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NSR JV Plan

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    NSR JV Plan

    NSR announced a JV with GIC this week. Apparently transferring some of their growth development planning projects into 25/75 JV with GIC. I understand that this is a way to speed up their growth plans, maximise on their development skill/set & increase market share. The share market seems to approve to idea, so does MM have any thoughts on JV?

    Answer

    Hi Glenn,

    Self-storage manager NSR announced a JV with Singapore Sovereign Wealth fund GIC to develop an initial portfolio of 10 assets, with the partnership planning to deploy $270m within the next 18 months.

    • NSR will own 25% of the venture but will act as the manager for the initial 5-year term.
    • NSR will reap $120m from asset sales into the fund, helping to reduce debt.
    • The deal shows plenty of interest in Australian storage assets and the announcement leaves the door ajar for a far bigger investment from the fund which controls ~$US750b.

    We discussed NSR in Fridays webinar, it’s one of our top, albeit a conservative picks for MM view that global interest rates will decline through 2024/5. We like it and the level of DD conducted by GIC gives us more confidence in NSR’s operations.

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    National Storage REIT (NSR)
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