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Key highlights
Self-Storage REITS improving in 3Q of 2023
Overall self storage public REIT performance continues fundamental resilience across the sector, with a number of key takeaways from the quarter, including:
Key highlights from Self Storage REITS Q3 2023 report filings:
Public Storage (PSA)
- On July 24, PSA closed on a $2.2 billion acquisition of Simply Self Storage from Blackstone Group. The 127 properties were fully integrated into the Public Storage platform on day 1, and the rebranding process is reported to be ahead of schedule.
- In addition to the $2.2 billion Simply purchase, PSA has closed just north of $400 million of acquisitions year-to-date. And by year-end, they will have delivered $375 million of new developments with a go forward development pipeline of over $1 billion to be delivered over the next two years.
Extra Space Storage (EXR)
- Revenue growth was driven by high average occupancy of 94.4% throughout the quarter. Existing customer behavior stayed strong, as exhibited by solid length of stay, muted vacates, and continued acceptance of rate increases.
- EXR has slowed its acquisition pace since the LSI merger but continues to be very active in third-party management, adding 49 new managed stores during the quarter.
CubeSmart (CUBE)
- CUBE has continued to be very active on the third party management front, with 41 new managed stores during the third quarter, bringing CUBE to 124 stores added year-to-date and 763 total managed stores.
- Net effective rates to new customers were down year over year 16.9% during the quarter and the gap widened to 18% in October, yet revenue was still up 2.3% YoY, driven by effective revenue management via rate increases to existing customers.
National Storage Affiliates (NSA)
- During the third quarter, NSA repurchased 6.4 million common shares for $213 million. NSA is encouraged by the volume of execution it was able to achieve under the repurchase plan the Board established last year. NSA is confident in its long-term outlook and believe the current trading levels represent a very attractive investment opportunity.
- NSA continues to execute on acquisitions from its captive pipeline while its PROs continue to replenish the pipeline by making acquisitions outside of the REIT. NSA remains pleased with its geographic exposure and secondary market performance.
