Advances on new store Pipeline

15 June 2020

Lok'nStore Group plc

Advances on new store Pipeline

Two new planning permissions achieved

Lok'nStore, the fast-growing AIM listed self-storage company, is pleased to provide the following update on its new store development pipeline.

In recent weeks planning permission has been granted for two new landmark stores in Warrington and Stevenage. Both of these stores are freehold in prominent locations in busy markets, and will each provide 60,000 sq ft of storage space.

We are now in the process of tendering the contracts to build these stores, as well as our 50,000 sq ft Wolverhampton store for which we received planning permission in December 2019. No decisions on commencing building works on these stores will be made until the trajectory of the economy out of the pandemic has become clearer. 

In the meantime, the new 45,000 sq ft managed store in Oldbury, West Midlands is now open, and the new 60,000 sq ft freehold store in Leicester is on track to open in August.

As planned, we intend to go on site at our new 53,000 sq ft freehold store in Salford, Manchester in September 2020 for opening in January 2021. The site sits strategically on the key arterial route into the west of Manchester at the end of the M602 motorway. Once developed it will be highly prominent from the main road on this busy dual carriageway and will benefit from its location between the growing residential, business and media hub of Salford Docks and the ever-spreading West Manchester residential expansion.

The Woking store, which for many years has been managed by us on behalf of a third party has now been closed for development of a residential scheme. As the smallest store in our portfolio with a de minimis management fee, and with a number of customers moving to other stores within our operation, the closure will have no financial impact on Lok'nStore Group.

Following the opening of the new Leicester store in August we will have 36 stores open. Our total new store pipeline will be 12 sites which will take us to 48 stores when fully developed. As at the half year end in January 2020 Lok'nStore had cash of £11m and undrawn facilities of £32m. The £75m bank facility has an accordion of a further £25 million and runs to April 2024 with no amortisation. The loan to value ratio was 17.2%

As regards current trading, Lok'nStore's business model continues to prove its resilience.  As the government has eased lockdown restrictions new enquiries have increased and in May were 3% ahead of the same month last year.  All of our stores remain open and we continue to operate normal opening hours over a 7-day week while maintaining strict social distancing and hygiene protocols.

Commenting on the recent developments to the new store pipeline Andrew Jacobs, CEO, said;

"Despite the current unsettled economic circumstances Lok'nStore's trading remains resilient. We continue to progress the development of our new store pipeline, having secured two new planning permissions over recent weeks. Nevertheless, we are determined to maintain the strength of our balance sheet and our substantial liquidity.  Against this background we continue to execute our objective to open more landmark stores whilst remaining conservatively geared with both the Oldbury and Leicester stores opening this summer and the Salford store early next year.  The pipeline of new stores will add considerable momentum to sales and earnings growth over the medium term allowing further increases in dividends."

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