularly important for purchasers looking to buy a self storage facility or land to build a facility. The due diligence involves a purchaser’s representative assessing: l Location and planning

Tony Raunic.

Irene Emmanuel.

restrictions •

•

It is important to consider zoning regulations and whether any restrictions could affect land use. It is also important to consider whether the location has a parking allocation or functional uses for storers when using the facility.

l Leases and licences • Will the property be sold with vacant possession, or will the property have existing tenants on lease agreements that run with the land? These may include leases for telecommunication towers or electrical substations. • A licence (which does not run with the land) will need to be properly transferred to the purchaser. • It is vital to check the lease or licence for its duration, options to renew and additional terms specified to ensure the purchaser can take possession at the intended time.

Madelyn Hassan.

Harriet Whiteley.

www.selfstorage.org.au

•

It is also important to review existing leases or licences to identify the income capable of being generated. This may affect the value of the property.

l Owners corporation • Suppose the property is subject to a body corporate scheme or equivalent. In that case, restrictions on the permitted use may apply, and additional fees may be payable if an owner’s corporation manager manages it. • It is important to note that each jurisdiction has differing applicable legislation regarding managing an owner’s corporation or body corporate. l Purchasing entity • It is important to consider an appropriate purchasing entity to consider any applicable tax or other concessions available. • If the vendor or purchaser is a company, a current and historical company search is necessary to identify whether the individual signing on behalf of the company has standing to do so. • A current and history company extract search can be obtained from ASIC Connect. l Outgoings • Outgoings payable on purchasing a property or land include council rates, water charges, insurance, and maintenance costs. • Outgoings are generally adjusted at settlement, with the vendor responsible for any outgoings up to and including the settlement date. The purchaser will be responsible for any outgoings after the settlement date. The extent of due diligence required will be informed by the complexity of the transaction, state-specific requirements, the purchaser’s budget, and the time available to undertake the due diligence process.

Disclosure statement

The vendor or their representative must provide prospective purchasers with a disclosure statement outlining key details about the property that purchasers must be aware of. It www.selfstorage.org.au

generally must include information relating to outgoings payable in relation to the land and any limitations or defects in the property title, such as easements and zoning. Additionally, vendors are required to disclose “material facts” to prospective purchasers. A material fact is something that would be important to a reasonable person in determining whether or not to proceed with a purchase or to proceed with the purchaser only at a specific price. Significant penalties may apply if a vendor breaches their disclosure obligations. The exact disclosure requirements vary between each state and territory, so we strongly recommend you seek independent advice from a lawyer.

Contract of sale

A thorough review of the contract of sale should also be conducted before signing. The contract of sale is the primary document setting out each party’s rights and obligations, with the main objective of the transaction being the purchaser paying the purchase price and the vendor transferring the title of the property. Each land transaction is unique, particularly for self storage facilities, and special provisions should be included in the contract to tailor it to suit each transaction. These include provisions dealing with finance or building inspection approval and warranties given in relation to the environmental condition of the land and the presence of asbestos. It is very important to check that all the information provided in the contract of sale and disclosure statement is accurate.

Construction and planning requirements

It is prudent to consider state and local planning and construction policies if you wish to expand your existing facility or construct a new facility. Such requirements are lengthy, onerous and can carry large penalties if unmet. Therefore, before developing the facility expansion or construction project plan, preliminary advice and information should be sought from

council planning officers. Council planning officers can advise on a variety of matters, such as: l whether a permit is required and which permit(s); l the nature and amount of supporting information to submit with an application; l any state and local planning policies, schemes and strategies that should be addressed as part of the application; l any relevant guidelines, requirements, or particular provisions that may apply; and l any referral authorities relevant to the application that must be notified. Using your local council planning officer (or equivalent) can equip you with construction and planning policy knowledge before you begin commercial development, reducing undue delay and minimising costs. Numerous state-specific requirements need to be taken into account. For example, from 1 July 2023 in Victoria, Australia, a windfall gains tax applies to all land rezoned by a planning scheme amendment, resulting in a value uplift of more than $100,000. Suppose you develop a new facility, the land must first be rezoned to a commercial zone, resulting in a value uplift of $1 million – a tax of 50% of the value uplift, being $500,000, would apply.

Conclusion

The process of purchasing land and expanding or building on that land for a self storage facility can be lengthy and costly. Many regulatory and legislative requirements must be adhered to and considering requirements specific to self storage. If you are looking to purchase or sell a self storage facility or require advice in relation to building or redeveloping a facility, please contact the SSAA Legal Help Desk for assistance. l Disclaimer: The information contained in this article is of a general nature and is not intended as legal advice. It is important that you seek legal advice that is specific to your circumstances. Please refer to the SSAA’s website for more information on the SSAA’s Legal Help Desk.

NOVEMBER 2023 INSIDER 133

40 TRADE DIRECTORY – TRUSTED SUPPLIERS TO THE SELF STORAGE INDUSTRY ACCESS CONTROL, FIRE & SECURITY

ANCILLARY SERVICES

TELECOMMUNICATION

PTI SECURITY SYSTEMS

ENERGY

3SIP Services Orhan Guzel T: 1300 843 256 E: sales@igd.com.au https://3SIPServices.com.au

T: Sales: 1300 798 860 Support: 1300 159 473 E: apac-sales@ptisecurity.com www.ptisecurity.com AD-TECH Security Adrian Rostirolla T: 1300 306 090 E: adrian@ad-tech.com.au www.ad-tech.com.au

AlarmQuip Security Systems Evan Richardson T: 1300 552 520 E: admin@alarmquip.com.au www.alarmquip.com.au

Cobra Electric Fencing Matthew Golland T: +61 413 901 007 E: sales@cobraelectricfencing.com.au www.cobraelectricfencing.com.au Gallagher Group Limited T: +64 7 838 9800 E: sales.nz@security.gallagher.com www.security.gallagher.com

Gallagher Group Limited Epping T: +61 3 9308 7722 E: sales.au@security.gallagher.com www.security.gallagher.com/en-AU/ Solutions Nokē™ Smart Entry T: +61 (07) 3865 1600 E: sales@janusintl.au https://janusintl.au/noke

QueAccess Pty Ltd Mike Bristol T: 1300 783 222 E: info@QueAccess.com.au www.queaccess.com.au

Security Distributors Australia T: 1300 882 101 E: info@securitydistributors.com.au www.securitydistributors.com.au

Security Vision Networks T: 1300 500 606 E: sales@secvision.com.au https://secvision.com.au/self-storage/ Self Storage Security Ltd T: (+64) 224937700 E: dave@selfstoragesecurity.nz https://www.selfstoragesecurity.nz/ Sentinel Storage Systems Jason Keane T: 1300 852 117/+61 3 9988 2035 E: info@storagesecurity.com.au www.storagesecurity.com.au StorAxxS T: (07) 3088 8091 E: support@storaxxs.com https://storaxxs.com/ Ultra Access T: +64 22 177 5270 E: kris@ultraaccess.co.nz www.ultraaccess.nz

INSIDER 133 NOVEMBER 2023

Choice Energy Pty Ltd T: 1300 304 448 E: info@choiceenergy.com.au www.choiceenergy.com.au

The Energy Alliance Pty Ltd T: +61 3 9872 6869 E: sales@energyalliance.net.au www.energyalliance.net.au

URL Networks Ashley Breeden T: 1300 331 178 E: support@url.net.au www.url.net.au

CLEANING

DESIGN & CONSTRUCTION

Sweepers Australia Michelle Maxwell & Vaughan Rose T: +61 3 9562 7533 E: info@sweepersaustralia.com.au www.sweepersaustralia.com.au

JANUS INTERNATIONAL AUSTRALIA PTY LTD

COMPUTER REPAIR & IT SERVICES Millennium Technology Shane Goodall T: 0800 724 376 E: info@millenniumtechnology.co.nz www.miltech.co.nz

LOCKS Lock Distributors Australia Martin Coote T: 1800 28 77 24 E: sales@lockdistributors.com.au www.lockdistributors.com.au

MARKETING Digital First Robbie Cameron T: +27 216 713 233 E: info@digitalfirst.co.uk

PACKAGING VISY BOXES & MORE

Ralph Inglese T: 13 84 79 E: vbm_vic@visy.com.au www.boxesandmore.com.au Branches across AUS and NZ

PRINTING Homestead Press Ingrid Nammensma T: +61 2 6299 4500 E: printing@homesteadpress.com.au www.homesteadpress.com.au

SIGNAGE PICHA Projects Dan Willis T: 1300 086 695 E: info@pichagroup.com.au www.pichaprojects.com.au

STORAGE AUCTION iBidOnStorage Brennan McLoughlin T: +61 2 4302 0605 E: info@ibidon.com.au www.ibidonstorage.com.au

Stephen Boxall T: +61 7 3865 1600 E: sales@janusintl.au www.janusintl.au

STORCO STORAGE SYSTEMS Jonathan Layton T: +61 2 6391 2800 E: sales@storco.com.au www.storco.com.au

Aluminium Specialties Group PTY LTD Peter McLean T: 1300 257 732 E: pmclean@alspec.com.au www.alspec.com.au

Bruac Design Michael Bruton T: +61 416 352 057 E: admin@bruacdesign.com.au www.bruacdesign.com.au Cloustruct Pty Ltd Robert Clouston T: +61 409 726 789 E: bobby@cloustruct.com.au www.cloustruct.com.au Gliderol Garage Doors Tom Ainscough T: +61 8 8360 0000 E: sales@gliderol.com.au www.gliderol.com.au

RegisBuilt Group Anthony Regis T: 1300 388 224 E: info@regisbuilt.com.au www.regisbuilt.com.au Storcad Pty Limited Javier Rezzonico T: +61 447 566 988 E: info@storcad.com.au www.storcad.com.au Taurean Door Systems Vikram Indugula T: +61 3 9721 8366 E: Vikram.Indugula@stramit.com.au www.taureands.com.au Total Construction Pty Ltd Steven Taylor T: +61 2 9746 9555 E: stevet@totalconstruction.com.au www.totalconstruction.com.au

www.selfstorage.org.au

TRADE DIRECTORY | 41 FINANCIAL SERVICES

LIFTS & HOISTS

Bishop Collins Pty Ltd Phillip Keenan T: +61 2 4353 2333 E: mail@bishopcollins.com.au www.bishopcollins.com.au

SOUTHWELL LIFTS AND HOISTS

Debtplacer James Cook E: support@debtplacer.com www.debtplacer.com

Gallagher Accountants Michael Gallagher T: 1300 263 260 E: michael@gallagheraccountants.com.au www.gallagheraccountants.com.au Suncorp Bank Steve Hammond T: 131 155 E: steven.hammond@suncorp.com.au www.suncorp.com.au

HR SERVICES HR Central Cath Grawe T: 1300 717 721 E: cath.grawe@hrcentral.com.au www.hrcentral.com.au

INSURANCE SERVICES AON Risk Services Darren Clauscen E: darren.clauscen@aon.com T: +61 2 9253 8350 www.aon.com.au/storage

AON Risk Services New Zealand Jeffery Nathan E: jeffery.nathan@aon.com T: 0800 266 276 www.aon.co.nz Midland Insurance Brokers Gilda Mihran T: 1300 306 571 E: storage@midlandinsurance.com.au www.midlandinsurance.com.au Network Insurance Group Joel Morrell T: +61 456 560 500 E: jmorrell@networksteadfast.com.au www.networksteadfast.com.au Wallace McLean Ltd Insurance Brokers and Risk Advisers Simon Keenan T: +64 9 358 7233 E: simon@wallacemclean.co.nz www.wallacemclean.co.nz

LEGAL SERVICES Hunt & Hunt Lawyers Graeme Armstead T: +61 3 8602 9200 E: garmstead@huntvic.com.au www.hunthunt.com.au

Hamish McGregor T: +61 2 4655 7007 E: sales@southwell.com.au www.southwell.com.au

ABT Loadmac Ltd Chris Walker T: +61 431 281 108 E: chris.w@loadmac.com www.loadmac.com

Orbitz Elevators Pty Ltd Justin Lee T: 1300 851 554 E: info@orbitzelevators.com.au www.orbitzelevators.com.au Safetech Lifts & Hoists Tony Krlevski T: +61 3 5127 4566 E: sales@safetech.com.au www.safetech.com.au

MANAGEMENT SERVICES Kennards Self Storage Management Services Fiona Harding T: +61 2 9764 9815 E: fiona@kss.com.au www.kss.com.au

Pioneer Performance Leigh Thewlis T: 1300 857 903 E: admin@pioneerperformance.com.au www.pioneerperformance.com.au

Storage King Management Services Martin Richards, Australia/ New Zealand T: +61 2 9460 6660 E: martin@storageking.com.au www.storageking.com.au StoreLocal Mark Greig T: 1300 099 022 E: partners@storelocal.com.au www.storelocal.com.au

Vision Self Storage Management Gavin Koorey T: +61 2 9432 2880 E: valuations@valuationpartners.com.au www.vssm.com.au

OHS SERVICES Action OHS Consulting Pty Ltd Craig Salter T: 1300 101 647 E: craig.salter@actionohs.com.au www.actionohs.com.au

REAL ESTATE & VALUERS CBRE Limited Peter Hamilton T: +64 9 355 3333 E: peter.hamilton@cbre.co.nz www.cbre.co.nz

CBRE Dylan Adams E: dylan.adams@cbre.com www.cbre.com.au/people-andoffices/corporate-offices/brisbane www.selfstorage.org.au

Colliers Rishikesh Elkunchwar T: +61 2 9017 6910 E: Rishikesh.Elkunchwar@colliers.com www.colliers.com.au/en-au Collins & Associates Malcolm Collins T: +61 3 8456 5134 E: malcolm@malcolmcollins.com www.malcolmcollins.com

Cushman and Wakefield Linda Sharkey E: linda.sharkey@cushwake.com www.cushmanwakefield.com/ en/australia/services/valuationadvisory-services/self-storage

Highway Frontage Specialist Estate Agents Matt Walsh T: 1300 661 950 +61 3 9944 9350 E: matt@highwayfrontage.com.au www.selfstoragerealestate.com.au JLL Mitchell Cope T: +61 428 460 000 E: mitchell.cope@jll.com www.jll.com.au/en/industries/ alternatives

m3property Jeremy Hoffman T: +61 7 3620 7900 E: Jeremy.hoffman@m3property.com.au www.m3property.com.au My Haus Property Group Kira Steinhaus T: +61 7 5478 9122 E: info@my-haus.com.au www.my-haus.com.au Urbis Valuations Pty Ltd Shane Robb T: +61 2 8233 7627 E: SRobb@urbis.com.au www.urbis.com.au

Valuation Partners Martin Fallon T: 1300 248 209/+61 3 9674 0374 E: mfallon@valuationpartners.com.au www.valuationpartners.com.au

SOFTWARE SOLUTIONS STORMAN AUSTRALIA T: +61 7 3319 1522

STORMAN NEW ZEALAND T: +64 9 280 3393 E: sales@storman.com www.storman.com Alyta Pty Ltd Stephanie Scoleri T: +61 3 9808 1149 E: info@alyta.co www.alyta.co

Centreforce Technology Group Pty Ltd Dallas Dogger T: +61 7 3889 9822 E: sales@centreforceit.com.au www.centreforceit.com.au/ (continued next page)

NOVEMBER 2023 INSIDER 133

42 TRADE DIRECTORY (continued) NEW MEMBERS GapMaps Pty Ltd Kolt Luty T: +61 417 841 680 E: kolt.luty@gapmaps.com www.gapmaps.com

Rubik Sebastian Kerekes T: +61 3 9988 2036 E: sebastian@rubikapp.com www.rubikapp.com

Sitelink Michael Dogger T: +61 7 3889 9822 E: support@sitelinksoftware.com.au www.sitelinksoftware.com.au Storeganise Miles Davison T: +1 416 639 0873 E: hello@storeganise.com https://storeganise.com/

STORAGE CONTAINERS UNIVERSAL STORAGE CONTAINERS (USC)

Shay McQuade T: +61 438 256 541 E: shay.mcquade@universalstorage containers.com www.universalstoragecontainers.com AIM Quickbuild Elise Kelsey T: +61 3 9720 4455 E: ekelsey@aimhire.com.au www.boscontainer.com.au Boxwell T: +1 303 317 5850 E: karah@boxwell.co www.boxwell.co

Royal Wolf Trading Craig Baker T: +61 2 9482 3466 E: removals@royalwolf.com.au www.royalwolf.com.au

WEBSITE DESIGN Big Budda Boom Pty Ltd Andy Pudmenzky T: 1300 660 937 E: info@bigbuddaboom.com.au www.bigbuddaboom.com.au Digital First Robbie Cameron T: +27 216-713233 E: info@digitalfirst.co.uk https://digitalfirst.co.uk/ R6 Digital Michael Dogger T: +61 7 3889 9822 E: sales@r6digital.com.au www.r6digital.com.au

Unwired Logic Aaron Farney T: +81 034 588 4511 E: info@unwiredlogic.com www.unwiredlogic.com/en/

INSIDER 133 NOVEMBER 2023

ADDITIONAL FACILITIES

PROVISIONAL MEMBERS

Total Store Bairnsdale 72 Forge Creek Road BAIRNSDALE VIC 3875 P: +61 3 5153 0844 E: totalstore@bigpond.com –––––– KBH Waroona Pty Ltd 3 McDowell Street WAROONA WA 6215 P: +61 8 9733 2959 E: waroona@keepsafestorage.com.au –––––– Storage King Balcatta 11 Mumford Place BALCATTA WA 6021 P: +61 8 9240 1444 E: balcatta@storageking.com.au

Sam Jackson MANLY VALE NSW 2093 P: +61 415 220 251 E: sam@tolsonproperties.com.au –––––– Olivia Dunstan QUEENSTOWN OTAGO 9300 P: +64 21 741 646 E: olivia@dunstangroup.nz –––––– Vida Luo CHERRYBROOK NSW 2126 P: +61 4135 48550 E: vida@gpcoatingsnsw.com.au

FACILITY MEMBERS Everyday Self Storage 14 Gemoka Drive RICHMOND QLD 4822 P: +61 7 4741 7029 E: admin@everydayself storage.com.au –––––– Gobrand Pty Ltd 8-10 Queensbury Avenue CURRUMBIN WATERS QLD 4223 P: +61 7 5534 7181 E: hjpetrie9@gmail.com –––––– Mawson Lakes Self Storage 27-29 Metro Parade MAWSON LAKES SA 5095 P: +61 408 638 999 E: info@mawsonlakesself storage.com.au –––––– Go Box 10-12 Commercial Street MARLESTON SA 5033 P: +61 8 7095 7955 E: operations@gobox.com.au –––––– Aldinga Storage Units 4 Lacey Drive ADELAIDE SA 5173 P: +61 412 935 111 E: aldingastorageunits@gmail.com –––––– R & F Di Cerbo Pty Ltd 92 Pfeiler Road LONG FLAT SA 5253 P: +61 409 693 524 E: aquasunproduce@gmail.com –––––– MyBox Ltd 94 Totara Road WHENUAPAI AUCKLAND 0618 P: +64 21 955 763 E: gene@mybox.co.nz –––––– Box to Go Ltd 39 Maru Street Mount Maunganui BAY OF PLENTY 3116 P: +64 273 400 024 E: info@boxtogo.co.nz

SERVICE MEMBERS Self Storage Security Ltd 21 Harford Place AUCKLAND 2010 P: +64 22 493 7700 E: dave@selfstoragesecurity.nz –––––– HMW Real Estate Advisory Level 5/10 Eagle Street BRISBANE CITY QLD 4000 P: +61 7 3832 6455 E: rossp@hmwrea.com.au –––––– Security Vision Networks 552-560 Church Street NORTH PARRAMATTA NSW 2151 P: 1300 50 606 E: sales@secvision.com.au –––––– Stockland Development Level 25/133 Castlereagh Street SYDNEY NSW 2000 P: +61 438 895 587 E: joyce.tiong@stockland.com.au –––––– Heitman 10/F LHT Tower, 31 Queen's Road Central HONG KONG SAR Hong Kong Island P: +852 3976 6813 E: henka.darsono@heitman.com

www.selfstorage.org.au

Our NEW Padlock Technology! The self-storage industry is automating but not every owner wants to invest in expensive electronics. Rubik’s system reduces your investment & operation costs drastically.

• Contactless access for Self-Storage • No expensive retrofitting required • Low cost & low maintenance • Can work as a stand-alone product or with SiteLink

Provide instant access without expensive electronic locks and never mix up locks or codes & make sure tenants can always get in.

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Interested in Rubik? Speak with our sales manager on

+61 3 9988 2036 Sentinel Storage Security is the partner for the life of your facility.

1300 852 117

0800 746 311

+61 3 9988 2035

AUSTRALIA

NEW ZEALAND

INTERNATIONAL

sales@storagesecurity.com.au www.storagesecurity.com.au

Sentinel Australasia distributes to all of Australia, New Zealand, Indonesia and Asia. Installers and technicians in every state of Australia, NZ and throughout Asia.

Better spaces from design to handover

Smart operators know that it takes more than just walls and roller doors to make a successful self storage facility. It takes a prime location to maximise your visibility and attract customers from a wide area. It takes smart facility design to take advantage of every square metre of land and bring in maximum returns. And it takes a savvy knowledge of materials to keep construction efficient.

Balancing all these needs is no mean feat, which is why smart operators partner with Storco. Storco has worked with developers across Australia and New Zealand to create facilities that attract customers and offer high returns. Our team has over 150 years of combined experience, and every one of us is dedicated to finding opportunities to make your next project successful.

Learn more about Storco storage systems

We have everything you need to build your next facility, from innovative products, local manufacturing knowhow, and a network of trusted industry partners. We take the guesswork out of your project to minimise risk and maximise your potential returns. Ready to build a winning self storage facility? Talk to us.