REITs Q4 2023 Financial Results: Highlights, CEO Statements, Webcasts

The “Big Four” REITs – CubeSmart, Extra Space Storage Inc., National Storage Affiliates Trust, and Public Storage Inc – have all released their financial statements for Q4 2023. Below are highlights from each, a statement from each company’s CEO, and where to view a recording of the webcasts.

CubeSmart (NYSE: CUBE)

“We closed 2023 with another solid quarter as we experienced more stable trends compared to earlier in the year. Looking to 2024, our strong platform and team, coupled with our significant balance sheet capacity, have us well-positioned to execute our growth strategy in any macroeconomic climate.”

- Christopher P. Marr, President and CEO

Key Q4 2023 Highlights:

• Net Income increased to $112.7 million in Q4 2023, up from $81.9 million in Q4 2022.
• EPS increased  to $0.50 in Q4 2023, up from $0.36 in the same period last year.
• FFO, adjusted per diluted share, increased by 4.5% to $0.70 in Q4 2023, compared to $0.67 in Q4 2022.
• One store was acquired for $22 million and an additional and a two-store portfolio was acquired for $20.2 million post year-end; four joint venture development properties are in progress.
• Despite a slight decrease in physical occupancy, same-store net operating income increased by 1.2% in Q4 2023.
• Quarterly dividends increased $0.51 per common share, a 4.1% increase from the previous dividend.
• Third-party management continued to expand with 43 stores added in the fourth quarter (167 stores for the year). This brings the total managed stores to 795.
• In 2024, CubeSmart expects a fully diluted EPS between $1.69 and $1.79 and FFO per share, as adjusted, between $2.59 and $2.69.

CubeSmart Q4 2023 Webcast

The recorded webcast will remain available on the company website for 15 days. In addition, a telephonic replay will be available through March 14. The dial-in number is 877.674.7070, with access code 924806. View the Webcast.

Extra Space Storage Inc. (NYSE: EXR)

"We had a solid quarter, focusing on optimizing the performance of the recently added Life Storage assets, while maximizing the performance of the legacy Extra Space Storage locations. We maintained healthy in-place rents and strong same-store occupancy in the quarter, averaging 93.4%, which drove positive same-store revenue growth. Turning to 2024, we anticipate stronger revenue growth from the Life Storage assets, which are benefiting from the sophistication of the Extra Space platform. While we expect a headwind from lower new customer rates, we are confident in the durability of self-storage, our highly diversified portfolio and our platform's ability to capture customer volume when sector demand accelerates."

- Joe Margolis, CEO

Key Q4 2023 Highlights:

• Achieved net income of $1.02 per diluted share, representing a 32.9% decrease compared to the same period in the prior year, primarily due to $30.6 million in transition costs, non-cash interest and amortization of intangibles related to the Life Storage Merger.
• Achieved FFO of $1.89 per diluted share. FFO, excluding adjustments, was $2.02 per diluted share, representing a 3.3% decrease compared to the same period in the prior year.
• Increased same-store revenue by 0.8% and same-store NOI decreased by 0.1% compared to the same period in the prior year.
• Reported ending same-store occupancy of 93% as of December 31, 2023, compared to 94% for December 31, 2022.
• Acquired three operating stores and four stores at completion of construction for a total cost of approximately $82.7 million.
• Acquired one operating store with a joint venture partner for a total cost of approximately $25 million (company invested $1 million).
• Originated $129.2 million in mortgage and mezzanine bridge loans and sold $43.9 million in mortgage bridge loans.
• Added 74 stores (55 stores net) to company third-party management platform. New totals at year end: 1,337 stores for third parties and 472 stores in unconsolidated joint ventures, a total of 1,809 managed stores.
• Paid a quarterly dividend of $1.62 per share.

ExtraSpace Q4 2023 Webcast

The recorded webcast will remain available on the company website for one year. The full text of the earnings report and supplemental data will also be available online immediately following the release to the wire services. View the Webcast.

National Storage Affiliates Trust (NYSE: NSA)

“We are pleased with our results this quarter, as we balanced rate and occupancy to drive revenues, while remaining focused on cost efficiencies across our platform. Looking back at the full year, I’m very proud of our team’s focus on People, Process and Platform initiatives, which we believe will enhance our results going forward. We’ve made significant progress on our strategic initiatives during the fourth quarter and thus far in 2024, including the sale of approximately $540 million of properties, the formation of two new joint ventures, the repurchase of approximately $120 million of common shares, and fully repaying our line of credit as of February 23, 2024. These key steps improve our portfolio quality and concentration, while putting us in an attractive position to take advantage of external growth opportunities as they arise.”

-  David Cramer, President & CEO

Key Q4 2023 Highlights:

• Reported net income of $108.1 million, an increase of 114.5% compared to the Q4 2022.
• Reported diluted earnings per share of $0.72 compared to $0.31 for the Q4 2022.
• Reported core FFO of $83.6 million, or $0.68 per share compared to the Q4 2022.
• Reported a decrease in same store NOI of 1.6% compared to the same period in 2022, driven by a negligible increase in same store total revenues, which was offset by an increase of 4.8% in same store property operating expenses.
• Reported same store period-end occupancy of 86.0% as of December 31, 2023, a decrease of 410 basis points compared to December 31, 2022.
• Acquired two wholly-owned self storage properties for approximately $25 million. Consideration for these acquisitions included the issuance of $8.1 million of OP equity.
• Issued $250 million of senior unsecured notes with a weighted average interest rate of 6.58% and a weighted average maturity of 5.8 years in a private placement with institutional investors.
• Repurchased 852,771 of the Company's common shares for approximately $27.4 million under the previously announced share repurchase program.
• Approved a new share repurchase program authorizing, but not obligating, the repurchase of up to $275.0 million of NSA's common shares of beneficial interest from time to time.
• Entered into an agreement to sell 71 wholly-owned self storage properties for approximately $540 million. 32 of the properties were sold in December 2023, while the remaining 39 properties are classified as held for sale as of December 31, 2023, of which 38 were sold in February 2024.
• Entered into a joint venture agreement between a subsidiary of NSA (JV NSA Member) and a state pension fund advised by Heitman Capital Management LLC (JV Investor) together with the JV Members, to acquire and operate self storage properties. The 2023 Joint Venture agreement provides for equity capital contributions from the JV Members of up to $400 million over a 24-month period starting in December 2023, with the JV Investor holding a 75% ownership interest and the JV NSA Member holding a 25% ownership interest. A subsidiary of NSA will serve as the manager of the new venture. As of the date of this release, there have been no properties acquired by the Joint Venture.

NSA Q4 2023 Webcast

The recorded webcast will remain available on the company website for 30 days. Supplemental materials will be posted to the investor relations section of the company’s website prior to the conference call. View the Webcast.

Public Storage (NYSE: PSA)

“Public Storage achieved record revenues and net operating income, quickly acquired and integrated the 90,000-customer Simply Self Storage portfolio, and reached more than 3,000 owned properties during 2023. I want to thank the entire team for their focus and determination. We are well positioned in 2024 with our operating model transformation enhancing the industry’s highest margins, our high growth non-same store pool comprising nearly 30% of the portfolio, and our balance sheet positioned to fund significant external growth. Our ability to drive unmatched levels of performance and profitability uniquely positions us for growth and value creation into the future.”

- Joe Russell, President and CEO

Key Q4 2023 Highlights:

• Reported net income allocable to common shareholders of $2.21 per diluted share.
• Reported core FFO allocable to common shareholders of $4.20 per diluted share, an increase of 1.0% relative to the same period in 2022.
• Achieved 79.7% Same Store direct net operating income margin.
• Acquired eleven self-storage facilities (0.8 million net rentable square feet) for $171.9 million.
• Opened five newly developed facilities and various expansion projects which together added 0.8 million net rentable square feet at a cost of $190.3 million. Post-year-end, additional facilities remain in development and expansion expected to add 3.6 million net rentable square feet at an estimated cost of $766.2 million.

Public Storage Q4 2023 Webcast

The recorded webcast will remain available on the company website until March 6. For the conference-call replay, the domestic dial-in number is 844.512.2921, and the international number is 412.317.6671. The access ID number is 13744115. View the Webcast.