Self-storage giant Big Yellow Group (BYG) has reported a drop-off in occupancy as a result of covid-19.
The company said current like-for-like occupancy across its portfolio is 81.6% across 56,000 customers. In half-year results to the end of September 2019, like-for-like occupancy was 84.1%.
The group said it had seen an increase in demand from domestic and student customers in the past week urgently needing storage as a result of the lockdown measures imposed. However, it said this had been outweighed by businesses directly affected by the lockdown moving out.
Big Yellow has also agreed to give rent holidays or deferrals on a case by case basis for some of its customers.
“Self-evidently given the levels of distress in the economy it would not be appropriate to make judgements about future trading until we have better visibility,” the group added.
Storage facilities have not been identified for closure at this stage by the government due to their role in the distribution network (as many businesses use the facilities as logistics hubs including for e-tailing and the distribution of medication). The NHS and other government departments are among BYG’s customers.
The group said it has cash and available undrawn committed facilities of £38m. The average cost of debt on drawn facilities is 2.5% and the marginal cost of additional debt is 1.35%.
The £211.5m of total drawn debt is unhedged, which has benefited from the recent reductions in the base rate.
Proforma interest cover based on the current quarter, the group said, was in excess of 9 times, with banking covenants set at 1.5 times.
The group’s earliest maturity is on its £70m M&G loan in June 2023 and total debt has an average maturity of 4.7 years.
Whilst the UK is in lockdown, the group is winding down construction on its three development sites, Camberwell, Bracknell and Battersea. The cost to complete the three stores is around £13m, of which only £3m will be payable in respect of works completed prior to the temporary close down. All further capital expenditure is entirely discretionary, the group added.
This includes payment of the final dividend, which the group will make a decision on “in due course”.
BYG : Big Yellow Group reports drop-off in occupancy due to covid-19