National Storage Affiliates Trust (NSA) Financial Report Summaries

Risks

• Adverse economic or other conditions in the markets in which we do business and more broadly associated with the real estate industry could negatively affect our occupancy levels and rental rates and therefore our operating results and the value of our self storage properties.
• We may not be successful in identifying and consummating suitable acquisitions, adding additional suitable new PROs, or integrating and operating such acquisitions, including integrating them into our financial and operational reporting infrastructure and internal control framework in a timely manner, which may impede our growth.
• We face competition for tenants.
• Increases in taxes and regulatory compliance costs, including as a result of changes in law or property reassessments, may reduce our income and adversely impact our cash flows.
• Our storage leases are relatively short-term in nature, which exposes us to the risk that we may have to re-lease our units and we may be unable to do so on attractive terms, on a timely basis or at all.
• Security breaches through cyber-attacks, cyber-intrusions, or other methods could disrupt our information technology networks and related systems.
• Costs associated with complying with the ADA may result in unanticipated expenses.
• Environmental compliance costs and liabilities associated with operating our properties may affect our results of operations.
• We and certain of our PROs have tenant insurance- and/or tenant protection plan-related arrangements that are in some cases subject to state-specific governmental regulation, which may adversely affect our results.
• Privacy concerns could result in regulatory changes that may harm our business.
• Uninsured losses or losses in excess of our insurance coverage could adversely affect our financial condition, operating results and cash flow.
• Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our properties.
• Our business could be harmed if key personnel terminate their employment with us.
• We invest in strategic joint ventures that subject us to additional risks.
• Terrorist attacks, active shooter incidents and other acts of violence or war may adversely impact our performance and may affect the markets on which our securities are traded.
• Our ability to terminate our facilities portfolio management agreements ("FPMAs") and asset management agreements ("AMAs") with a PRO is limited, which may adversely affect our ability to execute our business plan.
• We may less vigorously pursue enforcement of terms of agreements entered into with our PROs because of conflicts of interest with our PROs.
• We own self storage properties in some of the same geographic regions as our PROs and may compete for tenants with other properties managed by our PROs.
• Our PROs may engage in other activities, diverting their attention from the management of our properties, which could adversely affect the execution of our business plan and our operating results.
• When a PRO elects or is required to "retire" we may become exposed to new and additional costs and risks.
• Conflicts of interest could arise with respect to certain transactions between the holders of OP units and subordinated performance units, which include our PROs, on the one hand, and us and our shareholders, on the other.
• The partnership agreement of our operating partnership contains provisions that may delay, defer or prevent a change in control.
• Certain provisions of the Maryland General Corporation Law (the "MGCL") and of our bylaws and our declaration of trust could inhibit a change in our control and have an adverse impact on the price of our shares.
• Restrictions on ownership and transfer of our shares may restrict change of control or business combination opportunities in which our shareholders might receive a premium for their shares.
• There are risks associated with our indebtedness.
• We depend on external sources of capital that are outside of our control, which could adversely affect our ability to acquire or develop properties, satisfy our debt obligations and/or make distributions to shareholders.
• Increases in interest rates may increase our interest expense and adversely affect our cash flow and our ability to service our indebtedness, make cash distributions to our shareholders, and acquire or sell properties and our decision to hedge against interest rate risk might not be effective.
• The terms and covenants relating to our indebtedness could adversely impact our economic performance.
• Our failure to remain qualified as a REIT would subject us to U.S. federal income tax and applicable state and local taxes, which would reduce the amount of operating cash flow to our shareholders.
• Even if we qualify as a REIT, we may face other tax liabilities that reduce our cash flow.
• Complying with the REIT requirements may cause us to forgo and/or liquidate otherwise attractive investments, and in some situations, to maintain our REIT qualification, we may be forced to borrow funds during unfavorable market conditions.
• If our operating partnership is treated as a corporation for U.S. federal income tax purposes, we will cease to qualify as a REIT.
• Complying with REIT requirements may limit our ability to hedge effectively and may cause us to incur tax liabilities.
• The ability of our board of trustees to revoke our REIT election without shareholder approval may cause adverse consequences to our shareholders.
• Legislative or regulatory tax changes related to REITs could materially and adversely affect our business.
• Common shares and preferred shares eligible for future sale may have adverse effects on our share price.
• We cannot assure our ability to pay dividends in the future.
• Future offerings of debt or equity securities, which may rank senior to our common shares, may adversely affect the market price of our common shares.