LONDON: Safestore Holdings will invest in a 20% stake in a joint venture with Carlyle to invest in carefully selected self-storage opportunities in Europe.

Safestore has developed a highly scalable platform in self-storage built on leading marketing and operational expertise. This platform is proven to work across geographies and Safestore sees an opportunity to leverage the platform in regions outside its existing footprint in the UK and Paris.

Safestore’s initial equity investment in the JV will amount to €5 million. Safestore will also earn a fee for providing management services to the JV. The cash consideration, funded from the Group’s existing resources, will be payable on completion of the acquisition of M3, which is expected to happen by the end of August 2019.

M3, which will have assets with an unaudited proforma book value of €21.5 million at the date of completion, has six prime locations in Amsterdam and Haarlem with one of the sites currently under construction.

The three stores in Haarlem are all freehold whilst two of the Amsterdam stores are subject to perpetual Ground Leases. The third Amsterdam store is a leasehold store with nine years remaining on the lease. The construction of the sixth store is in the process of being finalised and completion of the acquisition of M3 will take place shortly after this store is opened.

The Group’s investment in the JV is expected to be immediately accretive to Group earnings per share from completion and will support the Group’s future dividend capacity.

In addition, Safestore has acquired Salus Services Ltd, the owner of a 34,000 sq ft MLA freehold store from Rockpool Investments for £6.5m in cash, funded from the Group’s existing resources. The store is currently branded and operated by Ready Steady Store and is located on the Parkway Trading Estate near Heathrow Airport to the west of London.

The store, which opened in 2015, is currently trading at an occupancy of 86%. The Group anticipates that the first year initial yield will be 5.5%. The Group will rebrand the store and take over operation of the site with immediate effect.