Property Flash


Stor-Age Property Real Estate Investment Trust (Reit), is looking to convert certain storage properties to micro-warehouses as it diversifies its revenue streams.

Chief marketing officer Chris Oosthuizen told Property Flash, that the JSE-listed company with a market capitalisation of R6.692bn which owns assets in South Africa and the UK, had realised that it needed to meet its customers’ needs better. These were often businesses and not individuals.

He said that the company’s micro-warehousing product being used in South Africa, referred not only to physical enhancements made to a standard storage unit but also to the active use of the storage unit by its customers.

“Conventionally, storage units were primarily used passively with customers simply loading the unit with their belongings and returning a few times in the months that followed. Micro-warehousing refers to the active use of the unit, with our commercial customers using the product as a base of operations for daily work, such as inventory storage, and picking, packing and dispatching products directly from the storage unit, thus eliminating the need for warehouses or sorting facilities,” said Oosthuizen.

He said that micro-warehousing was therefore offered to the company’s customers “on various levels . This would include the ability to work in one’s storage unit with no additional enhancements or to retro-fit a storage unit, to include lighting, shelving and even plug points to support light office equipment.

Stor-Age also owned bespoke units on offer at its Sunninghill store in Gauteng, sized at more than 600m2, where units come standard with lighting, plug points, enhanced security measures within the individual units, Wi-Fi and drive-up access.

“We are currently in the construction phase of a similar product at our Stikland store in Cape Town. Our locations are carefully selected and perfectly placed to support the growth in e-tailing, with each of our facilities situated in high commercial and residential areas with easy access to major transport routes and convenient last mile delivery hubs,” said Oosthuizen.

He said that since listing in November 2015, Stor-Age had developed and grown its property portfolio such that it owned 85 properties, worth a combined R10.2bn, with more than 40% of its customer base coming from business customers.

“With micro-warehousing, our business customers have the option of short or long-term rentals to meet their changing needs while enjoying the necessary office comforts, whether they’re there all day, every day or just when they need to be,” Oosthuizen said.

Commercial customers typically took larger units and rented for longer periods than people who rented the space for personal reasons such as when they were moving home or to store holiday equipment.

Implementing micro-warehousing was also cost-friendly.

“It is beneficial for Stor-Age to place an increased focus on the commercial segment. As highlighted above, micro-warehousing is offered in various forms and levels, resulting in different costs. The enhancements are often not complex in nature, and revenue can be recuperated through a larger tenant base and longer-term customers,” Oosthuizen said.

As online businesses continued to increase globally and based on the initial success of the micro-warehousing product launch in South Africa, Stor-Age was also exploring the feasibility of launching a similar offering in the UK.

By 2025, Stor-Age expected to own a refined portfolio of more than 70 properties, a large number of which would be micro-warehouses. 

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