Deutsche Bank downgraded Safestore Holdings Plc and Shurgard Self Storage SA to “hold” from “buy”, citing more aggressive pricing competition and cost inflation that have caused European self‑storage trading to disappoint since March, analyst Jonathan Coubrough said. The downgrade led Safestore shares to fall 4.7% to 581.50p and Shurgard shares to drop 2.1% to €22.95, with Shurgard briefly touching a 52‑week low of €22.70 intraday. Deutsche Bank cut its price target for Safestore to 700p from 880p and for Shurgard to €27 from €37, representing a reduction of more than 27% for Shurgard in a single note.
Coubrough noted that costs are largely fixed but are inflating due to higher property taxes, and that the marginal customer base consists of home movers. He added that earnings are operationally and financially linked to housing transactions and swap rates, both of which are currently acting as headwinds. While the analyst believes the companies’ long‑term prospects remain intact, the combination of rising fixed costs, intensifying pricing competition, and sensitivity to occupancy swings and swap‑rate movements makes a meaningful near‑term recovery difficult to justify at current valuation levels.
Deutsche Bank observed that the self‑storage sector has underperformed since March, with Shurgard down about 16% and Safestore down roughly 25% over that period. Safestore’s shares have meaningfully underperformed the FTSE All‑Share Index over the past six months, now sitting well below its 200‑day moving average, and its 52‑week high stands at 837p.
The downgrade arrived days after Shurgard released its H1 2026 interim results. In that release, Shurgard cut its full‑year 2026 revenue‑growth guidance to a range of 3.5%‑4.5% from the prior 6%‑8% range, reduced its underlying EBITDA guidance to €263 million‑€268 million from €278 million‑€289 million, and withdrew its medium‑term financial targets entirely. Adjusted EPRA earnings per share for the half came in at €0.77, down 5.7% year‑over‑year, while average occupancy slipped to 83.6%. EPRA EPS yields are close to the highest they have been since Shurgard listed in 2018, offering “significant long‑term upside potential,” Coubrough said, though he cautioned that self‑storage share prices are primarily driven by earnings growth.
Deutsche Bank warned that more downgrades are likely and that there is no clear catalyst over the next 12 months, but it believes the price cuts are already priced in.