![]() Our AFA bookings accounted for 17% of our total product bookings in Q2FY17, up from 9% in Q1FY17," said CEO Suresh Vasudevan. "We saw strong momentum in customer and channel partner adoption of our All Flash arrays. estimates of $-0.17 and Q3 revenues of $100-$103 million vs. "And that is in a market where house purchase is at a very low level in the UK," he said, attributing the rise to more homeowners being prudent by selling their homes before finding new ones, hence raising the demand for storage.Nimble Storage saw Q3 EPS at $(0.19)-$(0.17) vs. "If you take the last six months and the last quarter particularly, our enquiries in relation to house movers have actually been very buoyant," said Steve Williams, CEO of Safestore, which runs 117 facilities across the UK and in Paris. "It isn't immune in a downturn, but with demand being so multi-layered, you're never going to get to a point where you suddenly lose all your customers at the same time," he said.Ĭoncerns remain, however, that the self-storage industry, which typically counts house movers as its biggest customers, faces headwinds from a weakening UK housing market, reflected in falling prices and low mortgage approval rates.īut storage executives say they remain positive, putting faith in the prospect of housing activity rebounding from last year's low base, and helped by changes in buying habits. "Whether it's small businesses wanting flexibility or individuals looking for a lifestyle change, we're spreading the risk over thousands of different customers," said Big Yellow Chief Executive James Gibson. Self-storage firms were relatively resilient in the recent recession, for example by offering temporary space to downsizing companies, and should be able to navigate repercussions of UK austerity measures, industry executives said. ![]() ![]() "I suspect they will be less volatile," KBC Peel Hunt analyst Anthony Bell said, adding self-storage companies were set to continue outperforming commercial property REITS if serious economic problems persist. With persistent gloom over the weak global recovery fueling fears of a double-dip recession, storage suppliers such as Lok'n Store should still hold up relatively well, analysts say. Some offices and malls - typically on leases of between 10 to 15 years - could also be "over-rented", meaning their rents are well above market rates, Burt added, leading to sharp drops in income when leases expire and landlords adjust asking rates. "For the other Reits, earnings are going to be flat because they've got relatively fully occupied portfolios, so there's not a lot of vacancy for them to lease up and enhance the income," said Execution Noble property analyst Michael Burt. Still, storage firms trade at about a 18 to 37 per cent discount to median 12-month price targets while the top three property REITs trade at discounts of eight to 12 per cent, I/B/E/S data show. Short leases turn into a key advantage for storage firms in an improving economy, allowing them to raise rental rates quickly as demand for their services bounce back.Īnalysts surveyed by Thomson Reuters I/B/E/S expect Big Yellow's earnings per share (EPS) to jump by a fifth in the financial year to March 2011, while EPS for Safestore is forecast to rise four per cent for its year to October 2010.īy contrast, the top three UK real estate investment trusts (Reits) - Land Secs, British Land and Hammerson - are seen posting flat to slightly lower earnings for this financial year as rental income stays weak. "If you look at the magnitude of what they have developed and what the pickup would be by simply increasing occupancy, it's very substantial," said Promisel, who is "overweight" on Big Yellow, UK's largest storage firm by market value.īritain's economy grew almost twice as fast as expected in the second quarter of this year, buoyed by a sharp pick-up in services and the fastest rise in construction output in half a century, official data showed last Friday. ![]() There are few property firms with that inherent, internal growth prospects," said Robert Promisel, who manages the Invista Global Property Securities fund. "Storage companies have an attractive advantage at this point of the recovery cycle. With leases as brief as a week to a few months aimed at businesses and house-movers who need interim space, storage owners such as Big Yellow and Safestore can quickly boost their income as occupancy picks up from the worst property downturn in decades. UK-listed self-storage property firms, with shorter leases and wider client bases, will likely outshine peers that own more conventional offices, malls and factories by snaring higher rents in a recovering economy.
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