Public Storage Reports Results for the Three and Nine Months Ended September 30, 2024
Public Storage (NYSE:PSA) reported Q3 2024 results with net income of $2.16 per diluted share, down from $3.20 in Q3 2023. Core FFO was $4.20 per share, representing a 3.0% decrease from the previous year. The company's Same Store direct net operating income margin reached 78.4%. Key operational metrics showed some pressure, with Same Store revenues decreasing 1.3% due to lower realized rent per occupied square foot and declining occupancy. During the quarter, PSA acquired three self-storage facilities for $24.3 million and had 14 additional facilities under contract for $181.2 million. The company also expanded its portfolio through development, adding 0.5 million net rentable square feet at a cost of $142.6 million.
Public Storage (NYSE:PSA) ha riportato i risultati del terzo trimestre 2024 con un reddito netto di $2.16 per azione diluita, in calo rispetto ai $3.20 del terzo trimestre 2023. Il Core FFO è stato di $4.20 per azione, con una diminuzione del 3.0% rispetto all'anno precedente. Il margine dell'utile operativo netto diretto Same Store dell'azienda ha raggiunto il 78.4%. I principali indicatori operativi hanno mostrato alcune pressioni, con i ricavi Same Store in diminuzione dell'1.3% a causa di un affitto realizzato più basso per piede quadrato occupato e un calo dell'occupazione. Durante il trimestre, PSA ha acquisito tre strutture di self-storage per $24.3 milioni e aveva 14 strutture aggiuntive sotto contratto per $181.2 milioni. L'azienda ha anche ampliato il proprio portafoglio attraverso lo sviluppo, aggiungendo 0.5 milioni di piedi quadrati netti affittabili a un costo di $142.6 milioni.
Public Storage (NYSE:PSA) reportó los resultados del tercer trimestre de 2024 con una ganancia neta de $2.16 por acción diluida, en comparación con $3.20 en el tercer trimestre de 2023. El Core FFO fue de $4.20 por acción, lo que representa una disminución del 3.0% con respecto al año anterior. El margen de ingresos operativos netos directos Same Store de la compañía alcanzó el 78.4%. Las métricas operativas clave mostraron cierta presión, con ingresos Same Store disminuyendo un 1.3% debido a un alquiler realizado más bajo por pie cuadrado ocupado y una disminución en la ocupación. Durante el trimestre, PSA adquirió tres instalaciones de autoalmacenamiento por $24.3 millones y tenía 14 instalaciones adicionales bajo contrato por $181.2 millones. La empresa también amplió su cartera a través del desarrollo, agregando 0.5 millones de pies cuadrados netos alquilables a un costo de $142.6 millones.
퍼블릭 스토리지(Public Storage, NYSE:PSA)는 2024년 3분기 실적을 발표했으며, 희석 주당 순이익은 $2.16로, 2023년 3분기의 $3.20에서 감소했습니다. 코어 FFO는 주당 $4.20로, 전년 대비 3.0% 감소했습니다. 회사의 동일 매장 직접 순 운영 소득 마진은 78.4%에 달했습니다. 주요 운영 지표는 약간의 압박을 보였으며, 동일 매장의 수익은 점유된 평방피트당 실현 임대료와 점유율 감소로 인해 1.3% 감소했습니다. 분기 동안 PSA는 $24.3백만에 세 개의 셀프 스토리지 시설을 인수했으며, $181.2백만에 14개의 추가 시설에 대한 계약을 체결했습니다. 회사는 개발을 통해 포트폴리오를 확장하여, $142.6백만의 비용으로 50만 평방피트의 순 임대 가능 면적을 추가했습니다.
Public Storage (NYSE:PSA) a rapporté les résultats du troisième trimestre 2024 avec un revenu net de 2,16 $ par action diluée, en baisse par rapport à 3,20 $ au troisième trimestre 2023. Le Core FFO était de 4,20 $ par action, représentant une baisse de 3,0 % par rapport à l'année précédente. La marge d'exploitation nette directe Same Store de l'entreprise a atteint 78,4 %. Les principaux indicateurs opérationnels ont montré une certaine pression, avec les revenus Same Store diminuant de 1,3 % en raison d'un loyer réalisé plus bas par pied carré occupé et d'une baisse du taux d'occupation. Au cours du trimestre, PSA a acquis trois installations de self-stockage pour 24,3 millions de dollars et avait 14 installations supplémentaires sous contrat pour 181,2 millions de dollars. L'entreprise a également élargi son portefeuille par le biais de développements, ajoutant 0,5 million de pieds carrés nets louables pour un coût de 142,6 millions de dollars.
Public Storage (NYSE:PSA) berichtete über die Ergebnisse des dritten Quartals 2024 mit einem Nettogewinn von $2.16 pro verwässerter Aktie, ein Rückgang von $3.20 im dritten Quartal 2023. Der Core FFO betrug $4.20 pro Aktie, was einem Rückgang von 3.0% im Vergleich zum Vorjahr entspricht. Die operative Nettomarge der Same Store betrug 78.4%. Die wichtigsten operativen Kennzahlen zeigten gewissen Druck, da die Same Store-Einnahmen um 1.3% aufgrund niedrigerer realisierter Miete pro belegtem Quadratfuß und gesunkener Belegungsraten zurückgingen. Im Laufe des Quartals erwarb PSA drei Selbstlagerungsanlagen für $24.3 Millionen und hatte 14 weitere Anlagen im Vertrag für $181.2 Millionen. Das Unternehmen erweiterte auch sein Portfolio durch Entwicklung und fügte 0.5 Millionen netto mietbare Quadratfuß zu Kosten von $142.6 Millionen hinzu.
- Maintained high Same Store direct net operating income margin of 78.4%
- Continued portfolio expansion with $24.3M in acquisitions and $181.2M under contract
- Added 0.5M net rentable square feet through development at $142.6M
- Net income per share decreased 32.4% YoY to $2.16
- Core FFO per share declined 3.0% YoY to $4.20
- Same Store revenues decreased 1.3% due to lower occupancy and rental rates
- Cost of operations increased 2.6% for Same Store Facilities
Insights
Public Storage reported significant declines in key metrics for Q3 2024, with net income per share falling
Key concerns include:
- Declining occupancy rates to
91.4% from91.9% - Revenue pressure with Same Store revenue down
1.3% - Rising operating costs up
3.8% year-over-year
However, the company maintains strong expansion with
The self-storage market is showing signs of normalization after peak pandemic performance. Public Storage's acquisition strategy remains robust with 14 facilities under contract for
The development pipeline of 4.0 million square feet concentrated in high-growth markets like Florida and California positions PSA well for future growth. However, near-term pressure on rental rates and occupancy suggests a challenging operating environment persisting into 2024.
“Performance is stabilizing across our portfolio,” said Joe Russell, President and Chief Executive Officer. “With formidable competitive advantages and our distinctive operating model transformation ahead of schedule, we are very well-positioned for growth in an environment of improving fundamentals and increasing transaction market activity.”
Highlights for the Three Months Ended September 30, 2024
-
Reported net income allocable to common shareholders of
$2.16 -
Reported core FFO allocable to common shareholders (“Core FFO”) of
$4.20 -
Achieved
78.4% Same Store (as defined below) direct net operating income margin. -
Acquired three self-storage facilities with 0.2 million net rentable square feet for
$24.3 million $181.2 million -
Opened one newly developed facility and completed various expansion projects, which together added 0.5 million net rentable square feet at a cost of
$142.6 million $712.4 million
Operating Results for the Three Months Ended September 30, 2024
For the three months ended September 30, 2024, net income allocable to our common shareholders was
The
Operating Results for the Nine Months Ended September 30, 2024
For the nine months ended September 30, 2024, net income allocable to our common shareholders was
The
Funds from Operations
Funds from Operations (“FFO”) and FFO per share are non-GAAP measures defined by Nareit. We believe that FFO and FFO per share are useful to REIT investors and analysts in measuring our performance because Nareit’s definition of FFO excludes items included in net income that do not relate to or are not indicative of our operating and financial performance. FFO represents net income before real estate-related depreciation and amortization, which is excluded because it is based upon historical costs and assumes that building values diminish ratably over time, while we believe that real estate values fluctuate due to market conditions. FFO also excludes gains or losses on sale of real estate assets and real estate impairment charges, which are also based upon historical costs and are impacted by historical depreciation. FFO and FFO per share are not a substitute for net income or earnings per share. FFO is not a substitute for net cash flow in evaluating our liquidity or ability to pay dividends, because it excludes investing and financing activities presented on our consolidated statements of cash flows. In addition, other REITs may compute these measures differently, so comparisons among REITs may not be helpful.
For the three months ended September 30, 2024, FFO was
For the nine months ended September 30, 2024, FFO was
We also present “Core FFO” and “Core FFO per share,” non-GAAP measures that represent FFO and FFO per share excluding the impact of (i) foreign currency exchange gains and losses, (ii) charges related to the redemption of preferred securities, and (iii) certain other non-cash and/or nonrecurring income or expense items primarily representing, with respect to the periods presented below, the impact of loss contingencies and resolutions, casualties, due diligence costs incurred in pursuit of strategic transactions, unrealized gain on private equity investments, UPREIT reorganization costs, Simply integration costs, amortization of acquired non real estate-related intangibles, and our equity share of deferred tax benefits of a change in tax status, unrealized gain on derivatives and Lok’nStore integration costs from our equity investee. We review Core FFO and Core FFO per share to evaluate our ongoing operating performance, and we believe they are used by investors and REIT analysts in a similar manner. However, Core FFO and Core FFO per share are not substitutes for net income and net income per share. Because other REITs may not compute Core FFO or Core FFO per share in the same manner as we do, may not use the same terminology, or may not present such measures, Core FFO and Core FFO per share may not be comparable among REITs.
The following table reconciles net income to FFO and Core FFO and reconciles diluted earnings per share to FFO per share and Core FFO per share (unaudited):
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
Percentage
|
|
|
2024 |
|
|
|
2023 |
|
|
Percentage
|
|
(Amounts in thousands, except per share data) |
||||||||||||||||||
Reconciliation of Net Income to FFO and Core FFO: |
|
|
|
|
|
|
|
|
|
|
|||||||||
Net income allocable to common shareholders |
$ |
380,712 |
|
|
$ |
563,237 |
|
|
(32.4)% |
|
$ |
1,308,287 |
|
|
$ |
1,559,084 |
|
|
(16.1)% |
Eliminate items excluded from FFO: |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Real estate-related depreciation and amortization |
|
277,652 |
|
|
|
237,098 |
|
|
|
|
|
839,749 |
|
|
|
677,856 |
|
|
|
Real estate-related depreciation from unconsolidated real estate investment |
|
12,013 |
|
|
|
8,457 |
|
|
|
|
|
31,531 |
|
|
|
26,141 |
|
|
|
Real estate-related depreciation allocated to noncontrolling interests and restricted share unitholders and unvested LTIP unitholders |
|
(2,192 |
) |
|
|
(1,612 |
) |
|
|
|
|
(5,904 |
) |
|
|
(4,817 |
) |
|
|
Gains on sale of real estate investments, including our equity share from investment |
|
(554 |
) |
|
|
(167 |
) |
|
|
|
|
(1,428 |
) |
|
|
(239 |
) |
|
|
FFO allocable to common shares |
$ |
667,631 |
|
|
$ |
807,013 |
|
|
(17.3)% |
|
$ |
2,172,235 |
|
|
$ |
2,258,025 |
|
|
(3.8)% |
Eliminate the impact of items excluded from Core FFO, including our equity share from investment: |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange loss (gain) |
|
70,572 |
|
|
|
(47,880 |
) |
|
|
|
|
20,580 |
|
|
|
(19,924 |
) |
|
|
Other items |
|
40 |
|
|
|
3,804 |
|
|
|
|
|
1,291 |
|
|
|
(2,422 |
) |
|
|
Core FFO allocable to common shares |
$ |
738,243 |
|
|
$ |
762,937 |
|
|
(3.2)% |
|
$ |
2,194,106 |
|
|
$ |
2,235,679 |
|
|
(1.9)% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Reconciliation of Diluted Earnings per Share to FFO per Share and Core FFO per Share: |
|
|
|
|
|
|
|
|
|
|
|||||||||
Diluted earnings per share |
$ |
2.16 |
|
|
$ |
3.20 |
|
|
(32.5)% |
|
$ |
7.43 |
|
|
$ |
8.85 |
|
|
(16.0)% |
Eliminate amounts per share excluded from FFO: |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Real estate-related depreciation and amortization |
|
1.64 |
|
|
|
1.38 |
|
|
|
|
|
4.92 |
|
|
|
3.97 |
|
|
|
Gains on sale of real estate investments, including our equity share from investment |
|
— |
|
|
|
— |
|
|
|
|
|
(0.01 |
) |
|
|
— |
|
|
|
FFO per share |
$ |
3.80 |
|
|
$ |
4.58 |
|
|
(17.0)% |
|
$ |
12.34 |
|
|
$ |
12.82 |
|
|
(3.7)% |
Eliminate the per share impact of items excluded from Core FFO, including our equity share from investment: |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign currency exchange loss (gain) |
|
0.40 |
|
|
|
(0.27 |
) |
|
|
|
|
0.11 |
|
|
|
(0.11 |
) |
|
|
Other items |
|
— |
|
|
|
0.02 |
|
|
|
|
|
0.01 |
|
|
|
(0.02 |
) |
|
|
Core FFO per share |
$ |
4.20 |
|
|
$ |
4.33 |
|
|
(3.0)% |
|
$ |
12.46 |
|
|
$ |
12.69 |
|
|
(1.8)% |
Diluted weighted average common shares |
|
175,866 |
|
|
|
176,150 |
|
|
|
|
|
176,074 |
|
|
|
176,170 |
|
|
|
Property Operations – Same Store Facilities
The Same Store Facilities consist of facilities that have been owned and operated on a stabilized level of occupancy, revenues, and cost of operations since January 1, 2022. Our Same Store Facilities did not change from June 30, 2024. The composition of our Same Store Facilities allows us to more effectively evaluate the ongoing performance of our self-storage portfolio in 2022, 2023, and 2024 and exclude the impact of fill-up of unstabilized facilities, which can significantly affect operating trends. We believe the Same Store Facilities information is used by investors and analysts in a similar manner. However, because other REITs may not compute Same Store Facilities in the same manner as we do, may not use the same terminology, or may not present such a measure, Same Store Facilities may not be comparable among REITs. The following table summarizes the historical operating results (for all periods presented) of these 2,507 facilities (170.0 million net rentable square feet) that represent approximately
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
Change (f) |
|
|
2024 |
|
|
|
2023 |
|
|
Change (f) |
|
(Dollar amounts in thousands, except for per square foot data) |
||||||||||||||||||
Revenues (a): |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Rental income |
$ |
894,123 |
|
|
$ |
906,280 |
|
|
(1.3)% |
|
$ |
2,666,474 |
|
|
$ |
2,688,604 |
|
|
(0.8)% |
Late charges and administrative fees |
|
32,192 |
|
|
|
32,292 |
|
|
(0.3)% |
|
|
94,587 |
|
|
|
93,898 |
|
|
|
Total revenues |
|
926,315 |
|
|
|
938,572 |
|
|
(1.3)% |
|
|
2,761,061 |
|
|
|
2,782,502 |
|
|
(0.8)% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Direct cost of operations (a): |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Property taxes |
|
86,902 |
|
|
|
86,282 |
|
|
|
|
|
266,408 |
|
|
|
256,227 |
|
|
|
On-site property manager payroll |
|
32,039 |
|
|
|
33,833 |
|
|
(5.3)% |
|
|
99,273 |
|
|
|
102,885 |
|
|
(3.5)% |
Repairs and maintenance |
|
18,813 |
|
|
|
15,947 |
|
|
|
|
|
57,141 |
|
|
|
50,844 |
|
|
|
Utilities |
|
13,316 |
|
|
|
13,407 |
|
|
(0.7)% |
|
|
36,451 |
|
|
|
38,231 |
|
|
(4.7)% |
Marketing |
|
21,920 |
|
|
|
19,528 |
|
|
|
|
|
63,360 |
|
|
|
52,239 |
|
|
|
Other direct property costs |
|
27,546 |
|
|
|
24,284 |
|
|
|
|
|
76,413 |
|
|
|
72,968 |
|
|
|
Total direct cost of operations |
|
200,536 |
|
|
|
193,281 |
|
|
|
|
|
599,046 |
|
|
|
573,394 |
|
|
|
Direct net operating income (b) |
|
725,779 |
|
|
|
745,291 |
|
|
(2.6)% |
|
|
2,162,015 |
|
|
|
2,209,108 |
|
|
(2.1)% |
Indirect cost of operations (a): |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Supervisory payroll |
|
(9,940 |
) |
|
|
(9,980 |
) |
|
(0.4)% |
|
|
(30,091 |
) |
|
|
(31,441 |
) |
|
(4.3)% |
Centralized management costs |
|
(13,857 |
) |
|
|
(15,126 |
) |
|
(8.4)% |
|
|
(41,785 |
) |
|
|
(46,159 |
) |
|
(9.5)% |
Share-based compensation |
|
(2,371 |
) |
|
|
(2,544 |
) |
|
(6.8)% |
|
|
(7,516 |
) |
|
|
(8,867 |
) |
|
(15.2)% |
Net operating income (c) |
$ |
699,611 |
|
|
$ |
717,641 |
|
|
(2.5)% |
|
$ |
2,082,623 |
|
|
$ |
2,122,641 |
|
|
(1.9)% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gross margin (before indirect costs, depreciation and amortization expense) |
|
78.4 |
% |
|
|
79.4 |
% |
|
(1.0)% |
|
|
78.3 |
% |
|
|
79.4 |
% |
|
(1.1)% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gross margin (before depreciation and amortization expense) |
|
75.5 |
% |
|
|
76.5 |
% |
|
(1.0)% |
|
|
75.4 |
% |
|
|
76.3 |
% |
|
(0.9)% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average for the period: |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Square foot occupancy |
|
92.7 |
% |
|
|
93.2 |
% |
|
(0.5)% |
|
|
92.6 |
% |
|
|
93.2 |
% |
|
(0.6)% |
Realized annual rental income per (d): |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Occupied square foot |
$ |
22.71 |
|
|
$ |
22.89 |
|
|
(0.8)% |
|
$ |
22.59 |
|
|
$ |
22.64 |
|
|
(0.2)% |
Available square foot |
$ |
21.06 |
|
|
$ |
21.33 |
|
|
(1.3)% |
|
$ |
20.92 |
|
|
$ |
21.10 |
|
|
(0.9)% |
At September 30: |
|
|
|
|
|
|
|
|
|
|
|
||||||||
Square foot occupancy |
|
|
|
|
|
|
|
91.4 |
% |
|
|
91.9 |
% |
|
(0.5)% |
||||
Annual contract rent per occupied square foot (e) |
|
|
|
|
|
|
$ |
23.04 |
|
|
$ |
23.16 |
|
|
(0.5)% |
||||
(a) |
Revenues and cost of operations do not include tenant reinsurance and merchandise sales and expenses generated at the facilities. |
|
(b) |
Direct net operating income (“Direct NOI”), a subtotal within NOI, is a non-GAAP financial measure that excludes the impact of supervisory payroll, centralized management costs, and share-based compensation in addition to depreciation and amortization expense. We utilize direct net operating income in evaluating property performance and in evaluating property operating trends as compared to our competitors. |
|
(c) |
See reconciliation of self-storage NOI to net income provided below. |
|
(d) |
Realized annual rent per occupied square foot is computed by dividing annualized rental income, before late charges and administrative fees, by the weighted average occupied square feet for the period. Realized annual rent per available square foot (“REVPAF”) is computed by dividing annualized rental income, before late charges and administrative fees, by the total available rentable square feet for the period. These measures exclude late charges and administrative fees in order to provide a better measure of our ongoing level of revenue. Late charges are dependent upon the level of delinquency, and administrative fees are dependent upon the level of move-ins. In addition, the rates charged for late charges and administrative fees can vary independently from rental rates. These measures take into consideration promotional discounts, which reduce rental income. |
|
(e) |
Annual contract rent represents the agreed upon monthly rate that is paid by our tenants in place at the time of measurement. Contract rates are initially set in the lease agreement upon move-in, and we adjust them from time to time with notice. Contract rent excludes other fees that are charged on a per-item basis, such as late charges and administrative fees, does not reflect the impact of promotional discounts, and does not reflect the impact of rents that are written off as uncollectible. |
|
(f) |
Represents the absolute nominal change with respect to gross margin and square foot occupancy, and the percentage change with respect to all other items. |
Property Operations – Non-Same Store Facilities
In addition to the 2,507 Same Store Facilities, we have 546 facilities that were not stabilized with respect to occupancies, revenues, or cost of operations since January 1, 2022 or that we did not own as of January 1, 2022, including 243 facilities that were acquired, 43 newly developed facilities, 84 facilities that have been expanded or are targeted for expansion, and 176 facilities that are unstabilized because they are undergoing fill-up or were damaged in casualty events (collectively, the “Non-Same Store Facilities”). Operating data, metrics, and further commentary with respect to these facilities, including detail by vintage, are included in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under “Analysis of Net Income – Self-Storage Operations” in our September 30, 2024 Form 10-Q.
Investing and Capital Activities
During the three months ended September 30, 2024, we acquired three self-storage facilities (one each in
Subsequent to September 30, 2024, we acquired or were under contract to acquire 14 self-storage facilities across nine states with 1.2 million net rentable square feet, for
During 2023, we acquired BREIT Simply Storage LLC (“Simply”), a self-storage company that owned and operated 127 self-storage facilities (9.4 million square feet) and managed 25 self-storage facilities (1.8 million square feet) for third parties, for a purchase price of
During the three months ended September 30, 2024, we opened one newly developed facility and completed various expansion projects, which together contributed 0.5 million net rentable square feet (0.1 million each in
Distributions Declared
On October 30, 2024, our Board of Trustees declared a regular common quarterly dividend of
Outlook for the Year Ending December 31, 2024
Set forth below are our current expectations and prior expectations as of July 30, 2024 with respect to full year 2024 Core FFO per share and certain underlying assumptions. In reliance on the exception provided by applicable SEC rules, we do not provide guidance for GAAP net income per share, the most comparable GAAP financial measure, or a reconciliation of 2024 Core FFO per share to GAAP net income per share because we are unable to reasonably predict the following items which are included in GAAP net income: (i) gains or losses on sales of real estate investments, (ii) foreign currency exchange gains and losses, (iii) charges related to the redemption of preferred securities, and (iv) certain other significant non-cash and/or nonrecurring income or expense items. The actual amounts for any and all of these items could significantly impact our 2024 GAAP net income and, as disclosed in our historical financial results, have significantly impacted GAAP net income in prior periods.
|
2024 Guidance |
|||
|
Current Guidance |
Prior Guidance |
||
|
Low |
High |
Low |
High |
|
(Dollar amounts in thousands, except per share data) |
|||
Same Store: |
|
|
|
|
Revenue growth |
(1.3)% |
(0.5)% |
(1.5)% |
(0.5)% |
Expense growth (a) |
|
|
|
|
Net operating income growth (a) |
(2.7)% |
(1.3)% |
(3.0)% |
(1.3)% |
|
|
|
|
|
Consolidated: |
|
|
|
|
Non-Same Store net operating income |
|
|
|
|
Ancillary net operating income |
|
|
|
|
General and administrative expense |
|
|
|
|
Interest expense |
|
|
||
Preferred dividends |
|
|
||
|
|
|
|
|
Capital Activity: |
|
|
|
|
Acquisitions |
|
|
||
Development openings |
|
|
||
|
|
|
|
|
Capital expenditures: |
|
|
|
|
Maintenance of real estate facilities |
|
|
||
Property enhancements (b) |
|
|
||
Energy efficiencies (c) |
|
|
||
|
|
|
|
|
Core FFO per share: |
|
|
|
|
Core FFO per share growth from 2023 Core FFO per share |
(2.3)% |
(0.2)% |
(2.3)% |
(0.2)% |
|
|
|
|
|
Non-Same Store Net Operating Income Beyond 2024: |
|
|
|
|
Incremental Non-Same Store NOI to stabilization (2025 and beyond) |
|
|
||
(a) |
Based on total same store cost of operations and net operating income (i.e., not direct), as reflected on page 4. |
|
(b) |
Expenditures to enhance the competitive position of certain of our facilities relative to local competitors pursuant to a multi-year program that we expect to complete in 2024. Such investments include development of more pronounced, attractive, and clearly identifiable color schemes and signage and upgrades to the configuration and layout of the offices and other customer zones to improve the customer experience. |
|
(c) |
Energy efficiency initiatives primarily include solar panel installation. |
Third Quarter Conference Call
A conference call is scheduled for October 31, 2024 at 9:00 a.m. (PT) to discuss the third quarter earnings results. The domestic dial-in number is (877) 407-9039, and the international dial-in number is (201) 689-8470. A simultaneous audio webcast may be accessed by using the link at www.publicstorage.com under “About Us, Investor Relations, News and Events, Event Calendar.” A replay of the conference call may be accessed through November 14, 2024 by calling (844) 512-2921 (domestic), (412) 317-6671 (international) (access ID number for either domestic or international is 13749511) or by using the link at www.publicstorage.com under “About Us, Investor Relations, News and Events, Event Calendar.”
About Public Storage
Public Storage, a member of the S&P 500, is a REIT that primarily acquires, develops, owns, and operates self-storage facilities. At September 30, 2024, we: (i) owned and/or operated 3,333 self-storage facilities located in 40 states with approximately 241 million net rentable square feet in
This press release, our Form 10-Q for the third quarter of 2024, a financial supplement, and additional information about Public Storage are available on our website, www.publicstorage.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements relating to our 2024 outlook and all underlying assumptions; our expected acquisition, disposition, development, and redevelopment activity; supply and demand for our self-storage facilities; information relating to operating trends in our markets; expectations regarding operating expenses, including property tax changes; expectations regarding the impacts from inflation and changes in macroeconomic conditions; our strategic priorities; expectations with respect to financing activities, rental rates, cap rates, and yields; leasing expectations; our credit ratings; and all other statements other than statements of historical fact. Such statements are based on management’s beliefs and assumptions made based on information currently available to management and may be identified by the use of the words “outlook,” “guidance,” “expects,” “believes,” “anticipates,” “should,” “estimates,” and similar expressions. These forward-looking statements involve known and unknown risks and uncertainties, which may cause our actual results and performance to be materially different from those expressed or implied in the forward-looking statements. Risks and uncertainties that may impact future results and performance include, but are not limited to those described in Part 1, Item 1A, “Risk Factors” in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on February 20, 2024 and in our other filings with the SEC. These include changes in demand for our facilities; changes in macroeconomic conditions; changes in national self-storage facility development activity; impacts of natural disasters; adverse changes in laws and regulations including governing property tax, evictions, rental rates, minimum wage levels, and insurance; adverse economic effects from public health emergencies, international military conflicts, or similar events impacting public health and/or economic activity; increases in the costs of our primary customer acquisition channels; adverse impacts to us and our customers from high interest rates, inflation, unfavorable foreign currency rate fluctuations, or changes in federal or state tax laws related to the taxation of REITs; security breaches, including ransomware; or a failure of our networks, systems, or technology. These forward-looking statements speak only as of the date of this press release or as of the dates indicated in the statements. All of our forward-looking statements, including those in this press release, are qualified in their entirety by this cautionary statement. We expressly disclaim any obligation to update publicly or otherwise revise any forward-looking statements, whether because of new information, new estimates, or other factors, events, or circumstances after the date of these forward-looking statements, except when expressly required by law. Given these risks and uncertainties, you should not rely on any forward-looking statements in this press release, or which management may make orally or in writing from time to time, neither as predictions of future events nor guarantees of future performance.
PUBLIC STORAGE |
|||||||||||||||
SELECTED CONSOLIDATED INCOME STATEMENT DATA |
|||||||||||||||
(Amounts in thousands, except per share data) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
||||||||
Revenues: |
|
|
|
|
|
|
|
||||||||
Self-storage facilities |
$ |
1,110,115 |
|
|
$ |
1,078,721 |
|
|
$ |
3,295,896 |
|
|
$ |
3,167,025 |
|
Ancillary operations |
|
77,643 |
|
|
|
65,099 |
|
|
|
222,293 |
|
|
|
190,797 |
|
|
|
1,187,758 |
|
|
|
1,143,820 |
|
|
|
3,518,189 |
|
|
|
3,357,822 |
|
|
|
|
|
|
|
|
|
||||||||
Expenses: |
|
|
|
|
|
|
|
||||||||
Self-storage cost of operations |
|
287,435 |
|
|
|
267,785 |
|
|
|
858,350 |
|
|
|
794,078 |
|
Ancillary cost of operations |
|
34,265 |
|
|
|
21,159 |
|
|
|
88,877 |
|
|
|
63,037 |
|
Depreciation and amortization |
|
280,330 |
|
|
|
238,748 |
|
|
|
848,875 |
|
|
|
682,531 |
|
Real estate acquisition and development expense |
|
2,530 |
|
|
|
5,059 |
|
|
|
9,154 |
|
|
|
13,687 |
|
General and administrative |
|
26,214 |
|
|
|
20,732 |
|
|
|
74,130 |
|
|
|
57,459 |
|
Interest expense |
|
74,252 |
|
|
|
58,350 |
|
|
|
215,266 |
|
|
|
132,530 |
|
|
|
705,026 |
|
|
|
611,833 |
|
|
|
2,094,652 |
|
|
|
1,743,322 |
|
|
|
|
|
|
|
|
|
||||||||
Other increases (decreases) to net income: |
|
|
|
|
|
|
|
||||||||
Interest and other income |
|
20,029 |
|
|
|
32,295 |
|
|
|
52,248 |
|
|
|
69,381 |
|
Equity in earnings of unconsolidated real estate entity |
|
2,888 |
|
|
|
7,227 |
|
|
|
15,458 |
|
|
|
22,787 |
|
Foreign currency exchange (loss) gain |
|
(70,572 |
) |
|
|
47,880 |
|
|
|
(20,580 |
) |
|
|
19,924 |
|
Gain on sale of real estate |
|
554 |
|
|
|
88 |
|
|
|
1,428 |
|
|
|
88 |
|
Income before income tax expense |
|
435,631 |
|
|
|
619,477 |
|
|
|
1,472,091 |
|
|
|
1,726,680 |
|
Income tax expense |
|
(2,488 |
) |
|
|
(2,834 |
) |
|
|
(6,042 |
) |
|
|
(8,457 |
) |
Net income |
|
433,143 |
|
|
|
616,643 |
|
|
|
1,466,049 |
|
|
|
1,718,223 |
|
Allocation to noncontrolling interests |
|
(2,814 |
) |
|
|
(3,345 |
) |
|
|
(8,645 |
) |
|
|
(9,188 |
) |
Net income allocable to Public Storage shareholders |
|
430,329 |
|
|
|
613,298 |
|
|
|
1,457,404 |
|
|
|
1,709,035 |
|
Allocation of net income to: |
|
|
|
|
|
|
|
||||||||
Preferred shareholders – distributions |
|
(48,678 |
) |
|
|
(48,678 |
) |
|
|
(146,029 |
) |
|
|
(146,029 |
) |
Restricted share units and unvested LTIP units |
|
(939 |
) |
|
|
(1,383 |
) |
|
|
(3,088 |
) |
|
|
(3,922 |
) |
Net income allocable to common shareholders |
$ |
380,712 |
|
|
$ |
563,237 |
|
|
$ |
1,308,287 |
|
|
$ |
1,559,084 |
|
|
|
|
|
|
|
|
|
||||||||
Per common share: |
|
|
|
|
|
|
|
||||||||
Net income per common share – Basic |
$ |
2.17 |
|
|
$ |
3.21 |
|
|
$ |
7.46 |
|
|
$ |
8.89 |
|
Net income per common share – Diluted |
$ |
2.16 |
|
|
$ |
3.20 |
|
|
$ |
7.43 |
|
|
$ |
8.85 |
|
Weighted average common shares – Basic |
|
175,043 |
|
|
|
175,499 |
|
|
|
175,403 |
|
|
|
175,451 |
|
Weighted average common shares – Diluted |
|
175,866 |
|
|
|
176,150 |
|
|
|
176,074 |
|
|
|
176,170 |
|
PUBLIC STORAGE |
|||||||
SELECTED CONSOLIDATED BALANCE SHEET DATA |
|||||||
(Amounts in thousands, except share and per share data) |
|||||||
|
September 30, 2024 |
|
December 31, 2023 |
||||
ASSETS |
(Unaudited) |
|
|
||||
|
|
|
|
||||
Cash and equivalents |
$ |
599,004 |
|
|
$ |
370,002 |
|
Real estate facilities, at cost: |
|
|
|
||||
Land |
|
5,652,960 |
|
|
|
5,628,488 |
|
Buildings |
|
22,441,100 |
|
|
|
21,836,750 |
|
|
|
28,094,060 |
|
|
|
27,465,238 |
|
Accumulated depreciation |
|
(10,172,372 |
) |
|
|
(9,423,974 |
) |
|
|
17,921,688 |
|
|
|
18,041,264 |
|
Construction in process |
|
310,514 |
|
|
|
345,453 |
|
|
|
18,232,202 |
|
|
|
18,386,717 |
|
|
|
|
|
||||
Investment in unconsolidated real estate entity |
|
397,482 |
|
|
|
390,180 |
|
Goodwill and other intangible assets, net |
|
294,546 |
|
|
|
387,267 |
|
Other assets |
|
279,985 |
|
|
|
275,050 |
|
Total assets |
$ |
19,803,219 |
|
|
$ |
19,809,216 |
|
|
|
|
|
||||
|
|
|
|
||||
LIABILITIES AND EQUITY |
|
|
|
||||
|
|
|
|
||||
Notes payable |
$ |
9,473,778 |
|
|
$ |
9,103,277 |
|
Accrued and other liabilities |
|
619,416 |
|
|
|
598,993 |
|
Total liabilities |
|
10,093,194 |
|
|
|
9,702,270 |
|
|
|
|
|
||||
Commitments and contingencies |
|
|
|
||||
|
|
|
|
||||
Equity: |
|
|
|
||||
Public Storage shareholders’ equity: |
|
|
|
||||
Preferred Shares, |
|
4,350,000 |
|
|
|
4,350,000 |
|
Common Shares, |
|
17,511 |
|
|
|
17,567 |
|
Paid-in capital |
|
6,032,686 |
|
|
|
5,980,760 |
|
Accumulated deficit |
|
(737,450 |
) |
|
|
(267,910 |
) |
Accumulated other comprehensive loss |
|
(52,684 |
) |
|
|
(67,239 |
) |
Total Public Storage shareholders’ equity |
|
9,610,063 |
|
|
|
10,013,178 |
|
Noncontrolling interests |
|
99,962 |
|
|
|
93,768 |
|
Total equity |
|
9,710,025 |
|
|
|
10,106,946 |
|
Total liabilities and equity |
$ |
19,803,219 |
|
|
$ |
19,809,216 |
|
PUBLIC STORAGE |
|||||||||||||||
SELECTED FINANCIAL DATA |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Computation of Funds Available for Distribution (“FAD”) |
|||||||||||||||
(Unaudited – amounts in thousands except per share data) |
|||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
FFO allocable to common shares |
$ |
667,631 |
|
|
$ |
807,013 |
|
|
$ |
2,172,235 |
|
|
$ |
2,258,025 |
|
Eliminate effect of items included in FFO but not FAD: |
|
|
|
|
|
|
|
||||||||
Share-based compensation expense in excess of cash paid |
|
10,248 |
|
|
|
8,871 |
|
|
|
25,806 |
|
|
|
21,269 |
|
Foreign currency exchange loss (gain) |
|
70,572 |
|
|
|
(47,880 |
) |
|
|
20,580 |
|
|
|
(19,924 |
) |
Less: |
|
|
|
|
|
|
|
||||||||
Capital expenditures to maintain real estate facilities |
|
(60,909 |
) |
|
|
(56,768 |
) |
|
|
(173,684 |
) |
|
|
(153,120 |
) |
Capital expenditures for property enhancements |
|
(40,030 |
) |
|
|
(53,312 |
) |
|
|
(109,320 |
) |
|
|
(124,298 |
) |
FAD (a) |
$ |
647,512 |
|
|
$ |
657,924 |
|
|
$ |
1,935,617 |
|
|
$ |
1,981,952 |
|
Distributions paid to common shareholders |
$ |
525,252 |
|
|
$ |
526,503 |
|
|
$ |
1,577,419 |
|
|
$ |
1,579,372 |
|
Distribution payout ratio |
|
81.1 |
% |
|
|
80.0 |
% |
|
|
81.5 |
% |
|
|
79.7 |
% |
Distributions per common share |
$ |
3.00 |
|
|
$ |
3.00 |
|
|
$ |
9.00 |
|
|
$ |
9.00 |
|
(a) |
FAD represents FFO adjusted to exclude certain non-cash charges and to deduct recurring capital expenditures, which do not include capital expenditures for energy efficiencies including LED lighting and solar panel installation. We utilize FAD in evaluating our ongoing cash flow available for investment, debt repayment, and common distributions. We believe investors and analysts utilize FAD in a similar manner. FAD is not a substitute for GAAP net cash flow in evaluating our liquidity or ability to pay dividends, because it excludes investing and financing activities presented on our statements of cash flows. In addition, other REITs may compute this measure differently, so comparisons among REITs may not be helpful. |
PUBLIC STORAGE |
|||||||||||||||
SELECTED FINANCIAL DATA |
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Self-Storage Net Operating Income to Net Income |
|||||||||||||||
(Unaudited – amounts in thousands) |
|||||||||||||||
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
|
|
|
|
||||||||
Self-storage revenues for: |
|
|
|
|
|
|
|
||||||||
Same Store Facilities |
$ |
926,315 |
|
|
$ |
938,572 |
|
|
$ |
2,761,061 |
|
|
$ |
2,782,502 |
|
Acquired facilities |
|
61,116 |
|
|
|
23,683 |
|
|
|
179,313 |
|
|
|
48,895 |
|
Newly developed and expanded facilities |
|
58,135 |
|
|
|
53,758 |
|
|
|
167,152 |
|
|
|
154,492 |
|
Other non-same store facilities |
|
64,549 |
|
|
|
62,708 |
|
|
|
188,370 |
|
|
|
181,136 |
|
Self-storage revenues |
|
1,110,115 |
|
|
|
1,078,721 |
|
|
|
3,295,896 |
|
|
|
3,167,025 |
|
|
|
|
|
|
|
|
|
||||||||
Self-storage cost of operations for: |
|
|
|
|
|
|
|
||||||||
Same Store Facilities |
|
226,704 |
|
|
|
220,931 |
|
|
|
678,438 |
|
|
|
659,861 |
|
Acquired facilities |
|
20,871 |
|
|
|
8,233 |
|
|
|
61,011 |
|
|
|
19,660 |
|
Newly developed and expanded facilities |
|
18,364 |
|
|
|
16,311 |
|
|
|
54,649 |
|
|
|
47,712 |
|
Other non-same store facilities |
|
21,496 |
|
|
|
22,310 |
|
|
|
64,252 |
|
|
|
66,845 |
|
Self-storage cost of operations |
|
287,435 |
|
|
|
267,785 |
|
|
|
858,350 |
|
|
|
794,078 |
|
|
|
|
|
|
|
|
|
||||||||
Self-storage NOI for: |
|
|
|
|
|
|
|
||||||||
Same Store Facilities |
|
699,611 |
|
|
|
717,641 |
|
|
|
2,082,623 |
|
|
|
2,122,641 |
|
Acquired facilities |
|
40,245 |
|
|
|
15,450 |
|
|
|
118,302 |
|
|
|
29,235 |
|
Newly developed and expanded facilities |
|
39,771 |
|
|
|
37,447 |
|
|
|
112,503 |
|
|
|
106,780 |
|
Other non-same store facilities |
|
43,053 |
|
|
|
40,398 |
|
|
|
124,118 |
|
|
|
114,291 |
|
Self-storage NOI (a) |
|
822,680 |
|
|
|
810,936 |
|
|
|
2,437,546 |
|
|
|
2,372,947 |
|
Ancillary revenues |
|
77,643 |
|
|
|
65,099 |
|
|
|
222,293 |
|
|
|
190,797 |
|
Ancillary cost of operations |
|
(34,265 |
) |
|
|
(21,159 |
) |
|
|
(88,877 |
) |
|
|
(63,037 |
) |
Depreciation and amortization |
|
(280,330 |
) |
|
|
(238,748 |
) |
|
|
(848,875 |
) |
|
|
(682,531 |
) |
Real estate acquisition and development expense |
|
(2,530 |
) |
|
|
(5,059 |
) |
|
|
(9,154 |
) |
|
|
(13,687 |
) |
General and administrative expense |
|
(26,214 |
) |
|
|
(20,732 |
) |
|
|
(74,130 |
) |
|
|
(57,459 |
) |
Interest and other income |
|
20,029 |
|
|
|
32,295 |
|
|
|
52,248 |
|
|
|
69,381 |
|
Interest expense |
|
(74,252 |
) |
|
|
(58,350 |
) |
|
|
(215,266 |
) |
|
|
(132,530 |
) |
Equity in earnings of unconsolidated real estate entity |
|
2,888 |
|
|
|
7,227 |
|
|
|
15,458 |
|
|
|
22,787 |
|
Gain on sale of real estate |
|
554 |
|
|
|
88 |
|
|
|
1,428 |
|
|
|
88 |
|
Foreign currency exchange (loss) gain |
|
(70,572 |
) |
|
|
47,880 |
|
|
|
(20,580 |
) |
|
|
19,924 |
|
Income tax expense |
|
(2,488 |
) |
|
|
(2,834 |
) |
|
|
(6,042 |
) |
|
|
(8,457 |
) |
Net income on our income statement |
$ |
433,143 |
|
|
$ |
616,643 |
|
|
$ |
1,466,049 |
|
|
$ |
1,718,223 |
|
(a) |
Net operating income or “NOI” is a non-GAAP financial measure that excludes the impact of depreciation and amortization expense, which is based upon historical costs and assumes that building values diminish ratably over time, while we believe that real estate values fluctuate due to market conditions. We utilize NOI in determining current property values, evaluating property performance, and evaluating operating trends. We believe that investors and analysts utilize NOI in a similar manner. NOI is not a substitute for net income, operating cash flow, or other related GAAP financial measures, in evaluating our operating results. This table reconciles from NOI for our self-storage facilities to the net income presented on our income statement. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20241030385664/en/
Ryan Burke
(818) 244-8080, Ext. 1141
Source: Public Storage
FAQ
What was Public Storage's (PSA) Core FFO per share in Q3 2024?
How many new facilities did PSA acquire in Q3 2024?
What was PSA's Same Store occupancy rate in Q3 2024?
How much development pipeline does PSA have as of September 30, 2024?
