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Caroline Thirifay: Good morning, everyone. Thank you for joining us today, both in person and virtually for the management presentation of our full year results 2025. I'm here with Marc Oursin, CEO; Thomas Oversberg, CFO; and Isabel Neumann, Chief Investment Officer and Chief Operating Officer. Before we begin, we want to remind you that all statements other than statements of historical fact included in this management presentation are forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected by the statements. These risks and other factors could adversely affect our business and future results that are described in our earnings release and in our publicly reported information. With that, I will hand over to Marc.
Marc Oursin: Thank you, Caroline. Hello, good morning to all of you. Thank you for being here. So let's start with this page, Page #2. So you can see that we have, at the end of '25, close to 350 properties in Europe and reaching almost 1.8 million square meter of footage. Regarding the performance of the year, we have delivered another very strong one. Our revenues grew by almost 11%. We increased our NOI same-store margin by 40 bps with an EBITDA growth following the one from the revenue at 10.4%, and ending with an earnings per share growth of 1.7% versus last year despite the additional cost of debt and dilution from our scrip dividend. Meanwhile, we stay with a very solid balance sheet. We have a BBB+ rating, a leverage of 23% or 6.2x net debt over EBITDA and having an EPRA net tangible asset per share of EUR 53.3. So let's go to Page 4 for more details. So you can see on the right side of the page how the revenue growth full year of 10.8% has been achieved. We got the benefit of additional available square meters of 5% versus '24 coming from our development, renting them up by 8.8% versus '24, and combined with an increase of our in-place rent of 1.9%. When you combine all of that, you get the 10.8%. And as explained earlier, our cost management due to the efficiency of our platform allowed us to grow the EBITDA by 10.4%, therefore, in line with our revenue speed. And this performance is clearly putting us on an earnings per share growth trajectory, medium term. If you go to the next page, Page 5. So I think it is interesting to notice how the company has been able to grow physically, meaning in terms of footage and translating this square meter growth into revenue growth. So you can see on the left that we grew by almost 7% CAGR for the past 5 years in terms of number of stores, but also square meter-wise. At the same time, our revenue grew close to 11% CAGR and demonstrating that our strategy of growth delivers unique revenue increase. If we go to Page 6, and this slide is focusing on the NOI growth '25 versus '24 for the total company. It is also showing the importance of the margin generation from our so-called non-same stores, representing all the properties not yet matured and coming from organic development or M&A transactions. You can see that almost 2/3 of the incremental NOI value is delivered by our development engine, confirming our capacity to deliver profitable growth. So now let's go to Page 7. So on this page -- I think this page is really important to understand what we have achieved and how we will continue to use 2 major strengths that we have. I mean the scalability of our platform, allowing us to increase our same-store NOI margin and, at the same time, our development engine bringing profitable growth. And you can see that we got the benefit of both with a significant increase of our total NOI margin value since '21, with having the non-same-store taking the major share of this growth, 2/3 in '25, as you have seen on the previous slide, while having the same stores normalizing their NOI delivery. And Isabel, by the way, will come back later with details regarding our future pipeline. On this, I turn to Thomas.
Thomas Oversberg: Thank you, Marc, and good morning, everyone. Let me now turn to the same-store performance for 2025 on Slide 8. Across our 251 same stores, we delivered a solid full year revenue growth of 3.2% at constant exchange rates, supported mainly by the continued in-place rent growth of 3.5%. Occupancy remained resilient at 89% despite the modest addition of rentable square meters during the year. Overall, demand remained steady across our markets. But as we highlighted, in several regions, market dynamics intensified during Q4, particularly in the U.K., the Netherlands, France and Germany, requiring selective pricing adjustments to protect occupancy while preserving our long-term growth. This Q4 NOI margin impact flowed through to EBITDA, as you will see later. That said, throughout the year, we were able to rely on our structural strength, disciplined pricing, the scalability of our platform and cost efficiencies delivered through clusterizations, helping us mitigating inflationary pressure, for example, of payroll and real estate taxes. As a result, full year same-store NOI grew by 3.8% and our same-store NOI margin expanded by 40 basis points, reaching 68.1% for the year. Moving to same-store NOI performance on Slide 9, where we break down the main components of our NOI growth for 2025. We delivered EUR 254.2 million of same-store NOI in 2025, up from EUR 244.8 million last year. As noted, key contributors were higher in-place rent, which added EUR 8.1 million and a EUR 1.4 million benefit from margin improvements. Rental square meters were broadly stable year-on-year, having only a marginal NOI impact. With same-store representing approximately 86% of our total NOI, this demonstrates our ability to sustain high profitability, allowing for predictable earnings growth. Slide 10 illustrates the normalization pattern, which we anticipated and communicated throughout 2025. After several years of exceptional post-COVID growth, 2025 showed the expected return to more typical revenue dynamics across our same stores. Revenue growth remained positive at 3.2%. And as mentioned, Q4 was clearly more challenging, in particular, against our very strong comps from 2024. The key message here is that the overall slowdown in revenue growth was expected. But importantly, the long-term fundamentals of our markets remain intact: urbanization, mobility and still significant undersupply. We remain convinced that our omnichannel and pricing capabilities position us well to manage through different market conditions as we have demonstrated in the past, most recently in Sweden. Turning to adjusted EPRA earnings per share on Slide 11. For 2025, adjusted EPRA earnings per share landed at EUR 1.74, fully in line with our expectations and market consensus. This performance was underpinned by a strong underlying EBITDA growth of 10.4%, reflecting the impact of our expanded portfolio and economies of scale. As noted, the performance in Q4 eventually did not allow us to expand our EBITDA margin as the Q4 slowdown flowed through to EBITDA, resulting in a decrease in EBITDA margin by 30 basis points. While interest and taxes grew in absolute amounts, we increased slightly less than what we initially estimated, resulting in a 1.7% adjusted EPRA earnings per share growth. I now hand over to Isabel, who will walk us through capital allocation and returns.
Isabel Neumann: Thank you, Thomas, and let me add my good morning to all of you as well. In 2025, we have delivered exactly as guidance. We have opened about 90,000 new square meters of properties at an 8% to 9% yield for an investment of about EUR 210 million. By delivering this 90,000, yet again, we really show that we can consistently deliver this target that our development engine is working very well indeed. What I'm particularly pleased about is that we have delivered these 90,000 square meters through all the regions, across the regions and also using the different ways of growing we have. So through new developments, redevelopments and M&A. So it shows again the scalability of our platform, we can grow in all 3 ways across 7 countries. And you can really see how in 2025, this comes together quite nicely. This brings me to the next slide. We have a strong pipeline for '26 and '27 with 160,000 square meters already secured at a yield of 8% to 9%. Let me remind you that we buy our properties subject to building permit, and we don't land bank. For '26, we have 23 properties in the -- 23 projects in the pipeline for a total of 102 (sic) [ 102,000 ] square meters. And for '27, we already have 12 projects in the pipeline for a total of 56,000 square meter. We've also decided to increase the hurdle rate going forward from the current 8% to 9% to 9% to 10%, but we will come back to this later in the presentation. On the following slide, we show our strong track record in delivering the returns we set out. On the left graph, you can see how our organic projects have performed per vintage year. And on the right, you can see how our acquisition projects have performed. This is the second year we're showing these numbers. So the bars in red show the returns at the end of '25 and the bars in gray show the returns last year at the end of '24. Up to 2023, we had a hurdle rate of 7% to 8%. And since then, we have increased it to 8% to 9%. So now let's look at our track record. On the organic projects, we delivered very strong performance indeed. All vintages before 2021 already delivered a minimum hurdle rate and the younger vintages, as you can see, they continue to progress well. For the acquisitions, we generally delivered the hurdle rate with the exception of 2021, 2023 and 2024. And there are specific reasons for each of them, and let me go into that. In '21, we did the acquisition of the A&A portfolio. The A&A portfolio consisted of 4 stores in London, out of which 3 in the Kings Cross area. We have 2 topics that has impacted us on this acquisition. The first one is that we've seen a large increase of competition in the Kings Cross area in the years following our acquisition. In 2023, Big Yellow opened a very large store in the summer of '23. And in fall of '23, Access also opened a store exactly in the same area. Secondly, because of the very central location, we also -- it took us also a little bit longer to get the permits to do the work that we set out to do. So that has, I would say, caused a slight delay, but we remain confident that we will reach the hurdle rates as we have set out. Then for 2023, this is the year where we did the Top Box acquisition in Germany. But Top Box, I think, was very much like an organic project. We are 5 stores and -- 5 open stores and 2 pipeline stores, but the open stores effectively were at a very low occupancy, and we, of course, also had to build out 2 stores. So if you look at the occupancy at the time of acquisition versus the fully built-out square meters at the end, at maturity, we were only at an occupancy of 42%. So this is an organic project. This is not an M&A-type project. And therefore, if you look at the returns of 1.6% that compares in '23, that compares fairly nicely with the 1.8% on the organic side. So you can see this is just more a fact that it's an organic-type project. Then for 2024, this is the year we did Lok'nStore. We also did Pickens and Prime, and Pickens and Prime are very mature, fairly mature properties. But of course, Lok'nStore as well is a portfolio that's not mature yet. The occupancy for the existing store was about 70% at the time of acquisition, but we had quite an aggressive redevelopment program, and we also had a high number of pipeline stores. This year, effectively, we have delivered already 18,000 of the pipeline stores. And next year, we will deliver 26,000 of the pipeline stores. But if you take into account the redevelopment and the pipeline, at acquisition, we were about 50% occupancy. So you can see for 2004 Lok'nStore, it's a bit of a combination between mature and organic. This brings me to the Lok'nStore acquisition. And let me give you an update on where we stand. First of all, on the real estate side, I'm pleased to say we have fully completed the rebranding of all the Lok'nStore stores. We have installed access control, brought it up to our standard to reduce the energy consumption. So they are now, for all intents and purposes, fully Shurgard stores. Further on the real estate side, as I mentioned before, this year, we have added 18,000 square meters to the portfolio through a combination of redevelopments, remixes and the opening of 2 properties. And next year -- sorry, in this year, we will open the remainder of the stores from the L&S pipeline for a total of 26,000 square meters. So by the end of this year, the full FBO, as we had set out will be delivered. Now let me shift to the operational side. First and foremost, our occupancy is on track. We started the acquisition at 67% occupancy. And by December '25, we were at 80%, and we continue to expect to reach our target of 90% by the end of this year. Now we have said in the past that we will deliver a CAGR of about 2% of in-place rent, and you can really start to see how this is coming together, a, by an increase of the move-in rate; and two, by a decrease of the move-out rate. On the move-in rate, as we have a higher occupancy, we need less promotions and therefore, logically, the move-in rate goes up. On the move-out rate, you can really see the impact of our commercial policy of the Shurgard standardization. And therefore, you see normalization of the move-out ratio in line basically with our London portfolio. So the 2 of them together will make that our in-place rent is moving up. The last point I would like to mention is on the synergies. We have realized synergies at the high end of the range. At the time of the acquisition, we had guided towards between EUR 4 million and EUR 5 million, and you can see that we are delivering at EUR 5 million. This is through a combination of factors. First and foremost, as we put the Shurgard operating model in place, we've been able to lower the FTEs per store. All the assets have been folded under the U.K. REIT, and we have a reduction in G&A, Primarily, we have closed the former Lok'nStore headquarters. So in summary, we are delivering according to plan on the Lok'nStore acquisition. I will now hand it back over to Thomas to talk about the balance sheet.
Thomas Oversberg: Thank you, Isabel. Let's now move on to our balance sheet and financing structure. Shurgard, as you know, is the only European self-storage operator with a BBB+ investment-grade rating. Our capital structure continues to be a source of competitive advantage, supporting our long-term low-cost funding. At the end of the year, our LTV stood at 23.2%, broadly stable year-on-year and comfortably below our 25% long-term target. Net debt to underlying EBITDA remained at 6.2x, fully within the boundaries of our rating. Our average cost of debt is 3.33% with a 7.2-year weighted average maturity. Liquidity remains strong with EUR 56 million cash on hand and a fully undrawn EUR 500 million revolving credit facility, giving us flexibility to fund our development pipeline. As you know, 100% of our mainly freehold portfolio is unencumbered. And this, with our commitment to our BBB+ rating, is a cornerstone of our decision-making process. On Slide 21, we outline the strategic decisions we are implementing to accelerate medium-term adjusted earnings per share growth. We have increased our investment hurdle rate by 100 basis points, as mentioned by Isabel. This means that all projects from -- approved from 2026 onwards will have to earn an NOI yield on cost at maturity of 9% to 10%. This reflects our focus on disciplined value-generating organic growth. It has no impact on the growth already embedded in our pipeline for 2026 and 2027. Further, we are discontinuing the scrip dividend options, moving to a cash-only dividend of EUR 1.17 per share. We remain fully committed to our BBB+ rating, as I mentioned. Therefore, we continue to target a long-term LTV target of 25% and below, refine our medium-term net debt-to-EBITDA target to 5x to 6x. And finally, we reiterate our commitment to continue applying a disciplined M&A framework, requiring acquisitions to be EPS-accretive in the first full year, ensuring value generating also on this front. These decisions collectively reinforce our ability to deliver sustained compounding earnings growth. Looking ahead and incorporating the current pricing and occupancy conditions and expectations, on Slide 22, we are guiding for 2026 to be a year of continuing growth. We expect all store revenue growth of 6% to 8%, driven primarily by the continued ramp-up of our properties opened or acquired in 2023 to 2025. Underlying EBITDA is expected to be in the range of EUR 278 million to EUR 289 million, reflecting our confidence in delivering operational efficiencies that offset ongoing cost pressures as the ones mentioned on the slide. As a consequence of the strategic decisions explained on the previous slide, we anticipate net interest expenses to be between EUR 57.5 million and EUR 59.5 million. Overall, resulting adjusted EPRA earnings growth will be between 1% and 6%, and is expected to translate into adjusted EPRA earnings per share between EUR 1.70 and EUR 1.81. We plan to add 100,000 to 125,000 square meters to our portfolio in 2026 with CapEx in the range of EUR 250 million to EUR 315 million. Our year-end leverage is expected to remain within the rating framework at 6.5 to 6.8 net debt to EBITDA. We expect to update the outlook throughout the year, where necessary, to ensure consistent and transparent communication. Finally, let me close with our medium-term guidance for 2027 through 2030 on Slide 23. We expect all store revenue, underlying EBITDA and adjusted EPRA earnings to reach a growth at 6% to 8% CAGR, reflecting the long-term compounding nature of our business. Our pipeline, approximately 90,000 square meter per year, will require around EUR 200 million of annual investment and continues to offer an attractive yield at maturity. We anticipate continuing to distribute EUR 1.17 dividend per share paid in cash and remain firmly committed to our BBB+ rating with landing in our target net debt-to-EBITDA range of 5x to 6x by 2030. Our model remains simple: disciplined capital allocation, a scalable platform, strong cost control and a structured demand that continues to support long-term value creation. With that, I hand back to Marc for his concluding comments.
Marc Oursin: Thank you, Thomas. So in summary, Shurgard has a proven and resilient business model. If I show it, it's better. So yes, indeed, we have a proven and resilient business model, combined with a high-growth profile and, I would say, a development engine based on a real scalable platform. And that's why you've seen all these improvement in the same-store margin along the years. At the same time, as explained by Thomas, our balance sheet is solid with its BBB+ investment grade. And therefore, we have an attractive earnings growth perspective. So on that, I thank you for your attention, and I hand over to you, Caroline. Thank you.
Caroline Thirifay: Thank you, Isabel, Marc and Thomas. As you can see, the next rendezvous will be the Q1 results on May 13, same day as the AGM. We are now available to take your questions. We will take first the question of the audience, followed by the question from the webcast. [Operator Instructions] We have the first question.
Jonathan William Coubrough: Jonny Coubrough from Deutsche Bank. Could I ask firstly, please, on the medium-term guidance range? What is informing that current range and what's implied there for same-store growth rates? And also, whether the new guidance range reflects the new hurdle rate for yield on cost of new developments? And then secondly, on that new hurdle rate, how does that impact the opportunity set for potential new investments?
Marc Oursin: Okay. So I will take the first part and you take the second part, Isabel. So regarding the -- and maybe we can share the slide of the medium term. So the medium term actually is taking into account the fact that on the same-store, we have said that many times, the normalized same-store growth should be, I would say, between 2% and 3%. That's what we have usually for this model. And then, of course, we took into account also, that's why you have a range this year. And we think it's -- we are not the only one, by the way, giving ranges. We've seen that in the U.S., and we think it's a good thing to do with the -- with you guys. So we have taken an assumption, which is on the low side, if it's not going into exactly what we are looking for. And if all the planets are globally aligned, you have the high side on the right. So that's what we are disclosing this. And the midpoint of this medium-term guidance is more or less the trajectory that we're looking for. That's for the -- I would say, the explanation to this. And regarding the hurdle rate, Isabel?
Isabel Neumann: So on the hurdle rate -- so indeed, we've increased the hurdle rate to reflect our cost of capital, that is clear. With regards to the opportunities going forward, well, first and foremost, I would say 2026 and 2027 is largely already driven by the pipeline that has already been created. So there's, as such, not necessarily an immediate [Audio Gap]. We have, in the past, increased the hurdle rate from 7% to 8% to 8% to 9%, and we have still managed to find projects. However, we will only do them if they are -- they generate the returns. It means we will have to work together as a team. Our construction team will look at opportunities to lower our cost of construction, look at opportunities to lower our broker costs and so forth. So it will be a collective effort. And I would say there is a possibility that, in the first year, we will do slightly less project than we have done before, but we remain confident that we can continue to grow in an attractive way.
Andres Toome: Andres Toome from Green Street. So a few questions. Firstly, on that same guidance for the medium term, and it seems it's come down in terms of what you're looking for in terms of underlying EBITDA growth, which was more in the double digits before. So maybe you can help to understand what's driving that because you -- I think you sort of alluded to the fact that your same-store guidance, implicit one, has not really changed. So is it just that the delivery on development pipeline, lease-up is under your expectations?
Marc Oursin: Do you want to take this one, Thomas?
Thomas Oversberg: I think we shouldn't take that conclusion from that. I think we have a very solid understanding of where we expect the markets to be. We have taken the current condition into account. And based on that, we do think that delivering in that range on a CAGR perspective is more or less in line with what we said before. I mean -- so from that perspective, we don't expect really a fundamental change in the dynamics. It's more a refinement where we see we're going to land.
Andres Toome: Okay. And then I guess, looking back also on the slide with your 2024 acquisitions and the delivery there on the yield on cost so far, it looks to be lower compared to what you had, I think, when you announced Lok's acquisition in terms of just the day 1 unlevered yield on that. So I guess there are other sort of bits in that 2024 vintage as well. But just on the headline there, it looks maybe Lok'nStore is actually underdelivering on your expectations. Or is that the wrong read and there's something else included?
Marc Oursin: Yes. I think it's the wrong read. If I remember, we said when we did Lok'nStore that we will deliver 8% yield on cost, '29, 2030. And that the, as explained, actually, by Isabel, when we took over, the portfolio was not at all matured because if you look at it, occupancy was 2/3, 67% of the current square meters. But with all the new ones that are coming in, especially this year, plus the expansion that we have done in the past year, the 67% is actually 40 -- less than that, 35% of the ending point of the square meters in '29, '30. So that's one. Secondly, in terms of return or let's call it, entry yield, the first year, we were saying that we were roughly below half of what we're targeting, so between 3% and 4%, which is the case shown on that slide, more or less.
Andres Toome: Right. I guess from the prospectus or the sales, sort of, memorandum, I think the EV EBITDA multiple was sort of 27% on in-place income, which would be sort of at high 30% range, but...
Marc Oursin: Okay. Knowing that in this, you have also other deals, you have the Pickens one, you have the Prime one plus another one we did the same year.
Andres Toome: Okay. And then final question is just on your thinking around your cost of capital and how you think about net external growth because you keep on sort of plowing ahead, but your shares are trading at a pretty hefty discount. So do you have any thoughts around just because of that discount to actually sell some assets and capture any sort of private market arbitrage there might be?
Marc Oursin: Well, we have said, especially in the case of Lok'nStore when we met with all of you because we had a question about the geography of Lok'nStore. And we said, we want to stick to London, the surroundings of London Southeast and therefore, Greater Manchester. So obviously, we said that we do a review of these properties. So we said, let's give us some time. It will take probably 1 to 2 years to see how the stores where Isabel has invested the money to put them up to speed are delivering. And also, are there better opportunities with this capital potentially? And you're right. So we are working on this.
Valerie Jacob Guezi: I'm Valerie Jacob from Bernstein. I just have a follow-up question. If I look at your 2026 CapEx, I think you previously guided for EUR 320 million and now the number is a bit lower. And so I just wanted to understand the reason for that. And also, as a follow-up, what are you seeing in terms of your acquisition pipeline? And do you think you'll be able to offset that?
Isabel Neumann: Sure. So indeed, we usually generate about 20,000 square meters in M&A. So the 102,000 that you're seeing here is organic pipeline. So M&A would kind of come on top of that. But of course, with M&A, it's always -- some years, there's lots and other years, there's less. So we never quite know where we're going to be ending up in terms of M&A in a given year. But so indeed, we have a good basis with 102,000 of organic pipeline and any M&A would effectively come on top of that. So we are expecting to kind of end up in this range that we have guided towards.
Thomas Oversberg: Yes. Probably there, we always consistently have been saying we are expecting 90,000 overall, a certain amount of CapEx. And as we are not in full control of M&A, the mix might change between where we go, but the target of the square meters and the amount we are investing remains the same.
Caroline Thirifay: Do we have any other questions from the audience? If not, we will take questions from the webcast.
Unknown Attendee: We have our first raised hand from Vincent Koppmair.
Vincent Koppmair: Congrats on the results. My first question is a little bit more information on the Q4 weakness you've seen in certain markets. Could you give a little bit more color on those, please?
Marc Oursin: Okay. So thank you, Vincent. So we have seen -- as we also have said during the course of the year that the way we're looking at '25, and there's a slide actually showing this deceleration, we're anticipating the deceleration. If you remember, actually, Q1 was better in terms of results than anticipation. Q2, Q3 were in line and Q4 is not as we were expecting, to be frank. And we have seen this deceleration stronger in 4 markets: the U.K., the Netherlands, France and Germany. And I will come back to this. Meanwhile, at least 2 markets that are the Nordics, so Sweden and Denmark, did pretty well and very happy with that, of course. And back to the U.K., Netherlands and France and Germany, so the reasons are probably different. If you take Germany, for example, we have opened quite a number of stores, but especially one of our competitor called MyPlace did in Berlin, for example, in that city. And the situation in Berlin is much more -- we think, a kind of what we experienced in Stockholm some years ago. So suddenly an oversupply that the market has to digest. And therefore, in order to keep our occupancy where we want, it's what we did with Sweden, and you saw that the payoff is very good today. We are, I would say, putting more discounts. We don't see any lack of demand at all in all the 4 markets that I've mentioned to you for this deceleration. It's much more the fact that we have to do more discount to convert that demand into contracts. And why do we have to do more demand? Let's take Berlin, it's more supply and they want to fill up their properties, which is logical. And in other markets, I would say, like the U.K., for example, especially London, we have seen some competitors becoming more aggressive on their pricing, probably for different reasons. If you look at Access, for example, if you look at Safestore and the surroundings of London outside the M25, smaller players also became more aggressive. That's what we have seen. Will it last? We don't know. But what we can say is that when you start to look at the first 2 months of the year, Q1 in '26, we start to see a certain normalization on that. And the Netherlands, it's a bit the combination of both in the sense that if you go to Randstad, especially in Amsterdam area, there is openings and there is some cannibalization regarding certain properties and also some competitors being more aggressive. That's what we are experiencing. That's the answer, Vincent.
Vincent Koppmair: Yes. I had one follow-up question on your 2026 guidance. I appreciate that you now give a range, so quite nice to have some more information. But should we understand, as you've mentioned that, of course, the high end of the range is the blue sky scenario, but would you, compared to the high range and the low range, aim for the middle? Or is your base case scenario a little bit closer to the higher end of the range?
Marc Oursin: No, that's a good question. Thank you very much. So obviously, here, Vincent, the -- what we are looking at is to be within this range, obviously, first. Secondly, across the year that will come every quarter, and I think this is what our peers in the U.S. are doing and other companies not in real estate, you just adjust the -- where you're going to end within this range. So obviously, because year-to-date, quarter-over-quarter, you have actuals versus simply last year. So you know where you will end. So for us, we want to be in this range. And you can say that the midpoint of this range is probably where we would like to be.
Unknown Attendee: Our next raised hand is from [ Stephane Afonso ].
Unknown Analyst: I'll ask them one by one. So first, regarding your 10% yield on cost, how many years does it take to reach this stabilized yield? And could you break that down between occupancy and ramp-up rents, please?
Marc Oursin: Okay. So the 10% is related to maturity. So usually, this is taking more or less between 5 to 7 years, depending on the size of the property and the investment. But if you want to be on the safe side, take 7. That's one. Secondly, how do we get there between the volume effect, so occupancy first and then the rates? So occupancy to get to 90% will be between 2 to 3 years. And then the rates will start to kick in and especially the ECRI, so the increase that you do to your existing customers. And this would bring you the remaining years to this -- after 7 years to this level of targeted 10% return.
Unknown Analyst: Okay. And has this time line changed, meaning does it take longer or not, no?
Marc Oursin: No, no, no.
Unknown Analyst: And regarding the 2% to 3% same-store annual growth that you expect, on what basis are you deriving this figure? And within the information that is publicly available, how can analysts challenge this figure?
Marc Oursin: It depends on the talent of the analyst, obviously, and the knowledge of the analyst. And I think if you're the analyst, what you will do is you will look at the past first. We know that the past is not the future, but it gives you at least a good understanding how Shurgard has been able to go through the past 10 years, for example. So GFC, COVID, interest rates, high inflation. And you will see that if you are between 2% and 3%, it's, we think, reasonable. So if you want to take, [ Stephane ], something more conservative, you stick to 2%. If you are more aggressive, you go for 3%. But I think that if you are in this range, you are close to the truth as a run rate long term.
Unknown Analyst: But just to understand, do you base it on inflation, for example, could be a threshold or -- just trying to...
Marc Oursin: That's an interesting one because, usually, you're right, many analysts or people who are, let's say, looking at the company and this class of assets are looking at CPI. But we have demonstrated -- we have a couple of graphics in -- I think it's what we call the company presentation where we show that we have always overbeaten the CPI actually. I'm talking same-store revenue growth year-on-year. So I would say that usually, we are above CPI. And why? Because it's a need business. And that makes the whole thing very different, meaning that because you need space, and as soon as you got in, you need that space and the exit barrier to leave that space, people are sticky. So again, think about what it is, it's like having your attic or your basement in a remote location and think how you behave versus your attic and your basement when you want to leave it is because you are forced to do so. So that's why we have been able, I think, to beat the CPI for quite a long time.
Unknown Analyst: And last question. If the right opportunity came up, would you be open to another...
Marc Oursin: We didn't hear you at the beginning. Will you repeat, please?
Unknown Analyst: Yes. Just asking one question about M&A. If the right opportunity came up, would you be open to another sizable acquisition in the short term? Or is the focus firmly on completing the Lok'nStore ramp-up?
Isabel Neumann: Of course, we are very much focused on delivering the returns for Lok'nStore or any M&A that we have done. But clearly, as we have -- Thomas has also said, we are very cautious in the M&A that we do. It needs to deliver the returns that we have set out, and it needs to be accretive from the first year. So yes, of course, we will look at everything. But of course, the hurdle rate to move forward is very high.
Thomas Oversberg: And let me clarify on that point also for the people in the room. We are really committed to 2 things, and that's our BBB+ rating, which defines and what we can do on the debt side and to our accretiveness in the first year. Those 2 points are not negotiable. So therefore, you will not see us coming out and saying, oh, there was this strategic opportunity and we throw everything overboard.
Unknown Attendee: Our next raised hand is from Aakanksha Anand of Citi.
Aakanksha Anand: I have 3 of them, and I'll go through them one by one. The first one, we're obviously speaking about increased competition and a higher level of discounts. Could you just give some color around what kind of incremental discounts are we talking about compared to previous years? That's the first one.
Marc Oursin: Okay. Thank you for the question. So first, we do not disclose the intensity of discounts per market. What we can tell you is that, for example, if I would take Berlin as a reference, yes, we are increasing the discounts there. If you take usually the normalized level of discounts, we are close to 15% of the revenue. So it might go to 20%, for example, a certain period of time or less, depending -- actually, the pricing we do is per unit type in a given property. So it's very focused in terms of investing these discounts. And therefore, globally, you see this level. But it's hiding actually, very different situation per location and per type of size.
Thomas Oversberg: And if I can add to that, the important part is, and Marc alluded to that, is self-storage is a need business. So what I need to make sure is that I get the people who have the need. And that means I want to give them as little hurdle to make the conversion as possible. So the prices and next to the location of convenience are the 2 really driving factors. As I don't know, who of you will stay longer than 1, 2 months, but we know that more than 60% stay with us very long, the only reasonable thing I can do is make sure I get all of you. And that's what we are trying to do. So we are always saying we want to get as many people as possible because it's a need business. It's a sticky business. So that allows us, while we are coming in at a lower price, to again increase thereafter on our ECRI. And that's really important to understand. When we are saying we're giving more discounts, this is not something which we are not expecting that is executing on our pricing strategy, which, as said, we want to have 90% occupancy because we know it's a sticky business, and we want to get as many of the customers as possible.
Marc Oursin: And back to what you were saying, Thomas, with Sweden, it's exactly this is what happened. If you remember 3, 4 years ago, we had really a hard fight with one of our competitors in Stockholm mainly. And the payback today is that we were right to stick to this occupancy. Yes, it was painful in terms of revenue growth, same-store, because Sweden, the worst moment was minus 1% quarter-on-quarter, but never more than that. It's not like going to minus 5% or minus 10% -- minus 1%. And in the end, later on, you get the payback because the customer base is there, and you can apply the ECRI on it. What is your second question?
Aakanksha Anand: The second one is just on the same-store revenue growth over the medium term. So which would be the top 4 geographies where you expect to see the highest, if you could rate them for us, please?
Marc Oursin: Okay. So that's a -- I would say that if you look at medium term, so '27, 2030, which is the range that -- the time horizon that we have given, I would say that probably the Nordics will be on the top for -- that's one. At the bottom, I would say, probably Germany and maybe the U.K. And in the middle, I would say, Netherlands, France, Belgium. If I have to give you a ranking, I would see these 3 groups, the 3 tiers.
Thomas Oversberg: If I can add some color to that, the reason why this is not an easy answer because how our pricing mechanism works is we are sort of like agnostic of where a customer is sitting because we know the customer behavior is the same in all of our markets. So what you can see is that our pricing algorithm, both on the initial pricing and on the increase to existing customers is really agnostic to that. So whenever we see dynamics which impact our occupancy, we will see that the pricing algorithms are acting on both fronts. So what Marc was therefore referring is to what you should see probably the lowest growth is where we see most of our new store own opening because we are competing with ourselves, obviously. That means we can -- we need to make investments to ramp that store up. Again, not a buck, it's a feature of our model and where we see unexpected short-term price competition by competitors. So that, I think, is the way of looking at it. But overall, because we are applying exactly the same everywhere, our model is not saying, oh, you're a U.K. customer, you're only getting X percent. That's not how we're looking at it.
Aakanksha Anand: All right. And the third question, just on the investment hurdle. So the raised investment hurdle, I understand that applies to both acquisitions and the development pipeline. I think the question here is, does this mean -- I mean, are you able to find as many opportunities with that raised investment hurdle from the visibility that you have on the bolt-on acquisitions market at the moment? And if not, I guess it just basically means that the future external growth potential is going to be driven -- I mean, the share of future growth potential from the bolt-on acquisitions is going to be much lower.
Marc Oursin: Do you want to take this, Isabel? Or do you want me to answer?
Isabel Neumann: Well, I can start and you can add. I think the question was already kind of raised here in the room. But indeed, as we said, the pipeline for '26, '27 is kind of set, right? So there is no immediate change here for the next couple of years as, of course, we have a certain delay between the moment we do a deal and then we execute it. And our objective in terms of being accretive in day 1, this is not new. So to a certain extent, we're not necessarily changing the way we're doing it since we have done this year. M&A is always a situation whereby it's driven by effectively what is also available in the market, what is happening. And so part of it, of course, is where we want to act, but also it's what is the availability of opportunities. And that's the part we have not necessarily a control over.
Marc Oursin: So to complete the answer from Isabel, I would say that you're right, the risk on the M&A is higher than on the development, organic, because as Isabel said previously, organic development, finding a piece of land, okay, dealing the land and then after that, being able to act on the cost of development are much higher in terms of capacity internally to work on than trying to negotiate a deal -- a price with a seller in order to reach your hurdle rate of 9% to 10%. So you get the deal, you don't get the deal because you are priced in at the level of the seller. That's it. So that's clear to me that probably you're right, if we are not able to satisfy the, let's say, will of the sellers, knowing that we want to be at 9% to 10% return on this M&A transaction, yes, it will diminish. But it's not a big deal to me. It's -- I prefer to be not on a bad deal than with several on a good deal -- sorry, on a bad deal. So here, organically, potentially, it might take over what we are missing on the M&A. And as said by Isabel also, in the past, we have already increased the hurdle rate. We were at 7%, 8% till '23. And as of '24, we went from 7%, 8% to 8% to 9%. So the -- let's say, the concern was the same. Would you be able to still do M&A? Would you be able to buy lands and to deliver organic at the same -- at this new hurdle rate? And the answer is yes. So I would say the coming quarters will give us a good sense of our capacity to continue to organically develop at this new level of requirement. And regarding the M&A, let's see.
Isabel Neumann: And maybe one final point here is that it really shows the value of looking at our growth across M&A and organic. And there's been years whereby we've had much more organic and less M&A, and there's been years where we've had more M&A and less organic. Over the years, it all kind of levels out a little bit. But it's -- we are really depending on the opportunities, adjusting effectively how we combine the growth.
Marc Oursin: Caroline?
Caroline Thirifay: [indiscernible] conscious about the time.
Marc Oursin: Thank you. See you in Miami.
Unknown Attendee: Our next raised hand is from Ana Escalante from Morgan Stanley.
Ana Taborga: My first question is also on the level of discounts. Just wanted to understand if these discounts are more focused on attracting new customers or are more focused on existing customers, meaning keeping existing customers in your properties to sustain that occupancy? And to the extent that you can comment, are you seeing those discounts being sustained into the first quarter of this year?
Thomas Oversberg: Yes. So the discounts which we are talking about is indeed to attract new customers. As I said, what we are trying to achieve is that we get as many customers in and then increase their prices as long as they're staying with us. We don't see any changes in dynamics there. We are becoming, again, more sophisticated on increasing our existing customers. We're also having now machine learning tools on that running so that we are really having a risk-based approach there. But the main amount is always talking about the initial pricing, which a prospect gets to convert them into a customer. At the moment, I think we are seeing no major changes in there to what we saw in Q4. But again, that is not something which we are -- which we should have expected to see, because the dynamics -- market dynamics are not changing from one day to the other. If competitors are more competitive on pricing -- initial pricing, it's because they're obviously trying to fill up. And then it's more a question of what is the end goal. Are we dealing with a customer -- with a competitor who is happy to be at a certain occupancy and then manage the rates at that point in time? Or are we dealing with a competitor who is following our pricing strategy? We barely ever meet the ones in the second class. So at one point in time, this will naturally level out. As we also were saying, we are part of this pricing pressure ourselves because we're adding new spaces close to our existing store to enable us to plug the holes in our network and get from that the scalability effects. So again, we are obviously causing that to a certain extent as well.
Ana Taborga: Okay. Very clear. Maybe also related to this, thinking medium term, do you think that there is a risk that artificial intelligence makes this sector or the price search by prospective customers a bit more transparent? Because I know that you are very clear with your first month, EUR 1 or GBP 1, but there are other competitors that are not that transparent, do you think there is a risk that AI increases the transparency here and therefore, customers become a little bit more opportunistic, not only for new customers but also existing ones trying to -- looking for cheaper alternatives and the search process being facilitated by AI advances?
Marc Oursin: Okay. So Ana, here, I think, again, back to what Thomas just said and confirmed, the global revenue growth of the company is actually combining 2 engines. One engine, which is to attract new customers. That's one thing. It's where the discounts prices are public. They're on the website. The price you see is the price you pay and you have discounts after that. Discounts could be $1, EUR 1 the first month, can be additional discounts. That's one thing. And secondly, you have everything related to the ECRI, which is increasing your existing customer. And here, it's purely discretionary, it's private. So I will start with this, where AI -- actually, from a customer -- an existing customer perspective, I would say that the risk there to me are very limited because as we have said, people are sticky. You don't wake up in the morning and check every morning like a stock price if the price that you are paying for your unit can be cheaper with AI because you forget it. And that's the whole behavior of the customer. So that's very important because it's protecting actually our business, and that's key. I don't think AI will change that, to be very frank. I might be wrong. But today, with what I understood from this business after being 15 years in it, and by the way, being a customer of Shurgard before even working for Shurgard, I doubt. But where you are potentially right is on the first aspect is how, for new customers, people who are searching for a unit, how they can be, let's say, for themselves more efficient, more agile to pick up a location, a price which is closer to their home, and they can choose that. You would have told me, for example, in 2012 that in '25, 12 years later, more or less, or 13 years later, 95% of the search we have are gone through Internet and in Europe, because Google is almost a monopoly, the search engine used is Google for 95% of those, and that the people are doing that today for close to 80% with their mobile phone, when in 2012, it was 5%. I would have told you, well, I doubt. And I was wrong. So what will happen and that we have started to see is that people are using ChatGPT to search. And today, out of all the search that we have on the web within 1 year, it went from 0.1% to 0.6%. So 6x, still 0.6%. So it's a long way. And ChatGPT up to now is more than 80% of all this search in terms of tool used. So you remember, in the past, if you take the analogy with the web, you could say there was Google, there was [ Bling ] or Bing, there was -- I don't know what. And in the end, Google took over. So here, for the time being, what we see is this. So it's very early day. It will go probably quite fast. It might take also another 5 or 10 years to become more significant. There will be, I suppose, a fight between the search -- let's say, the different tools as we had with the search engine. And -- but in the end, I would say, already with the way we are pricing our products, I think that by being the cheapest in the area where we are, in the 15 minutes, that's what we are looking for, is probably the best protection.
Thomas Oversberg: Yes. So probably to add just 2 sentence before Caroline stops me. So self-storage is a hyperlocal product, which means that the searches will be hyperlocal. And we are having the right network to be hyperlocal. So what is happening in the future -- in the foreseeable future is that customers are more informed making their decision. We have already pricing transparency on our website. So there's -- we are not hiding anything. So it's more difficult for the people who don't have pricing transparency. And overall, customers will have a much better understanding. It's like what does it mean? How does the contract work? How does a rating increase work? Because those are the information which you typically quest, and those are the question which AI will be able to help you.
Caroline Thirifay: Do you have any additional question, Ana?
Ana Taborga: Yes. Super quick, a final one. It is on your dividend, capital allocation. So you're guiding to 6% to 8% EPS CAGR in the next 4 years, but stable dividend. I understand that you want to retain cash to continue funding your expansion, right? But just wondering how do you balance that more immediate shareholder remuneration versus the long-term value creation through your growth initiatives?
Thomas Oversberg: So I think that's an important point to look at. When we looked at the decisions which we took this year, we looked exactly at that conundrum of what is my cost of equity, what is my cost of debt and what are investors expecting as a return. And that led then, for example, into the fact that we're saying, okay, we need to increase our hurdle rates because the investors require a higher return there. So -- and that then, as I was saying, is we need to balance off with the earnings per share growth, which people are expecting going forward, which is obviously impacting, on the one hand, on the dilutive effect of more shares, which we have now eliminated. And on the other hand, which is then compensating is the additional interest expenses, which will reduce earnings as well. So long term, we are continuing to say, well, an investor should expect a total shareholder return, which is made of the dividend yield and the earnings growth of 10%, and we remain committed to that. Once we are seeing that there's really an imbalance where this is no longer happening, we always said and we haven't changed our opinion on that, but we are also going to change our dividend payout. But at the moment, we feel that to -- in order to deliver this growth and our strategy, we are comfortable with the dividend at the level where it is at the moment.
Caroline Thirifay: So we are conscious of the time, then we will take the last question, and it's Roy Külter from ODDO - ABN AMRO.
Roy Külter: It's just one from my side. I know it's a more operational real estate sector that you're operating in, but I do want to focus a little bit on property values. So we've seen the NAV per share has grown strongly, but valuation yields have remained flat. So it's basically operational performance. But we've also seen in the market some large transactions being pulled during 2025. So how comfortable are you today with your book values? And maybe secondly on that, can you give some comments on the investment market?
Marc Oursin: Thomas?
Thomas Oversberg: Yes. So the main increase, if you look at the value increase in our portfolio, which is around EUR 500 million, I can split that into 3 buckets. The first one is -- and they're not equal size, but for the sake of debate, let's assume they are almost. The first one is stores which we opened last year and the year before, which are ramping up. And therefore, this means that the valuation expert can reduce the discount and the risk because they are seeing that we're performing against our target. And therefore, this increases the value of our portfolio. The other part is where, indeed, we are talking about stores which we have added this year, which are under construction. So again, that results in value increases there. And the third part is, and this is not -- by far not the biggest, is the operational performance where we are delivering better performance than before. If you look now -- and on what we were saying, well, this part here, I'm talking about is mainly same stores. Same stores, as you saw in our slides, is actually performing still quite well. We're having a revenue growth there. So the NOI is growing. So everything is fine there. So we are not concerned about the operational performance that this would immediately impact our valuations. To speculate on why transaction in the M&A markets are not taking place is beyond my skill set, to be perfectly honest. And therefore, we are obviously aware of what is happening in the market. We are watching it with great interest and excitement. But in the end of the day, there's always 2, it's a buyer and a seller. And if those 2 cannot agree with each other, then the transaction's not happening. And that sounds very, very basic, but you see on the one hand, let's go to Australia where we have 2 transaction, potential transaction, which might have happened at the same time. The one was not going through because people thought the valuation was too high. And the other went through despite the fact that it's the same principle. So I think it's more a deal-specific one, but I'm surely having more experts on my left side here to deal with that.
Marc Oursin: We can speak for a long time about that, but let's take it aside when we'll be with you, Roy. But I don't want to paraphrase what Thomas said in the end, it's like selling your house. I want EUR 1 million. I'm ready to pay EUR [ 700,000 ], it doesn't work. That's it. If someone is going to pay EUR 1 million for the house and taking a risk, it's a risk appetite story from the buyer. That's it. And we have precise -- and repeated what -- how we approach the risk. We have said we want the first full year to be accretive per share in terms of returns for an acquisition. So that's it. That's where we stand. Let's see how '26 will go with all these deals that have been put into the fridge. Are they coming to the microwave oven or not? Let's have a look. But thank you for the question.
Caroline Thirifay: Thank you all for joining us today, and we look forward to reconnecting in this venue soon. Thank you.