Extra Space Storage Inc. Reports 2025 First Quarter Results
Extra Space Storage reported strong Q1 2025 results with net income of $1.28 per share, up 26.7% year-over-year. The company's Core FFO reached $2.00 per share, marking a 2.0% increase from 2024.
Key performance metrics include:
- Same-store revenue increased 0.3%
- Same-store occupancy improved to 93.4% from 92.4% last year
- Acquired 12 operating stores for $153.8 million
- Expanded management platform to 2,114 total managed stores
- Paid quarterly dividend of $1.62 per share
CEO Joe Margolis noted a solid first quarter that exceeded revenue expectations. The company maintained its same-store guidance despite economic uncertainty. Notable transactions include a $100 million investment in Strategic Storage Growth Trust III convertible preferred stock and the sale of 11 operating properties. The company's debt profile shows 78.8% fixed-rate debt with a combined weighted average interest rate of 4.4%.
Extra Space Storage ha riportato risultati solidi nel primo trimestre 2025 con un utile netto di $1,28 per azione, in aumento del 26,7% rispetto all'anno precedente. Il Core FFO della società ha raggiunto $2,00 per azione, segnando un incremento del 2,0% rispetto al 2024.
Le principali metriche di performance includono:
- Ricavi da negozi comparabili aumentati dello 0,3%
- Occupazione dei negozi comparabili migliorata al 93,4% rispetto al 92,4% dell'anno scorso
- Acquisizione di 12 negozi operativi per $153,8 milioni
- Espansione della piattaforma di gestione a un totale di 2.114 negozi gestiti
- Pagamento di un dividendo trimestrale di $1,62 per azione
Il CEO Joe Margolis ha sottolineato un primo trimestre solido che ha superato le aspettative di ricavi. L'azienda ha mantenuto le previsioni per i negozi comparabili nonostante l'incertezza economica. Tra le operazioni significative vi sono un investimento di $100 milioni in azioni privilegiate convertibili di Strategic Storage Growth Trust III e la vendita di 11 proprietà operative. Il profilo del debito della società mostra il 78,8% di debito a tasso fisso con un tasso di interesse medio ponderato combinato del 4,4%.
Extra Space Storage reportó sólidos resultados en el primer trimestre de 2025 con un ingreso neto de $1.28 por acción, un aumento del 26.7% interanual. El Core FFO de la compañía alcanzó $2.00 por acción, marcando un incremento del 2.0% respecto a 2024.
Las métricas clave de desempeño incluyen:
- Los ingresos de tiendas comparables aumentaron un 0.3%
- La ocupación de tiendas comparables mejoró al 93.4% desde el 92.4% del año pasado
- Adquisición de 12 tiendas operativas por $153.8 millones
- Expansión de la plataforma de gestión a un total de 2,114 tiendas gestionadas
- Pago de dividendo trimestral de $1.62 por acción
El CEO Joe Margolis destacó un primer trimestre sólido que superó las expectativas de ingresos. La compañía mantuvo su guía de tiendas comparables a pesar de la incertidumbre económica. Transacciones destacadas incluyen una inversión de $100 millones en acciones preferentes convertibles de Strategic Storage Growth Trust III y la venta de 11 propiedades operativas. El perfil de deuda de la compañía muestra un 78.8% de deuda a tasa fija con una tasa de interés promedio ponderada combinada del 4.4%.
Extra Space Storage는 2025년 1분기에 주당 순이익 1.28달러를 기록하며 전년 대비 26.7% 증가한 강력한 실적을 발표했습니다. 회사의 Core FFO는 주당 2.00달러로 2024년 대비 2.0% 상승했습니다.
주요 성과 지표는 다음과 같습니다:
- 동일 점포 매출이 0.3% 증가
- 동일 점포 점유율이 작년 92.4%에서 93.4%로 개선
- 운영 중인 점포 12곳을 1억 5,380만 달러에 인수
- 관리 플랫폼을 총 2,114개 점포로 확장
- 분기별 배당금으로 주당 1.62달러 지급
CEO 조 마골리스는 매출 기대치를 초과한 견고한 1분기를 언급했습니다. 회사는 경제 불확실성에도 불구하고 동일 점포 가이던스를 유지했습니다. 주요 거래로는 Strategic Storage Growth Trust III 전환 우선주에 1억 달러 투자와 11개 운영 자산 매각이 포함됩니다. 회사의 부채 구조는 78.8%가 고정 금리 부채이며, 가중 평균 금리는 4.4%입니다.
Extra Space Storage a annoncé de solides résultats pour le premier trimestre 2025 avec un bénéfice net de 1,28 $ par action, en hausse de 26,7 % par rapport à l'année précédente. Le Core FFO de la société a atteint 2,00 $ par action, soit une augmentation de 2,0 % par rapport à 2024.
Les principaux indicateurs de performance comprennent :
- Revenus des magasins comparables en hausse de 0,3 %
- Taux d’occupation des magasins comparables passé de 92,4 % à 93,4 %
- Acquisition de 12 magasins en activité pour 153,8 millions de dollars
- Extension de la plateforme de gestion à un total de 2 114 magasins gérés
- Versement d’un dividende trimestriel de 1,62 $ par action
Le PDG Joe Margolis a souligné un premier trimestre solide qui a dépassé les attentes en matière de revenus. La société a maintenu ses prévisions pour les magasins comparables malgré l’incertitude économique. Parmi les opérations notables figurent un investissement de 100 millions de dollars dans des actions privilégiées convertibles de Strategic Storage Growth Trust III et la vente de 11 propriétés opérationnelles. Le profil d’endettement de la société montre 78,8 % de dette à taux fixe avec un taux d’intérêt moyen pondéré combiné de 4,4 %.
Extra Space Storage meldete starke Ergebnisse für das erste Quartal 2025 mit einem Nettogewinn von 1,28 USD pro Aktie, was einem Anstieg von 26,7 % im Jahresvergleich entspricht. Das Core FFO des Unternehmens erreichte 2,00 USD pro Aktie, was einer Steigerung von 2,0 % gegenüber 2024 entspricht.
Wichtige Leistungskennzahlen umfassen:
- Umsatz aus vergleichbaren Filialen stieg um 0,3 %
- Belegung der vergleichbaren Filialen verbesserte sich von 92,4 % im Vorjahr auf 93,4 %
- Erwerb von 12 betriebenen Filialen für 153,8 Millionen USD
- Ausbau der Managementplattform auf insgesamt 2.114 verwaltete Filialen
- Quartalsdividende von 1,62 USD pro Aktie gezahlt
CEO Joe Margolis bezeichnete das erste Quartal als solide und über den Umsatzerwartungen liegend. Das Unternehmen hielt trotz wirtschaftlicher Unsicherheiten an seiner Prognose für vergleichbare Filialen fest. Bemerkenswerte Transaktionen umfassen eine Investition von 100 Millionen USD in wandelbare Vorzugsaktien von Strategic Storage Growth Trust III sowie den Verkauf von 11 betriebenen Immobilien. Das Schuldenprofil des Unternehmens zeigt einen Anteil von 78,8 % festverzinslicher Schulden mit einem kombinierten gewichteten Durchschnittszinssatz von 4,4 %.
- Net income increased 26.7% to $1.28 per diluted share YoY
- Core FFO grew 2% to $2.00 per diluted share YoY
- High occupancy rate of 93.4%, up from 92.4% YoY
- Acquired 12 operating stores for $153.8M and 6 additional properties through exchange
- Strong management platform growth with 113 new stores added
- Healthy dividend payment of $1.62 per share
- Robust bridge loan portfolio of $1.4B with $53.2M new originations
- Successfully issued $500M in senior notes and $350M reopening of existing notes
- Same-store NOI decreased 1.2% YoY
- Property taxes increased significantly by 15.8% YoY
- Total same-store operating expenses increased 4.2% YoY
- Other income declined 8.7% YoY
- Maintaining cautious guidance due to economic uncertainty
- Variable-rate debt exposure at 21.2% of total debt
Insights
Extra Space Storage posts modest 2% Core FFO growth amid mixed operational metrics with strong occupancy but declining NOI due to expense pressures.
Extra Space Storage's Q1 2025 results present a mixed financial picture. The company achieved net income of $1.28 per diluted share, representing a substantial
The operational metrics reveal both strengths and challenges. Same-store revenue increased marginally by
A bright spot is the company's occupancy metrics, with same-store occupancy reaching
The company's external growth initiatives continue, with
On the capital structure front, Extra Space maintains a balanced approach with
Management has maintained its full-year 2025 guidance ranges for Core FFO (
EXR navigates economic uncertainty with solid fundamentals but rising expenses threaten margins; strategic acquisitions and innovative financing continue.
Extra Space Storage's Q1 results demonstrate resilience in a challenging operating environment. While the headline
The
Management's strategic moves during the quarter showcase a multipronged approach to value creation beyond core operations. The
The property exchanges (swapping interests in 17 properties to gain full ownership of 6) illustrate portfolio optimization efforts, consolidating control where strategically advantageous while maintaining management relationships. This transaction, along with the
Looking forward, management's decision to maintain guidance ranges (same-store revenue:
Highlights for the three months ended March 31, 2025:
- Achieved net income attributable to common stockholders of
$1.28 26.7% increase compared to the same period in the prior year. - Achieved funds from operations attributable to common stockholders and unit holders ("FFO") of
$1.93 $2.00 2.0% increase compared to the same period in the prior year. - Same-store revenue increased by
0.3% and same-store net operating income ("NOI") decreased by (1.2)% compared to the same period in the prior year. - Reported ending same-store occupancy of
93.4% as of March 31, 2025, compared to92.4% as of March 31, 2024. - Acquired 12 operating stores for a total cost of approximately
$153.8 million - In conjunction with joint venture partners, acquired two operating stores and completed the development of one store for a total cost of approximately
$38.3 million $24.5 million - Originated
$53.2 million $27.7 million - Added 113 stores (100 stores net) to the Company's third-party management platform. As of March 31, 2025, the Company managed 1,675 stores for third parties and 439 stores in unconsolidated joint ventures, for a total of 2,114 managed stores.
- Paid a quarterly dividend of
$1.62
Joe Margolis, CEO of Extra Space Storage Inc., stated: "We had a solid first quarter, beating same store revenue expectations, maintaining historically high occupancy, and continuing to grow our capital light ancillary businesses. This led to FFO growth above our internal projections. Despite this level of performance, the recent economic uncertainty has caused us to maintain our same-store guidance. While the current environment is volatile and may lead to difficult economic times, our team, strategy, and systems have proven the ability to produce stable cash flow returns in similar conditions."
FFO Per Share:
The following table (unaudited) outlines the Company's FFO and Core FFO for the three months ended March 31, 2025 and 2024. The table also provides a reconciliation to GAAP net income attributable to common stockholders and earnings per diluted share for each period presented (amounts shown in thousands, except share and per share data):
For the Three Months Ended March 31, | |||||||
2025 | 2024 | ||||||
(per share)1 | (per share)1 | ||||||
Net income attributable to common stockholders | $ 270,875 | $ 1.28 | $ 213,112 | $ 1.01 | |||
Impact of the difference in weighted average number of shares – diluted2 | (0.06) | (0.05) | |||||
Adjustments: | |||||||
Real estate depreciation | 159,170 | 0.72 | 154,372 | 0.70 | |||
Amortization of intangibles | 11,079 | 0.05 | 29,284 | 0.12 | |||
Gain on real estate assets held for sale and sold, net | (35,761) | (0.16) | — | — | |||
Unconsolidated joint venture real estate depreciation and amortization | 8,689 | 0.04 | 7,840 | 0.04 | |||
Income allocated to Operating Partnership and other noncontrolling interests | 14,050 | 0.06 | 10,962 | 0.05 | |||
FFO | $ 428,102 | $ 1.93 | $ 415,570 | $ 1.87 | |||
Adjustments: | |||||||
Non-cash interest expense related to amortization of discount on Life | 11,313 | 0.05 | 10,705 | 0.05 | |||
Amortization of other intangibles related to the Life Storage Merger, net of tax benefit | 4,531 | 0.02 | 7,440 | 0.04 | |||
CORE FFO | $ 443,946 | $ 2.00 | $ 433,715 | $ 1.96 | |||
Weighted average number of shares – diluted3 | 221,896,114 | 221,737,606 | |||||
(1) | Per share amounts may not recalculate due to rounding. |
(2) | The adjustment to account for the difference between the number of shares used to calculate earnings per share and the number of shares used to calculate FFO per share. Earnings per share is calculated using the two-class method, which uses a lower number of shares than the calculation for FFO per share and Core FFO per share, which are calculated assuming full redemption of all OP units as described in note (3). |
(3) | Extra Space Storage LP (the "Operating Partnership") has outstanding preferred and common Operating Partnership units ("OP units"). These OP units can be redeemed for cash or, at the Company's election, shares of the Company's common stock. Redemption of all OP units for common stock has been assumed for purposes of calculating the weighted average number of shares — diluted, as presented above. The computation of weighted average number of shares — diluted, for FFO per share and Core FFO per share also includes the effect of share-based compensation plans. |
Operating Results and Same-Store Performance:
The following table (unaudited) outlines the Company's same-store performance for the three months ended March 31, 2025 and 2024 (amounts shown in thousands, except store count data)1:
For the Three Months | Percent | ||||
2025 | 2024 | Change | |||
Same-store property revenues2 | |||||
Net rental income | $ 635,798 | $ 631,313 | 0.7 % | ||
Other income | 23,938 | 26,210 | (8.7) % | ||
Total same-store revenues | $ 659,736 | $ 657,523 | 0.3 % | ||
Same-store operating expenses2 | |||||
Payroll and benefits | $ 40,220 | $ 41,152 | (2.3) % | ||
Marketing | 13,929 | 15,917 | (12.5) % | ||
Office expense3 | 20,305 | 20,873 | (2.7) % | ||
Property operating expense4 | 19,568 | 19,131 | 2.3 % | ||
Repairs and maintenance | 15,207 | 14,574 | 4.3 % | ||
Property taxes | 75,448 | 65,149 | 15.8 % | ||
Insurance | 7,750 | 7,841 | (1.2) % | ||
Total same-store operating expenses | $ 192,427 | $ 184,637 | 4.2 % | ||
Same-store net operating income2 | $ 467,309 | $ 472,886 | (1.2) % | ||
Same-store square foot occupancy as of quarter end | 93.4 % | 92.4 % | |||
Average same-store square foot occupancy | 93.3 % | 92.1 % | |||
Properties included in same-store5 | 1,829 | 1,829 | |||
(1) | A reconciliation of net income to same-store net operating income is provided later in this release, entitled "Reconciliation of GAAP Net Income to Total Same-Store Net Operating Income." |
(2) | Same-store revenues, operating expenses and net operating income do not include tenant reinsurance revenue or expense. |
(3) | Includes general office expenses, computer, bank fees, and credit card merchant fees. |
(4) | Includes utilities and miscellaneous other store expenses. |
(5) | On January 1, 2025, the Company updated the property count of the same-store pool from 1,071 to 1,829 stores. |
Details related to the same-store performance of stores by metropolitan statistical area ("MSA") for the three months ended March 31, 2025 and 2024 are provided in the supplemental financial information published on the Company's Investor Relations website at https://ir.extraspace.com/.
Investment and Property Management Activity:
The following table (unaudited) outlines the Company's acquisitions and developments that are closed, completed or under agreement (dollars in thousands).
Closed/Completed | Closed/Completed | Scheduled to Still | Total 2025 | To Close/Complete | ||||||||||||||||
Wholly-Owned Investment1 | Stores | Price | Stores | Price | Stores | Price 3 | Stores | Price | Stores | Price | ||||||||||
Operating Stores2 | 12 | $ 153,808 | — | $ — | 28 | $ 338,500 | 40 | — | $ — | |||||||||||
C of O and Development Stores1 | — | — | — | — | — | — | — | — | — | — | ||||||||||
EXR Investment in Wholly-Owned Stores | 12 | 153,808 | — | — | 28 | 338,500 | 40 | 492,308 | — | — | ||||||||||
Joint Venture Investment1 | ||||||||||||||||||||
EXR Investment in JV Acquisition of Operating Stores | 2 | 12,385 | — | — | — | — | 2 | 12,385 | — | — | ||||||||||
EXR Investment in JV Development and C of O | 1 | 12,138 | — | — | 4 | 47,007 | 5 | 59,145 | 2 | 26,634 | ||||||||||
EXR Investment in Joint Ventures | 3 | 24,523 | — | — | 4 | 47,007 | 7 | 71,530 | 2 | 26,634 | ||||||||||
Total EXR Investment | 15 | $ 178,331 | — | $ — | 32 | $ 385,507 | 47 | 2 | $ 26,634 | |||||||||||
(1) | The locations of C of O and development stores and joint venture ownership interest details are included in the supplemental financial information published on the Company's Investor Relations website at https://ir.extraspace.com/. |
(2) | Includes the buyout of a partner's interest in one existing consolidated joint venture in the three months ended March 31, 2025. |
(3) | Includes the buyout of the remaining ownership interest in two existing joint ventures, which own a total of 27 stores. |
The projected developments and acquisitions under agreement described above are subject to customary closing conditions and no assurance can be provided that these developments and acquisitions will be completed on the terms described, or at all.
Other Investment Activity:
During the three months ended March 31, 2025, the Company invested
Subsequent to quarter end the Company was repaid its
During the quarter, the Company exchanged its
Property Sales:
During the three months ended March 31, 2025, the Company sold 11 operating properties and three parcels of land resulting in a net gain of
Bridge Loans:
During the three months ended March 31, 2025, the Company originated
Property Management:
As of March 31, 2025, the Company managed 1,675 stores for third-party owners and 439 stores owned in unconsolidated joint ventures, for a total of 2,114 stores under management. The Company is the largest self-storage management company in
Balance Sheet:
During the three months ended March 31, 2025, the Company did not issue any shares on its ATM program, and as of March 31, 2025, the Company had
Subsequent to quarter end, the Company repurchased 68,585 shares of common stock for
In January 2025, the Company re-opened an existing issuance of
As of March 31, 2025, the Company's commercial paper program had total capacity of
As of March 31, 2025, the Company's percentage of fixed-rate debt to total debt was
Dividends:
On March 31, 2025, the Company paid a first quarter common stock dividend of
Outlook:
The following table outlines the Company's current and prior quarter Core FFO estimates and assumptions for the year ending December 31, 20251.
Ranges for 2025 Annual Assumptions | Ranges for 2025 Annual Assumptions | Notes | |||||||
(April 29, 2025) | (February 25, 2025) | ||||||||
Low | High | Low | High | ||||||
Core FFO | |||||||||
Dilution per share from C of O and value add acquisitions | |||||||||
Same-store revenue growth | (0.75) % | 1.25 % | (0.75) % | 1.25 % | Same-store pool of 1,829 stores | ||||
Same-store expense growth | 3.75 % | 5.25 % | 3.75 % | 5.25 % | Same-store pool of 1,829 stores | ||||
Same-store NOI growth | (3.00) % | 0.25 % | (3.00) % | 0.25 % | Same-store pool of 1,829 stores | ||||
Weighted average one-month SOFR | 4.05 % | 4.05 % | 4.15 % | 4.15 % | |||||
Net tenant reinsurance income | |||||||||
Management fees and other income | |||||||||
Interest income | Includes interest from bridge loans and | ||||||||
General and administrative expenses | Includes non-cash compensation | ||||||||
Average monthly cash balance | |||||||||
Equity in earnings of real estate ventures | 1) Includes reduction in dividends from SmartStop 2) Adjusted for JV buyouts with NOI now included | ||||||||
Interest expense | Excludes non-cash interest expense shown below. | ||||||||
Non-cash interest expense related to amortization | Amortization of LSI debt mark-to-market; excluded | ||||||||
Income Tax Expense | Taxes associated with the Company's taxable | ||||||||
Acquisitions | Includes wholly-owned acquisitions and the Company's | ||||||||
Bridge loans outstanding | Represents the Company's average retained loan | ||||||||
Weighted average share count | 222,200,000 | 222,200,000 | 222,200,000 | 222,200,000 | Assumes redemption of all OP units for common stock | ||||
(1) A reconciliation of net income outlook to same-store net operating income outlook is provided later in this release entitled "Reconciliation of Estimated GAAP Net Income to Estimated Same-Store Net Operating Income." The reconciliation includes details related to same-store revenue and same-store expense outlooks. A reconciliation of net income per share outlook to funds from operations per share outlook is provided later in this release entitled "Reconciliation of the Range of Estimated GAAP Fully Diluted Earnings Per Share to Estimated Fully Diluted FFO Per Share." |
FFO estimates for the year are fully diluted for an estimated average number of shares and OP units outstanding during the year. The Company's estimates are forward-looking and based on management's view of current and future market conditions. The Company's actual results may differ materially from these estimates.
Supplemental Financial Information:
Supplemental unaudited financial information regarding the Company's performance can be found on the Company's website at www.extraspace.com. Under the "Company Info" navigation menu on the home page, click on "Investor Relations," then under the "Financials" navigation menu click on "Quarterly Results." This supplemental information provides additional detail on items that include store occupancy and financial performance by portfolio and market, debt maturity schedules and performance of lease-up assets.
Conference Call:
The Company will host a conference call at 1:00 p.m. Eastern Time on Wednesday, April 30, 2025, to discuss its financial results. Telephone participants may avoid any delays in joining the conference call by pre-registering for the call using the following link to receive a special dial-in number and PIN:https://emportal.ink/3DPDVBn
A live webcast of the call will also be available on the Company's investor relations website at https://ir.extraspace.com. To listen to the live webcast, go to the site at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software.
A replay of the call will be available for 30 days on the investor relations section of the Company's website beginning at 5:00 p.m. Eastern Time on April 30, 2025.
Forward-Looking Statements:
Certain information set forth in this release contains "forward-looking statements" within the meaning of the federal securities laws. Forward-looking statements include statements concerning the benefits of store acquisitions, developments, market conditions, our outlook and estimates for the year and other statements concerning our plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, the competitive landscape, the impact of broader economic trends on the storage industry, our plans or intentions relating to acquisitions and developments, and other information that is not historical information. In some cases, forward-looking statements can be identified by terminology such as "believes," "estimates," "expects," "may," "will," "should," "anticipates," or "intends," or the negative of such terms or other comparable terminology, or by discussions of strategy. We may also make additional forward-looking statements from time to time. All such subsequent forward-looking statements, whether written or oral, by us or on our behalf, are also expressly qualified by these cautionary statements. There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements contained in or contemplated by this release. Any forward-looking statements should be considered in light of the risks referenced in the "Risk Factors" section included in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Such factors include, but are not limited to:
- adverse changes in general economic conditions, the real estate industry and the markets in which we operate;
- potential liability for uninsured losses and environmental contamination;
- our ability to recover losses under our insurance policies;
- the impact of the regulatory environment as well as national, state and local laws and regulations, including, without limitation, those governing real estate investment trusts ("REITs"), tenant reinsurance and other aspects of our business, which could adversely affect our results;
- the effect of competition from new and existing stores or other storage alternatives, including increased or unanticipated competition for our properties, which could cause rents and occupancy rates to decline;
- failure to close pending acquisitions and developments on expected terms, or at all;
- risks associated with acquisitions, dispositions and development of properties, including increased development costs due to additional regulatory requirements related to climate change and other factors;
- reductions in asset valuations and related impairment charges;
- our reliance on information technologies, which are vulnerable to, among other things, attack from computer viruses and malware, hacking, cyberattacks and other unauthorized access or misuse, any of which could adversely affect our business and results;
- impacts from any outbreak of highly infectious or contagious diseases, including reduced demand for self-storage space and ancillary products and services such as tenant reinsurance, and potential decreases in occupancy and rental rates and staffing levels, which could adversely affect our results;
- economic uncertainty due to the impact of natural disasters, war or terrorism, which could adversely affect our business plan;
- our lack of sole decision-making authority with respect to our joint venture investments;
- disruptions in credit and financial markets and resulting difficulties in raising capital or obtaining credit at reasonable rates or at all, which could impede our ability to grow;
- availability of financing and capital, the levels of debt that we maintain and our credit ratings;
- changes in global financial markets and increases in interest rates;
- the effect of recent or future changes to
U.S. tax laws; and - the failure to maintain our REIT status for
U.S. federal income tax purposes.
All forward-looking statements are based upon our current expectations and various assumptions. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them, but there can be no assurance that management's expectations, beliefs and projections will result or be achieved. All forward-looking statements apply only as of the date made. We undertake no obligation to publicly update or revise forward-looking statements which may be made to reflect events or circumstances after the date made or to reflect the occurrence of unanticipated events.
Definition of FFO:
FFO provides relevant and meaningful information about the Company's operating performance that is necessary, along with net income and cash flows, for an understanding of the Company's operating results. The Company believes FFO is a meaningful disclosure as a supplement to net income. Net income assumes that the values of real estate assets diminish predictably over time as reflected through depreciation and amortization expenses. The values of real estate assets fluctuate due to market conditions and the Company believes FFO more accurately reflects the value of the Company's real estate assets. FFO is defined by the National Association of Real Estate Investment Trusts, Inc. ("NAREIT") as net income computed in accordance with
For informational purposes, the Company also presents Core FFO. Core FFO excludes revenues and expenses not core to our operations and transaction costs. It also includes certain costs associated with the Life Storage Merger including transition costs, non-cash interest related to the amortization of discount on unsecured senior notes, amortization of other intangibles, net of tax benefit, and impairment of Life Storage trade name. Although the Company's calculation of Core FFO differs from NAREIT's definition of FFO and may not be comparable to that of other REITs and real estate companies, the Company believes it provides a meaningful supplemental measure of operating performance. The Company believes that by excluding revenues and expenses not core to our operations and non-cash interest charges, stockholders and potential investors are presented with an indicator of our operating performance that more closely achieves the objectives of the real estate industry in presenting FFO. Core FFO by the Company should not be considered a replacement of the NAREIT definition of FFO. The computation of FFO may not be comparable to FFO reported by other REITs or real estate companies that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently. FFO does not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to net income as an indication of the Company's performance, as an alternative to net cash flow from operating activities as a measure of liquidity, or as an indicator of the Company's ability to make cash distributions.
Definition of Same-Store:
The Company's same-store pool for the periods presented consists of 1,829 stores that are wholly-owned and operated and that were stabilized by the first day of the earliest calendar year presented. The Company considers a store to be stabilized once it has been open for three years or has sustained average square foot occupancy of
About Extra Space Storage Inc.:
Extra Space Storage Inc., headquartered in
Extra Space Storage Inc. Condensed Consolidated Balance Sheets (In thousands, except share data) | |||
March 31, 2025 | December 31, 2024 | ||
(Unaudited) | |||
Assets: | |||
Real estate assets, net | $ 24,683,924 | $ 24,587,627 | |
Real estate assets - operating lease right-of-use assets | 685,393 | 689,803 | |
Investments in unconsolidated real estate entities | 1,320,849 | 1,332,338 | |
Investments in debt securities and notes receivable | 1,675,464 | 1,550,950 | |
Cash and cash equivalents | 119,559 | 138,222 | |
Other assets, net | 508,729 | 548,986 | |
Total assets | $ 28,993,918 | $ 28,847,926 | |
Liabilities, Noncontrolling Interests and Equity: | |||
Secured notes payable, net | $ 999,062 | $ 1,010,541 | |
Unsecured term loans, net | 1,948,161 | 2,192,507 | |
Unsecured senior notes, net | 8,616,517 | 7,756,968 | |
Revolving lines of credit and commercial paper | 978,000 | 1,362,000 | |
Operating lease liabilities | 704,730 | 705,845 | |
Cash distributions in unconsolidated real estate ventures | 76,097 | 75,319 | |
Accounts payable and accrued expenses | 359,495 | 346,519 | |
Other liabilities | 533,353 | 538,865 | |
Total liabilities | 14,215,415 | 13,988,564 | |
Commitments and contingencies | |||
Noncontrolling Interests and Equity: | |||
Extra Space Storage Inc. stockholders' equity: | |||
Preferred stock, | — | — | |
Common stock, | 2,122 | 2,120 | |
Additional paid-in capital | 14,851,126 | 14,831,946 | |
Accumulated other comprehensive income | 6,204 | 12,806 | |
Accumulated deficit | (972,665) | (899,337) | |
Total Extra Space Storage Inc. stockholders' equity | 13,886,787 | 13,947,535 | |
Noncontrolling interest represented by Preferred Operating Partnership units | 53,827 | 76,092 | |
Noncontrolling interests in Operating Partnership, net and other noncontrolling interests | 837,889 | 835,735 | |
Total noncontrolling interests and equity | 14,778,503 | 14,859,362 | |
Total liabilities, noncontrolling interests and equity | $ 28,993,918 | $ 28,847,926 | |
Consolidated Statement of Operations for the Three Months Ended March 31, 2025 and 2024 (In thousands, except share and per share data) - Unaudited | |||
For the Three Months Ended March 31, | |||
2025 | 2024 | ||
Revenues: | |||
Property rental | $ 704,380 | $ 688,044 | |
Tenant reinsurance | 84,712 | 81,347 | |
Management fees and other income | 30,905 | 30,148 | |
Total revenues | 819,997 | 799,539 | |
Expenses: | |||
Property operations | 223,582 | 204,518 | |
Tenant reinsurance | 17,116 | 18,505 | |
General and administrative | 45,974 | 43,722 | |
Depreciation and amortization | 180,356 | 196,966 | |
Total expenses | 467,028 | 463,711 | |
Gain on real estate assets held for sale and sold, net | 35,761 | — | |
Income from operations | 388,730 | 335,828 | |
Interest expense | (142,399) | (132,887) | |
Non-cash interest expense related to amortization of discount on Life Storage unsecured senior notes | (11,313) | (10,705) | |
Interest income | 38,967 | 23,573 | |
Income before equity in earnings and dividend income from unconsolidated real estate entities and income tax expense | 273,985 | 215,809 | |
Equity in earnings and dividend income from unconsolidated real estate entities | 19,931 | 15,007 | |
Income tax expense | (8,991) | (6,742) | |
Net income | 284,925 | 224,074 | |
Net income allocated to Preferred Operating Partnership noncontrolling interests | (724) | (2,208) | |
Net income allocated to Operating Partnership and other noncontrolling interests | (13,326) | (8,754) | |
Net income attributable to common stockholders | $ 270,875 | $ 213,112 | |
Earnings per common share | |||
Basic | $ 1.28 | $ 1.01 | |
Diluted | $ 1.28 | $ 1.01 | |
Weighted average number of shares | |||
Basic | 211,850,618 | 211,283,335 | |
Diluted | 212,052,742 | 220,018,777 | |
Cash dividends paid per common share | $ 1.62 | $ 1.62 | |
Reconciliation of GAAP Net Income to Total Same-Store Net Operating Income — for the Three Months Ended March 31, 2025 and 2024 (In thousands) - Unaudited | |||
For the Three Months Ended March 31, | |||
2025 | 2024 | ||
Net Income | $ 284,925 | $ 224,074 | |
Adjusted to exclude: | |||
Gain on real estate assets held for sale and sold, net | (35,761) | — | |
Equity in earnings and dividend income from unconsolidated real estate entities | (19,931) | (15,007) | |
Interest expense | 142,399 | 132,887 | |
Non-cash interest expense related to amortization of discount on Life Storage unsecured senior notes | 11,313 | 10,705 | |
Depreciation and amortization | 180,356 | 196,966 | |
Income tax expense | 8,991 | 6,742 | |
General and administrative | 45,974 | 43,722 | |
Management fees, other income and interest income | (69,872) | (53,721) | |
Net tenant insurance | (67,596) | (62,842) | |
Non same-store rental revenue | (44,644) | (30,521) | |
Non same-store operating expense | 31,155 | 19,881 | |
Total same-store net operating income | $ 467,309 | $ 472,886 | |
Same-store rental revenues | 659,736 | 657,523 | |
Same-store operating expenses | 192,427 | 184,637 | |
Same-store net operating income | $ 467,309 | $ 472,886 | |
Reconciliation of the Range of Estimated GAAP Fully Diluted Earnings Per Share to Estimated Fully Diluted FFO Per Share — for the Year Ending December 31, 2025 - Unaudited | ||||
For the Year Ending December 31, 2025 | ||||
Low End | High End | |||
Net income attributable to common stockholders per diluted share | $ 4.48 | $ 4.78 | ||
Income allocated to noncontrolling interest - Preferred Operating Partnership and Operating Partnership | 0.25 | 0.25 | ||
Net income attributable to common stockholders for diluted computations | 4.73 | 5.03 | ||
Adjustments: | ||||
Real estate depreciation | 2.70 | 2.70 | ||
Amortization of intangibles | 0.27 | 0.27 | ||
Unconsolidated joint venture real estate depreciation and amortization | 0.16 | 0.16 | ||
Gain on real estate transactions | (0.16) | (0.16) | ||
Funds from operations attributable to common stockholders | 7.70 | 8.00 | ||
Adjustments: | ||||
Non-cash interest expense related to amortization of discount on Life Storage unsecured senior notes | 0.21 | 0.21 | ||
Amortization of other intangibles related to the Life Storage Merger, net of tax benefit | 0.09 | 0.09 | ||
Core funds from operations attributable to common stockholders | $ 8.00 | $ 8.30 | ||
Reconciliation of Estimated GAAP Net Income to Estimated Same-Store Net Operating Income — for the Year Ending December 31, 2025 (In thousands) - Unaudited | |||
For the Year Ending December 31, 2025 | |||
Low | High | ||
Net Income | $ 1,033,250 | $ 1,113,500 | |
Adjusted to exclude: | |||
Equity in earnings of unconsolidated joint ventures | (72,000) | (73,000) | |
Interest expense | 578,000 | 573,000 | |
Non-cash interest expense related to amortization of discount on Life Storage unsecured senior notes | 47,000 | 46,000 | |
Depreciation and amortization | 700,500 | 700,500 | |
Income tax expense | 39,000 | 38,000 | |
General and administrative | 188,000 | 186,000 | |
Management fees and other income | (125,000) | (126,500) | |
Interest income | (152,000) | (153,500) | |
Net tenant reinsurance income | (269,000) | (272,000) | |
Non same-store rental revenues | (225,000) | (225,000) | |
Non same-store operating expenses | 129,000 | 129,000 | |
Total same-store net operating income1 | $ 1,871,750 | $ 1,936,000 | |
Same-store rental revenues1 | 2,645,000 | 2,698,000 | |
Same-store operating expenses1 | 773,250 | 762,000 | |
Total same-store net operating income1 | $ 1,871,750 | $ 1,936,000 | |
(1) | Estimated same-store rental revenues, operating expenses and net operating income are for the Company's 2025 same-store pool of 1,829 stores. |
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SOURCE Extra Space Storage, Inc.
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