Kennards July eKourier

My father pioneered storage in Australia. There was no choice but to build it new. The entrepreneurial gene was abundant in him. Experimentation, make mistakes, learn, adapt and re-try was natural. He was inventing the building designs, methods of construction, unit mix config- urations, security and business systems. Low cost and high return was the objective in the early days. Today, new storage development remains a very entrepreneurial endeavour. Finding market gaps, securing premium proper- ties, outdoing the competitors, innovating design solutions, wrestling through the regulatory maze, then embarking on years to fill the centre and finally see a return on capital. Our preference for new development has distinguished us from many major competitors. It is driven by the strong preference to build and own high quality assets. We have deliberately avoided the frenzy of acquisitions by others for mostly mediocre quality buildings and inferior locations. Growth for the sake of it is not our ambition. We prefer to develop new projects so we will maintain a very high standard portfolio-wide with designs and amenities offering a superior customer experience. Indeed, the higher standard of the KSS portfolio is apparent when compared to competing portfolios. We have been discerning, preferring locations that are superior, with high visibility and good access. We develop and maintain our assets to a high standard. This matters because we want to provide a consistently high standard of customer experience across the business. This is also about trust. When consumers see that we are consistent, they trust us, and will be inclined to use us again and again. It builds loyalty and earns repeat business. We expect the wave of new projects to further raise the bar, to differentiate and distinguish the KSS Brand.

L to R: Sam Kennard, Kellie Robley (Centre Manager) and Natalia Gerasimova (Assistant Manager), Kennards Self Storage Coorparoo L to R: Sam Kennard, Kellie Robley (Centre Manager) and Natalia Gerasimova (Assistant Manager), Kennards Self Storage Coorparoo

MESSAGE FROM SAM many risks that can turn a project sour.

Our company is now at the beginning of a significant and exciting growth phase. Our development program, which was briefly paused in 2020, is now expecting to bring a total of 84,750 square metres to market before the end of 2022. There are 10 new centres being developed and 13 centre expansions planned. The total construction investment will approach $100 million. Embarking on new self storage development requires a high degree of resolve and fortitude. There are

Unusually for commercial property development, we open a new project with no pre-commitment of occupant. We are 0% occupancy. It is highly speculative. None the less, new development is our preferred pathway for growth. Indeed, our many years of development experience makes it a core capability within the organisation. In contrast, many storage investors, particularly the storage Real Estate Investment Trusts (REIT’s), have preferred acquisition of existing operating storage assets. This saves them a great deal of risk and time.

Sam Kennard Chief Executive Officer

3 Kennards Kourier July 2021