StoreLocal reveals amitious plan to grow to 40 properties

StoreLocal co-founder and chief executive Hans Pearson at the company’s flagship Hendra property in Brisbane.

Expanding self-storage company StoreLocal is on track to have 40 properties under its brand in 2023-24 as homes get smaller and businesses seek innovative places to grow.

StoreLocal is in the top ranks of national self-storage companies with a presence in every mainland state and has accelerated its expansion plans following a $100m equity capital partnership with global private markets firm Partners Group that was inked in late 2022.

The Partners Group fund was seeded with initial development projects with a combined end value of more than $120m ensuring the company will be nipping at the heels of National Storage, Abacus Storage King and Kennards.

Co-founder and chief executive Hans Pearson said the rise of the Australian mutlibillion dollar self-storage sector was underpinned by long-term trends of smaller living spaces and changing workplaces. Recently those trends have been pushed along by historically low residential and industrial vacancy rates which are driving rents sky high.

“Self storage is a flexible and simple part of business solutions for SME’s, (Small Medium Enterprises) start-ups and online e-commerce and last mile logistics, as well as for downsizers and increasingly smaller residential units and houses,” he said.

StoreLocal co-founder and chief executive Hans Pearson in a unit in the company’s flagship Hendra property in Brisbane.

A property valuer, lawyer and investor, Mr Pearson said the penny dropped for him in 2010 after he co-developed his first self storage property in Melbourne.

He and business partner, former head of property at the Brisbane Airport Corporation Rob Mactaggart, pre-leased the building to National Storage.

Mr Pearson said he looked at it and thought “that’s a pretty good business”.

“At the time we took the view from the get go that this was a very under appreciated sector in Australia. From a risk perspective you will never wake up and find you have no income,” he said.

National Storage bought the property in 2013 and the pair took the proceeds and acquired another property in Melbourne.

Mr Pearson said he and Mr Mactaggart, who is non-executive director of StoreLocal, started to build the business and by 2015 they had 10 buildings. They brought in Mark Greig from Storage King as another co-founder and COO, and officially started StoreLocal in 2015.

They went from being an investor-developer to an investor-developer-operator and by the end of 2023-2024 will have 40 properties in every mainland state of which they manage 15 for other owners, and the remainder are owned by the company.

Brisbane-based StoreLocal has a current annual turnover of more than $30m and an owned building portfolio of more than $450m nationwide.

“We have a long-term view and we see ourselves as a 30-year business and make decisions on that basis,” Mr Pearson said.

“The sector itself will grow in line with population growth and smaller residential units which we know are long-term demographic trends. For us if we are growing our share of a growing sector it’s growth upon growth.”

The sector remains highly fragmented and has seen a variety of new private equity entrants in recent times including Abacus taking a stake in Storage King this year and in 2021 US private equity firm Blackstone spent $400m to buy Melbourne-based Fort Knox Self Storage.

However, Mr Pearson said the sector will undergo consolidation in the future and there were still only a small handful of national players that own and manage their assets.

StoreLocal co-founder and chief executive Hans Pearson in a unit in the company’s flagship Hendra property in Brisbane.

He said the self-storage sector was continuing to evolve as a customer experience.

StoreLocal’s flagship facility at Hendra, in Brisbane’s inner east, was awarded Australasia’s Best Facility in November 2022 due to its mix of bluetooth keyless self-storage over four levels, co-working space and strata-titled workstores.

“We’re pushing the envelope with staff-less technology, using AI and data to better inform us what customers are truly seeking, and pushing efficiencies through our platform as we continue to scale,” he said.

“We see this as a competitive advantage that the larger players such as ourselves will be able to maintain in the years ahead.”

Mr Pearson said they take the line that StoreLocal is an essential piece of daily infrastructure within the local community instead of being just storage space.

The company has more than 20 local community partnerships with sporting and community groups, including Super Rugby’s Queensland Reds, Rugby Union’s Hospital Cup, SANFL Panthers, Brothers Touch Association and the Pacific Pines Football Club.

“We’re deeply passionate about self storage and its place as a part of the daily infrastructure of local communities,” Mr Pearson said.

This was demonstrated during the 2022 Brisbane floods when StoreLocal’s Newmarket store in Brisbane, which was well out of the flood zone, was unexpectedly flooded by an uphill storm water breakage.

“Our entire head office team and their families and friends and local community groups rallied at the store to work with customers day and night to clean out the units and sort their precious personal belongings,” he said.

“I remember the visceral reaction of customers and seeing what was commonly stored – photos, childhood mementos, paper files, business items, collectable cars; weirdly, we learnt that no-one throws out their Lego!

“The emotional connection of customers to their self storage is what really struck me – we look after much more than old junk; it was actually a powerful reminder for me that we are custodians of family memories and business endeavours and that the emotional connection runs deep.”