UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON,Washington, DC 20549
FORM 10-K
x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended | ||
December 31, |
OR
OR | ||
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to |
Commission file number 001-32324
Commission File Number 001-32324
U-STORE-IT TRUST
(Exact Name of Registrant as Specified in Its Charter)
Maryland | ||
20-1024732 | ||
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(State or Other Jurisdiction of | (IRS Employer | |
Incorporation or Organization) | Identification No.) | |
50 Public Square | ||
Suite 2800 | ||
Cleveland, Ohio |
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(Address of Principal Executive Offices) | ( |
Registrant’s telephone number, including area code (216) 274-1340
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Name of each exchange on which registered | |
Common Shares, $0.01 par value per share | New York Stock Exchange |
Securities registered pursuant to Section 12(g) of the Act:
None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YESxNOo
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. YESoNOx
Indicate by check mark whether the Registrantregistrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days.YESþ NO ¨xNOo
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’sregistrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.þo
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:
Large Accelerated Filer x Accelerated Filer o Non-Accelerated Filer o Smaller Reporting Company o
Indicate by check mark whether the Registrantregistrant is an accelerated filera shell company (as defined in Rule 12b-2 of the Exchange Act Rule 12b-2)Act).YES¨oNO NO þx
As of June 30, 2004,2007, the last business day of the Registrant’sregistrant’s most recently completed second quarter, there was nothe aggregate market value of common shares held by non-affiliates of the Registrant. The Registrant completed its initial public offering on October 27, 2004.registrant was $942,351,737.
As of March 21, 2005,February 27, 2008, the number of common shares of the Registrantregistrant outstanding was 37,345,162.57,847,325.
Documents incorporated by reference: Portions of the Proxy Statement for the 20052008 Annual Meeting of Shareholders of the Registrant to be filed subsequently with the SEC are incorporated by reference into Part III of this report.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations | 36 | |||
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 50 | |||
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Trustees, Executive Officers | 51 | |||
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Certain Relationships and Related Transactions, and Trustee Independence | 51 | |||
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Forward-Looking Statements
This Annual Report on Form 10-K, together with other statements and information publicly disseminated by U-Store-It Trust (“we,” “us,” “our” or the “Company”), contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.1934, as amended (the “Exchange Act”). Such statements are based on assumptions and expectations whichthat may not be realized and are inherently subject to risks, uncertainties and other factors, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Although we believe the expectations reflected in these forward-looking statements are based on reasonable assumptions, future events and actual results, performance, transactions or achievements, financial and otherwise, may differ materially from the results, performance, transactions or achievements expressed or implied by the forward-looking statements. Risks, uncertainties and other factors that might cause such differences, some of which could be material, include, but are not limited to:
·national and local economic, business, real estate and other market conditions;
·the competitive environment in which we operate;
·the execution of our business plan;
·financing risks;
· increases in interest rates and operating costs;
·our ability to maintain our status as a real estate investment trust (“REIT”) for federal income tax purposes;
·acquisition and development risks;
· changes in real estate and zoning laws or regulations;
· risks related to natural disasters;
·potential environmental and other liabilities;
·other factors affecting the real estate industry generally or the self-storage industry in particular; and
·other risks identified in Item 1A of this Annual Report on Form 10-K and, from time to time, in other reports we file with the Securities and Exchange Commission (the “SEC”) or in other documents that we publicly disseminate.
We undertake no obligation to publicly update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.otherwise except as may be required in securities laws.
Overview
We are a self-administered and self-managed real estate company focused primarily on the ownership, operation, acquisition and development of self-storage facilities in the United States.
As of December 31, 2004,2007, we owned and managed 201409 self-storage facilities located in 2126 states and aggregating approximately 13.026.1 million rentable square feet. As of December 31, 2004, we also managed 14 additional facilities owned by Rising Tide Development, LLC (“Rising Tide Development”), a company owned and controlled by Robert J. Amsdell,2007, our Chairman and Chief Executive Officer, and Barry L. Amsdell, one of our trustees. As of December 31, 2004, our 201409 facilities were approximately 82.2%79.5% leased to a total of approximately 91,000180,000 tenants and no single customertenant accounted for more than 1% of our annual rent.rental revenue.
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Our self-storage facilities are designed to offer affordable, easily-accessible and secure storage space for our residential and commercial customers. Our customers rent storage units for their exclusive use, typically on a month-to-month basis. Additionally, some of our facilities offer outside storage areas for vehicles and boats. Our facilities are specifically designed to accommodate both residential and commercial customers, with features such as security systems and wide aisles and load-bearing capabilities for large truck access. All of our facilities have an on-site manager during business hours, and 307, or approximately 75%, of our facilities have a manager who resides in an apartment at the facility. Our customers can access their storage units during business hours, and some of our facilities provide customers with 24-hour access through computer controlled access systems. Our goal is to provide customers with the highest standard of facilities and service in the industry. To that end, approximately 53% of our facilities include climate controlled units, compared to the national average of 39% reported by the 2007 Self-Storage Almanac.
We were formed in July 2004 to succeed to the self-storage operations owned directly and indirectly by Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdell, our Chief Operating Officer, and their affiliated entities and related family trusts (which entities and family trusts are referred to herein as the “Amsdell Entities”). We are organized as a REIT under Maryland real estate investment trust,law, and we believe that we qualify for taxation as a REIT for federal income tax purposes beginning with our short taxable year ended December 31, 2004. From our inception until October 2004, we did not have any operations. We commenced operations onas a publicly-traded REIT in October 21, 2004 after completing the mergers of certain Amsdell Partners, Inc. and High Tide LLCEntities with and into us, followed by our initial public offering (“IPO”), and the consummation of various other formation transactions whichthat occurred concurrently with, or shortly after, completion of theour IPO.
We conduct all of our business through U-Store-It, L.P., our operating partnership, U-Store-It, L.P., of which we serve as general partner, and its subsidiaries. As of December 31, 2004,2007, we held approximately 97%91.9% of the aggregate partnership interests in our operating partnership. Since its formation in 1996, our operating partnership has been engaged in virtually all aspects of the self-storage business, including the development, acquisition, ownership and operation of self-storage facilities.
Recent DevelopmentsAcquisition and Disposition Activity
As of December 31, 2007 and 2006, we owned 409 and 399 facilities, respectively, that contained an aggregate of 26.1 million and 25.4 million rentable square feet with occupancy rates of 79.5% and 78.2%, respectively. As of December 31, 2007 we had facilities in 26 states: Alabama, Arizona, California, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Louisiana, Maryland, Massachusetts, Michigan, Mississippi, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Utah, Virginia and Wisconsin. A complete listing of, and certain information about, our facilities is included in Item 2 of this Annual Report on Form 10-K. The following acquisitions occurred during the years ended December 31, 2007 and 2006:
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| Total Number of |
| Purchase / Sale Price (in |
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Facility/Portfolio |
| Transaction Date |
| Facilities |
| thousands) |
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2007 Acquisitions |
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Sanford Portfolio |
| January 2007 |
| 1 |
| $ | 6,300 |
|
Grand Central Portfolio |
| January 2007 |
| 2 |
| 13,200 |
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Rising Tide Portfolio |
| September 2007 |
| 14 |
| 121,000 |
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|
| 17 |
| $ | 140,500 |
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2007 Dispositions |
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South Carolina Assets |
| May 2007 |
| 3 |
| $ | 12,750 |
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Arizona Assets |
| December 2007 |
| 2 |
| 6,440 |
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|
|
|
| 5 |
| $ | 19,190 |
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2006 Acquisitions |
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Nashville, TN Portfolio |
| January 2006 |
| 2 |
| $ | 13,100 |
|
Dallas, TX Portfolio |
| January 2006 |
| 2 |
| 11,500 |
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U-Stor Self Storage Portfolio |
| February 2006 |
| 3 |
| 10,800 |
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Sure Save Portfolio |
| February 2006 |
| 24 |
| 164,500 |
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Texas Storage Portfolio |
| March 2006 |
| 4 |
| 22,500 |
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Nickey Portfolio |
| April 2006 |
| 4 |
| 13,600 |
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SecurCare Portfolio |
| May 2006 |
| 4 |
| 35,700 |
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Texas Storage Portfolio |
| June 2006 |
| 1 |
| 6,500 |
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Jernigan Portfolio |
| July 2006 |
| 9 |
| 45,300 |
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U-Stor Self Storage Portfolio |
| August 2006 |
| 1 |
| 3,500 |
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Bailes Portfolio |
| August 2006 |
| 3 |
| 15,600 |
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In & Out Self Storage Portfolio |
| August 2006 |
| 1 |
| 7,600 |
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Texas Storage Portfolio |
| September 2006 |
| 2 |
| 12,200 |
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| 60 |
| $ | 362,400 |
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The following table summarizes the change in number of self-storage facilities from January 1, 2006 through December 31, 2007:
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| 2007 |
| 2006 |
|
Balance - Beginning of year |
| 399 |
| 339 |
|
Facilities acquired |
| 17 |
| 60 |
|
Facilities consolidated |
| (2 | ) | — |
|
Facilities sold |
| (5 | ) | — |
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Balance - End of year |
| 409 |
| 399 |
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Financing Activities
We entered into the following significant financings during the years ended December 31, 2007, 2006 and 2005:
·Completion of IPOLehman Brothers Fixed Rate Mortgage Loan.. On October 27, 2004, we completed our IPO, pursuant to which we sold an aggregate of 28,750,000 common shares (including 3,750,000 common shares pursuant to the exercise of the underwriters’ over-allotment option) at an offering price of $16.00 per share, for gross proceeds of $460.0 million. As part In July 2005, one of our formation transactions, we acquired generalsubsidiaries entered into a fixed rate mortgage loan agreement with Lehman Brothers Bank, FSB in the principal amount of $80.0 million. The mortgage loan, which is secured by 24 of our self-storage facilities, bears interest at 5.13% and limited partner interestsmatures in August 2012.
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·LaSalle Bank Fixed Rate Mortgage Loan. In August 2005, one of our Operating Partnership from Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdellsubsidiaries entered into a fixed rate mortgage loan agreement with LaSalle Bank National Association in the principal amount of $80.0 million. The mortgage loan, which is secured by 29 of our self-storage facilities, bears interest at 4.96% and certain of the Amsdell Entitiesmatures in exchange for our common shares, and we also acquired U-Store-It Mini Warehouse Co., our management company, for cash. In addition, three additional facilities were contributed to our operating partnership by the Amsdell Entities in exchange for operating partnership units and the assumption of outstanding indebtedness on these facilities.September 2012.
·Revolving Credit Facility.AEGON USA Fixed Rate Mortgage Loan.On October 27, 2004, concurrently with the closing In November 2005, one of our IPO, we and our operating partnershipsubsidiaries entered into a three-year,fixed rate mortgage loan with Transamerica Financial Life Insurance Company, a subsidiary of AEGON USA Realty Advisors, Inc., in the principal amount of $72.5 million. The mortgage loan, which is secured by 36 of our self-storage facilities, bears interest at 5.97% and matures in November 2015. We assumed the obligation to enter into this loan in connection with the National Self Storage acquisition.
·Repayment of Balance under Revolving CreditFacility. We used a portion of the proceeds from our October 2005 public offering to pay down the outstanding balance under our then existing $150.0 million secured revolving credit facility with Lehman Brothers Inc. and Wachovia Capital Markets, LLC, as joint advisors, joint lead arrangers and joint bookrunners.
facility. The facility iswas scheduled to matureterminate on October 27, 2007, with the option for us to extend the maturitytermination date to October 27, 2008. As described below, we replaced our secured revolving credit facility with a $250.0 million unsecured revolving credit facility in February 2006. Borrowings under the facility bearbore interest at a variable rate based upon a basethe prime rate or a Eurodollar rate plus,LIBOR and in each case, a spread depending on our leverage ratio. The credit facility iswas secured by certain of our self-storage facilities and requiresrequired that we maintain a minimum “borrowing base” of properties. We intendAs of December 31, 2005, we had no outstanding balance under our revolving credit facility.
·Term Loan Agreement. In February 2006, we and our operating partnership entered into a 60-day, unsecured $30 million term loan agreement with Wachovia Bank, National Association as the lender. The term loan bore interest at a variable rate of LIBOR plus 175 basis points. The loan proceeds were used to use thisfinance a portion of the Sure Save Portfolio. The loan was paid in full from proceeds obtained upon entering into a new revolving credit facility principallyin February 2006.
·Revolving Credit Facility. In February 2006, we and our operating partnership entered into a three-year $250.0 million unsecured revolving credit facility with Wachovia Bank, National Association, replacing our $150.0 million secured revolving facility. The revolving credit facility was scheduled to terminate in February 2009, but we replaced it with a new revolving credit facility in November 2006 as described below. The terms of the revolving credit facility allowed us to increase the amount that may be borrowed up to $350.0 million at a later date, if necessary. The facility required that we satisfy certain financial coverage ratios and operating covenants, including a maximum leverage ratio and a minimum interest coverage ratio. Borrowings under the facility bore interest, at the Company’s option, at either an alternate base rate or a Eurodollar rate, in each case plus an applicable margin. The alternative base interest rate was a fluctuating rate equal to the higher of the prime rate or the sum of the federal funds effective rate plus 50 basis points. The applicable margin for the alternative base rate varied from 0.15% to 0.60% depending on the Company’s leverage ratio. The Eurodollar rate was a periodic fixed rate equal to LIBOR. The applicable margin for the Eurodollar rate varied from 1.15% to 1.60% based on the Company’s leverage ratio.
·Term Loan Agreement. In November 2006, we and our operating partnership entered into a 30-day, unsecured $50 million term loan agreement with Wachovia Bank, National Association as the lender. The term loan bears interest at a variable rate of LIBOR plus 115 basis points. The loan proceeds, along with borrowings under our revolving credit facility, were used to finance the future acquisition and developmentrepayment of self-storage facilities and for general working capital purposes.maturing secured loans. The loan was paid in full from proceeds obtained upon entering into a new revolving credit facility in November 2006.
·Fixed Rate Mortgage Loans.Revolving Credit Facility.Also on October 27, 2004, In November 2006, we and concurrently with the closing of our IPO, three of our subsidiariesoperating partnership entered into a new three-year $450.0 million unsecured credit facility with Wachovia Capital Markets, LLC and Keybanc Capital Markets, replacing our existing $250.0 million unsecured revolving facility. The facility consists of a $200 million term loan and a $250 million revolving credit facility. The new facility has a three-year term with a one-year extension option and scheduled termination in November 2009. Borrowings under the credit facility bear interest, at our option, at either an alternative base rate or a Eurodollar rate, in each case, plus an applicable margin based on our leverage ratio or our credit rating. The alternative base interest rate is a fluctuating rate equal to the higher of the prime rate or the sum of the federal funds effective rate plus 50 basis points. The applicable margin for the alternative base rate will vary from 0.00% to 0.50% depending on our leverage ratio prior to achieving an investment grade rating, and will vary from 0.00% to 0.25% depending on our credit rating after achieving an investment grade rating. The Eurodollar rate is a rate of interest that is fixed for interest periods of one, two, three separate fixedor six months based on the LIBOR rate mortgagedetermined two business days prior to the commencement of the applicable interest period. The applicable margin for the Eurodollar rate will vary from 1.00% to 1.50% depending on our leverage ratio prior to achieving an investment grade rating, and will vary from
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0.425% to 1.00% depending on our credit rating after achieving an investment grade rating. At December 31, 2007, borrowings under the unsecured credit facility had a weighted average interest rate of 6.06%.
·Secured Term Loan. In September 2007, we and our Operating Partnership entered into a secured term loan agreement that allows for term loans with anin the aggregate principal amount of approximately $270.0 million ($90.0 million each). Affiliatesup to $50 million. Each term loan matures on November 20, 2009, subject to extension in the sole discretion of Lehman Brothers served as the lenders under these mortgage loans.lenders. Each term loan bears interest at either an alternative base rate or a Eurodollar rate, at our option, in each case plus an applicable margin at terms identical to the unsecured revolving credit facility. As of December 31, 2007, there was one term loan outstanding for $47.4 million. The mortgage loans areoutstanding term loan is secured by certaina pledge by our Operating Partnership of ourall equity interests in YSI RT LLC, the wholly-owned subsidiary of the Operating Partnership that acquired eight self-storage facilities bearin September 2007. At December 31, 2007, the outstanding term loan had an interest at 5.09%, 5.19% and 5.33%, and mature in November 2009, May 2010 and January 2011, respectively. These mortgage loans require usrate of 6.18%.
Capital Markets Activity
In October 2005, we completed a follow-on public offering, pursuant to establish reserves relatingwhich we sold an aggregate of 19,665,000 common shares (including 2,565,000 shares pursuant to the mortgaged facilities for real estate taxes, insurance and capital spending.
Post-IPO 2004 Acquisition Activities.In 2004, concurrently with, or shortly after, the completion of our IPO, we completed the acquisition of 46 self-storage facilities, all of which were pending at the timeexercise of the IPO:
Quarterly Distribution.On November 16, 2004, our board of trustees declared a pro-rated quarterly distribution of $0.2009 per common share for the period commencing upon completion of our IPO on October 27, 2004 and ending December 31, 2004. The distribution was paid on January 24, 2005 to common shareholders of record on January 10, 2005. This initial pro-rated distribution was based on a distribution of $0.28$20.35 per share, for a full quarter.gross proceeds of $400.2 million. The offering resulted in net proceeds to the Company, after deducting underwriting discount and commissions and expenses of the offering, of approximately $378.7 million.
Subsequent 2005 Events.
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Proposed Acquisitions.As of March 23, 2005, we had entered into definitive agreements to acquire 89 self-storage facilities, as discussed below, for a total purchase price of approximately $272.3 million.
The proposed acquisitions are comprised of the following unrelated transactions:
We expect these acquisitions to close on or before June 30, 2005. The closings of the transactions are contingent upon the satisfaction of certain customary conditions. There are no assurances that the conditions will be met or that the transactions will be consummated.
Business Strategy
Our business strategy consists of several elements:
·Maximize cash flow from our facilities by increasing — Our operating strategy focuses on achieving the highest sustainable rent levels at each of our facilities while at the same time meeting and sustaining occupancy levels, increasing rents, controllingtargets. We utilize our operating expensessystems and expandingexperienced personnel to manage the balance between rental rates, discounts, and improvingphysical occupancy with an objective of maximizing our facilities;
·Acquire facilities within our targeted markets;
·Utilize our expertise in selective newdevelopments — We seek to use our development expertise and access to multiple financing sources to pursue new developments in selective new developments;
development primarily in conjunction with joint venture partners.
Investment and Market Selection Process.Process
We intend to focus on targeted investmentsmaintain a disciplined and focused process in the acquisition and development of self-storage facilities. Our investment committee, which consists of certain of our executive officers and is led by Steven G. Osgood,Dean Jernigan, our President and Chief FinancialExecutive Officer, will overseeoversees our investment process. Our investment process involves five stages—stages — identification, initial due diligence, economic assessment, investment committee approval (and when required, boardBoard approval) and final due diligence, and documentation. Through our investment committee, we intend to focus on the following criteria:
·Targeted Markets:markets — Our targeted markets include areas where we currently maintain management that can be extended to additional facilities, or where we believe that we can acquire a significant number of facilities efficiently and within a short period of time. We evaluate both the broader market and the immediate area, typically five miles around the facility, for their ability to support above-average demographic growth. We will seek to grow our presence primarily in areas that we consider to be growth markets, such as Arizona, California, Florida and the Northeastern United States and to enter new markets should suitable opportunities arise.
·Quality of Facility:facility — We focus on self-storage facilities that have good visibility and are located near retail centers, which typically provide high traffic corridors and are generally located near residential communities and commercial customers. In addition, we seek to acquire facilities with an on-site apartment for the manager, security cameras and gated access, accessibility for tractor trailers and good construction.
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·Growth Potential:potential — We will target acquisitions that offer growth potential through increased operating efficiency and, in some cases, through additional leasing efforts, renovations or expansions. In addition to acquisitions ofacquiring single facilities, we will seek to invest in portfolio acquisitions, searching for situations where there is significant potential for increased operating efficiency and an ability to spread our fixed costs across a large base of facilities.
From the completion of our IPO through December 31, 2004,2007, we acquired 46269 facilities totaling approximately 3.116.9 million rentable square feet for an aggregate purchase priceconsideration of approximately $221.8 million.$1.3 billion. We believe that the self-storage industry will continue to provide us with opportunities for future growth through consolidation due to the highly fragmentedhighly-fragmented composition of the industry, the lack of skilled operators, the economies of scale available to a real estate company with a significant number of self-storage facilities, and the relative scarcity of capital available to the smaller operators. We intend to take advantage of these opportunities by utilizing our experience in identifying, evaluating and acquiring self-storage facilities. The experience of our
management team and our history of actively acquiring self-storage facilities give us an advantage in identifying attractive potential acquisitions, as we are well-known within the self-storage brokerage community and are often approached directly by principals interested in selling their facilities. Furthermore, we believe that our ability to offer our operating partnership units as a form of acquisition consideration will help us pursue acquisitions from tax-sensitive private sellers through tax-deferred transactions.industry.
Operating Segment
We have one reportable operating segment: we own, operate, develop, and acquire self-storage facilities.
Concentration
Our self-storage facilities are located in major metropolitan areas as well as rural areas and have numerous tenants per facility. All our operations are within the United States and noNo single tenant represents 1% or more of our revenues. The facilities in Florida, IllinoisCalifornia, Texas and CaliforniaIllinois provided approximately 28.0%19%, 11.4%15%, 8% and 10.3%, respectively,7% of total revenues, respectively, for the period October 21, 2004 throughyear ended December 31, 2004.2007. Florida, California, Illinois and New Jersey provided total revenues of approximately 19%, 16%, 7% and 6%, respectively, for the year ended December 31, 2006.
Seasonality
We experience minor seasonal fluctuations in the occupancy levels of our facilities, which are generally slightly higher during the summer months due to increased moving activity.
Financing Strategy
Although our organizational documents contain no limitation on the amount of debt we may incur, we maintain what we consider to be a conservative capital structure, characterized by the use of leverage in a manner that we believe is reasonable and prudent and that will enable us to have ample cash flow to cover interest expense.debt service and make distributions to our shareholders. As of December 31, 2004,2007, our debt to total capitalization ratio, determined by dividing the bookcarrying value of our total indebtedness by the sum of (a) the market value of our outstanding common shares and operating partnership units other than held by the Company and (b) the bookcarrying value of our total indebtedness, was approximately 36.3%64.1%. We expect to finance additional investments in self-storage facilities through the most attractive available source of capital at the time of the transaction, in a manner consistent with maintaining a strong financial position and future financial flexibility. These capital sources may include borrowings under our revolving credit facility, selling common or preferred shares or debt securities through public offerings or private placements, incurring additional secured indebtedness, issuing units in our operating partnership in exchange for contributed property, issuing preferred units in our operating partnership to institutional partners and forming joint ventures. We also may consider selling less productive self-storage facilities from time to time in order to reallocate proceeds from these sales into more productive facilities.
Competition
The continued development of new self-storage facilities has intensified the competition among self-storage operators in many market areas in which we operate. Self-storage facilities compete based on a number of factors, including location, rental rates, security, suitability of the facility’s design to prospective customers’ needs and the manner in which the facility is operated and marketed. In particular, the number of competing self-storage facilities in a particular market could have a material effect on our occupancy levels, rental rates and on the overall operating performance of our facilities. We believe that the primary competition for potential customers of any of our self-storage facilities comes from other self-storage facilities within a three-mile radius of that facility. We believe we have positioned our facilities within their respective markets as high-quality operators that emphasize customer convenience, security and professionalism.
Our key competitors include:include local and regional operators as well as the other public self-storage REITS, including Public Storage, Storage USA, Shurgard Storage Centers, U-Haul International, Sovran Self Storage and Extra Space Storage Inc. These companies, some of which operate significantly more facilities than we do and have greater resources than we do,have, and other entities may generally be able to accept more risk
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than we determine is prudent, including risks with respect to the geographic proximity of facility investments and the payment of higher facility acquisition prices. This competition may generally reduce the number of suitable acquisition opportunities available to us, increase the price required to be able to consummate the acquisition of particular facilities and reduce the demand for self-storage space in certain areas where our facilities are located. Nevertheless, we believe that our experience in operating, acquiring, developing and obtaining financing for self-storage facilities particularly our customer-oriented approach toward managing our facilities, should enable us to compete effectively.
Government Regulation
We are subject to federal, state and local environmental regulations that apply generally to the ownership of real property and the operation of self-storage facilities.
Under various federal, state and local laws, ordinances and regulations, an owner or operator of real property may become liable for the costs of removal or remediation of hazardous substances released on or in its property. These laws often impose liability without regard to whether the owner or operator knew of, or was responsible for, the release of such hazardous substances. The presence of hazardous substances, or the failure to properly remediate such substances, when released, may adversely affect the property owner’s ability to sell the real estate or to borrow using real estate as collateral, and may cause the property owner to incur substantial remediation costs. In addition to claims for cleanup costs, the presence of hazardous substances on a property could result in a claim by a private party for personal injury or a claim by an adjacent property owner or user for property damage. We may also become liable for the costs of removal or remediation of hazardous substances stored at the facilities by a customer even though storage of hazardous substances would be without our knowledge or approval and in violation of the customer’s storage lease agreement with us.
In order to assess the potential for cleanup liability, we obtained an environmental assessment of each of our facilities from a qualified and reputable environmental consulting firm (and intendOur practice is to conduct suchor obtain environmental assessments prior toin connection with the acquisition or development of additional facilities).facilities. Whenever the environmental assessment for one of our facilities indicatedindicates that thea facility wasis impacted by soil or groundwater contamination from prior owners/operators or other sources, we workedwill work with our environmental consultants and where appropriate, state governmental agencies, to ensure that the facility wasis either cleaned up, that no cleanup wasis necessary because the low level of contamination posedposes no significant risk to public health or the environment, or that the responsibility for cleanup restedrests with a third party. Therefore, we
We are not aware of any environmental cleanup liability that we believe will have a material adverse effect on us. We cannot assure you, however, that these environmental assessments and investigations have revealed or will reveal all potential environmental liabilities, that no prior owner created any material environmental condition not known to us or the independent consultant or that future events or changes in environmental laws will not result in the imposition of environmental liability on us.
We have not received notice from any governmental authority of any material noncompliance, claim or liability in connection with any of theour facilities, nor have we been notified of a claim for personal injury or property damage by a private party in connection with any of theour facilities in connection withrelating to environmental conditions.
We are not aware of any environmental condition with respect to any of theour facilities that could reasonably be expected to have a material adverse effect on our financial condition or results of operations, and we do not expect that the cost of compliance with environmental regulations will have a material adverse effect on our financial condition or results of operations. We cannot assure you, however, that this will continue to be the case.
Insurance
We believe that each of our facilities is covered by adequate fire, flood and property insurance provided by reputable companies and with commercially reasonable deductibles and limits. We maintaincarry comprehensive liability, all-risk propertyfire, extended coverage and rental loss insurance coverage with respect tocovering all of the facilities within our portfolio. We believe the policy specifications and insured limits are appropriate and deductibles customarily carriedadequate given the relative risk of loss, the cost of the coverage and industry practice. We do not carry insurance for losses such as loss from riots, war or acts of God, and, in our industry. We believe that allsome cases, flooding, because such coverage is not available or is not available at commercially reasonable rates. Some of our current title insurance policies, adequately insure fee titlesuch as those covering losses due to the facilities.terrorist activities, hurricanes, floods and earthquakes, are insured subject to limitations involving large deductibles or co-payments and policy limits that may not be sufficient to cover losses.
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Offices
Our principal executive office is located at 6745 Engle Road,50 Public Square, Suite 300,2800, Cleveland, Ohio 44130.OH 44113. Our telephone number is (440) 234-0700.
Employees
As of December 31, 2004,2007, we employed approximately 560989 employees, of whom approximately 80112 were corporate executive and administrative personnel and approximately 480877 were management and administrativeproperty level personnel. We believe that our relations with our employees are good. None of our employees are unionized.
Available Information
We file our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports with the Securities and Exchange Commission (the “SEC”). You may obtain copies of these documents by visiting the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549, by calling the SEC at 1-800-SEC-0330 or by accessing the SEC’s website at www.sec.gov. Our internet website address iswww.u-store-it.com. www.ustoreit.com. You also can obtain on our website, free of charge, a copy of our annual report on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K, and any amendments to those reports, as soon as reasonably practicable after we electronically file such reports or amendments with, or furnish them to, the SEC. Our internet website and the information contained therein or connected thereto are not intended to be incorporated by reference into this Annual Report on Form 10-K.
Also available on our website, free of charge, are copies of our Code of Business Conduct and Ethics, our Code of Ethics for Principal Executive Officer and Senior Financial Officers, our Corporate Governance Guidelines, and the charters for each of the committees of our boardBoard of trustees—Trustees — the Audit Committee, the Corporate Governance and Nominating Committee, and the Compensation Committee. Copies of our Codeeach of Business Conduct and Ethics, our Code of Ethics for Principal Executive Officer and Senior Financial Officers, our Corporate Governance Guidelines, and our committee chartersthese documents are also available in print free of charge, upon request by any shareholder. You can obtain such copies in printof these documents by contacting Investor Relations by mail at our corporate office.460 E. Swedesford Road, Suite 3000, Wayne, PA 19087.
Risk FactorsITEM 1A. RISK FACTORS
Overview
Investors should carefully consider, among other factors, the risks set forth below. We have separated the risks into three groups:
These risks are not the only ones that we may face. Additional risks not presently known to us or that we currently consider immaterial may also impair our business operations and hinder our ability to make expected distributions to our shareholders.
Risks RelatedOur performance and the value of our self-storage facilities are subject to risks associated with our properties and with the real estate industry.
Our Operationsrental revenues and operating costs and the value of our real estate assets, and consequently the value of our securities, are subject to the risk that if our facilities do not generate revenues sufficient to meet our operating expenses, including debt service and capital expenditures, our cash flow and ability to pay distributions to our shareholders will be adversely affected. Events or conditions beyond our control that may adversely affect our operations or the value of our facilities include:
·downturns in the national, regional and local economic climate;
Our rental revenues are significantly influenced by the economies and other conditions of the markets in which we operate, particularly in Florida, Illinois and California, where we have high concentrations of self-storage facilities.·
We are susceptible to adverse developments in the markets in which we operate, such as business layoffslocal or downsizing, industry slowdowns, relocations of businesses, changing demographics and other factors. Our facilities in Florida, Illinois and California accounted for approximately 24.8%, 11.7% and 10.4%, respectively, of our total rentable square feet as of December 31, 2004. As a result of this geographic concentration of our facilities, we are particularly susceptible to adverse market conditions in these particular areas. Any adverse economicregional oversupply, increased competition or real estate developments in these markets, or in any of the other markets in which we operate, or any decreasereduction in demand for self-storage space resultingspace;
·vacancies, changes in market rents for self-storage space;
·inability to collect rent from customers;
·increased operating costs, including maintenance, insurance premiums and real estate taxes;
·changes in interest rates and availability of financing;
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·hurricanes, earthquakes and other natural disasters, civil disturbances, terrorist acts or acts of war that may result in uninsured or underinsured losses;
·significant expenditures associated with acquisitions and development projects, such as debt service payments, real estate taxes, insurance and maintenance costs which are generally not reduced when circumstances cause a reduction in revenues from a property;
·costs of complying with changes in laws and governmental regulations, including those governing usage, zoning, the local business climateenvironment and taxes; and
·the relative illiquidity of real estate investments.
In addition, prolonged periods of economic slowdown or recession, rising interest rates or declining demand for self-storage, or the public perception that any of these events may occur, could adversely affect ourresult in a general decline in rental revenues, which could impair our ability to satisfy our debt service obligations and payto make distributions to our shareholders.
Because we are primarily focused on the ownership, operation, acquisition and development of self-storage facilities, our rentalRental revenues are significantlyinfluenced by demand for self-storage space generally, and a decrease in such demandwould likely have a greater adverse effect on our rental revenues than if we owned a more diversified real estate portfolio.
Because our portfolio of facilities consists primarily of self-storage facilities, we are subject to risks inherent in investments in a single industry. A decrease in the demand for self-storage space would likely have a greater adverse effect on our rental revenues than if we owned a more diversified real estate portfolio. Demand for self-storage space has been and could be adversely affected by weakness in the national, regional and local economies, changes in supply of, or demand for, similar or competing self-storage facilities in an area and the excess amount of self-storage space in a particular market. To the extent that any of these conditions occur, they are likely to affect market rents for self-storage space, which could cause a decrease in our rental revenue. Any such decrease could impair our ability to satisfy debt service obligations and make distributions to our shareholders.
We face risks associated with actions taken by our competitors.
Actions by our competitors may decrease or prevent increases of the occupancy and rental rates of our properties. We compete with other owners and operators of self-storage, some of which own properties similar to ours in the same submarkets in which our properties are located. If our competitors offer space at rental rates below current market rates or below the rental rates we currently charge our tenants, we may lose potential tenants, and we may be pressured to reduce our rental rates below those we currently charge in order to retain tenants when our tenants’ leases expire. As a result, our financial condition, cash flow, cash available for distribution, market price of our stock and ability to satisfy our debt service obligations could be materially adversely affected.
We face risks related to balloon payments.
Approximately 50% (or approximately $573.5 million) of our mortgage and revolving indebtedness is due on or before December 31, 2009. Certain of our mortgages will have significant outstanding balances on their maturity dates, commonly known as “balloon payments.” There can be no assurance that we will be able to refinance the debt on favorable terms or at all. To the extent we cannot refinance debt on favorable terms or at all, we may be forced to dispose of properties on disadvantageous terms or pay higher interest rates, either of which would have an adverse impact on our financial performance and ability to pay dividends to investors.
Rising operating expenses could reduce our cash flow and funds available for futuredistributions.
Our facilities and any other facilities we acquire or develop in the future are and will be subject to operating risks common to real estate in general, any or all of which may negatively affect us. Our facilities are subject to increases in operating expenses such as real estate and other taxes, utilities, insurance, administrative expenses and costs for repairs and maintenance. If operating expenses increase without a corresponding increase in revenues, our profitability could diminish and limit our ability to make distributions to our shareholders.
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We face risks associated with facility acquisitions that could impede our growth.
We have in the past acquired, and intend in the future to acquire, individual and portfolios of self-storage facilities that would increase our size and potentially alter our capital structure. Although we believe that the acquisitions that we expect to undertake in the future will enhance our future financial performance, the success of such transactions is subject to a number of factors, including the risk that:
·we may not be able to obtain financing for acquisitions on favorable terms;
·acquisitions may fail to perform as expected;
·the actual costs of repositioning or redeveloping acquired facilities may be higher than our estimates; and
·acquisitions may be located in new markets where we may have limited knowledge and understanding of the local economy, an absence of business relationships in the area or an unfamiliarity with local governmental and permitting procedures.
We also face significant competition for acquisitions and development opportunities. Some of our competitors have greater financial resources than we do and a greater ability to borrow funds to acquire facilities. These competitors may also be willing and/or able to accept more risk than we can prudently manage, including risks with respect to the geographic proximity of investments and the payment of higher facility acquisition prices. This competition for investments may reduce the number of suitable investment opportunities available to us, may increase acquisition costs and may reduce demand for self-storage space in certain areas where our facilities are located and, as a result, adversely affect our operating results.
Financing our future growth plan or refinancing existing debt maturities could be impacted by negative capital market conditions.
Recently, domestic financial markets have experienced unusual volatility and uncertainty. While this condition has occurred most visibly within the “subprime” mortgage lending sector of the credit market, liquidity has tightened in overall domestic financial markets, including the investment grade debt and equity capital markets. Consequently, there is greater uncertainty regarding our ability to access the credit markets in order to attract financing on reasonable terms nor can there be any assurance we can issue common or preferred equity securities at a reasonable price. Our ability to finance new acquisitions as well as our ability to refinance debt maturities could be adversely affected by our inability to secure permanent financing on reasonable terms, if at all.
We may not be able to adapt our management and operation systems to respond to theintegration of additional facilities without disruption or expense.
From the completion of our IPO in October 2004 through December 31, 2007, we acquired 269 facilities, containing approximately 15.6 million rentable square feet for an aggregate cost of approximately $1.3 billion. In 2008 we acquired two additional self-storage facilities. In addition, we expect to acquire additional self-storage facilities in the future. We cannot assure you that we will be able to adapt our management, administrative, accounting and operational systems or hire and retain sufficient operational staff to integrate these facilities into our portfolio and manage any future acquisition or development of additional facilities without operating disruptions or unanticipated costs. As we acquire or develop additional facilities, we will be subject to risks associated with managing new facilities, including customer retention and mortgage default risks. In addition, acquisitions or developments may cause disruptions in our operations and divert management’s attention away from day-to-day operations. Furthermore, our profitability may suffer because of acquisition-related costs or amortization costs for acquired goodwill and other intangible assets. Our failure to successfully integrate any future facilities into our portfolio could have an adverse effect on our operating costs and our ability to make distributions to our shareholders.
Acquired facilities may subject us to unknown liabilities.
Facilities that we have acquired or may acquire in the future may be subject to unknown liabilities for which we would have no recourse, or only limited recourse, to the former owners of such facilities. As a result, if a liability were asserted against us based upon ownership of an acquired facility, we might be required to pay significant sums to settle it, which could adversely affect our financial results and cash flow. Unknown liabilities relating to acquired facilities could include:
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·liabilities for clean-up of undisclosed environmental contamination;
·claims by tenants, vendors or other persons arising on account of actions or omissions of the former owners of the facilities; and
·liabilities incurred in the ordinary course of business.
We face significant competition from other developers, owners and operators in the self-storage industry, which may impede our ability to retain customers or re-let space when existing customers vacate, or impede our ability to make, or increase the cost of, future acquisitions or developments.industry.
We compete with numerous developers, owners and operators in the self-storage industry, including other REITs, some of which own or may in the future own facilities similar to ours in the same markets in which our facilities are located, and some of which may have greater capital resources. In addition, due to the relatively low cost of each individual self-storage facility, other developers, owners and operators have the capability to build additional facilities that may compete with our facilities.
If our competitors build new facilities that compete with our facilities or offer space at rental rates below current market rates or below the rental rates we currently charge our customers, we may lose potential customers and we may be pressured to discount our rental rates below those we currently charge in order to retain customers. As a result, our rental revenues may decrease, which could impair our ability to satisfy our debt service obligations and to pay distributions to our shareholders. In addition, increased competition for customers may require us to make capital improvements to facilities that we would not have otherwise made. Any unbudgeted capital improvements we undertake may reduce cash available for distributions to our shareholders.
Our rental revenues and operating costs, as well as the value of our self-storage facilities, are subject to risks associated with real estate assets and with the real estate industry.
Our ability to make expected distributions to our shareholders depends onProperty ownership through joint ventures may limit our ability to generate substantial revenues fromact exclusively in our facilities. Events and conditions generally applicableinterest.
We may co-invest with third parties through joint ventures. In any such joint venture, we may not be in a position to owners and operatorsexercise sole decision-making authority regarding the facilities owned through joint ventures. Investments in joint ventures may, under certain circumstances, involve risks not present when a third party is not involved, including the possibility that joint venture partners might become bankrupt or fail to fund their share of real propertyrequired capital contributions. Joint venture partners may have business interests or goals that are beyondinconsistent with our business interests or goals and may be in a position to take actions contrary to our policies or objectives. Such investments also have the potential risk of impasse on strategic decisions, such as a sale, because neither we nor the joint venture partner would have full control over the joint venture. Any disputes that may decrease cash available for distributionarise between us and the value of our facilities. These events and conditions include:
In addition, prolonged periods of economic slowdown or recession, rising interest rates or declining demand for self-storage, or the public perception that any of these events may occur,joint venture partners could result in a general decline in rental revenues, whichlitigation or arbitration that could impairincrease our ability to satisfyexpenses and distract our debt service obligationsofficers and/or Trustees from focusing their time and to make distributions toeffort on our shareholders.
If we are unable to promptly re-let units within our facilities or if the rates upon such re-letting are significantly lower than expected, our rental revenues would be adversely affected and our growth may be impeded.
Virtually all of our leases are on a month-to-month basis. Delays in re-letting units as vacancies arise would reduce our revenues and could adversely affect our operating performance. In addition, lower than expected rental rates upon re-letting could adversely affect our rental revenues and impede our growth.
We may not be successful in identifying and completing suitable acquisitions or development projects that meet our criteria, which may impede our growth, and even if we are able to identify suitable projects, our future acquisitions and developments may not yield the returns we expect or may result in shareholder dilution.
Our business strategy involves expansion through acquisitions and development projects. These activities require us to identify suitable acquisition or development candidates or investment opportunities that meet our criteria and are compatible with our growth strategy. We may not be successful in identifying suitable self-storage facilities, that meet our acquisition or development criteria or in completing acquisitions, developments or investments on satisfactory terms. Similarly, although we currently have the option to purchase 15 self-storage facilities, consisting of 11 facilities owned by Rising Tide Development and four facilities which Rising Tide Development has the right to acquire from unaffiliated third parties, Rising Tide Development may not acquire one or more of the four option facilities it currently has under contract, which would reduce the number of facilities available to us pursuant to the option agreement. Failure to identify or complete acquisitions or developments or to purchase one or more of the four option facilities could slow our growth.
We also face significant competition for acquisitions and development opportunities. Some of our competitors have greater financial resources than we do and a greater ability to borrow funds to acquire facilities. These competitors may also be able to accept more risk than we can prudently manage, including risks with respect to the geographic proximity of investments and the payment of higher facility acquisition prices. This competition for investments may reduce the number of suitable investment opportunities available to us, may increase acquisition costs and may reduce demand for self-storage space in certain areas where our facilities are located and, as a result, adversely affect our operating results.
In addition, even if we are successful in identifying suitable acquisitions or development projects, newly acquired facilities may fail to perform as expected and our management may underestimate the costs associated with the integration of the acquired facilities. In addition, any developments we undertake in the future are subject to a number of risks, including, but not limited to, construction delays or cost overruns that may increase project costs, financing risks, the failure to meet anticipated occupancy or rent levels, failure to receive required zoning, occupancy, land use and other governmental permits and authorizations and changes in applicable zoning and land use laws. If any of these problems occur, development costs for a project will increase, and there may be significant costs incurred for projects that are not completed. In deciding whether to acquire or develop a particular facility, we make certain assumptions regarding the expected future performance of that facility. If our acquisition or development facilities fail to perform as expected or incur significant increases in projected costs, our rental revenues could be lower, and our operating expenses higher, than we expect. In addition, the issuance of equity securities for any acquisitions could be substantially dilutive to our shareholders.
We may not be able to adapt our management and operation systems to respond to the integration of additional facilities without disruption or expense.
Since completion of our IPO in October 2004, we have acquired 60 self-storage facilities, containing approximately 3.8 million rentable square feet for an aggregate cost of approximately $288.8 million, and we
currently have entered into agreements to acquire an additional 89 self-storage facilities.business. In addition, we expect to acquire additional self-storage facilitiesmight in certain circumstances be liable for the future. We cannot assure you that we will be able to adapt our management, administrative, accounting and operational systems or hire and retain sufficient operational staff to integrate these facilities into our portfolio and manage any future acquisition or development of additional facilities without operating disruptions or unanticipated costs. As we acquire or develop additional facilities, we will be subject to risks associated with managing new facilities, including customer retention and mortgage default. In addition, acquisitions or developments may cause disruptions in our operations and divert management’s attention away from day-to-day operations. Furthermore, our profitability may suffer because of acquisition-related costs or amortization costs for acquired goodwill and other intangible assets. Our failure to successfully integrate any future facilities into our portfolio could have an adverse effect on our operating costs and our ability to make distributions to our shareholders.
We depend on our on-site personnel to maximize customer satisfaction at eachactions of our facilities; any difficulties we encounter in hiring, training and retaining skilled field personnel may adversely affect our rental revenues.
As of December 31, 2004, we had approximately 480 field personnel involved in the management and operation of our facilities. The customer service, marketing skills and knowledge of local market demand and competitive dynamics of our facility managers are contributing factors to our ability to maximize our rental income and to achieve the highest sustainable rent levels at each of our facilities. If we are unable to successfully recruit, train and retain qualified field personnel, our rental revenues may be adversely affected, which could impair our ability to satisfy new debt obligations and make distributions to our shareholders.
We had approximately $380.5 million of indebtedness outstanding as of December 31, 2004, and this level of indebtedness will result in significant debt service obligations, impede our ability to incur additional indebtedness to fund our growth and expose us to refinancing risk.
We had approximately $380.5 million of outstanding indebtedness as of December 31, 2004. We also intend to incur additional debt in connection with the future acquisition and development of facilities. We also may incur or increase our mortgage debt by obtaining loans secured by some or all of the real estate facilities we acquire or develop. In addition, we may borrow funds if necessary to satisfy the requirement that we distribute to shareholders at least 90% of our annual REIT taxable income, or otherwise as is necessary or advisable, to ensure that we maintain our qualification as a REIT for federal income tax purposes or otherwise avoid paying taxes that can be eliminated through distributions to our shareholders.
Our substantial debt may harm our business and operating results by:
In addition to the risks discussed above and those normally associated with debt financing, including the risk that our cash flow will be insufficient to meet required payments of principal and interest, we also are subject to the risk that we will not be able to refinance the existing indebtedness on our facilities (which, in most cases, will not have been fully amortized at maturity) and that the terms of any refinancing we could obtain would not be as favorable as the terms of our existing indebtedness. In particular, as of December 31, 2004, we had $106.1 million of indebtedness outstanding pursuant to two multi-facility mortgage loans with anticipated repayment dates in 2006. If we are not successful in refinancing debt when it becomes due, we may be forced to dispose of facilities on disadvantageous terms, which might adversely affect our ability to service other debt and to meet our other obligations.
Our mortgage indebtedness contains covenants that restrict our operating, acquisition and disposition activities.
Our mortgage indebtedness contains covenants, including limitations on our ability to incur secured and unsecured indebtedness, sell all or substantially all of our assets and engage in mergers and consolidations and various acquisitions. In addition, our mortgage indebtedness contains limitations on our ability to transfer or encumber the mortgaged facilities without lender consent. These provisions may restrict our ability to pursue business initiatives or acquisition transactions that may be in our best interests. They also may prevent us from selling facilities at times when, due to market conditions, it may be advantageous to do so. In addition, failure to meet any of the covenants could cause an event of default under and/or acceleration of some or all of our indebtedness, which would have an adverse effect on us.
Mortgage debt obligations expose us to the possibility of foreclosure, which could result in the loss of our investment in a facility or group of facilities subject to mortgage debt.
Most of the facilities we own are pledged as collateral for mortgage debt. If we are unable to meet mortgage payments, the lender could foreclose on the facilities or group of facilities, resulting in the loss of our investment. Any foreclosure on a mortgaged facility or group of facilities could adversely affect the overall value of our portfolio of self-storage facilities.
In the future, we could incur variable rate debt, and therefore increases in interest rates may increase our debt service obligations.
As of December 31, 2004, we did not have any variable rate debt outstanding. However, we intend to finance future acquisitions in part by borrowings under our revolving credit facility, which bears interest at a variable rate. The interest expense on our variable rate indebtedness will increase when interest rates increase. Interest rates are currently low relative to historical levels and may increase significantly in the future. A significant increase in interest expense could adversely affect our results of operations. We currently do not expect to utilize hedging arrangements or derivative instruments in connection with our revolving credit facility.
Our organizational documents contain no limitation on the amount of debt we may incur. As a result, we may become highly leveraged in the future.
Our organizational documents contain no limitations on the amount of indebtedness that we or our operating partnership may incur. We could alter the balance between our total outstanding indebtednessjoint venture partners, and the valueactivities of our assets at any time. If we become more highly leveraged, then the resulting increase in debt servicea joint venture could adversely affect our ability to make payments on our outstanding indebtedness and to pay our anticipated distributions and/orqualify as a REIT, even though we do not control the distributions required to maintain our REIT status, and could harm our financial condition.joint venture.
WeBecause real estate is illiquid, we may not be able to sell facilitiesproperties when appropriate or on favorable terms, which could significantly impede our ability to respond to economic or other market conditions or adverse changes in the performance of our facilities.appropriate.
Real estate property investments generally cannot be sold quickly. Also, the tax laws applicable to REITs require that we hold our facilities for investment, rather than sale in the ordinary course of business, which may cause us to forgo or defer sales of facilities that otherwise would be in our best interest. Therefore, we may not be able to dispose of facilities promptly, or on favorable terms, in response to economic or other market conditions, which may adversely affect our financial position.
We face system security risks as we depend upon automated processes and the Internet.
We are increasingly dependent upon automated information technology processes. While we attempt to mitigate this risk through offsite backup procedures and contracted data centers that include, in some cases, redundant operations, we could still be severely impacted by a catastrophic occurrence, such as a natural disaster or a terrorist attack. In addition, an increasing portion of our business operations are conducted over the Internet, increasing the risk of viruses that could cause system failures and disruptions of operations despite our deployment of anti-virus measures. Experienced computer programmers may be able to penetrate our network security and misappropriate our confidential information, create system disruptions or cause shutdowns.
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Potential losses may not be covered by insurance, which could result in the loss of our investment in a facility and the future cash flows from the facility.
We carry comprehensive liability, fire, extended coverage and rental loss insurance covering all of the facilities in our portfolio. We believe the policy specifications and insured limits are appropriate and adequate
given the relative risk of loss, the cost of the coverage and industry practice. We do not carry insurance for losses such as loss from riots, war or acts of God, and, in some cases, flooding, because such coverage is not available or is not available at commercially reasonable rates. Some of our policies, such as those covering losses due to terrorism, hurricanes, floods and earthquakes, are insured subject to limitations involving large deductibles or co-payments and policy limits that may not be sufficient to cover losses. If we experience a loss at a facility that is uninsured or that exceeds policy limits, we could lose the capital invested in that facility as well as the anticipated future cash flows from that facility. Inflation, changes in building codes and ordinances, environmental considerations, and other factors also might make it impractical or undesirable to use insurance proceeds to replace a facility after it has been damaged or destroyed. In addition, if the damaged facilities are subject to recourse indebtedness, we would continue to be liable for the indebtedness, even if these facilities were irreparably damaged.
Rising operating expensesTerrorist attacks and other acts of violence or war may adversely impact our performance and may affect the markets on which our securities are traded.
Terrorist attacks against our facilities, the United States or our interests, may negatively impact our operations and the value of our securities. Attacks or armed conflicts could negatively impact the demand for self-storage facilities and increase the cost of insurance coverage for our facilities, which could reduce our profitability and cash flowflow. Furthermore, any terrorist attacks or armed conflicts could result in increased volatility in or damage to the United States and funds availableworldwide financial markets and economy.
Potential liability for future distributions.environmental contamination could result in substantial costs.
Our facilities and any other facilities we acquire or develop in the future are and will be subject to operating risks common to real estate in general, any or all of which may negatively affect us. The facilities will be subject to increases in real estate and other tax rates, utility costs, operating expenses, insurance costs, repairs and maintenance and administrative expenses. If rents are being paid in an amount that is insufficient to cover operating expenses, then we could be required to expend funds for that facility’s operating expenses.
We could incur significant costs related to government regulation and environmental matters.
We are subject to federal, state and local environmental regulations that apply generally to the ownership of real property and the operation of self-storage facilities. If we fail to comply with those laws, we could be subject to significant fines or other governmental sanctions.
Under various federal, state and local laws, ordinances and regulations, an owner or operator of real estate may be required to investigate and clean up hazardous or toxic substances or petroleum product releases at a facility and may be held liable to a governmental entity or to third parties for property damage and for investigation and clean up costs incurred by such parties in connection with contamination. Such liability may be imposed whether or not the owner or operator knew of, or was responsible for, the presence of these hazardous or toxic substances. The cost of investigation, remediation or removal of such substances may be substantial, and the presence of such substances, or the failure to properly remediate such substances, may adversely affect the owner’s ability to sell or rent such facility or to borrow using such facility as collateral. In addition, in connection with the ownership, operation and management of real properties, we are potentially liable for property damage or injuries to persons and property.
In orderOur practice is to assess the potential for liabilities arising from the environmental condition of our facilities we obtainedconduct or obtain environmental assessments on allin connection with the acquisition or development of our existing facilitiesadditional facilities. We obtain or examine environmental assessments from qualified and reputable environmental consulting firms (and intend to conduct such assessments prior to the acquisition or development of additional facilities). TheseThe environmental assessments received to date have not revealed, nor are we aware of, any environmental liability that we believe will have a material adverse effect on us. However, we cannot assure you that any environmental assessments performed have identified or will identify all material environmental conditions, that any prior owner of any facility did not create a material environmental condition not known to us or that a material environmental condition does not otherwise exist with respect to any of our facilities.
We must comply with the Americans with Disabilities Act of 1990, whichcompliance may require unanticipated expenditures.
Under the Americans with Disabilities Act of 1990 (the “ADA”), all places of public accommodation are required to meet federal requirements related to physical access and use by disabled persons. A number of other U.S. federal, state and local laws may also impose access and other similar requirements at our facilities. A failure to comply with the ADA or similar state or local requirements could result in the governmental imposition
of fines or the award of damages to private litigants affected by the noncompliance. Although we believe that our facilities comply in all material respects with these requirements (or would be eligible for applicable exemptions from material requirements because of adaptive assistance provided), a
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determination that one or more of our facilities is not in compliance with the ADA or similar state or local requirements would result in the incurrence of additional costs associated with bringing the facilities into compliance. If we are required to make substantial modifications to comply with the ADA or similar state or local requirements, we may be required to incur significant unanticipated expenditures.
We may become subject to litigation or threatened litigation which may divert management time and attention, require us to pay damages and expenses or restrict the operation of our business.
We may become subject to disputes with commercial parties with whom we maintain relationships or other parties with whom we do business. Any such dispute could result in litigation between us and the other parties. Whether or not any dispute actually proceeds to litigation, we may be required to devote significant management time and attention to its successful resolution (through litigation, settlement or otherwise), which would detract from our management’s ability to focus on our business. Any such resolution could involve the payment of damages or expenses by us, which may be significant. In addition, any such resolution could involve our agreement with terms that restrict the operation of our business.
One type of commercial dispute could involve our use of our brand name and other intellectual property (for example, logos, signage and other marks), for which we generally have common law rights but no federal trademark registration. There are other commercial parties, at both a local and national level, that may assert that our use of our brand names and other intellectual property conflict with their rights to use brand names and other intellectual property that they consider to be similar to ours. Any such commercial dispute and related resolution would involve all of the risks described above, including, in particular, our agreement to restrict the use of our brand name or other intellectual property.
If in the future we elect to make joint venture investments, we could be adversely affected by a lack of sole decision-making authority, reliance on joint venture partners’ financial conditionThe terms and any disputes that might arise between us and our joint venture partners.
Although we currently have no joint venture investments, we may in the future co-invest with third parties through joint ventures. In any such joint venture, we may not be in a position to exercise sole decision-making authority regarding the facilities owned through joint ventures. Investments in joint ventures may, under certain circumstances, involve risks not present when a third party is not involved, including the possibility that joint venture partners might become bankrupt or fail to fund their share of required capital contributions. Joint venture partners may have business interests or goals that are inconsistent with our business interests or goals and may be in a position to take actions contrarycovenants relating to our policies or objectives. Such investments also have the potential risk of impasse on strategic decisions,indebtedness could adversely impact our economic performance.
Like other real estate companies that incur debt, we are subject to risks associated with debt financing, such as a sale, because neither we nor the joint venture partner would have full control over the joint venture. Any disputes that may arise between us and our joint venture partners could result in litigation or arbitration that could increase our expenses and distract our officers and/or trustees from focusing their time and effort on our business. In addition, we might in certain circumstances be liable for the actionsinsufficiency of our joint venture partners,cash flow to meet required debt service payment obligations and the activities of a joint venture could adversely affectinability to refinance existing indebtedness. If our ability to qualify as a REIT, even thoughdebt cannot be paid, refinanced or extended at maturity, we do not control the joint venture.
Risks Related to Our Organization and Structure
Our organizational documents contain provisions that may have an anti-takeover effect, which may discourage third parties from conducting a tender offer or seeking other change of control transactions that could involve a premium price for our shares or otherwise benefit our shareholders.
Our declaration of trust and bylaws contain provisions that may have the effect of delaying, deferring or preventing a change in control of our company or the removal of existing management and, as a result, could prevent our shareholders from being paid a premium for their common shares over the then-prevailing market price. These provisions include limitations on the ownership of our common shares, advance notice requirements for shareholder proposals, our board of trustees’ power to reclassify shares and issue additional common shares or preferred shares and the absence of cumulative voting rights.
Our charter documents prohibit any person (other than members of the Amsdell family and related family trusts and entities which, as a group, may own up to 29% of our common shares) from beneficially owning more than 5% of our common shares (or up to 9.8% in the case of certain designated investment entities, as defined in our declaration of trust).
There are ownership limits and restrictions on transferability in our declaration of trust. In order for us to qualify as a REIT, no more than 50% of the value of our outstanding shares may be owned, actually or constructively, by five or fewer individuals at any time during the last half of each taxable year. To make sure that we will not fail to satisfy this requirement and for anti-takeover reasons, subject to some exceptions, our declaration of trust generally prohibits any shareholder (other than an excepted holder or certain designated investment entities, as defined in our declaration of trust) from owning (actually, constructively or by attribution), more than 5% of the value or number of our outstanding shares. Our declaration of trust provides an excepted holder limit that allows members of the Amsdell family, certain trusts established for the benefit of members of the Amsdell family and related entities to own up to 29% of our common shares, subject to limitations contained in our declaration of trust. Entities that are defined as designated investment entities in our declaration of trust, which generally includes pension funds, mutual funds, and certain investment management companies, are permitted to own up to 9.8% of our outstanding common shares, so long as each beneficial owner of the shares owned by such designated investment entity would satisfy the 5% ownership limit if those beneficial owners owned directly their proportionate share of the common shares owned by the designated investment entity. Our board of trustees may, but is not required to, except a shareholder who is not an individual for tax purposes from the 5% ownership limit or the 9.8% designated investment entity limit if such shareholder provides information and makes representations to the board that are satisfactory to the board in its reasonable discretion demonstrating that exceeding the 5% ownership limit or the 9.8% designated investment entity limit as to such person would not jeopardize our qualification as a REIT.
These restrictions may:
Our declaration of trust permits our board of trustees to issue preferred shares with terms that may discourage third parties from conducting a tender offer or seeking other change of control transactions that could involve a premium price for our shares or otherwise benefit our shareholders.
Our declaration of trust permits our board of trustees to issue up to 40,000,000 preferred shares, having those preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions, qualifications, or terms or conditions of redemption as determined by our board. Thus, our board could authorize, without shareholder approval, the issuance of preferred shares with terms and conditions that could have the effect of discouraging a takeover or other transaction in which holders of some or a majority of our shares might receive a premium for their shares over the then-prevailing market price of our shares. We currently do not expect that the board would require shareholder approval prior to such a preferred issuance. In addition, any preferred shares that we issue would rank senior to our common shares with respect to the payment of distributions, in which case we could not pay any distributions on our common shares until full distributions have been paid with respect to such preferred shares.
Our management has limited experience operating a REIT and a public company and therefore, may not be able to successfully operatemake distributions to shareholders at expected levels or at all and may not be able to acquire new properties. Failure to make distributions to our company as a REIT and as a public company.
We have limited history operating as a REIT and as a public company. We completedshareholders could result in our initial public offering in October 2004 and believe that wefailure to qualify for taxation as a REIT for federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”) beginning withpurposes. Furthermore, an increase in our short taxable year ended December 31, 2004. Our board of trusteesinterest expense could adversely affect our cash flow and executive officersability to make distributions to shareholders. If we do not meet our debt service obligations, any facilities securing such indebtedness could be foreclosed on, which would have overall responsibility for our management and, while certain of our officers and trustees have extensive experience in real estate marketing, development, management, finance and law, our executive officers have limited experience in operating a business in accordance with the Internal Revenue Code requirements for maintaining qualification as a REIT and in operating a public company. In addition, we are in the process of developing control systems and procedures required to operate as a public REIT, and this transition could place a significant strainmaterial adverse effect on our management systems, infrastructurecash flow and ability to make distributions and, depending on the number of facilities foreclosed on, could threaten our continued viability.
Our unsecured credit facility and unsecured term loan each contain (and any new or amended facility will likely contain) customary restrictions, requirements and other resources. We cannot assure youlimitations on our ability to incur indebtedness, including total debt to asset ratios, secured debt to total asset ratios, debt service coverage ratios and minimum ratios of unencumbered assets to unsecured debt which we must maintain. Our ability to borrow under our credit facility is (and any new or amended facility will be) subject to compliance with such financial and other covenants. In the event that our past experience will be sufficient to enable us to successfully operate our company as a REIT and as a public company. If we fail to qualify as a REIT,satisfy these covenants, we would be in default under the credit facility and are not able to avail ourselves of certain savings provisions set forth in the Internal Revenue Code, our distributions to shareholders will not be deductible for federal income tax purposes,term loan and therefore we willmay be required to pay corporate tax at applicablerepay such debt with capital from other sources. Under such circumstances, other sources of debt or equity capital may not be available to us, or may be available only on unattractive terms.
Increases in interest rates on variable rate indebtedness would increase our taxable income,interest expense, which will substantially reducecould adversely affect our earningscash flow and ability to make distributions to shareholders. Rising interest rates could also restrict our ability to refinance existing debt when it matures. In addition, an increase in interest rates could decrease the amounts that third parties are willing to pay for our assets, thereby limiting our ability to alter our portfolio promptly in relation to economic or other conditions. We have entered into and may, reducefrom time to time, enter into agreements such as interest rate hedges, swaps, floors, caps and other interest rate hedging contracts with respect to a portion of our variable rate debt. Although these agreements may lessen the impact of rising interest rates on us, they also expose us to the risk that other parties to the agreements will not perform or that we cannot enforce the agreements.
Our organizational documents contain no limitation on the amount of debt we may incur. As a result, we may become highly leveraged in the future.
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Our organizational documents contain no limitations on the amount of indebtedness that we or our operating partnership may incur. We could alter the balance between our total outstanding indebtedness and the value of our common shares andassets at any time. If we become more highly leveraged, then the resulting increase in debt service could adversely affect our ability to raise additional capital. We would not be ablemake payments on our outstanding indebtedness and to electpay our anticipated distributions and/or the distributions required to be taxed as amaintain our REIT for four years followingstatus, and could harm our financial condition.
Our ability to make distributions is subject to various risks.
Historically, we have paid quarterly distributions to our shareholders. Our ability to make distributions in the year we first failed to qualify unless the Internal Revenue Service (the “IRS”) were to grant us relief under certain statutory provisions.future will depend upon:
Certain provisions·the operational and financial performance of Maryland law could inhibit changes in control, which may discourage third parties from conductingour facilities;
·capital expenditures with respect to existing and newly acquired facilities;
·general and administrative costs associated with our operation as a tender offer or seekingpublicly-held REIT;
·the amount of, and the interest rates on, our debt; and
·the absence of significant expenditures relating to environmental and other change of control transactions that could involve a premium price for our shares or otherwise benefit our shareholders.regulatory matters.
Certain provisions of Maryland law may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under circumstances that otherwise could provide the holders of our common shares with the opportunity to realize a premium over the then-prevailing market price of those shares, including:
We have opted out of these provisions of Maryland law. However,matters are beyond our board of trustees may optcontrol and any significant difference between our expectations and actual results could have a material adverse effect on our cash flow and our ability to make these provisions applicabledistributions to us at any time.
Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdell and the Amsdell Entities collectively own an approximate 26% beneficial interest in our company and operating partnership and may have the ability to exercise significant influence on our company and any matter presented to our shareholders.
Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdell and the Amsdell Entities collectively own approximately 23% of our outstanding common shares, and an approximate 26% beneficial interest in our company and operating partnership. Consequently, these persons and entities may be able to significantly influence the outcome of matters submitted for shareholder action, including the election of our board of trustees and approval of significant corporate transactions, including business combinations, consolidations and mergers and the determination of our day-to-day business decisions and management policies. As a result, Robert J. Amsdell, Barry L. Amsdell and Todd C. Amsdell have substantial influence on us and could exercise their influence in a manner that conflicts with the interests of our other shareholders.
Robert J. Amsdell, our Chairman and Chief Executive Officer, and Barry L. Amsdell, one of our trustees, have interests, through their ownership of limited partner units in our operating partnership and their ownership, through Rising Tide Development, of the option facilities, that may conflict with the interests of our other shareholders.
Robert J. Amsdell, our Chairman and Chief Executive Officer, and Barry L. Amsdell, one of our trustees, own limited partner units in our operating partnership. These individuals may have personal interests that conflict with the interests of our shareholders with respect to business decisions affecting us and our operating partnership, such as interests in the timing and pricing of facility sales or refinancings in order to obtain favorable tax treatment. As a result, the effect of certain transactions on these unitholders may influence our decisions affecting these facilities.
In addition, Robert J. Amsdell and Barry L. Amsdell own all of the equity interests in Rising Tide Development, which currently owns 11 of the option facilities and has the right to acquire four option facilities from unaffiliated third parties. We have options to purchase these 15 option facilities from Rising Tide Development. As a result of their ownership interest in Rising Tide Development, Robert J. Amsdell and Barry L. Amsdell may have personal interests that conflict with the interests of our shareholders with respect to decisions affecting our exercise of our right to purchase any or all of the option facilities or our management of the option facilities. For example, it could be in the best interests of Rising Tide Development, at some time during the term of the option agreement, to seek our agreement to permit it to sell any or all of the option facilities to an outside third party rather than to our operating partnership. Under these circumstances, our interests would conflict with the fiduciary obligations of Robert J. Amsdell and Barry L. Amsdell as officers and directors of the entity that manages Rising Tide Development and their economic interests as the holders of the equity of Rising Tide Development. Although we expect that our decisions regarding our relationship with Rising Tide Development will be made by the independent members of our board of trustees, we cannot assure you that we will not be adversely affected by conflicts arising from Robert J. Amsdell and Barry L. Amsdell’s relationship with Rising Tide Development.
Our Chairman and Chief Executive Officer has outside business interests that could require time and attention and may interfere with his ability to devote time to our business and affairs.
Robert J. Amsdell, our Chairman and Chief Executive Officer, has outside business interests that are not being contributed to our company which could require time and attention. These interests include the ownership and operation of certain office and industrial properties and ownership of the entity that owns or in some cases has a right to purchase the option facilities. Mr. Amsdell’s employment agreement permits him to devote time to his outside business interests, so long as such activities do not materially or adversely interfere with his duties to us. In some cases, Mr. Amsdell may have fiduciary obligations associated with these business interests that interfere with his ability to devote time to our business and affairs and that could adversely affect our operations. In particular, Mr. Amsdell also serves as an officer or on the board of directors or comparable governing body of various entities owned and controlled by him and Barry L. Amsdell, which entities manage the office and industrial properties and own the option facilities referred to above. As a result of the customary requirement of a fiduciary to exercise the level of care a prudent person would exercise, Mr. Amsdell may be required, through his service as an officer and director of these various entities, to maintain significant familiarity with the businesses and operations of such entities. As well, Mr. Amsdell may be required from time to time to take action as an officer or director with respect to these entities. These activities could require significant time and attention of Mr. Amsdell.
Our business could be harmed if any of our key personnel, Robert J. Amsdell, Steven G. Osgood, Todd C. Amsdell and Tedd D. Towsley, all of whom have long-standing business relationships in the self-storage industry, terminated his employment with us.
Our continued success depends on the continued services of our Chairman and Chief Executive Officer and our other executive officers. Our top four executives, Robert J. Amsdell, Steven G. Osgood, Todd C. Amsdell and Tedd D. Towsley, have an average of approximately 22 years of real estate experience and have worked in the self-storage industry for an average of approximately 16 years. Although we have employment agreements with our Chairman and Chief Executive Officer and the other members of our senior management team, we cannot provide any assurance that any of them will remain in our employ. The loss of services of one or more members of our senior management team, particularly our Chairman and Chief Executive Officer, could adversely affect our operations and our future growth.
We depend on external sources of capital that are outside of our control; the unavailability of capital from external sources could adversely affect our ability to acquire or develop facilities, satisfy our debt obligations and/or make distributions to shareholders.
To continue to qualify as a REIT, we are required to distribute to our shareholders each year at least 90% of our REIT taxable income, excluding net capital gains.gains or pay applicable income taxes. In order to eliminate federal income tax, we will be required to distribute annually 100% of our net taxable income, including capital gains. Because of these distribution requirements, we likely will not be able to fund all future capital needs, including capital for acquisitions and facility development, with income from operations. We therefore will have to rely on third-party sources of capital, which may or may not be available on favorable terms, if at all. Our access to third-party sources of capital depends on a number of things, including the market’s perception of our growth potential and our current and potential future earnings and our ability to continue to qualify as a REIT for federal income tax purposes. If we are unable to obtain third-party sources of capital, we may not be able to acquire or develop facilities when strategic opportunities exist, satisfy our debt obligations or make distributions to shareholders that would permit us to qualify as a REIT or avoid paying tax on our REIT taxable income.
Our shareholders have limited control to prevent us from making any changes to our investment and financing policies that they believe could harm our business, prospects, operating results or share price.
Our board of trustees has adopted policies with respect to certain activities. These policies may be amended or revised from time to time at the discretion of our board of trustees without a vote of our shareholders. This means that our shareholders have limited control over changes in our policies. Such changes in our policies intended to improve, expand or diversify our business may not have the anticipated effects and consequently may adversely affect our business and prospects, results of operations and share price.
Our rights and the rights of our shareholders to take action against our trustees and officers are limited, and therefore our and our shareholders’ ability to recover damages from our trustees and officers is limited.
Maryland law provides that a director or officer has no liability in that capacity if he or she performs his or her duties in good faith, in a manner he or she reasonably believes to be in our best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. Our declaration of trust and bylaws require us to indemnify our trustees and officers for actions taken by them in those capacities to the extent permitted by Maryland law. Accordingly, in the event that actions taken in good faith by any trustee or officer impede our performance, our and our shareholders’ ability to recover damages from that trustee or officer will be limited.
We may have assumed unknown liabilities in connection with our formation transactions and will not have recourse to Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdell and the Amsdell Entities for any of these liabilities.
As part of our formation transactions, we acquired certain entities and/or assets that are subject to existing liabilities, some of which may be unknown at the present time. Unknown liabilities might include liabilities for cleanup or remediation of undisclosed environmental conditions, claims by customers, vendors or other persons dealing with our predecessor entities (that have not been asserted or threatened to date), tax liabilities, and accrued but unpaid liabilities incurred in the ordinary course of business. While in some instances we may have the right to seek reimbursement against an insurer or another third party for certain of these liabilities, we will not have recourse to Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdell or any of the Amsdell Entities for any of these liabilities.
Our share price could be volatile and could decline, resulting in a substantial or complete loss on your investment.
At times the stock markets, including the New York Stock Exchange, on which our common shares are listed, have experienced significant price and volume fluctuations. As a result, the market price of our common shares could be similarly volatile, and investors in our common shares may experience a decrease in the value of their shares, including decreases unrelated to our operating performance or prospects.
The price of our common shares could fluctuate in response to a number of factors, including:
In the past, securities class action litigation has been instituted against companies following periods of volatility in their stock price. If this type of litigation were to be initiated in respect of our shares, it could result in substantial costs and divert our management’s attention and resources.
A substantial number of our common shares will be eligible for sale in the near future, which could cause our common share price to decline significantly.
If our shareholders sell, or the market perceives that our shareholders intend to sell, substantial amounts of our common shares in the public market, the market price of our common shares could decline significantly. These sales also might make it more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem appropriate. As of December 31, 2004, we had outstanding approximately 37.3 million common shares. Of these shares, the approximately 28.8 million shares sold in our IPO are freely tradable, except for any shares held by our “affiliates,” as that term is defined by Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), and approximately 8.6 million additional common shares will be available for sale in the public market beginning in July 2005 following the expiration of lock-up agreements between our management and trustees, on the one hand, and the underwriters of our IPO, on the other hand. The representatives of the underwriters may release these shareholders from their lock-up agreements at any time and without notice, which would allow for earlier sale of shares in the public market. Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdell and the Amsdell Entities have been granted registration rights that will enable them to sell shares received in our formation transactions or upon redemption of operating partnership units in market transactions, subject to certain limitations. As restrictions on resale end, the market price of our common shares could drop significantly if the holders of restricted shares sell them or are perceived by the market as intending to sell them.
Tax Risks
If we fail to qualify as a REIT, our distributions to shareholders would not bedeductible for federal income tax purposes, and therefore we would be required to paycorporate income tax at applicable rates on our taxable income, which would substantiallyreduce our earnings and may substantially reduce the value of our common shares andadversely affect our ability to raise additional capital.capital.
We have electedoperate our business to qualify to be taxed as a REIT for federal income tax purposes commencing with our taxable year ending December 31, 2004, and we plan to continue to operate so that we can meet the requirements for qualification and taxation as a REIT.purposes. We have not requested and do not plan to request a ruling from the IRS that we qualify as a REIT, and the statements in this Annual Report on Form 10-K are not binding on the IRS or any court. As a REIT, we generally will not be subject to federal income tax on ourthe income that we distribute currently to our shareholders. Many of the REIT requirements, however, are highly technical and complex. The determination that we are a REIT requires an analysis of various factual matters and circumstances that may not be totally within our control. For example, to qualify as a REIT, at least 95% of our gross income must come from specific passive sources, such as rent, that are itemized in the REIT tax laws. In addition, to qualify as a REIT, we cannot own specified amounts of debt and equity securities of some issuers. We also are required to distribute to our shareholders with respect to each year at least 90% of our REIT taxable income (excluding net
capital gains). The fact that we hold substantially all of our assets through the operating partnership and its subsidiaries further complicates the application of the REIT requirements for us. Even a technical or inadvertent mistake could jeopardize our REIT status and, given the highly complex nature of the rules governing REITs and the ongoing importance of factual determinations, we cannot provide any assurance that we will continue to qualify as a REIT. Furthermore, Congress and the IRS might make changes to the tax laws and regulations, and
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the courts might issue new rulings, that make it more difficult, or impossible, for us to remain qualified as a REIT. If we fail to qualify as a REIT for federal income tax purposes and are able to avail ourselves of one or more of the statutory savings provisions in order to maintain our REIT status, we would nevertheless be required to pay penalty taxes of $50,000 or more for each such failure.
If we fail to qualify as a REIT for federal income tax purposes, and are unable to avail ourselves of certain savings provisions set forth in the Internal Revenue Code, we would be subject to federal income tax at regular corporate rates on all of our income. As a taxable corporation, we would not be allowed to take a deduction for distributions to shareholders in computing our taxable income or pass through long term capital gains to individual shareholders at favorable rates. We also could be subject to the federal alternative minimum tax and possibly increased state and local taxes. We would not be able to elect to be taxed as a REIT for four years following the year we first failed to qualify unless the IRS were to grant us relief under certain statutory provisions. If we failed to qualify as a REIT, we would have to pay significant income taxes, which would reduce our net earnings available for investment or distribution to our shareholders. This likely would have a significant adverse effect on our earnings and likely would adversely affect the value of our securities. In addition, we would no longer be required to pay any distributions to shareholders.
New legislation, enacted October 22, 2004, contained several provisions applicableAs a REIT, we are subject to REITs,certain distribution requirements, including provisionsthe requirement to distribute 90% of our REIT taxable income that could provide relief under specified circumstances in the event we violate a provision of the Internal Revenue Code that wouldmay result in our failurehaving to qualify as a REIT. If these relief provisions, which generally would applymake distributions at disadvantageous time or to us beginning January 1, 2005, are inapplicableborrow funds at unfavorable rates. Compliance with this requirement may hinder our ability to a particular setoperate solely on the basis of circumstances, we would fail to qualify as a REIT. Even if those relief provisions apply, we would be subject to a penalty tax of at least $50,000 for each disqualifying event in most cases.maximizing profits.
We will pay some taxes even if we qualify as a REIT.
Even if we qualify as a REIT for federal income tax purposes, we will be required to pay certain federal, state and local taxes on our income and property. For example, we will be subject to income tax to the extent we distribute less than 100% of our REIT taxable income, including capital gains. Additionally, we will be subject to a 4% nondeductible excise tax on the amount, if any, by which dividends paid by us in any calendar year are less than the sum of 85% of our ordinary income, 95% of our capital gain net income and 100% of our undistributed income from prior years. Moreover, if we have net income from “prohibited transactions,” that income will be subject to a 100% penalty tax. In general, prohibited transactions are sales or other dispositions of property held primarily for sale to customers in the ordinary course of business. The determination as to whether a particular sale is a prohibited transaction depends on the facts and circumstances related to that sale. We cannot guarantee that sales of our properties would not be prohibited transactions unless we comply with certain statutory safe-harbor provisions. The need to avoid prohibited transactions could cause us to forego or defer sales of facilities that our predecessors otherwise would have sold or that might otherwise be in our best interest to sell.
In addition, any net taxable income earned directly by our taxable REIT subsidiaries, or through entities that are disregarded for federal income tax purposes as entities separate from our taxable REIT subsidiaries, will be subject to federal and possibly state corporate income tax. We have elected to treat U-Store-It Mini Warehouse Co. as a taxable REIT subsidiary, and we may elect to treat other subsidiaries as taxable REIT subsidiaries in the future. In this regard, several provisions of the laws applicable to REITs and their subsidiaries ensure that a taxable REIT subsidiary will be subject to an appropriate level of federal income taxation. For example, a taxable REIT subsidiary is limited in its ability to deduct certain interest payments made to an affiliated REIT. In addition, the REIT has to pay a 100% penalty tax on some payments that it receives or on some deductions taken by a taxable REIT subsidiary if the economic arrangements between the REIT, the REIT’s customers, and the taxable REIT subsidiary are not comparable to similar arrangements between unrelated parties. Finally, some state and local jurisdictions may tax some of our income even though as a REIT we are not subject to federal income tax on that income because not all states and localities follow the federal income tax treatment of REITs. To the extent that we and our affiliates are required to pay federal, state and local taxes, we will have less cash available for distributions to our shareholders.
OverviewWe cannot assure you of our ability to pay dividends in the future.
We intend to pay quarterly dividends and to make distributions to our shareholders in amounts such that all or substantially all of our taxable income in each year, subject to certain adjustments, is distributed. This, along with other factors, should enable us to qualify for the tax benefits accorded to a REIT under the Internal Revenue Code. We have not established a minimum dividends payment level and our ability to pay dividends may be adversely affected by the risk factors described in this Annual Report on Form 10-K. All distributions will be made at the discretion of our Board of Trustees and will depend on our earnings, our financial condition, maintenance of our REIT status and such other factors as our Board of Trustees may deem relevant from time to time. We cannot assure you that we will be able to pay dividends in the future.
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We are dependent upon our key personnel whose continued service is not guaranteed.
Our top executives, Dean Jernigan, Christopher Marr, Kathleen Weigand, Stephen Nichols and Timothy Martin, have extensive self-storage, real estate and public company experience. Although we have employment agreements with all of the members of our senior management team, we cannot provide any assurance that any of them will remain in our employ. The loss of services of one or more members of our senior management team, particularly Dean Jernigan, our President and Chief Executive Officer, could adversely affect our operations and our future growth.
We are dependent upon our on-site personnel to maximize customer satisfaction; any difficulties we encounter in hiring, training and retaining skilled field personnel may adversely affect our rental revenues.
As of December 31, 2004,2007, we had approximately 880 field personnel involved in the management and operation of our facilities. The customer service, marketing skills and knowledge of local market demand and competitive dynamics of our facility managers are contributing factors to our ability to maximize our rental income and to achieve the highest sustainable rent levels at each of our facilities. We compete with various other companies in attracting and retaining qualified and skilled personnel. Competitive pressures may require that we enhance our pay and benefits package to compete effectively for such personnel. If there is an increase in these costs or if we fail to attract and retain qualified and skilled personnel, our business and operating results could be harmed.
Our insurance coverage may not comply fully with certain loan requirements.
We maintain comprehensive insurance on each of our self-storage facilities in amounts sufficient to permit replacement of the property, subject to applicable deductibles. Certain of our properties serve as collateral for our mortgage-backed debt, some of which was assumed in connection with our acquisition of facilities, that requires us to maintain insurance at levels and on terms that are not commercially reasonable in the current insurance environment. We may be unable to obtain required insurance coverage if the cost and/or availability make it impractical or impossible to comply with debt covenants. If we cannot comply with a lender’s requirements in any respect, the lender could declare a default that could affect our ability to obtain future financing and could have a material adverse effect on our results of operations and cash flows and our ability to obtain future financing. In addition, we may be required to self-insure against certain losses or the Company’s insurance costs may increase.
Certain provisions of Maryland law could inhibit changes in control, which maydiscourage third parties from conducting a tender offer or seeking other change ofcontrol transactions that could involve a premium price for our shares or otherwisebenefit our shareholders.
Certain provisions of Maryland law may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under circumstances that otherwise could provide the holders of our common shares with the opportunity to realize a premium over the then-prevailing market price of those shares, including:
·“business combination moratorium/fair price” provisions that, subject to limitations, prohibit certain business combinations between us and an “interested shareholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our shares or an affiliate thereof) for five years after the most recent date on which the shareholder becomes an interested shareholder, and thereafter imposes stringent fair price and super-majority shareholder voting requirements on these combinations; and
·“control share” provisions that provide that “control shares” of our company (defined as shares which, when aggregated with other shares controlled by the shareholder, entitle the shareholder to exercise one of three increasing ranges of voting power in electing Trustees) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of “control shares” from a party other than the issuer) have no voting rights except to the extent approved by our shareholders by the affirmative vote of at least two thirds of all the votes entitled to be cast on the matter, excluding all interested shares, and are subject to redemption in certain circumstances.
We have opted out of these provisions of Maryland law. However, our Board of Trustees may opt to make these provisions applicable to us at any time.
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Robert J. Amsdell, our former Chairman and Chief Executive Officer; Barry L. Amsdell, a former Trustee; Todd C. Amsdell, our former Chief Operating Officer and former President of our development subsidiary; and the Amsdell Entities (collectively, “The Amsdell Family”)collectively own an approximate 23.3% beneficial interest in our company on a fullydiluted basis and therefore have the ability to exercise significant influence on any matter presented to our shareholders.
The Amsdell Family collectively owns approximately 21.3% of our outstanding common shares, and an approximate 23.3% beneficial interest in our company on a fully diluted basis. Consequently, the Amsdell Family may be able to significantly influence the outcome of matters submitted for shareholder action, including the election of our Board of Trustees and approval of significant corporate transactions, including business combinations, consolidations and mergers. As a result, Robert J. Amsdell, Barry L. Amsdell and Todd C. Amsdell have substantial influence on us and could exercise their influence in a manner that conflicts with the interests of our other shareholders.
Robert J. Amsdell and Barry L. Amsdell have interests, through their ownership of limited partner unitsin our operating partnership that may conflict with the interests of our othershareholders.
Robert J. Amsdell and Barry L. Amsdell own limited partner units in our operating partnership. These individuals may have personal interests that conflict with the interests of our shareholders with respect to business decisions affecting us and our operating partnership, such as interests in the timing and pricing of facility sales or refinancings in order to obtain favorable tax treatment.
Our shareholders have limited control to prevent us from making any changes to ourinvestment and financing policies.
Our Board of Trustees has adopted policies with respect to certain activities. These policies may be amended or revised from time to time at the discretion of our Board of Trustees without a vote of our shareholders. This means that our shareholders have limited control over changes in our policies. Such changes in our policies intended to improve, expand or diversify our business may not have the anticipated effects and consequently may adversely affect our business and prospects, results of operations and share price.
Our rights and the rights of our shareholders to take action against our Trustees andofficers are limited.
Maryland law provides that a trustee or officer has no liability in that capacity if he or she performs his or her duties in good faith, in a manner he or she reasonably believes to be in our best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. Our declaration of trust and bylaws require us to indemnify our Trustees and officers for actions taken by them in those capacities to the extent permitted by Maryland law. Accordingly, in the event that actions taken in good faith by any Trustee or officer impede our performance, our and our shareholders’ ability to recover damages from that Trustee or officer will be limited.
Many factors could have an adverse effect on the market value of our securities.
A number of factors might adversely affect the price of our securities, many of which are beyond our control. These factors include:
·increases in market interest rates, relative to the dividend yield on our shares. If market interest rates go up, prospective purchasers of our securities may require a higher yield. Higher market interest rates would not, however, result in more funds for us to distribute and, to the contrary, would likely increase our borrowing costs and potentially decrease funds available for distribution. Thus, higher market interest rates could cause the market price of our common shares to go down;
·anticipated benefit of an investment in our securities as compared to investment in securities of companies in other industries (including benefits associated with tax treatment of dividends and distributions);
·perception by market professionals of REITs generally and REITs comparable to us in particular;
·level of institutional investor interest in our securities;
·relatively low trading volumes in securities of REITs;
19
·our results of operations and financial condition;
·investor confidence in the stock market generally; and
·additions and departures of key personnel.
The market value of our common shares is based primarily upon the market’s perception of our growth potential and our current and potential future earnings and cash distributions. Consequently, our common shares may trade at prices that are higher or lower than our net asset value per common share. If our future earnings or cash distributions are less than expected, it is likely that the market price of our common shares will diminish.
Additional issuances of equity securities may be dilutive to shareholders.
The interests of our shareholders could be diluted if we issue additional equity securities to finance future developments or acquisitions or to repay indebtedness. Our Board of Trustees may authorize the issuance of additional equity securities without shareholder approval. Our ability to execute our business strategy depends upon our access to an appropriate blend of debt financing, including unsecured lines of credit and other forms of secured and unsecured debt, and equity financing, including the issuance of common and preferred equity.
Our declaration of trust permits our Board of Trustees to issue preferred shares withterms that may discourage third parties from conducting a tender offer or seekingother change of control transactions that could involve a premium price for ourshares or otherwise benefit our shareholders.
Our declaration of trust permits our Board of Trustees to issue up to 40,000,000 preferred shares, having those preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions, qualifications, or terms or conditions of redemption as determined by our Board. In addition, our Board may reclassify any unissued common shares into one or more classes or series of preferred shares. Thus, our Board could authorize, without shareholder approval, the issuance of preferred shares with terms and conditions that could have the effect of discouraging a takeover or other transaction in which holders of some or a majority of our shares might receive a premium for their shares over the then-prevailing market price of our shares. We currently do not expect that the Board would require shareholder approval prior to such a preferred issuance. In addition, any preferred shares that we issue would rank senior to our common shares with respect to the payment of distributions, in which case we could not pay any distributions on our common shares until full distributions have been paid with respect to such preferred shares.
The acquisition of new facilities that lack operating history with us will give rise to difficulties in predicting revenue potential.
We will continue to acquire additional facilities. These acquisitions could fail to perform in accordance with expectations. If we fail to accurately estimate occupancy levels, operating costs or costs of improvements to bring an acquired facility up to the standards established for our intended market position, the performance of the facility may be below expectations. Acquired facilities may have characteristics or deficiencies affecting their valuation or revenue potential that we have not yet discovered. We cannot assure you that the performance of facilities acquired by us will increase or be maintained under our management.
Our financial performance is dependent upon the economic and other conditions of the markets in which our facilities are located.
We are susceptible to adverse developments in the markets in which we operate, such as business layoffs or downsizing, industry slowdowns, relocations of businesses, changing demographics and other factors. Our facilities in Florida, California, Texas, Ohio, Tennessee, Illinois and Arizona accounted for approximately 16%, 16%, 10%, 8%, 7%, 6% and 5%, respectively, of our total rentable square feet as of December 31, 2007. As a result of this geographic concentration of our facilities, we are particularly susceptible to adverse market conditions in these areas. Any adverse economic or real estate developments in these markets, or in any of the other markets in which we operate, or any decrease in demand for self-storage space resulting from the local business climate could adversely affect our rental revenues, which could impair our ability to satisfy our debt service obligations and pay distributions to our shareholders.
Our business may be sensitive to economic conditions that impact consumer spending.
20
Our results of operations may be sensitive to changes in overall economic conditions that impact consumer spending, including discretionary spending. Future economic conditions affecting disposable consumer income, such as employment levels, business conditions, interest rates, tax rates, fuel and energy costs, and other matters could reduce consumer spending or cause consumers to shift their spending to other products and services. A general reduction in the level of discretionary spending or shifts in consumer discretionary spending could adversely affect our growth and profitability.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
Overview
As of December 31, 2007, we owned 201409 self-storage facilities located in 2126 states and aggregating approximately 13.026.1 million rentable square feet. The following table sets forth certain summary information regarding our facilities by state as of December 31, 2004.2007.
State | Number of Facilities | Number of Units | Total Rentable Square Feet | % of Total Rentable Square Feet | Occupancy(1) | |||||||
Florida | 47 | 29,478 | 3,217,366 | 24.8 | % | 86.1 | % | |||||
Illinois | 25 | 13,407 | 1,517,252 | 11.7 | % | 77.1 | % | |||||
California | 25 | 11,434 | 1,353,227 | 10.4 | % | 83.9 | % | |||||
Ohio | 19 | 8,908 | 1,121,327 | 8.6 | % | 84.0 | % | |||||
New Jersey | 11 | 7,247 | 760,149 | 5.9 | % | 84.3 | % | |||||
Indiana | 9 | 5,419 | 606,599 | 4.7 | % | 74.9 | % | |||||
North Carolina | 8 | 4,743 | 555,779 | 4.3 | % | 84.7 | % | |||||
Connecticut | 8 | 3,877 | 415,090 | 3.2 | % | 71.5 | % | |||||
Tennessee | 7 | 3,070 | 374,271 | 2.9 | % | 86.1 | % | |||||
Mississippi | 6 | 3,071 | 388,690 | 3.0 | % | 75.1 | % | |||||
Louisiana | 6 | 2,329 | 334,324 | 2.6 | % | 87.6 | % | |||||
Maryland | 4 | 3,299 | 418,638 | 3.2 | % | 83.5 | % | |||||
Georgia | 5 | 3,635 | 431,387 | 3.3 | % | 83.4 | % | |||||
Michigan | 4 | 1,787 | 272,911 | 2.1 | % | 78.0 | % | |||||
Arizona | 4 | 2,223 | 242,030 | 1.9 | % | 82.5 | % | |||||
Alabama | 3 | 1,655 | 234,631 | 1.8 | % | 71.1 | % | |||||
South Carolina | 3 | 1,281 | 214,113 | 1.6 | % | 80.8 | % | |||||
Pennsylvania | 2 | 1,585 | 177,411 | 1.4 | % | 88.5 | % | |||||
New York | 2 | 1,563 | 168,444 | 1.3 | % | 78.9 | % | |||||
Massachusetts | 2 | 1,134 | 115,541 | 0.9 | % | 72.9 | % | |||||
Wisconsin | 1 | 489 | 58,713 | 0.4 | % | 82.2 | % | |||||
Total | 201 | 111,634 | 12,977,893 | 100.0 | % | 82.2 | % |
|
|
|
|
|
| Total |
| % of Total |
|
|
|
|
| Number of |
| Number of |
| Rentable |
| Rentable |
| Occupied |
|
State |
| Facilities |
| Units |
| Square Feet |
| Square Feet |
| Square Feet |
|
|
|
|
|
|
|
|
|
|
|
|
|
California |
| 60 |
| 37,018 |
| 4,133,441 |
| 15.8 | % | 69.7 | % |
Florida |
| 59 |
| 39,973 |
| 4,173,724 |
| 16.0 | % | 80.2 | % |
Texas |
| 43 |
| 21,003 |
| 2,627,795 |
| 10.1 | % | 81.1 | % |
Ohio |
| 35 |
| 16,364 |
| 1,999,099 |
| 7.7 | % | 79.9 | % |
Illinois |
| 27 |
| 14,020 |
| 1,610,610 |
| 6.2 | % | 79.9 | % |
Arizona |
| 24 |
| 12,526 |
| 1,247,447 |
| 4.8 | % | 84.0 | % |
Tennessee |
| 24 |
| 12,930 |
| 1,686,433 |
| 6.3 | % | 82.5 | % |
Colorado |
| 20 |
| 10,389 |
| 1,200,834 |
| 4.6 | % | 87.9 | % |
Connecticut |
| 17 |
| 7,255 |
| 845,781 |
| 3.2 | % | 76.5 | % |
New Jersey |
| 15 |
| 10,266 |
| 1,003,586 |
| 3.8 | % | 75.0 | % |
Georgia |
| 13 |
| 9,245 |
| 1,060,144 |
| 4.1 | % | 76.8 | % |
New Mexico |
| 11 |
| 4,247 |
| 459,020 |
| 1.8 | % | 89.6 | % |
Indiana |
| 9 |
| 5,302 |
| 599,457 |
| 2.3 | % | 80.4 | % |
North Carolina |
| 8 |
| 4,810 |
| 557,459 |
| 2.1 | % | 86.5 | % |
Mississippi |
| 6 |
| 2,824 |
| 353,431 |
| 1.4 | % | 82.5 | % |
New York |
| 6 |
| 3,208 |
| 349,453 |
| 1.3 | % | 83.8 | % |
Louisiana |
| 5 |
| 2,358 |
| 304,555 |
| 1.2 | % | 93.2 | % |
Maryland |
| 5 |
| 4,232 |
| 517,895 |
| 2.0 | % | 86.5 | % |
Utah |
| 5 |
| 2,336 |
| 241,823 |
| 0.9 | % | 93.8 | % |
Michigan |
| 4 |
| 1,888 |
| 270,769 |
| 1.0 | % | 78.6 | % |
Alabama |
| 3 |
| 1,632 |
| 237,583 |
| 0.9 | % | 81.5 | % |
Massachusetts |
| 3 |
| 1,776 |
| 172,928 |
| 0.7 | % | 74.7 | % |
Nevada |
| 2 |
| 940 |
| 99,882 |
| 0.4 | % | 83.0 | % |
Pennsylvania |
| 2 |
| 1,609 |
| 176,577 |
| 0.7 | % | 79.0 | % |
Virginia |
| 2 |
| 1,214 |
| 130,943 |
| 0.5 | % | 59.8 | % |
Wisconsin |
| 1 |
| 486 |
| 58,515 |
| 0.2 | % | 84.1 | % |
Total/Weighted Average |
| 409 |
| 229,851 |
| 26,119,184 |
| 100.0 | % | 79.5 | % |
21
Our Facilities
The following table sets forth certain additional information with respect to each of our facilities as of December 31, 2004 (unless otherwise indicated).2007. Our ownership of each facility consists of a fee interest in the facility held by U-Store-It, L.P., our operating partnership, or one of its subsidiaries, except for our Morris Township, NJ facility, where we have a ground lease. In addition, small parcels of land at five of our other facilities are subject to ground leases.
22
|
| Year Acquired/ |
| Year |
| Rentable |
|
|
|
|
| Manager |
| % Climate |
|
Facility Location |
| Developed (1) |
| Built |
| Square Feet |
| Occupancy (2) |
| Units |
| Apartment (3) |
| Controlled (4) |
|
Mobile I, AL |
| 1997 |
| 1987 |
| 65,198 |
| 91.1 | % | 468 |
| N |
| 0.0 | % |
Mobile II, AL † |
| 1997 |
| 1974/90 |
| 129,260 |
| 73.2 | % | 801 |
| Y |
| 1.1 | % |
Mobile III, AL |
| 1998 |
| 1988/94 |
| 43,125 |
| 91.9 | % | 363 |
| Y |
| 34.5 | % |
Chandler, AZ |
| 2005 |
| 1985 |
| 47,520 |
| 93.8 | % | 466 |
| Y |
| 6.9 | % |
Glendale, AZ |
| 1998 |
| 1987 |
| 56,830 |
| 81.3 | % | 554 |
| Y |
| 0.0 | % |
Green Valley, AZ |
| 2005 |
| 1985 |
| 25,200 |
| 67.8 | % | 277 |
| N |
| 7.9 | % |
Mesa I, AZ |
| 2006 |
| 1985 |
| 52,375 |
| 91.1 | % | 535 |
| N |
| 0.0 | % |
Mesa II, AZ |
| 2006 |
| 1981 |
| 45,295 |
| 85.4 | % | 420 |
| Y |
| 8.4 | % |
Mesa III, AZ |
| 2006 |
| 1986 |
| 58,264 |
| 78.3 | % | 514 |
| Y |
| 4.1 | % |
Phoenix I, AZ |
| 2006 |
| 1987 |
| 100,887 |
| 76.5 | % | 822 |
| Y |
| 8.8 | % |
Phoenix II, AZ |
| 2006 |
| 1974 |
| 45,270 |
| 75.8 | % | 440 |
| Y |
| 0.0 | % |
Scottsdale, AZ |
| 1998 |
| 1995 |
| 80,925 |
| 90.3 | % | 692 |
| Y |
| 9.5 | % |
Tempe, AZ |
| 2005 |
| 1975 |
| 54,000 |
| 84.1 | % | 410 |
| Y |
| 14.0 | % |
Tucson I, AZ |
| 1998 |
| 1974 |
| 59,350 |
| 87.7 | % | 505 |
| Y |
| 0.0 | % |
Tucson II, AZ |
| 1998 |
| 1988 |
| 43,950 |
| 84.7 | % | 543 |
| Y |
| 100.0 | % |
Tucson III, AZ |
| 2005 |
| 1979 |
| 49,822 |
| 78.2 | % | 535 |
| N |
| 0.0 | % |
Tucson IV, AZ |
| 2005 |
| 1982 |
| 47,840 |
| 88.5 | % | 524 |
| Y |
| 3.7 | % |
Tucson IX, AZ |
| 2005 |
| 1984 |
| 67,656 |
| 81.7 | % | 653 |
| Y |
| 2.0 | % |
Tucson V, AZ |
| 2005 |
| 1982 |
| 45,160 |
| 82.8 | % | 452 |
| Y |
| 3.0 | % |
Tucson VI, AZ |
| 2005 |
| 1982 |
| 40,778 |
| 89.3 | % | 451 |
| Y |
| 3.5 | % |
Tucson VII, AZ |
| 2005 |
| 1982 |
| 52,738 |
| 85.4 | % | 637 |
| Y |
| 2.0 | % |
Tucson VIII, AZ |
| 2005 |
| 1979 |
| 46,800 |
| 83.9 | % | 504 |
| Y |
| 0.0 | % |
Tucson X, AZ |
| 2005 |
| 1981 |
| 46,350 |
| 84.6 | % | 491 |
| N |
| 0.0 | % |
Tucson XI, AZ |
| 2005 |
| 1974 |
| 42,800 |
| 82.0 | % | 465 |
| Y |
| 0.0 | % |
Tucson XII, AZ |
| 2005 |
| 1974 |
| 42,375 |
| 87.7 | % | 474 |
| Y |
| 4.8 | % |
Tucson XIII, AZ |
| 2005 |
| 1974 |
| 45,792 |
| 90.0 | % | 583 |
| Y |
| 0.0 | % |
Tucson XIV, AZ |
| 2005 |
| 1976 |
| 49,470 |
| 84.0 | % | 579 |
| Y |
| 8.8 | % |
Apple Valley I, CA |
| 1997 |
| 1984 |
| 73,340 |
| 48.3 | % | 594 |
| Y |
| 0.0 | % |
Apple Valley II, CA |
| 1997 |
| 1988 |
| 62,115 |
| 62.9 | % | 495 |
| Y |
| 7.0 | % |
Benicia, CA |
| 2005 |
| 1988/93/05 |
| 74,920 |
| 82.9 | % | 762 |
| Y |
| 0.0 | % |
Bloomington I, CA |
| 1997 |
| 1987 |
| 28,550 |
| 65.8 | % | 218 |
| N |
| 0.0 | % |
Bloomington II, CA † |
| 1997 |
| 1987 |
| 25,860 |
| 97.1 | % | 20 |
| N |
| 0.0 | % |
Cathedral City, CA † |
| 2006 |
| 1982/92 |
| 129,048 |
| 54.3 | % | 1029 |
| Y |
| 1.9 | % |
Citrus Heights, CA |
| 2005 |
| 1987 |
| 75,620 |
| 62.0 | % | 693 |
| Y |
| 0.0 | % |
Diamond Bar, CA |
| 2005 |
| 1988 |
| 103,228 |
| 81.7 | % | 918 |
| Y |
| 0.0 | % |
Escondido, CA |
| 2007 |
| 2002 |
| 143,145 |
| 77.2 | % | 1296 |
| Y |
| 6.7 | % |
Fallbrook, CA |
| 1997 |
| 1985/88 |
| 46,370 |
| 82.8 | % | 461 |
| Y |
| 0.0 | % |
Hemet, CA |
| 1997 |
| 1989 |
| 66,040 |
| 76.1 | % | 445 |
| Y |
| 0.0 | % |
Highland I, CA |
| 1997 |
| 1987 |
| 76,765 |
| 58.0 | % | 860 |
| Y |
| 0.0 | % |
Highland II, CA |
| 2006 |
| 1982 |
| 62,257 |
| 70.1 | % | 536 |
| Y |
| 0.0 | % |
Lancaster, CA |
| 2001 |
| 1987 |
| 61,275 |
| 53.1 | % | 414 |
| Y |
| 0.0 | % |
Long Beach, CA |
| 2006 |
| 1974 |
| 125,213 |
| 76.5 | % | 1424 |
| Y |
| 0.0 | % |
Murrieta, CA |
| 2005 |
| 1996 |
| 49,895 |
| 68.0 | % | 474 |
| Y |
| 3.3 | % |
North Highlands, CA |
| 2005 |
| 1980 |
| 57,244 |
| 89.6 | % | 481 |
| Y |
| 0.0 | % |
Orangevale, CA |
| 2005 |
| 1980 |
| 50,492 |
| 79.4 | % | 556 |
| Y |
| 0.0 | % |
Palm Springs I, CA |
| 2006 |
| 1989 |
| 72,775 |
| 68.0 | % | 582 |
| Y |
| 8.6 | % |
Palm Springs II, CA † |
| 2006 |
| 1982/89 |
| 122,745 |
| 57.8 | % | 634 |
| Y |
| 0.0 | % |
Pleasanton, CA |
| 2005 |
| 2003 |
| 82,415 |
| 86.0 | % | 718 |
| Y |
| 0.0 | % |
Rancho Cordova, CA |
| 2005 |
| 1979 |
| 53,928 |
| 79.0 | % | 484 |
| Y |
| 0.0 | % |
Redlands, CA |
| 1997 |
| 1985 |
| 62,805 |
| 80.0 | % | 548 |
| N |
| 0.0 | % |
Rialto, CA |
| 1997 |
| 1987 |
| 57,371 |
| 64.5 | % | 519 |
| Y |
| 0.0 | % |
Rialto II, CA |
| 2006 |
| 1980 |
| 99,393 |
| 67.2 | % | 779 |
| Y |
| 0.0 | % |
Riverside I, CA |
| 1997 |
| 1989 |
| 27,485 |
| 76.4 | % | 238 |
| N |
| 0.0 | % |
Riverside II, CA † |
| 1997 |
| 1989 |
| 20,420 |
| 91.6 | % | 18 |
| N |
| 0.0 | % |
Riverside III, CA |
| 1998 |
| 1989 |
| 46,809 |
| 70.9 | % | 442 |
| Y |
| 0.0 | % |
Riverside IV, CA |
| 2006 |
| 1977 |
| 67,320 |
| 60.5 | % | 715 |
| Y |
| 4.0 | % |
Riverside V, CA |
| 2006 |
| 1985 |
| 85,521 |
| 58.1 | % | 834 |
| Y |
| 12.7 | % |
Riverside VI, CA |
| 2007 |
| 2004 |
| 74,900 |
| 67.6 | % | 466 |
| Y |
| 0.0 | % |
Roseville, CA |
| 2005 |
| 1979 |
| 59,944 |
| 87.6 | % | 582 |
| Y |
| 0.0 | % |
Sacramento I, CA |
| 2005 |
| 1979 |
| 50,764 |
| 88.0 | % | 536 |
| Y |
| 0.0 | % |
Sacramento II, CA |
| 2005 |
| 1986 |
| 61,890 |
| 72.8 | % | 583 |
| Y |
| 4.7 | % |
San Bernardino I, CA |
| 1997 |
| 1985 |
| 47,350 |
| 63.2 | % | 460 |
| Y |
| 2.0 | % |
San Bernardino II, CA |
| 1997 |
| 1987 |
| 83,278 |
| 60.5 | % | 609 |
| Y |
| 0.0 | % |
San Bernardino III, CA |
| 1997 |
| 1987 |
| 31,070 |
| 74.8 | % | 259 |
| N |
| 0.0 | % |
San Bernardino IV, CA |
| 1997 |
| 1989 |
| 57,245 |
| 68.7 | % | 597 |
| Y |
| 0.0 | % |
San Bernardino IX, CA |
| 2006 |
| 1975 |
| 117,928 |
| 44.8 | % | 1076 |
| Y |
| 0.0 | % |
San Bernardino V, CA |
| 1997 |
| 1991 |
| 41,646 |
| 72.7 | % | 406 |
| Y |
| 0.0 | % |
San Bernardino VI, CA |
| 1997 |
| 1985/92 |
| 35,671 |
| 76.0 | % | 405 |
| N |
| 11.8 | % |
San Bernardino VII, CA |
| 2005 |
| 2002/04 |
| 83,507 |
| 77.9 | % | 776 |
| Y |
| 4.2 | % |
San Bernardino VIII, CA |
| 2006 |
| 1974 |
| 56,820 |
| 56.9 | % | 507 |
| Y |
| 1.3 | % |
San Bernardino X, CA |
| 2006 |
| 1978 |
| 78,839 |
| 66.1 | % | 669 |
| Y |
| 0.0 | % |
San Bernardino XI, CA |
| 2006 |
| 1977 |
| 112,154 |
| 58.0 | % | 1037 |
| Y |
| 0.0 | % |
San Marcos, CA |
| 2005 |
| 1979 |
| 37,430 |
| 91.8 | % | 247 |
| Y |
| 0.0 | % |
23
|
| Year Acquired/ |
| Year |
| Rentable |
|
|
|
|
| Manager |
| % Climate |
|
Facility Location |
| Developed (1) |
| Built |
| Square Feet |
| Occupancy (2) |
| Units |
| Apartment (3) |
| Controlled (4) |
|
Santa Ana, CA |
| 2006 |
| 1984 |
| 65,528 |
| 72.5 | % | 742 |
| Y |
| 2.4 | % |
South Sacramento, CA |
| 2005 |
| 1979 |
| 52,290 |
| 60.5 | % | 434 |
| Y |
| 0.0 | % |
South Palmetto, CA |
| 1998 |
| 1982 |
| 80,505 |
| 70.1 | % | 820 |
| Y |
| 0.0 | % |
Spring Valley, CA |
| 2006 |
| 1980 |
| 55,070 |
| 57.9 | % | 718 |
| Y |
| 0.0 | % |
Sun City, CA |
| 1998 |
| 1989 |
| 38,435 |
| 70.1 | % | 383 |
| N |
| 0.0 | % |
Temecula I, CA |
| 1998 |
| 1985/2003 |
| 81,740 |
| 80.0 | % | 716 |
| Y |
| 46.4 | % |
Temecula II, CA |
| 2006 |
| 2003 |
| 84,580 |
| 42.0 | % | 723 |
| Y |
| 51.3 | % |
Thousand Palms, CA |
| 2006 |
| 1988/01 |
| 76,336 |
| 52.0 | % | 896 |
| Y |
| 60.7 | % |
Vista I, CA |
| 2001 |
| 1988 |
| 74,405 |
| 90.4 | % | 621 |
| Y |
| 0.0 | % |
Vista II, CA |
| 2005 |
| 2001/02/03 |
| 147,721 |
| 78.4 | % | 1293 |
| Y |
| 2.3 | % |
Walnut, CA |
| 2005 |
| 1987 |
| 50,708 |
| 85.6 | % | 539 |
| Y |
| 9.2 | % |
West Sacramento, CA |
| 2005 |
| 1984 |
| 39,715 |
| 88.2 | % | 488 |
| Y |
| 0.0 | % |
Westminster, CA |
| 2005 |
| 1983/98 |
| 68,048 |
| 93.2 | % | 572 |
| Y |
| 0.0 | % |
Yucaipa, CA |
| 1997 |
| 1989 |
| 77,560 |
| 69.4 | % | 671 |
| Y |
| 0.0 | % |
Aurora I, CO |
| 2005 |
| 1981 |
| 75,867 |
| 81.5 | % | 623 |
| Y |
| 0.0 | % |
Aurora II, CO |
| 2005 |
| 1984 |
| 57,753 |
| 89.6 | % | 475 |
| Y |
| 5.3 | % |
Aurora III, CO |
| 2005 |
| 1977 |
| 28,730 |
| 91.4 | % | 311 |
| Y |
| 0.0 | % |
Aurora IV, CO |
| 2006 |
| 1998/99 |
| 49,700 |
| 87.3 | % | 352 |
| Y |
| 0.0 | % |
Avon, CO |
| 2005 |
| 1989 |
| 28,227 |
| 91.5 | % | 387 |
| Y |
| 22.7 | % |
Boulder I, CO |
| 2006 |
| 1972/75/77 |
| 47,296 |
| 88.8 | % | 531 |
| Y |
| 0.0 | % |
Boulder II, CO |
| 2006 |
| 1983/84 |
| 101,245 |
| 90.9 | % | 1093 |
| Y |
| 0.0 | % |
Boulder III, CO |
| 2006 |
| 1974/78 |
| 80,174 |
| 82.9 | % | 781 |
| Y |
| 0.0 | % |
Boulder IV, CO |
| 2006 |
| 1983/98 |
| 95,148 |
| 94.0 | % | 715 |
| Y |
| 7.1 | % |
Colorado Springs, CO |
| 2005 |
| 1986 |
| 47,975 |
| 87.3 | % | 474 |
| Y |
| 0.0 | % |
Colorado Springs II, CO |
| 2006 |
| 2001 |
| 62,400 |
| 91.5 | % | 433 |
| Y |
| 0.0 | % |
Denver I, CO |
| 2005 |
| 1987 |
| 58,050 |
| 79.1 | % | 431 |
| Y |
| 4.4 | % |
Denver II, CO |
| 2006 |
| 1997 |
| 59,200 |
| 86.7 | % | 451 |
| Y |
| 0.0 | % |
Denver III, CO |
| 2006 |
| 1999 |
| 63,700 |
| 81.9 | % | 454 |
| Y |
| 0.0 | % |
Englewood, CO |
| 2005 |
| 1981 |
| 51,000 |
| 87.9 | % | 366 |
| Y |
| 0.0 | % |
Federal Heights, CO |
| 2005 |
| 1980 |
| 54,770 |
| 88.2 | % | 554 |
| Y |
| 0.0 | % |
Golden, CO |
| 2005 |
| 1985 |
| 87,832 |
| 90.7 | % | 645 |
| Y |
| 1.2 | % |
Littleton I , CO |
| 2005 |
| 1987 |
| 53,490 |
| 89.0 | % | 452 |
| Y |
| 37.4 | % |
Littleton II, CO |
| 2005 |
| 1982 |
| 46,175 |
| 90.4 | % | 363 |
| Y |
| 0.0 | % |
Northglenn, CO |
| 2005 |
| 1980 |
| 52,102 |
| 87.4 | % | 498 |
| Y |
| 0.0 | % |
Bloomfield, CT |
| 1997 |
| 1987/93/94 |
| 48,700 |
| 63.9 | % | 450 |
| Y |
| 6.6 | % |
Branford, CT |
| 1995 |
| 1986 |
| 49,079 |
| 91.3 | % | 433 |
| Y |
| 2.2 | % |
Bristol, CT |
| 2005 |
| 1989/99 |
| 47,825 |
| 83.4 | % | 479 |
| N |
| 22.6 | % |
East Windsor, CT |
| 2005 |
| 1986/89 |
| 45,900 |
| 68.7 | % | 309 |
| N |
| 0.0 | % |
Enfield, CT |
| 2001 |
| 1989 |
| 52,775 |
| 84.5 | % | 381 |
| Y |
| 0.0 | % |
Gales Ferry, CT |
| 1995 |
| 1987/89 |
| 54,230 |
| 70.6 | % | 599 |
| N |
| 7.5 | % |
Manchester I, CT (6) |
| 2002 |
| 1999/00/01 |
| 47,125 |
| 65.1 | % | 491 |
| N |
| 37.6 | % |
Manchester II, CT |
| 2005 |
| 1984 |
| 52,725 |
| 72.5 | % | 411 |
| N |
| 0.0 | % |
Milford, CT |
| 1994 |
| 1975 |
| 44,885 |
| 76.0 | % | 384 |
| Y |
| 4.0 | % |
Monroe, CT |
| 2005 |
| 1996/03 |
| 58,500 |
| 87.7 | % | 405 |
| N |
| 0.0 | % |
Mystic, CT |
| 1994 |
| 1975/86 |
| 50,800 |
| 67.0 | % | 538 |
| Y |
| 2.4 | % |
Newington I, CT † |
| 2005 |
| 1978/97 |
| 42,620 |
| 75.1 | % | 258 |
| N |
| 0.0 | % |
Newington II, CT |
| 2005 |
| 1979/81 |
| 35,810 |
| 88.1 | % | 213 |
| N |
| 0.0 | % |
Old Saybrook I, CT |
| 2005 |
| 1982/88/00 |
| 87,700 |
| 76.5 | % | 723 |
| N |
| 6.3 | % |
Old Saybrook II, CT |
| 2005 |
| 1988/02 |
| 26,425 |
| 84.4 | % | 257 |
| N |
| 55.3 | % |
South Windsor, CT |
| 1994 |
| 1976 |
| 71,725 |
| 66.4 | % | 557 |
| Y |
| 1.1 | % |
Stamford, CT |
| 2005 |
| 1997 |
| 28,957 |
| 95.1 | % | 367 |
| N |
| 32.8 | % |
Boca Raton, FL |
| 2001 |
| 1998 |
| 37,958 |
| 90.9 | % | 605 |
| N |
| 68.2 | % |
Boynton Beach I, FL |
| 2001 |
| 1999 |
| 62,013 |
| 87.4 | % | 812 |
| Y |
| 54.2 | % |
Boynton Beach II, FL |
| 2005 |
| 2001 |
| 61,841 |
| 79.2 | % | 601 |
| Y |
| 81.3 | % |
Bradenton I, FL |
| 2004 |
| 1979 |
| 68,502 |
| 53.8 | % | 659 |
| N |
| 2.8 | % |
Bradenton II, FL |
| 2004 |
| 1996 |
| 87,760 |
| 80.4 | % | 881 |
| Y |
| 40.0 | % |
Cape Coral, FL |
| 2000* |
| 2000 |
| 76,592 |
| 83.8 | % | 883 |
| Y |
| 83.5 | % |
Dania, FL |
| 1994 |
| 1988 |
| 58,270 |
| 98.4 | % | 498 |
| Y |
| 26.9 | % |
Dania Beach, FL (6) |
| 2004 |
| 1984 |
| 183,393 |
| 82.5 | % | 2011 |
| N |
| 20.7 | % |
Davie, FL |
| 2001* |
| 2001 |
| 81,035 |
| 85.9 | % | 853 |
| Y |
| 55.7 | % |
Deerfield Beach, FL |
| 1998* |
| 1998 |
| 57,600 |
| 80.6 | % | 526 |
| Y |
| 39.2 | % |
DeLand, FL |
| 1998 |
| 1987 |
| 37,552 |
| 87.1 | % | 401 |
| Y |
| 34.5 | % |
Delray Beach, FL |
| 2001 |
| 1999 |
| 67,809 |
| 90.6 | % | 821 |
| Y |
| 39.3 | % |
Fernandina Beach, FL |
| 1996 |
| 1986 |
| 111,030 |
| 74.7 | % | 897 |
| Y |
| 35.7 | % |
Ft. Lauderdale, FL |
| 1999 |
| 1999 |
| 70,596 |
| 90.9 | % | 703 |
| Y |
| 46.5 | % |
Ft. Myers, FL |
| 1998 |
| 1998 |
| 67,546 |
| 78.3 | % | 610 |
| Y |
| 67.0 | % |
Gulf Breeze, FL |
| 2005 |
| 1982/04 |
| 79,449 |
| 91.8 | % | 700 |
| N |
| 62.7 | % |
Jacksonville I, FL |
| 2005 |
| 2005 |
| 80,401 |
| 60.1 | % | 753 |
| N |
| 100.0 | % |
Jacksonville II, FL |
| 2007 |
| 2004 |
| 65,020 |
| 86.0 | % | 688 |
| N |
| 100.0 | % |
Jacksonville III, FL |
| 2007 |
| 2003 |
| 65,603 |
| 82.5 | % | 723 |
| N |
| 100.0 | % |
Jacksonville IV, FL |
| 2007 |
| 2006 |
| 78,604 |
| 33.9 | % | 756 |
| N |
| 100.0 | % |
Jacksonville V, FL |
| 2007 |
| 2004 |
| 81,860 |
| 73.1 | % | 753 |
| N |
| 82.3 | % |
Kendall, FL |
| 2007 |
| 2003 |
| 75,395 |
| 84.7 | % | 710 |
| N |
| 71.0 | % |
24
|
| Year Acquired/ |
| Year |
| Rentable |
|
|
|
|
| Manager |
| % Climate |
|
Facility Location |
| Developed (1) |
| Built |
| Square Feet |
| Occupancy (2) |
| Units |
| Apartment (3) |
| Controlled (4) |
|
Lake Worth, FL † |
| 1998 |
| 1998/02 |
| 163,683 |
| 82.0 | % | 1408 |
| Y |
| 36.4 | % |
Lakeland I, FL |
| 1994 |
| 1988 |
| 48,911 |
| 82.2 | % | 484 |
| Y |
| 79.6 | % |
Lakeland II, FL |
| 1996 |
| 1984 |
| 47,680 |
| 81.1 | % | 351 |
| Y |
| 19.0 | % |
Leesburg, FL |
| 1997 |
| 1988 |
| 59,840 |
| 82.4 | % | 484 |
| Y |
| 17.7 | % |
Lutz I, FL |
| 2004 |
| 2000 |
| 72,495 |
| 49.7 | % | 633 |
| Y |
| 34.1 | % |
Lutz II, FL |
| 2004 |
| 1999 |
| 69,292 |
| 70.3 | % | 536 |
| Y |
| 20.6 | % |
Margate I, FL † |
| 1994 |
| 1979/81 |
| 54,405 |
| 87.5 | % | 339 |
| N |
| 9.8 | % |
Margate II, FL † |
| 1996 |
| 1985 |
| 65,168 |
| 87.3 | % | 437 |
| Y |
| 28.8 | % |
Merrit Island, FL |
| 2000 |
| 2000 |
| 50,427 |
| 86.8 | % | 465 |
| Y |
| 56.8 | % |
Miami I, FL |
| 1995 |
| 1995 |
| 46,925 |
| 89.7 | % | 565 |
| Y |
| 52.2 | % |
Miami II, FL |
| 1994 |
| 1987 |
| 57,040 |
| 73.0 | % | 612 |
| Y |
| 0.0 | % |
Miami III, FL |
| 1994 |
| 1989 |
| 67,060 |
| 85.2 | % | 571 |
| Y |
| 8.0 | % |
Miami IV, FL |
| 1995 |
| 1987 |
| 58,315 |
| 86.1 | % | 614 |
| Y |
| 7.3 | % |
Miami V, FL |
| 1995 |
| 1976 |
| 78,465 |
| 79.2 | % | 344 |
| Y |
| 4.0 | % |
Miami VI, FL |
| 2005 |
| 1988/03 |
| 150,510 |
| 70.8 | % | 1518 |
| N |
| 86.8 | % |
Naples I, FL |
| 1996 |
| 1996 |
| 48,050 |
| 81.1 | % | 351 |
| Y |
| 26.6 | % |
Naples II, FL |
| 1997 |
| 1985 |
| 65,850 |
| 81.1 | % | 671 |
| Y |
| 44.6 | % |
Naples III, FL |
| 1997 |
| 1981/83 |
| 81,145 |
| 67.2 | % | 876 |
| Y |
| 24.3 | % |
Naples IV, FL |
| 1998 |
| 1990 |
| 40,975 |
| 67.8 | % | 458 |
| N |
| 43.4 | % |
Ocala, FL |
| 1994 |
| 1988 |
| 41,891 |
| 86.5 | % | 375 |
| Y |
| 9.8 | % |
Ocoee, FL |
| 2005 |
| 1997 |
| 76,250 |
| 87.7 | % | 652 |
| Y |
| 15.5 | % |
Orange City, FL |
| 2004 |
| 2001 |
| 59,636 |
| 80.5 | % | 669 |
| N |
| 39.2 | % |
Orlando I, FL (6) |
| 1997 |
| 1987 |
| 52,170 |
| 84.9 | % | 515 |
| Y |
| 4.9 | % |
Orlando II, FL |
| 2005 |
| 2002/04 |
| 62,864 |
| 89.9 | % | 592 |
| N |
| 74.1 | % |
Orlando III, FL |
| 2006 |
| 1988/90/96 |
| 104,165 |
| 77.3 | % | 796 |
| Y |
| 6.9 | % |
Oviedo, FL |
| 2006 |
| 1988/1991 |
| 49,256 |
| 80.2 | % | 444 |
| Y |
| 3.2 | % |
Pembroke Pines, FL |
| 1997 |
| 1997 |
| 67,337 |
| 88.8 | % | 718 |
| Y |
| 63.2 | % |
Royal Palm Beach I, FL † |
| 1994 |
| 1988 |
| 98,961 |
| 67.7 | % | 692 |
| Y |
| 54.5 | % |
Royal Palm Beach II, FL † |
| 2007 |
| 2004 |
| 81,515 |
| 73.5 | % | 817 |
| N |
| 82.3 | % |
Sanford, FL |
| 2006 |
| 1988/2006 |
| 61,810 |
| 90.4 | % | 452 |
| Y |
| 28.6 | % |
Sarasota, FL |
| 1998 |
| 1998 |
| 70,788 |
| 76.0 | % | 554 |
| Y |
| 42.3 | % |
St. Augustine, FL |
| 1996 |
| 1985 |
| 59,670 |
| 78.7 | % | 734 |
| Y |
| 29.9 | % |
Stuart I, FL |
| 1997 |
| 1986 |
| 41,324 |
| 78.7 | % | 542 |
| Y |
| 26.9 | % |
Stuart II, FL |
| 1997 |
| 1995 |
| 86,924 |
| 77.8 | % | 1007 |
| Y |
| 51.4 | % |
SW Ranches, FL |
| 2007 |
| 2004 |
| 64,955 |
| 80.1 | % | 650 |
| N |
| 85.3 | % |
Tampa I, FL |
| 1994 |
| 1987 |
| 60,700 |
| 86.6 | % | 421 |
| Y |
| 0.0 | % |
Tampa II, FL |
| 2001 |
| 1985 |
| 55,997 |
| 84.1 | % | 480 |
| Y |
| 17.1 | % |
Tampa III, FL |
| 2007 |
| 2001/2002 |
| 83,788 |
| 77.7 | % | 807 |
| N |
| 28.4 | % |
Vero Beach, FL |
| 1997 |
| 1986/1987 |
| 50,390 |
| 75.6 | % | 513 |
| N |
| 23.7 | % |
West Palm Beach I, FL |
| 2001 |
| 1997 |
| 67,973 |
| 84.0 | % | 1025 |
| Y |
| 47.2 | % |
West Palm Beach II, FL |
| 2004 |
| 1996 |
| 93,764 |
| 89.4 | % | 890 |
| Y |
| 74.4 | % |
Alpharetta, GA |
| 2001 |
| 1996 |
| 90,485 |
| 76.5 | % | 678 |
| Y |
| 75.1 | % |
Austell , GA |
| 2006 |
| 2000 |
| 83,615 |
| 74.2 | % | 676 |
| Y |
| 65.9 | % |
Decatur, GA |
| 1998 |
| 1986 |
| 148,480 |
| 82.9 | % | 1356 |
| Y |
| 3.1 | % |
Norcross, GA |
| 2001 |
| 1997 |
| 85,390 |
| 80.8 | % | 607 |
| Y |
| 55.3 | % |
Peachtree City, GA |
| 2001 |
| 1997 |
| 49,845 |
| 83.5 | % | 453 |
| N |
| 75.6 | % |
Smyrna, GA |
| 2001 |
| 2000 |
| 56,820 |
| 94.9 | % | 507 |
| Y |
| 100.0 | % |
Snellville, GA |
| 2007 |
| 1996/1997 |
| 79,950 |
| 89.9 | % | 772 |
| Y |
| 27.1 | % |
Suwanee I, GA |
| 2007 |
| 2000/2003 |
| 85,450 |
| 82.8 | % | 633 |
| Y |
| 28.6 | % |
Suwanee II, GA |
| 2007 |
| 2005 |
| 79,640 |
| 62.8 | % | 630 |
| N |
| 60.8 | % |
Addison, IL |
| 2004 |
| 1979 |
| 31,275 |
| 82.4 | % | 370 |
| Y |
| 0.0 | % |
Aurora, IL |
| 2004 |
| 1996 |
| 73,845 |
| 67.7 | % | 563 |
| Y |
| 6.9 | % |
Bartlett, IL |
| 2004 |
| 1987 |
| 51,525 |
| 81.6 | % | 414 |
| Y |
| 33.6 | % |
Bellwood, IL |
| 2001 |
| 1999 |
| 86,575 |
| 83.3 | % | 747 |
| Y |
| 52.2 | % |
Des Plaines, IL (6) |
| 2004 |
| 1978 |
| 74,600 |
| 79.4 | % | 644 |
| N |
| 0.0 | % |
Elk Grove Village, IL |
| 2004 |
| 1987 |
| 64,304 |
| 87.8 | % | 648 |
| Y |
| 5.6 | % |
Glenview, IL |
| 2004 |
| 1998 |
| 100,115 |
| 84.5 | % | 743 |
| Y |
| 100.0 | % |
Gurnee, IL |
| 2004 |
| 1987 |
| 80,300 |
| 78.3 | % | 728 |
| Y |
| 34.1 | % |
Hanover, IL |
| 2004 |
| 1987 |
| 41,174 |
| 92.7 | % | 419 |
| Y |
| 0.4 | % |
Harvey, IL |
| 2004 |
| 1987 |
| 60,315 |
| 90.0 | % | 584 |
| Y |
| 2.9 | % |
Joliet, IL |
| 2004 |
| 1993 |
| 74,350 |
| 52.6 | % | 480 |
| Y |
| 100.0 | % |
Kildeer, IL |
| 2004 |
| 1988 |
| 46,475 |
| 85.8 | % | 429 |
| Y |
| 0.0 | % |
Lombard, IL |
| 2004 |
| 1981 |
| 57,736 |
| 88.6 | % | 547 |
| Y |
| 9.9 | % |
Mount Prospect, IL |
| 2004 |
| 1979 |
| 65,000 |
| 81.3 | % | 603 |
| Y |
| 12.7 | % |
Mundelein, IL |
| 2004 |
| 1990 |
| 44,700 |
| 80.1 | % | 493 |
| Y |
| 8.9 | % |
North Chicago, IL |
| 2004 |
| 1985 |
| 53,300 |
| 83.5 | % | 435 |
| N |
| 0.0 | % |
Plainfield I, IL |
| 2004 |
| 1998 |
| 53,900 |
| 80.2 | % | 403 |
| N |
| 3.3 | % |
Plainfield II, IL |
| 2005 |
| 2000 |
| 52,100 |
| 64.2 | % | 357 |
| N |
| 22.7 | % |
Schaumburg, IL |
| 2004 |
| 1988 |
| 31,235 |
| 83.5 | % | 323 |
| N |
| 5.6 | % |
Streamwood, IL |
| 2004 |
| 1982 |
| 64,305 |
| 74.9 | % | 572 |
| N |
| 4.4 | % |
Warrensville, IL |
| 2005 |
| 1977/89 |
| 48,796 |
| 84.6 | % | 385 |
| N |
| 0.0 | % |
Waukegan, IL |
| 2004 |
| 1977 |
| 79,750 |
| 77.7 | % | 703 |
| Y |
| 8.4 | % |
West Chicago, IL |
| 2004 |
| 1979 |
| 48,475 |
| 80.6 | % | 435 |
| Y |
| 0.0 | % |
25
|
| Year Acquired/ |
| Year |
| Rentable |
|
|
|
|
| Manager |
| % Climate |
|
Facility Location |
| Developed (1) |
| Built |
| Square Feet |
| Occupancy (2) |
| Units |
| Apartment (3) |
| Controlled (4) |
|
Westmont, IL |
| 2004 |
| 1979 |
| 53,700 |
| 89.0 | % | 402 |
| Y |
| 0.0 | % |
Wheeling I, IL |
| 2004 |
| 1974 |
| 54,210 |
| 81.5 | % | 502 |
| Y |
| 0.0 | % |
Wheeling II, IL |
| 2004 |
| 1979 |
| 67,825 |
| 68.2 | % | 619 |
| Y |
| 7.3 | % |
Woodridge, IL |
| 2004 |
| 1987 |
| 50,725 |
| 91.3 | % | 472 |
| Y |
| 7.6 | % |
Indianapolis I, IN |
| 2004 |
| 1987 |
| 43,600 |
| 91.5 | % | 327 |
| N |
| 0.0 | % |
Indianapolis II, IN |
| 2004 |
| 1997 |
| 44,900 |
| 80.3 | % | 456 |
| Y |
| 15.6 | % |
Indianapolis III, IN |
| 2004 |
| 1999 |
| 60,850 |
| 83.3 | % | 501 |
| Y |
| 32.8 | % |
Indianapolis IV, IN |
| 2004 |
| 1976 |
| 68,250 |
| 77.8 | % | 615 |
| Y |
| 0.0 | % |
Indianapolis IX, IN |
| 2004 |
| 1976 |
| 61,732 |
| 83.7 | % | 549 |
| Y |
| 0.0 | % |
Indianapolis V, IN |
| 2004 |
| 1999 |
| 74,825 |
| 91.1 | % | 587 |
| Y |
| 33.6 | % |
Indianapolis VI, IN |
| 2004 |
| 1976 |
| 73,353 |
| 74.1 | % | 728 |
| Y |
| 0.0 | % |
Indianapolis VII, IN |
| 2004 |
| 1992 |
| 91,807 |
| 77.7 | % | 818 |
| Y |
| 6.4 | % |
Indianapolis VIII, IN |
| 2004 |
| 1975 |
| 80,140 |
| 71.1 | % | 721 |
| Y |
| 0.0 | % |
Baton Rouge I, LA |
| 1997 |
| 1980 |
| 55,474 |
| 92.2 | % | 464 |
| Y |
| 8.3 | % |
Baton Rouge II, LA |
| 1997 |
| 1980/1995 |
| 80,452 |
| 94.1 | % | 585 |
| Y |
| 40.4 | % |
Baton Rouge III, LA |
| 1997 |
| 1982 |
| 60,770 |
| 95.6 | % | 445 |
| Y |
| 10.3 | % |
Prairieville, LA |
| 1998 |
| 1991 |
| 28,319 |
| 83.5 | % | 341 |
| Y |
| 6.3 | % |
Slidell, LA |
| 2001 |
| 1998 |
| 79,540 |
| 94.5 | % | 523 |
| Y |
| 46.6 | % |
Boston, MA |
| 2002 |
| 2001 |
| 60,270 |
| 76.7 | % | 619 |
| Y |
| 100.0 | % |
Leominster, MA |
| 1998 |
| 1987/88/00 |
| 54,081 |
| 74.8 | % | 504 |
| Y |
| 38.5 | % |
Medford, MA |
| 2007 |
| 2001 |
| 58,577 |
| 72.5 | % | 653 |
| Y |
| 96.0 | % |
Baltimore, MD |
| 2001 |
| 1999/00 |
| 93,700 |
| 84.1 | % | 843 |
| Y |
| 45.5 | % |
California, MD |
| 2004 |
| 1998 |
| 77,678 |
| 83.8 | % | 761 |
| Y |
| 38.9 | % |
Gaithersburg, MD |
| 2005 |
| 1998 |
| 86,970 |
| 84.0 | % | 795 |
| Y |
| 41.7 | % |
Laurel, MD † |
| 2001 |
| 1978/99/00 |
| 162,297 |
| 92.4 | % | 1018 |
| Y |
| 41.0 | % |
Temple Hills, MD |
| 2001 |
| 2000 |
| 97,250 |
| 83.3 | % | 815 |
| Y |
| 68.8 | % |
Grand Rapids, MI |
| 1996 |
| 1976 |
| 87,031 |
| 72.8 | % | 526 |
| Y |
| 0.0 | % |
Portage, MI (6) |
| 1996 |
| 1980 |
| 50,280 |
| 82.3 | % | 387 |
| N |
| 0.0 | % |
Romulus, MI |
| 1997 |
| 1997 |
| 42,175 |
| 81.6 | % | 340 |
| Y |
| 7.5 | % |
Wyoming, MI |
| 1996 |
| 1987 |
| 91,283 |
| 80.5 | % | 635 |
| N |
| 0.0 | % |
Biloxi, MS |
| 1997 |
| 1978/93 |
| 66,394 |
| 85.4 | % | 594 |
| Y |
| 12.2 | % |
Gautier, MS |
| 1997 |
| 1981 |
| 35,925 |
| 83.5 | % | 305 |
| Y |
| 7.4 | % |
Gulfport I, MS |
| 1997 |
| 1970 |
| 68,320 |
| 83.2 | % | 494 |
| Y |
| 11.0 | % |
Gulfport II, MS |
| 1997 |
| 1986 |
| 64,445 |
| 92.6 | % | 448 |
| Y |
| 18.7 | % |
Gulfport III, MS |
| 1997 |
| 1977/93 |
| 61,251 |
| 83.7 | % | 517 |
| Y |
| 33.5 | % |
Waveland, MS |
| 1998 |
| 1982/83/84/93 |
| 57,096 |
| 64.8 | % | 466 |
| Y |
| 37.9 | % |
Belmont, NC |
| 2001 |
| 1996/97/98 |
| 80,512 |
| 91.8 | % | 605 |
| N |
| 25.2 | % |
Burlington I, NC |
| 2001 |
| 1990/91/93/94/98 |
| 109,545 |
| 73.2 | % | 966 |
| N |
| 0.7 | % |
Burlington II, NC |
| 2001 |
| 1991 |
| 42,280 |
| 77.3 | % | 397 |
| Y |
| 12.1 | % |
Cary, NC |
| 2001 |
| 1993/94/97 |
| 111,772 |
| 82.3 | % | 798 |
| N |
| 7.3 | % |
Charlotte, NC |
| 1999 |
| 1999 |
| 69,000 |
| 95.5 | % | 738 |
| Y |
| 52.8 | % |
Fayetteville I, NC |
| 1997 |
| 1981 |
| 41,450 |
| 97.9 | % | 347 |
| N |
| 0.0 | % |
Fayetteville II, NC |
| 1997 |
| 1993/95 |
| 54,225 |
| 97.1 | % | 547 |
| Y |
| 11.9 | % |
Raleigh, NC |
| 1998 |
| 1994/95 |
| 48,675 |
| 91.6 | % | 412 |
| Y |
| 8.2 | % |
Brick, NJ |
| 1994 |
| 1981 |
| 52,740 |
| 73.5 | % | 452 |
| N |
| 0.0 | % |
Clifton, NJ |
| 2005 |
| 2001 |
| 105,550 |
| 85.7 | % | 1015 |
| Y |
| 85.5 | % |
Cranford, NJ |
| 1994 |
| 1987 |
| 91,250 |
| 82.4 | % | 846 |
| Y |
| 7.9 | % |
East Hanover, NJ |
| 1994 |
| 1983 |
| 107,679 |
| 62.5 | % | 1013 |
| N |
| 1.6 | % |
Elizabeth, NJ |
| 2005 |
| 1925/97 |
| 38,892 |
| 56.5 | % | 677 |
| N |
| 0.0 | % |
Fairview, NJ |
| 1997 |
| 1989 |
| 27,676 |
| 87.3 | % | 449 |
| N |
| 100.0 | % |
Hamilton, NJ |
| 2006 |
| 1990 |
| 70,550 |
| 58.9 | % | 622 |
| Y |
| 0.0 | % |
Hoboken, NJ |
| 2005 |
| 1945/97 |
| 34,280 |
| 85.0 | % | 745 |
| N |
| 100.0 | % |
Jersey City, NJ |
| 1994 |
| 1985 |
| 91,361 |
| 81.3 | % | 1093 |
| Y |
| 0.0 | % |
Linden I, NJ |
| 1994 |
| 1983 |
| 95,575 |
| 73.6 | % | 1059 |
| N |
| 2.9 | % |
Linden II, NJ † |
| 1994 |
| 1982 |
| 35,800 |
| 92.5 | % | 23 |
| N |
| 0.0 | % |
Morris Township, NJ (5) |
| 1997 |
| 1972 |
| 75,576 |
| 69.9 | % | 595 |
| Y |
| 1.2 | % |
Parsippany, NJ |
| 1997 |
| 1981 |
| 66,325 |
| 81.0 | % | 605 |
| Y |
| 6.9 | % |
Randolph, NJ |
| 2002 |
| 1998/99 |
| 52,565 |
| 76.8 | % | 593 |
| Y |
| 81.5 | % |
Sewell, NJ |
| 2001 |
| 1984/98 |
| 57,767 |
| 67.6 | % | 479 |
| N |
| 5.0 | % |
Albuquerque I, NM |
| 2005 |
| 1985 |
| 65,927 |
| 86.7 | % | 607 |
| Y |
| 3.2 | % |
Albuquerque II, NM |
| 2005 |
| 1985 |
| 58,834 |
| 89.2 | % | 547 |
| Y |
| 4.2 | % |
Albuquerque III, NM |
| 2005 |
| 1978 |
| 41,016 |
| 93.6 | % | 455 |
| N |
| 4.3 | % |
Albuquerque IV, NM |
| 2005 |
| 1986 |
| 57,536 |
| 87.4 | % | 535 |
| Y |
| 4.7 | % |
Albuquerque V, NM |
| 2006 |
| 1994 |
| 52,217 |
| 91.0 | % | 424 |
| Y |
| 10.2 | % |
Carlsbad, NM |
| 2005 |
| 1975 |
| 39,999 |
| 97.8 | % | 343 |
| Y |
| 0.0 | % |
Deming, NM |
| 2005 |
| 1973/83 |
| 33,005 |
| 81.9 | % | 246 |
| Y |
| 0.0 | % |
Las Cruces, NM |
| 2005 |
| 1984 |
| 43,850 |
| 85.7 | % | 401 |
| Y |
| 3.0 | % |
Lovington, NM |
| 2005 |
| 1975 |
| 15,751 |
| 95.2 | % | 264 |
| Y |
| 0.0 | % |
Silver City, NM |
| 2005 |
| 1972 |
| 26,875 |
| 91.8 | % | 255 |
| Y |
| 0.0 | % |
Truth or Consequences, NM |
| 2005 |
| 1977/99/00 |
| 24,010 |
| 92.3 | % | 170 |
| Y |
| 0.0 | % |
Las Vegas I, NV † |
| 2006 |
| 1986 |
| 50,882 |
| 80.6 | % | 402 |
| Y |
| 5.0 | % |
Las Vegas II, NV |
| 2006 |
| 1997 |
| 49,000 |
| 85.4 | % | 538 |
| Y |
| 76.5 | % |
Endicott, NY |
| 2005 |
| 1989 |
| 35,930 |
| 90.8 | % | 296 |
| Y |
| 0.0 | % |
26
|
| Year Acquired/ |
| Year |
| Rentable |
|
|
|
|
| Manager |
| % Climate |
|
Facility Location |
| Developed (1) |
| Built |
| Square Feet |
| Occupancy (2) |
| Units |
| Apartment (3) |
| Controlled (4) |
|
Jamaica, NY |
| 2001 |
| 2000 |
| 89,455 |
| 75.7 | % | 924 |
| Y |
| 100.0 | % |
New Rochelle, NY † |
| 2005 |
| 1998 |
| 48,431 |
| 94.2 | % | 407 |
| N |
| 15.0 | % |
North Babylon, NY |
| 1998 |
| 1988/99 |
| 78,338 |
| 83.5 | % | 652 |
| N |
| 9.2 | % |
Riverhead, NY |
| 2005 |
| 1985/86/99 |
| 38,690 |
| 91.0 | % | 341 |
| N |
| 0.0 | % |
Southold, NY † |
| 2005 |
| 1989 |
| 58,609 |
| 79.0 | % | 588 |
| N |
| 3.1 | % |
Boardman, OH |
| 1980 |
| 1980/89 |
| 65,495 |
| 70.5 | % | 532 |
| Y |
| 24.0 | % |
Brecksville, OH |
| 1998 |
| 1970/89 |
| 58,452 |
| 88.5 | % | 448 |
| Y |
| 25.2 | % |
Canton I, OH |
| 2005 |
| 1979/87 |
| 39,750 |
| 72.4 | % | 416 |
| N |
| 0.0 | % |
Canton II, OH |
| 2005 |
| 1997 |
| 26,200 |
| 90.3 | % | 197 |
| N |
| 0.0 | % |
Centerville I, OH |
| 2004 |
| 1976 |
| 86,390 |
| 73.2 | % | 640 |
| Y |
| 0.0 | % |
Centerville II, OH |
| 2004 |
| 1976 |
| 43,400 |
| 66.1 | % | 308 |
| N |
| 0.0 | % |
Cleveland I, OH |
| 2005 |
| 1997/99 |
| 45,950 |
| 86.9 | % | 341 |
| Y |
| 4.9 | % |
Cleveland II, OH |
| 2005 |
| 2000 |
| 58,450 |
| 64.1 | % | 582 |
| Y |
| 0.0 | % |
Columbus, OH |
| 2006 |
| 1999 |
| 66,875 |
| 71.9 | % | 600 |
| Y |
| 28.1 | % |
Dayton I, OH |
| 2004 |
| 1978 |
| 43,100 |
| 78.0 | % | 345 |
| N |
| 0.0 | % |
Dayton II, OH |
| 2005 |
| 1989/00 |
| 48,149 |
| 90.1 | % | 387 |
| Y |
| 1.7 | % |
Euclid I, OH |
| 1988* |
| 1988 |
| 46,910 |
| 83.6 | % | 438 |
| Y |
| 22.2 | % |
Euclid II, OH |
| 1988* |
| 1988 |
| 47,275 |
| 87.6 | % | 378 |
| Y |
| 0.0 | % |
Grove City, OH |
| 2006 |
| 1997 |
| 89,290 |
| 80.5 | % | 776 |
| Y |
| 16.9 | % |
Hilliard, OH |
| 2006 |
| 1995 |
| 89,715 |
| 67.1 | % | 780 |
| Y |
| 24.5 | % |
Hudson, OH † |
| 1998 |
| 1987 |
| 65,240 |
| 82.7 | % | 393 |
| N |
| 9.3 | % |
Lakewood, OH |
| 1989* |
| 1989 |
| 39,267 |
| 82.3 | % | 467 |
| Y |
| 24.5 | % |
Louisville, OH |
| 2005 |
| 1988/90 |
| 53,960 |
| 79.1 | % | 387 |
| N |
| 0.0 | % |
Marblehead, OH |
| 2005 |
| 1988/98 |
| 52,300 |
| 75.9 | % | 386 |
| Y |
| 0.0 | % |
Mason, OH |
| 1998 |
| 1981 |
| 33,900 |
| 90.0 | % | 283 |
| Y |
| 0.0 | % |
Mentor, OH |
| 2005 |
| 1983/99 |
| 51,275 |
| 80.7 | % | 369 |
| N |
| 16.1 | % |
Miamisburg, OH |
| 2004 |
| 1975 |
| 59,930 |
| 78.7 | % | 432 |
| Y |
| 0.0 | % |
Middleburg Heights, OH |
| 1980* |
| 1980 |
| 93,025 |
| 84.3 | % | 694 |
| Y |
| 3.8 | % |
North Canton I, OH |
| 1979* |
| 1979 |
| 45,400 |
| 83.5 | % | 321 |
| Y |
| 0.0 | % |
North Canton II, OH |
| 1983* |
| 1983 |
| 44,180 |
| 84.3 | % | 351 |
| Y |
| 15.8 | % |
North Olmsted I, OH |
| 1979* |
| 1979 |
| 48,665 |
| 89.1 | % | 442 |
| Y |
| 7.0 | % |
North Olmsted II, OH |
| 1988* |
| 1988 |
| 47,850 |
| 88.7 | % | 398 |
| Y |
| 14.2 | % |
North Randall, OH |
| 1998* |
| 1998/02 |
| 80,099 |
| 87.0 | % | 792 |
| N |
| 90.8 | % |
Perry, OH |
| 2005 |
| 1992/97 |
| 63,850 |
| 79.1 | % | 425 |
| Y |
| 0.0 | % |
Reynoldsburg, OH |
| 2006 |
| 1979 |
| 67,545 |
| 68.2 | % | 669 |
| Y |
| 0.0 | % |
Strongsville, OH |
| 2007 |
| 1978 |
| 43,727 |
| 80.8 | % | 399 |
| Y |
| 100.0 | % |
Warrensville Heights, OH |
| 1980* |
| 1980/82/98 |
| 90,331 |
| 80.8 | % | 734 |
| Y |
| 0.0 | % |
Westlake, OH |
| 2005 |
| 2001 |
| 62,750 |
| 89.8 | % | 455 |
| Y |
| 6.1 | % |
Willoughby, OH |
| 2005 |
| 1997 |
| 34,454 |
| 79.5 | % | 269 |
| Y |
| 10.0 | % |
Youngstown, OH |
| 1977* |
| 1977 |
| 65,950 |
| 83.9 | % | 530 |
| Y |
| 1.2 | % |
Levittown, PA |
| 2001 |
| 2000 |
| 76,230 |
| 81.0 | % | 667 |
| Y |
| 36.3 | % |
Philadelphia, PA |
| 2001 |
| 1999 |
| 100,347 |
| 77.5 | % | 942 |
| N |
| 29.8 | % |
Alcoa, TN |
| 2005 |
| 1986 |
| 42,325 |
| 86.7 | % | 364 |
| Y |
| 0.0 | % |
Antioch, TN |
| 2005 |
| 1985/98 |
| 76,150 |
| 91.9 | % | 602 |
| Y |
| 8.2 | % |
Cordova I, TN |
| 2005 |
| 1987 |
| 54,225 |
| 88.2 | % | 388 |
| Y |
| 0.0 | % |
Cordova II, TN |
| 2006 |
| 1995 |
| 67,600 |
| 86.7 | % | 720 |
| Y |
| 7.2 | % |
Knoxville I, TN |
| 1997 |
| 1984 |
| 29,377 |
| 89.3 | % | 296 |
| Y |
| 6.8 | % |
Knoxville II, TN |
| 1997 |
| 1985 |
| 38,000 |
| 87.7 | % | 340 |
| Y |
| 6.9 | % |
Knoxville III, TN |
| 1998 |
| 1991 |
| 45,736 |
| 85.3 | % | 452 |
| Y |
| 6.9 | % |
Knoxville IV, TN |
| 1998 |
| 1983 |
| 58,852 |
| 82.2 | % | 440 |
| N |
| 1.1 | % |
Knoxville V, TN |
| 1998 |
| 1977 |
| 42,790 |
| 94.8 | % | 372 |
| N |
| 0.0 | % |
Knoxville VI, TN |
| 2005 |
| 1975 |
| 63,440 |
| 79.5 | % | 587 |
| Y |
| 0.0 | % |
Knoxville VII, TN |
| 2005 |
| 1983 |
| 54,994 |
| 84.1 | % | 448 |
| Y |
| 0.0 | % |
Knoxville VIII, TN |
| 2005 |
| 1978 |
| 96,518 |
| 79.1 | % | 771 |
| Y |
| 0.0 | % |
Memphis I, TN |
| 2001 |
| 1999 |
| 91,300 |
| 92.6 | % | 700 |
| N |
| 51.3 | % |
Memphis II, TN |
| 2001 |
| 2000 |
| 71,960 |
| 84.7 | % | 560 |
| N |
| 46.3 | % |
Memphis III, TN |
| 2005 |
| 1983 |
| 41,137 |
| 87.3 | % | 356 |
| Y |
| 6.9 | % |
Memphis IV, TN |
| 2005 |
| 1986 |
| 38,750 |
| 86.9 | % | 326 |
| Y |
| 7.9 | % |
Memphis V, TN |
| 2005 |
| 1981 |
| 60,370 |
| 84.2 | % | 499 |
| Y |
| 0.0 | % |
Memphis VI, TN |
| 2006 |
| 1985/93 |
| 109,317 |
| 79.4 | % | 873 |
| Y |
| 3.2 | % |
Memphis VII, TN |
| 2006 |
| 1980/85 |
| 115,303 |
| 77.6 | % | 582 |
| Y |
| 0.0 | % |
Memphis VIII, TN † |
| 2006 |
| 1990 |
| 96,060 |
| 70.3 | % | 562 |
| Y |
| 0.0 | % |
Nashville I, TN |
| 2005 |
| 1984 |
| 106,930 |
| 65.8 | % | 700 |
| Y |
| 0.0 | % |
Nashville II, TN |
| 2005 |
| 1986/00 |
| 83,274 |
| 86.5 | % | 633 |
| Y |
| 6.5 | % |
Nashville III, TN |
| 2006 |
| 1985 |
| 99,600 |
| 75.0 | % | 638 |
| Y |
| 5.1 | % |
Nashville IV, TN |
| 2006 |
| 1986/00 |
| 102,425 |
| 88.6 | % | 721 |
| Y |
| 7.0 | % |
Austin I, TX |
| 2005 |
| 2001 |
| 59,520 |
| 70.3 | % | 547 |
| Y |
| 59.1 | % |
Austin II, TX |
| 2006 |
| 2000/03 |
| 65,401 |
| 94.8 | % | 594 |
| Y |
| 38.8 | % |
Austin III, TX |
| 2006 |
| 2004 |
| 71,030 |
| 79.7 | % | 581 |
| Y |
| 84.9 | % |
Baytown, TX |
| 2005 |
| 1981 |
| 38,950 |
| 92.2 | % | 365 |
| Y |
| 0.0 | % |
Bryan, TX |
| 2005 |
| 1994 |
| 60,450 |
| 78.9 | % | 495 |
| Y |
| 0.0 | % |
College Station, TX |
| 2005 |
| 1993 |
| 26,550 |
| 88.7 | % | 346 |
| N |
| 0.0 | % |
Dallas, TX |
| 2005 |
| 2000 |
| 58,707 |
| 79.2 | % | 552 |
| Y |
| 26.3 | % |
27
|
| Year Acquired/ |
| Year |
| Rentable |
|
|
|
|
| Manager |
| % Climate |
|
Facility Location |
| Developed (1) |
| Built |
| Square Feet |
| Occupancy (2) |
| Units |
| Apartment (3) |
| Controlled (4) |
|
Denton, TX |
| 2006 |
| 1996 |
| 60,836 |
| 83.8 | % | 514 |
| Y |
| 3.9 | % |
El Paso I, TX |
| 2005 |
| 1980 |
| 59,864 |
| 87.7 | % | 515 |
| Y |
| 0.9 | % |
El Paso II, TX |
| 2005 |
| 1980 |
| 48,692 |
| 84.8 | % | 415 |
| Y |
| 0.0 | % |
El Paso III, TX |
| 2005 |
| 1980 |
| 71,276 |
| 87.7 | % | 611 |
| Y |
| 2.0 | % |
El Paso IV, TX |
| 2005 |
| 1983 |
| 48,962 |
| 78.0 | % | 383 |
| Y |
| 4.6 | % |
El Paso V, TX |
| 2005 |
| 1982 |
| 62,825 |
| 85.4 | % | 395 |
| Y |
| 0.0 | % |
El Paso VI, TX |
| 2005 |
| 1985 |
| 36,620 |
| 81.0 | % | 264 |
| Y |
| 0.0 | % |
El Paso VII, TX † |
| 2005 |
| 1982 |
| 34,545 |
| 80.8 | % | 17 |
| N |
| 0.0 | % |
Fort Worth I, TX |
| 2005 |
| 2000 |
| 49,778 |
| 72.7 | % | 405 |
| Y |
| 27.0 | % |
Fort Worth II, TX |
| 2006 |
| 2003 |
| 72,925 |
| 75.7 | % | 668 |
| Y |
| 49.0 | % |
Frisco I, TX |
| 2005 |
| 1996 |
| 50,854 |
| 89.8 | % | 443 |
| Y |
| 17.5 | % |
Frisco II, TX |
| 2005 |
| 1998/02 |
| 71,339 |
| 78.1 | % | 519 |
| Y |
| 22.4 | % |
Frisco III, TX |
| 2006 |
| 2004 |
| 72,275 |
| 66.5 | % | 594 |
| Y |
| 87.5 | % |
Garland I, TX |
| 2006 |
| 1991 |
| 70,000 |
| 83.5 | % | 682 |
| Y |
| 4.6 | % |
Garland II, TX |
| 2006 |
| 2004 |
| 68,475 |
| 69.1 | % | 476 |
| Y |
| 39.7 | % |
Greenville I, TX |
| 2005 |
| 2001/04 |
| 59,385 |
| 90.7 | % | 452 |
| Y |
| 28.8 | % |
Greenville II, TX |
| 2005 |
| 2001 |
| 44,900 |
| 71.8 | % | 318 |
| N |
| 36.3 | % |
Houston I, TX |
| 2005 |
| 1981 |
| 101,350 |
| 93.9 | % | 635 |
| Y |
| 0.0 | % |
Houston II, TX |
| 2005 |
| 1977 |
| 71,300 |
| 88.3 | % | 389 |
| Y |
| 0.0 | % |
Houston III, TX |
| 2005 |
| 1984 |
| 60,820 |
| 88.0 | % | 479 |
| Y |
| 4.0 | % |
Houston IV, TX |
| 2005 |
| 1987 |
| 43,775 |
| 94.7 | % | 378 |
| Y |
| 6.2 | % |
Houston V, TX † |
| 2006 |
| 1980/1997 |
| 127,145 |
| 79.0 | % | 1016 |
| Y |
| 54.7 | % |
Keller, TX |
| 2006 |
| 2000 |
| 61,885 |
| 96.9 | % | 488 |
| Y |
| 21.1 | % |
La Porte, TX |
| 2005 |
| 1984 |
| 45,100 |
| 86.3 | % | 434 |
| Y |
| 18.6 | % |
Lewisville, TX |
| 2006 |
| 1996 |
| 58,465 |
| 82.8 | % | 439 |
| Y |
| 19.3 | % |
Mansfield, TX |
| 2006 |
| 2003 |
| 63,025 |
| 83.9 | % | 501 |
| Y |
| 38.4 | % |
McKinney I, TX |
| 2005 |
| 1996 |
| 47,020 |
| 96.7 | % | 370 |
| Y |
| 9.2 | % |
McKinney II, TX |
| 2006 |
| 1996 |
| 70,050 |
| 92.7 | % | 540 |
| Y |
| 46.3 | % |
North Richland Hills, TX |
| 2005 |
| 2002 |
| 57,025 |
| 78.3 | % | 451 |
| Y |
| 47.4 | % |
Roanoke, TX |
| 2005 |
| 1996/01 |
| 59,400 |
| 93.3 | % | 455 |
| Y |
| 30.1 | % |
San Antonio I, TX |
| 2005 |
| 2005 |
| 75,270 |
| 39.4 | % | 584 |
| Y |
| 78.8 | % |
San Antonio II, TX |
| 2006 |
| 2005 |
| 73,205 |
| 62.3 | % | 672 |
| N |
| 82.3 | % |
San Antonio III, TX |
| 2007 |
| 2006 |
| 72,525 |
| 49.6 | % | 579 |
| N |
| 87.1 | % |
Sherman I, TX |
| 2005 |
| 1998 |
| 55,050 |
| 85.5 | % | 514 |
| Y |
| 20.8 | % |
Sherman II, TX |
| 2005 |
| 1996 |
| 48,425 |
| 85.2 | % | 392 |
| Y |
| 30.9 | % |
Spring, TX |
| 2006 |
| 1980/86 |
| 72,801 |
| 88.2 | % | 536 |
| Y |
| 14.2 | % |
Murray I, UT |
| 2005 |
| 1976 |
| 60,280 |
| 93.1 | % | 679 |
| Y |
| 0.0 | % |
Murray II, UT † |
| 2005 |
| 1978 |
| 71,421 |
| 98.0 | % | 384 |
| Y |
| 2.6 | % |
Salt Lake City I, UT |
| 2005 |
| 1976 |
| 56,446 |
| 88.5 | % | 763 |
| Y |
| 0.0 | % |
Salt Lake City II, UT |
| 2005 |
| 1978 |
| 53,676 |
| 94.6 | % | 510 |
| Y |
| 0.0 | % |
Fredericksburg I, VA |
| 2005 |
| 2001/04 |
| 69,450 |
| 62.6 | % | 634 |
| N |
| 21.5 | % |
Fredericksburg II, VA |
| 2005 |
| 1998/01 |
| 61,493 |
| 56.7 | % | 580 |
| N |
| 100.0 | % |
Milwaukee, WI |
| 2004 |
| 1988 |
| 58,515 |
| 84.1 | % | 486 |
| Y |
| 0.0 | % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total/Weighted Average (409 facilities) |
|
|
| 26,119,184 |
| 79.5 | % | 229,851 |
|
|
|
|
|
* Denotes facilities developed by us.
† Denotes facilities that contain a significant amount of commercial rentable square footage. All of this commercial space, which was developed in conjunction with the self-storage units, is located within or adjacent to our self-storage facilities and is managed by our self-storage facility managers. As of December 31, 2007, there was an aggregate of approximately 753,000 rentable square feet of commercial space at these facilities.
(1) Represents the year acquired for those facilities acquired from a third party or the year developed for those facilities developed by us.
(2) Represents occupied square feet divided by total rentable square feet at December 31, 2007.
(3) Indicates whether a facility has an on-site apartment where a manager resides.
(4) Represents the percentage of rentable square feet in climate-controlled units.
(5) We do not own the land at this facility. We leased the land pursuant to a ground lease.lease that expires in 2008, but have nine five-year renewal options.
Facility Location | Year Acquired/ Developed(1) | Year Built | Rentable Square Feet | Occupancy(2) | Units | Manager Apartment(3) | % Climate Controlled(4) | ||||||||||
Mobile I, AL | 1997 | 1987 | 65,256 | 75.8 | % | 490 | N | 7.4 | % | ||||||||
Mobile II, AL† | 1997 | 1974/90 | 126,050 | 64.2 | % | 794 | N | 1.3 | % | ||||||||
Mobile III, AL | 1998 | 1988/94 | 43,325 | 84.2 | % | 371 | Y | 33.8 | % | ||||||||
Glendale, AZ | 1998 | 1987 | 56,580 | 84.3 | % | 575 | Y | 0.0 | % | ||||||||
Scottsdale, AZ | 1998 | 1995 | 81,300 | 83.4 | % | 608 | Y | 10.9 | % | ||||||||
Tucson I, AZ | 1998 | 1974 | 60,000 | 82.7 | % | 504 | Y | 0.0 | % | ||||||||
Tucson II, AZ | 1998 | 1988 | 44,150 | 78.1 | % | 536 | Y | 100.0 | % | ||||||||
Apple Valley I, CA | 1997 | 1984 | 73,580 | 92.6 | % | 620 | Y | 0.0 | % | ||||||||
Apple Valley II, CA | 1997 | 1988 | 62,325 | 85.5 | % | 511 | Y | 5.3 | % | ||||||||
Bloomington I, CA | 1997 | 1987 | 31,246 | 70.7 | % | 226 | N | 0.0 | % | ||||||||
Bloomington II, CA† | 1997 | 1987 | 26,060 | 100.0 | % | 22 | N | 0.0 | % | ||||||||
Fallbrook, CA | 1997 | 1985/88 | 46,534 | 86.6 | % | 430 | Y | 0.0 | % | ||||||||
Hemet, CA | 1997 | 1989 | 66,260 | 94.8 | % | 454 | Y | 0.0 | % | ||||||||
Highland, CA | 1997 | 1987 | 74,951 | 84.5 | % | 848 | Y | 0.0 | % | ||||||||
Lancaster, CA | 2001 | 1987 | 60,875 | 79.0 | % | 416 | Y | 0.0 | % | ||||||||
Ontario, CA | 1998 | 1982 | 80,280 | 83.4 | % | 840 | Y | 0.0 | % | ||||||||
Redlands, CA | 1997 | 1985 | 63,005 | 90.6 | % | 563 | N | 0.0 | % | ||||||||
Rialto, CA | 1997 | 1987 | 100,083 | 86.4 | % | 808 | Y | 0.0 | % | ||||||||
Riverside I, CA | 1997 | 1989 | 28,860 | 90.0 | % | 249 | N | 0.0 | % | ||||||||
Riverside II, CA† | 1997 | 1989 | 21,880 | 91.2 | % | 20 | N | 0.0 | % | ||||||||
Riverside III, CA | 1998 | 1989 | 46,920 | 88.7 | % | 384 | Y | 0.0 | % | ||||||||
San Bernardino I, CA | 1997 | 1985 | 46,600 | 79.5 | % | 453 | Y | 5.3 | % | ||||||||
San Bernardino II, CA | 1997 | 1987 | 83,418 | 79.8 | % | 625 | Y | 2.0 | % | ||||||||
San Bernardino III, CA | 1997 | 1987 | 32,102 | 81.9 | % | 246 | N | 0.0 | % | ||||||||
San Bernardino IV, CA | 1997 | 1989 | 57,400 | 87.2 | % | 591 | Y | 0.0 | % | ||||||||
San Bernardino V, CA | 1997 | 1991 | 41,781 | 78.3 | % | 408 | Y | 0.0 | % | ||||||||
San Bernardino VI, CA | 1997 | 1985/92 | 35,007 | 79.4 | % | 413 | N | 0.0 | % | ||||||||
Sun City, CA | 1998 | 1989 | 38,635 | 83.6 | % | 305 | N | 0.0 | % | ||||||||
Temecula I, CA | 1998 | 1985 | 39,725 | 85.7 | % | 316 | N | 0.0 | % | ||||||||
Temecula II, CA | 2003 | * | 2003 | 42,475 | 57.7 | % | 392 | Y | 89.5 | % | |||||||
Vista, CA | 2001 | 1988 | 74,781 | 90.3 | % | 614 | Y | 0.0 | % | ||||||||
Yucaipa, CA | 1997 | 1989 | 78,444 | 69.7 | % | 680 | Y | 0.0 | % | ||||||||
Bloomfield, CT | 1997 | 1987/93/94 | 48,900 | 68.2 | % | 455 | Y | 6.6 | % | ||||||||
Branford, CT | 1995 | 1986 | 51,079 | 79.2 | % | 438 | Y | 2.2 | % | ||||||||
Enfield, CT | 2001 | 1989 | 52,975 | 71.3 | % | 384 | Y | 0.0 | % | ||||||||
Gales Ferry, CT | 1995 | 1987/89 | 51,780 | 63.7 | % | 592 | N | 4.8 | % | ||||||||
Manchester, CT | 2002 | 1999/00/01 | 47,400 | 70.2 | % | 519 | N | 37.0 | % | ||||||||
Milford, CT | 1994 | 1975 | 45,181 | 78.3 | % | 388 | N | 3.1 | % | ||||||||
Mystic, CT | 1994 | 1975/86 | 50,250 | 76.8 | % | 551 | Y | 2.4 | % | ||||||||
South Windsor, CT | 1994 | 1976 | 67,525 | 66.8 | % | 550 | Y | 0.8 | % | ||||||||
Boca Raton, FL | 2001 | 1998 | 38,203 | 95.8 | % | 605 | N | 67.9 | % | ||||||||
Boynton Beach, FL | 2001 | 1999 | 62,042 | 93.4 | % | 800 | Y | 54.0 | % | ||||||||
Bradenton I, FL | 2004 | 1979 | 68,480 | 81.0 | % | 676 | N | 2.8 | % | ||||||||
Bradenton II, FL | 2004 | 1996 | 88,103 | 87.4 | % | 904 | Y | 40.2 | % | ||||||||
Cape Coral, FL | 2000 | * | 2000 | 76,789 | 94.5 | % | 902 | Y | 83.0 | % | |||||||
Dania, FL | 1994 | 1988 | 58,319 | 96.5 | % | 483 | Y | 26.9 | % | ||||||||
Dania Beach, FL | 2004 | 1984 | 264,375 | 53.4 | % | 1,928 | N | 21.0 | % | ||||||||
Davie, FL | 2001 | * | 2001 | 81,235 | 88.6 | % | 839 | Y | 55.6 | % | |||||||
Deerfield Beach, FL | 1998 | * | 1998 | 57,770 | 96.6 | % | 527 | Y | 39.2 | % | |||||||
DeLand, FL | 1998 | 1987 | 38,577 | 96.1 | % | 412 | Y | 0.0 | % |
(6) We have ground leases for certain small parcels of land adjacent to these facilities that expire between 2008 and 2015.
Facility Location Delray Beach, FL Fernandina Beach, FL Fort Lauderdale, FL Fort Myers, FL Lake Worth, FL† Lakeland I, FL Lakeland II, FL Leesburg, FL Lutz I, FL Lutz II, FL Margate I, FL† Margate II, FL† Merrit Island, FL Miami I, FL Miami II, FL Miami III, FL Miami IV, FL Miami V, FL Naples I, FL Naples II, FL Naples III, FL Naples IV, FL Ocala, FL Orange City, FL Orlando, FL Pembroke Pines, FL Royal Palm Beach, FL† Sarasota, FL St. Augustine, FL Stuart I, FL Stuart II, FL Tampa I, FL Tampa II, FL Vero Beach I, FL Vero Beach II, FL West Palm Beach I, FL West Palm Beach II, FL Alpharetta, GA Decatur, GA Norcross, GA Peachtree City, GA Smyrna, GA Addison, IL Aurora, IL Bartlett I, IL Bartlett II, IL Bellwood, IL Des Plaines, IL Elk Grove Village, IL Glenview, IL Gurnee, IL Harvey, IL Joliet, IL Lake Zurich, IL Lombard, IL Mount Prospect, IL Mundelein, IL North Chicago, IL Plainfield, IL Schaumburg, IL Year Acquired/
Developed(1) Year Built Rentable
Square Feet Occupancy(2) Units Manager
Apartment(3) % Climate
Controlled(4) 2001 1999 68,531 97.4 % 819 Y 39.0 % 1996 1986 91,480 96.2 % 683 Y 21.7 % 1999 * 1999 70,544 96.9 % 655 Y 46.0 % 1998 * 1998 67,256 93.5 % 611 Y 67.0 % 1998 1998/02 167,946 88.0 % 1,293 N 44.9 % 1994 1988 49,111 99.2 % 463 Y 78.1 % 1996 1984 48,600 92.3 % 356 Y 19.5 % 1997 1988 51,995 93.9 % 447 Y 5.1 % 2004 2000 72,795 92.9 % 658 Y 34.0 % 2004 1999 69,378 92.7 % 549 Y 20.4 % 1994 1979/81 55,677 92.1 % 343 N 10.5 % 1996 1985 66,135 93.8 % 317 Y 65.0 % 2000 * 2000 50,523 94.2 % 470 Y 56.4 % 1995 * 1995 47,200 81.3 % 556 Y 52.2 % 1994 1987 57,165 53.2 % 598 Y 0.1 % 1994 1989 67,360 94.9 % 573 Y 7.8 % 1995 1987 58,298 80.9 % 610 Y 7.0 % 1995 1976 77,825 62.9 % 369 Y 4.0 % 1996 1996 48,150 92.4 % 349 Y 26.6 % 1997 1985 65,994 81.8 % 647 Y 43.9 % 1997 1981/83 80,709 72.4 % 889 Y 24.0 % 1998 1990 40,023 81.1 % 444 N 41.4 % 1994 1988 42,086 91.8 % 360 Y 9.7 % 2004 2001 59,781 78.8 % 680 N 39.0 % 1997 1987 51,770 87.7 % 453 Y 4.8 % 1997 * 1997 67,505 92.7 % 692 Y 73.1 % 1994 1988 98,851 90.8 % 670 N 79.2 % 1998 * 1998 70,798 91.6 % 532 Y 43.0 % 1996 1985 59,830 83.2 % 581 Y 29.6 % 1997 1986 41,694 96.6 % 524 Y 27.0 % 1997 1995 89,541 97.8 % 896 Y 34.1 % 1994 1987 60,150 77.9 % 416 Y 0.0 % 2001 1985 56,047 78.3 % 476 Y 16.8 % 1997 1986 24,260 97.9 % 219 N 23.3 % 1998 1987 26,255 96.7 % 263 N 23.9 % 2001 1997 68,295 93.3 % 1,028 Y 47.3 % 2004 1996 93,915 97.3 % 913 Y 77.0 % 2001 1996 90,685 81.6 % 670 Y 74.9 % 1998 1986 148,680 75.0 % 1,409 Y 3.1 % 2001 1997 85,460 86.2 % 598 Y 55.1 % 2001 1997 50,034 88.6 % 449 N 74.6 % 2001 2000 56,528 99.4 % 509 Y 100.0 % 2004 1979 31,775 83.5 % 377 Y 0.0 % 2004 1996 74,440 68.7 % 573 Y 6.9 % 2004 1987 41,394 86.7 % 430 Y 0.5 % 2004 1987/01 51,725 86.9 % 421 Y 33.5 % 2001 1999 86,700 83.7 % 724 Y 52.1 % 2004 1978 74,600 86.2 % 643 Y 0.0 % 2004 1987 63,638 75.2 % 655 Y 0.3 % 2004 1998 100,345 81.2 % 764 Y 100.0 % 2004 1987/95 80,500 73.6 % 741 Y 34.0 % 2004 1987 59,816 80.6 % 587 Y 3.0 % 2004 1993 74,750 68.9 % 481 Y 23.3 % 2004 1988 46,635 76.9 % 450 Y 0.0 % 2004 1981 61,242 77.0 % 520 Y 18.3 % 2004 1979 65,200 74.0 % 610 Y 12.6 % 2004 1990 44,900 70.4 % 509 Y 8.9 % 2004 1985/90 53,500 79.0 % 445 N 0.0 % 2004 1998 54,375 77.6 % 410 N 0.0 % 2004 �� 1988 31,157 77.0 % 325 N 0.8 %
Facility Location Streamwood, IL Waukegan, IL West Chicago, IL Westmont, IL Wheeling I, IL Wheeling II, IL Woodridge, IL Indianapolis I, IN Indianapolis II, IN Indianapolis III, IN Indianapolis IV, IN Indianapolis V, IN Indianapolis VI, IN Indianapolis VII, IN Indianapolis VIII, IN Indianapolis IX, IN Baton Rouge I, LA Baton Rouge II, LA Baton Rouge III, LA Baton Rouge IV, LA Prairieville, LA Slidell, LA Boston, MA Leominster, MA Baltimore, MD California, MD Laurel, MD† Temple Hills, MD Grand Rapids, MI Portage, MI Romulus, MI Wyoming, MI Biloxi, MS Gautier, MS Gulfport I, MS Gulfport II, MS Gulfport III, MS Waveland, MS Belmont, NC Burlington I, NC Burlington II, NC Cary, NC Charlotte, NC Fayetteville I, NC Fayetteville II, NC Raleigh, NC Brick, NJ Cranford, NJ East Hanover, NJ Fairview, NJ Jersey City, NJ Linden I, NJ Linden II, NJ† Morris Township, NJ (5) Parsippany, NJ Randolph, NJ Sewell, NJ Jamaica, NY North Babylon, NY Boardman, OH28 Year Acquired/
Developed(1) Year Built Rentable
Square Feet Occupancy(2) Units Manager
Apartment(3) % Climate
Controlled(4) 2004 1982 64,565 71.6 % 578 N 0.0 % 2004 1977/79 79,950 73.9 % 715 Y 8.4 % 2004 1979 48,625 76.0 % 440 Y 0.0 % 2004 1979 53,900 80.6 % 403 Y 0.0 % 2004 1974 54,900 69.4 % 505 Y 0.0 % 2004 1979 68,025 70.0 % 624 Y 7.3 % 2004 1987 50,595 85.2 % 477 Y 0.0 % 2004 1987/88 43,800 84.0 % 332 N 0.0 % 2004 1997 45,100 78.9 % 460 Y 15.6 % 2004 1999 61,325 77.6 % 506 Y 32.6 % 2004 1976 68,494 68.4 % 616 Y 0.0 % 2004 1999 75,025 84.7 % 596 Y 33.5 % 2004 1976 73,693 69.2 % 730 Y 0.0 % 2004 1992 95,290 68.8 % 884 Y 0.0 % 2004 1975 81,676 74.2 % 738 Y 0.0 % 2004 1976 62,196 75.5 % 557 Y 0.0 % 1997 1980 55,984 84.9 % 464 Y 9.7 % 1997 1980 72,082 83.2 % 499 Y 33.7 % 1997 1982 61,078 93.5 % 451 Y 10.2 % 1998 1995 8,920 95.5 % 84 N 100.0 % 1998 1991 56,520 84.8 % 306 Y 3.0 % 2001 1998 79,740 90.1 % 525 Y 46.5 % 2002 2001 61,360 69.7 % 630 Y 100.0 % 1998 * 1987/88/00 54,181 76.6 % 504 Y 45.1 % 2001 1999/00 93,750 78.2 % 808 Y 45.5 % 2004 1998 67,528 91.1 % 722 Y 40.1 % 2001 1978/99/00 161,530 82.5 % 956 N 63.7 % 2001 2000 95,830 85.2 % 813 Y 77.6 % 1996 1976 87,295 71.1 % 508 Y 0.0 % 1996 1980 50,671 92.2 % 340 N 0.0 % 1997 * 1997 43,970 72.9 % 318 Y 10.7 % 1996 1987 90,975 79.1 % 621 N 0.0 % 1997 1978/93 66,188 78.9 % 620 Y 7.4 % 1997 1981 35,775 68.1 % 306 Y 3.2 % 1997 1970 73,460 64.2 % 513 Y 0.0 % 1997 1986 64,745 66.0 % 436 Y 18.8 % 1997 1977/93 61,451 87.9 % 486 Y 33.2 % 1998 1982/83/84/93 87,071 82.1 % 710 Y 23.7 % 2001 1996/97/98 81,215 80.3 % 569 N 7.8 % 2001 1990/91/93/94/98 110,502 81.2 % 951 N 4.0 % 2001 1991 39,802 86.6 % 392 Y 11.9 % 2001 1993/94/97 110,464 73.0 % 751 N 8.5 % 1999 * 1999 69,246 92.0 % 740 N 52.4 % 1997 1981 41,600 97.3 % 352 N 0.0 % 1997 1993/95 54,425 98.9 % 557 Y 11.9 % 1998 1994/95 48,525 87.7 % 431 Y 8.2 % 1994 1981 51,892 86.6 % 456 Y 0.0 % 1994 1987 91,450 87.6 % 848 Y 7.9 % 1994 1983 107,874 79.6 % 1,019 N 1.6 % 1997 1989 28,021 87.9 % 452 N 100.0 % 1994 1985 91,736 82.2 % 1,095 Y 0.0 % 1994 1983 100,625 80.4 % 1,125 N 2.7 % 1994 1982 36,000 100.0 % 26 N 0.0 % 1997 1972 76,175 81.3 % 573 Y 1.3 % 1997 1981 66,375 88.2 % 613 Y 1.4 % 2002 1998/99 52,232 85.1 % 592 Y 82.5 % 2001 1984/98 57,769 82.5 % 448 N 4.4 % 2001 2000 90,156 73.7 % 928 Y 100.0 % 1998 * 1988/99 78,288 84.9 % 635 Y 9.1 % 1980 * 1980/89 66,187 83.0 % 525 Y 16.1 %
Facility Location Brecksville, OH Centerville I, OH Centerville II, OH Dayton, OH Euclid I, OH Euclid II, OH Hudson, OH† Lakewood, OH Mason, OH Miamisburg, OH Middleburg Heights, OH North Canton I, OH North Canton II, OH North Olmsted I, OH North Olmsted II, OH North Randall, OH Warrensville Heights, OH Youngstown, OH Levittown, PA Philadelphia, PA Hilton Head I, SC† Hilton Head II, SC Summerville, SC Knoxville I, TN Knoxville II, TN Knoxville III, TN Knoxville IV, TN Knoxville V, TN Memphis I, TN Memphis II, TN Milwaukee, WI Total/Weighted Average Year Acquired/
Developed(1) Year Built Rentable
Square Feet Occupancy(2) Units Manager
Apartment(3) % Climate
Controlled(4) 1998 1970/89 64,764 86.5 % 410 Y 34.2 % 2004 1976 86,590 78.2 % 654 Y 0.0 % 2004 1976 43,600 83.0 % 310 N 0.0 % 2004 1978 43,420 93.1 % 351 N 0.0 % 1988 * 1988 47,260 72.6 % 441 Y 21.9 % 1988 * 1988 48,058 79.4 % 381 Y 0.0 % 1998 1987 68,470 85.0 % 421 N 13.9 % 1989 * 1989 39,523 88.1 % 486 Y 24.5 % 1998 1981 33,700 91.0 % 282 Y 0.0 % 2004 1975 61,050 78.2 % 432 Y 0.0 % 1980 * 1980 94,150 81.1 % 667 Y 0.0 % 1979 * 1979 45,532 93.5 % 290 Y 0.0 % 1983 * 1983 44,380 83.3 % 354 Y 15.8 % 1979 * 1979 48,910 83.6 % 449 Y 1.2 % 1988 * 1988 48,050 83.0 % 406 Y 14.1 % 1998 * 1998/02 80,452 82.2 % 803 N 90.3 % 1980 * 1980/82/98 90,531 86.9 % 746 Y 0.0 % 1977 * 1977 66,700 91.6 % 500 Y 0.0 % 2001 2000 78,230 87.4 % 671 Y 36.2 % 2001 1999 99,181 89.4 % 914 N 91.6 % 1997 1981/84 116,766 75.2 % 545 Y 5.4 % 1997 1979/80 47,620 88.4 % 297 Y 0.0 % 1998 1989 49,727 86.8 % 439 Y 10.1 % 1997 1984 29,452 87.7 % 297 Y 5.4 % 1997 1985 38,550 98.7 % 350 Y 7.0 % 1998 1991 45,864 86.3 % 425 Y 6.7 % 1998 1983 59,070 78.0 % 456 N 1.1 % 1998 1977 43,050 86.6 % 376 N 0.0 % 2001 1999 86,075 85.3 % 622 N 51.3 % 2001 2000 72,210 85.7 % 544 N 46.2 % 2004 1988/92/96 58,713 82.8 % 489 Y 0.0 % ��
(201 Facilities) 12,977,893 82.2 % 111,634
Our growth has been achieved by internal growth and by adding facilities to our portfolio each year through acquisitions and development. The tables set forth below show the average occupancy, and annual rent per occupied square foot, average occupied square feet and total revenues for our existing facilities owned as of December 31, 2007 for each of the last fivethree years, grouped by the year end during which we first owned or operated the facility.
ExistingOur Facilities by Year Acquired—Acquired - Average OccupancyOccupied Square Feet (2)
Year Acquired(1) | Number of Facilities | Current Rentable Square Feet | Average Occupancy During the Twelve Months Ended December 31, | ||||||||||||||||
2000 | 2001 | 2002 | 2003 | 2004 | |||||||||||||||
1996 or earlier | 41 | 2,599,851 | 84.5 | % | 83.2 | % | 80.9 | % | 81.2 | % | 83.5 | % | |||||||
1997 | 46 | 2,672,957 | 83.1 | % | 82.2 | % | 81.0 | % | 82.8 | % | 84.1 | % | |||||||
1998 | 25 | 1,478,077 | 84.0 | % | 82.1 | % | 81.3 | % | 84.2 | % | 85.0 | % | |||||||
1999 | 2 | 138,054 | 45.6 | % | 67.2 | % | 81.3 | % | 82.0 | % | 88.0 | % | |||||||
2000 | 6 | 418,024 | 71.0 | % | 76.0 | % | 81.7 | % | 85.5 | % | 87.6 | % | |||||||
2001 | 27 | 2,107,610 | 73.6 | % | 75.7 | % | 80.6 | % | 84.9 | % | |||||||||
2002 | 7 | 405,966 | 83.3 | % | 82.9 | % | 83.9 | % | |||||||||||
2003 | 1 | 42,475 | 20.4 | % | 48.7 | % | |||||||||||||
2004 | 46 | 3,114,879 | 77.6 | % | |||||||||||||||
All Existing Facilities | 201 | 12,977,893 | 83.0 | % | 81.3 | % | 79.9 | % | 82.1 | % | 84.0 | % |
|
|
|
| Rentable Square |
|
|
|
|
|
|
|
Year Acquired (1) |
| # of Facilities |
| Feet |
| 2005 |
| 2006 |
| 2007 |
|
2004 and earlier |
| 195 |
| 12,606,750 |
| 82.8 | % | 81.4 | % | 80.6 | % |
2005 |
| 137 |
| 7,614,578 |
| 81.9 | % | 80.2 | % | 82.6 | % |
2006 |
| 60 |
| 4,578,622 |
|
|
| 75.6 | % | 75.2 | % |
2007 |
| 17 |
| 1,319,234 |
|
|
|
|
| 71.3 | % |
All Facilities Owned as of December 31, 2007 |
| 409 |
| 26,119,184 |
| 82.6 | % | 80.2 | % | 80.0 | % |
ExistingOur Facilities by Year Acquired—Acquired - Annual Rent Per Occupied Square Foot (2)
Year Acquired(1) | Number of Facilities | Annual Rent Per Occupied Square Foot for the Twelve Months Ended December 31, | |||||||||||||||
2000 | 2001 | 2002 | 2003 | 2004 | |||||||||||||
1996 or earlier | 41 | $ | 10.26 | $ | 10.71 | $ | 10.79 | $ | 10.59 | $ | 10.66 | ||||||
1997 | 46 | $ | 8.40 | $ | 8.81 | $ | 9.04 | $ | 9.21 | $ | 9.52 | ||||||
1998 | 25 | $ | 8.54 | $ | 8.73 | $ | 8.82 | $ | 8.89 | $ | 9.34 | ||||||
1999 | 2 | $ | 7.14 | $ | 7.10 | $ | 7.66 | $ | 8.25 | $ | 9.50 | ||||||
2000 | 6 | $ | 7.66 | $ | 13.10 | $ | 13.33 | $ | 13.26 | $ | 13.29 | ||||||
2001 | 27 | $ | 11.21 | $ | 10.88 | $ | 10.12 | $ | 10.56 | ||||||||
2002 | 7 | $ | 14.41 | $ | 13.31 | $ | 13.49 | ||||||||||
2003 | 1 | $ | 8.75 | $ | 12.94 | ||||||||||||
2004 | 46 | $ | 12.22 | ||||||||||||||
All Existing Facilities | 201 | $ | 9.13 | $ | 9.77 | $ | 10.13 | $ | 10.04 | $ | 10.44 |
Year Acquired (1) |
| # of Facilities |
| 2005 |
| 2006 |
| 2007 |
| |||
2004 and earlier |
| 195 |
| $ | 10.80 |
| $ | 11.38 |
| $ | 11.57 |
|
2005 |
| 137 |
| 8.34 |
| 10.53 |
| 10.43 |
| |||
2006 |
| 60 |
|
|
| 10.22 |
| 10.26 |
| |||
2007 |
| 17 |
|
|
|
|
| 11.16 |
| |||
All Facilities Owned as of December 31, 2007 |
| 409 |
| $ | 9.88 |
| $ | 10.61 |
| $ | 10.99 |
|
(1) For facilities developed by us, “Year Acquired” represents the year in which such facilities were acquired by our operating partnership from an affiliated entity, which in some cases is later than the year developed. (2) Determined by dividing the aggregate rental revenue for each twelve-month period by the average of the month-end occupied square feet for the period. Rental revenue includes customer rental revenues, access, administrative and late fees and revenues from auctions, but does not include ancillary revenues generated at our facilities. 29
(1) For facilities developed by us, “Year Acquired” represents the year in which such facilities were acquired by our operating partnership from an affiliated entity, which in some cases is later than the year developed.
(3) Represents the result obtained by multiplying annual rent per occupied square foot (4) Represents total revenues as presented in our historical financial
Planned Renovations and Improvements
We
We are not presently involved in any material litigation nor, to our knowledge, is any material litigation threatened against us or our properties. We are involved in routine litigation arising in the ordinary course of business, none of which we believe to be material.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
30 PART II
As of
our shareholders. Distributions to shareholders are usually taxable as ordinary income, although a portion of the distribution may be designated as capital gain or may constitute a tax-free return of capital. Annually, we provide each of our shareholders a statement detailing distributions paid during the preceding year and their characterization as ordinary income, capital gain or return of capital. The characterization of our dividends for 2007 was 29.42% ordinary income, 6.39% capital gain distribution and 64.19% return of capital.
We intend to continue to declare quarterly distributions. However, we cannot provide any assurance as to the amount or timing of future distributions. Under our new revolving credit facility, beginning in the fourth quarter of 2008 we are restricted from paying distributions on our common shares that would exceed an amount equal to the greater of (i) a certain percentage of our funds from operations, and (ii) such amount as may be necessary to maintain our REIT status.
In
The SEC requires us to present a chart comparing the cumulative total shareholder return on our common shares with the cumulative total shareholder return of (i) a broad equity index and (ii) a published industry or peer group index. The following chart compares the cumulative total shareholder return for our common shares with the cumulative shareholder return of companies on (i) the S&P 500 Index, (ii) the Russell 2000 and (iii) the NAREIT All Equity REIT Index as provided by NAREIT for the period beginning with October 22, 2004 (the first closing share price following the initial public offering of our common shares) and ending December 31, 2007. 31
The following table provides information about repurchases of the Company’s common shares during the three-month period
(1) On June 27, 2007, the Company announced that the Board of Trustees approved a share repurchase program for up to 3.0 million of the Company’s outstanding common shares. Unless terminated earlier by resolution of the Board of Trustees, the program will expire when the number of authorized shares has been repurchased. For the three-month period ended December 31, 2007, the Company made no repurchases under this program. 32 ITEM 6. SELECTED FINANCIAL DATA
The following table sets forth selected
The Predecessor’s combined historical financial information includes the following entities, which are the entities referred to collectively in this Form 10-K as Acquiport/Amsdell, for periods prior to October 21, 2004: the operating partnership (formerly known as Acquiport/Amsdell I Limited
The following data should be read in conjunction with the audited financial statements and notes thereto of the Company and
33
Period October 21, 2004 through December 31, Period January 1, 2004 through October 20, Balance Sheet Data (as of end of period): Storage facilities, net of accumulated depreciation Total assets Loans payable and capital lease obligations Total liabilities Minority interest Shareholders’/owners’ equity Total liabilities and shareholders’/owners’ equity Cash Flow data: Net cash flow provided by (used in): Operating activities Investing activities Financing activities Other data: Net operating income(2) Funds from operations(3) Number of facilities (end of period) Total rentable square feet (end of period) Occupancy (end of period) Reconciliation of Net Income to Funds from Operations(3): Net Income (Loss) Plus: Depreciation Depreciation included in discontinued operations Loss on sale of storage facilities Less: Minority interest Gain on sale of storage facilities FFO for the operating partnership FFO allocable to minority interest FFO attributable to common shareholders Reconciliation of Net Income (Loss) to Net Operating Income (3): Net Income (Loss) Plus: Management fees to related party/general and administrative(4) Depreciation Interest expense Loan procurement amortization expense (Gain) Loss from discontinued operations Early extinguishment of debt Costs incurred to acquire management company Other Less: Income from discontinued operations Minority interest Gain on sale of storage facilities Net operating income
(2) Prior to the IPO, management fees to related parties were paid to U-Store-It Mini Warehouse Co., the prior manager of (3) Excludes 5,198,855 operating partnership units issued at our IPO and in connection with the acquisition of facilities subsequent to our IPO. Operating partnership units have been excluded from the earnings per share calculations as there would be
(5) For the period from October 21, 2004 through December 31, 2004, amount includes a one-time management contract termination charge of approximately $22.2 million related to the termination of our management contracts as a result of the purchase of U-Store-It Mini Warehouse Co. and approximately $7.0 million of expenses related to the early extinguishment of debt at the time of our IPO. Additionally, for the period from October 21, 2004 through December 31, 2004, general and administrative expense includes a one-time compensation charge of approximately $2.4 million for deferred shares granted to certain members of our senior management team in connection with our IPO. 35 ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION ANDRESULTS OF OPERATIONS The following discussion should be read in conjunction with the financial statementsand notes thereto appearing elsewhere in this report.
On October 27, 2004, the Company completed its IPO, pursuant to which it sold an aggregate of 28,750,000 common shares (including 3,750,000 shares pursuant to the exercise of the underwriters’ over-allotment option) at an offering price of $16.00 per share. The IPO resulted in gross proceeds to the Company of $460.0 million. On October 7, 2005, the Company completed a follow-on public offering, pursuant to which it sold an aggregate of 19,665,000 common shares (including 2,565,000 shares pursuant to the exercise of the underwriters’ over-allotment option) at an offering price of $20.35 per share, for gross proceeds of approximately
The Company is an integrated self-storage real estate company, which means that it has
The Company derives revenues principally from rents received from its customers who rent units at its self-storage facilities under month-to-month leases. Therefore, our operating results depend materially on our ability to retain our existing customers and lease our available self-storage units to new customers while maintaining and, where possible, increasing our pricing levels. In addition, our operating results depend on the ability of our customers to make required rental payments to us. We believe that our decentralized approach to the management and operation of our facilities, which places an emphasis on local, market level oversight and control, allows us to respond quickly and effectively to changes in local market conditions, where appropriate increasing rents while maintaining occupancy levels, or increasing occupancy levels while maintaining pricing levels.
In the future,
The Company has one reportable operating segment: we own, operate, develop, and acquire self-storage facilities. The Company’s self-storage facilities are located in major metropolitan and rural areas and have numerous tenants per facility. No single tenant represents 1% or more of our revenues. The facilities in Florida, California, Texas and Illinois provided approximately 19%, 15%, 8% and 7%, respectively, of total revenues for the year ended December 31, 2007. Summary of Critical Accounting Policies and Estimates
Set forth below is a summary of the accounting policies that management believes are critical to the preparation of the consolidated 36 Basis of Presentation
The accompanying consolidated financial statements include all of the accounts of the Company, the operating partnership and the wholly-owned subsidiaries of
Self-Storage Facilities
The Company records self-storage facilities at cost less accumulated depreciation. Depreciation on the buildings and equipment is recorded on a straight-line basis over their estimated useful lives, which range from five to 40 years. Expenditures for significant renovations or improvements that extend the useful life of assets are capitalized. Repairs and maintenance costs are expensed as incurred.
When facilities are acquired, the purchase price is allocated to the tangible and intangible assets acquired and liabilities assumed based on estimated fair values. When a portfolio of facilities is acquired, the purchase price is allocated to the individual facilities based upon an income approach or a cash flow analysis using appropriate risk adjusted capitalization rates, which take into account the relative size, age and location of the individual facility along with current and projected occupancy and rental rate levels or appraised values, if available. Allocations to the individual assets and liabilities are based upon comparable market sales information for land, buildings and improvements and estimates of depreciated replacement cost of equipment.
In allocating the purchase price, the Company determines whether the acquisition includes intangible assets or liabilities. Substantially all of the leases in place at acquired
Long-lived assets
The Company considers long-lived assets to be “held for sale” upon satisfaction of the following criteria: (a) management commits to a plan to sell a facility (or group of facilities), (b) the facility is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such facilities, (c) an active program to locate a buyer and other actions required to complete the plan to sell the facility have been initiated, (d) the sale of the facility is probable and transfer of the asset is expected to be completed within one year, (e) the facility is being actively marketed for sale at a price that is reasonable in relation to its current fair value, and (f) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. Typically these criteria are all met when the relevant asset is under contract, significant non-refundable deposits have been made by the potential buyer, the assets are immediately available for transfer and there are no contingencies related to the sale that may prevent the transaction from closing. In most transactions, these contingencies are not satisfied until the actual closing of the
Revenue Recognition
Management has determined that all our leases with tenants are operating leases. Rental income is recognized in accordance with the terms of the lease agreements or contracts, which generally are month-to-month. Revenues from long-term operating leases are recognized on a straight-line basis over the term of the lease. The excess of rents recognized over 37 amounts contractually due pursuant to the underlying leases is included in
Share
We apply the fair value method of accounting for Minority Interests As of September 30, 2005, the Company recorded the operating partnership units issued in connection with the National Self Storage transaction as conditionally redeemable as the result of a special redemption right (see Note 4 and Note 7 to the consolidated financial statements) for a discussion of the National Self Storage transaction). On October 25, 2005, the sellers in the National Self Storage transaction agreed to terminate the Special Redemption Right, effective as of July 15, 2005 (the first date on which National Self Storage facilities were acquired by the operating partnership under the purchase agreement). From the issuance date until October 25, 2005, the Company elected to accrete changes in the redemption value of the National Self Storage units issued over the period from the date of issuance to the earliest redemption date (one year from the date of initial issuance) on a pro rata basis. Upon termination of the Special Redemption Right, the Company classified these units in minority interest. The amount of accretion recorded through October 25, 2005 was approximately $3.0 million. Effective October 26, 2005, minority interest represents issued and outstanding operating partnership units.
In December 2007, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards No. 141 (Revised 2007), Business Combinations (“FAS 141(R)”). FAS 141(R) establishes principles and requirements for recognizing identifiable assets acquired, liabilities assumed, noncontrolling interest in the acquiree, goodwill acquired in the combination or In December 2007, the FASB issued Statement of Financial Accounting Standards No. 160, Noncontrolling Interests in Consolidated Financial Statements (“FAS 160”). FAS 160 requires that In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities – including an amendment of FASB Statement No. 115 (“SFAS No. 159”). SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value, with unrealized gains and losses related to these financial instruments reported in earnings at each subsequent reporting date. 38 This statement is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007. The Company is in the process of evaluating the impact of SFAS No. 159 on
In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements (“SFAS No. 157”). SFAS No. 157 provides guidance for using fair value to measure assets and liabilities. This statement clarifies the principle that fair value should be based on the assumptions that market participants would use when pricing the asset or liability. SFAS No. 157 establishes a fair value hierarchy, giving the highest priority to quoted prices in active markets and the lowest priority to unobservable data. SFAS No. 157 applies whenever other standards require assets or liabilities to be measured at fair value. This statement is effective in fiscal years beginning after November 15, 2007. The Company believes that the adoption of this standard on January 1, 2008 will not have a material effect on our consolidated financial statements. In June 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an Interpretation of FASB Statement No. 109 (“FIN 48”). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in a company’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 also provides guidance on description, classification, interest and penalties, accounting in interim periods, disclosure and transition. FIN 48 became effective for the Company on January 1, 2007. The adoption of FIN 48 in 2007 did not have a material effect on the consolidated financial statements. In February 2006, the FASB issued SFAS No. 155, Accounting for Certain Hybrid Financial Instruments — An Amendment of FASB Nos. 133 and 140. The purpose of SFAS No. 155 is to simplify the accounting for certain hybrid financial instruments by permitting fair value re-measurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation. SFAS No. 155 also eliminates the restriction on passive derivative instruments that a qualifying special-purpose entity may hold. SFAS No. 155 is effective for all financial instruments acquired or issued after the beginning of an entity’s first fiscal year beginning after September 15, 2006. The adoption of SFAS No. 155 in 2007 did not have a material effect on the consolidated financial statements. Results of Operations
The following discussion of our results of operations should be read in conjunction with the consolidated
Comparison of Operating Results for the Years Ended December 31,
Acquisition and Development Activities
The comparability of the Company’s results of operations is significantly affected by
· In
· In 2007, 5 self-storage facilities were sold for approximately · In 2006, 60 self-storage facilities were acquired for approximately 39 A comparison of net income
Total Revenues Rental income increased from $195.3 million in 2006 to $211.9 million in 2007, an increase of $16.6 million, or 8%. This increase is primarily attributable to (i) additional rental income from the 2007 Acquisitions, (ii) a full year contribution from the 2006 Acquisitions, and (iii) an increase in rental income from our pool of same-store facilities of approximately $3.0 million resulting from rate increases and an increase in average occupancy from 81.2% to 81.7%. Other property related income, including Other – related party, increased from $15.3 million in 2006 to $17.2 million in 2007, an increase of $1.9 million, or 12%. This increase is primarily attributable to the other property income from the 2007 Acquisitions and a full year contribution from the 2006 Acquisitions. Total Operating Expenses Property operating expenses, including property operating expenses – related party, increased from $85.5 million in 2006 to $96.9 million in 2007, an increase of $11.4 million, or 13%. This increase is primarily attributable to (i) additional operating expenses from the 2007 Acquisitions, (ii) a full year of operating expenses from the 2006 Acquisitions, and (iii) an increase in repair and maintenance expenses of $1.2 million as part of the Company’s effort to address deferred maintenance items during 2007. General and administrative expenses, including General and administrative expenses – related party, remained unchanged at $22.3 million. The 2006 period includes approximately $2.7 million of severance costs related to a Company restructuring of certain management positions; the 2007 period includes approximately $1.2 million of non-recurring legal and professional costs associated with the litigation and related settlement with the Amsdells. 40 Depreciation increased from $64.1 million in 2006 to $70.1 million in 2007, an increase of $6.0 million, or 9%. The increase is primarily attributable to additional depreciation expense related to the 2007 Acquisitions and a full year of depreciation expense related to the 2006 Acquisitions.
Asset write-off of $0.3 million represents the disposal of the Company’s former point of sale system, which was replaced with CentershiftTM in the third quarter of 2006. In August 2007, the Company abandoned certain office space in Cleveland, OH that was previously used for its corporate offices. The related leases have expiration dates ranging from December 31, 2008 through December 31, 2014. Upon vacating the space, the Company entered into a sub-lease agreement with a sub-tenant to lease the majority of the space for the duration of the term. As a result of this exit activity, the Company recognized a “Lease abandonment charge” of $1.3 million during 2007. Total Other Expenses Interest expense increased from $45.6 million in 2006 to $54.1 million in 2007, an increase of $8.5 million, or 19%. The increase is attributable to a higher amount of outstanding debt in 2007 primarily resulting from the financing of the 2007 Acquisitions, which was primarily funded through the revolving credit facility and secured term loan. An additional source of the increase is a full year of interest expense related to debt assumed in conjunction with the 2006 Acquisitions. Loan procurement amortization expense decreased from $2.0 million in 2006 to $1.8 million in 2007, a decrease of $0.2 million, or 10%. The decrease is attributable to the repayment of five mortgages during 2007. In conjunction with the two revolving credit facility financings during 2006, the Company incurred charges of $1.9 million relating to the write-off of unamortized loan procurement costs. Interest income decreased to $0.4 million in 2007 from $1.3 million in 2006. This decrease is primarily attributable to the Company’s investment of excess proceeds from the 2005 follow-on public offering in interest bearing accounts and in short-term marketable securities until the excess proceeds were used to fund acquisitions or pay down existing debt during the first quarter of 2006. Comparison of Operating Results for the Years Ended December 31,
Acquisition and Development Activities The comparability of the Company’s results of operations is significantly affected by acquisition activities in 2006 and 2005. At December 31, 2006 and 2005, the Company owned 399 and 339 self-storage facilities and related assets, respectively. In 2006, 60 self-storage facilities were acquired for approximately $362.4 million (the “2006 Acquisitions”). In 2005, 146 self-storage facilities were acquired for approximately $547.9 million. During 2005, four self-storage facilities were sold for approximately $6.2 million, and accordingly results of operations for these facilities have been accounted for as discontinued operations. The Company also reduced its reported number of facilities during 2005 by consolidating four facilities into existing adjacent facilities. Based upon total acquisitions, dispositions and consolidations, the Company had a net increase of 138 facilities in 2005 (the “2005 Acquisitions”). 41 A comparison of net income (loss) for the years ended December 31, 2006 and 2005 is as follows:
Total Revenues
Rental income increased from
Other property related income,
Total Operating Expenses Property operating expenses, including Property operating expenses – related party, increased
42 Depreciation increased from $39.5 million in 2005 to $64.1 million in 2006, an increase of $24.6 million, or 62%. The increase is primarily attributable to additional depreciation expense related to the 2006 Acquisitions and a full year of depreciation expense related to the 2005 Acquisitions. Asset write-off in 2006 of $0.3 million represents the disposal of the Company’s former point of sale system, which was replaced with CentershiftTM in the fourth quarter of 2006. Total Other Expenses Interest expense increased from $31.9 million in 2005 to $45.6 million in 2006, an increase of $13.7 million, or 43%. The increase is attributable to a higher In conjunction with the two revolving credit facility financings during 2006, the
Same-Store Facility Results
The Company considers its same-store portfolio to consist of only those facilities owned at the beginning and at the end of the applicable periods presented. The following same-store presentation is considered to be useful to investors in evaluating our performance because it provides information relating to changes in facility-level operating performance without taking into account the effects of acquisitions, developments or dispositions. The following table sets forth operating data for our same-store portfolio for the periods presented.
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Comparison of the Year Ended December 31, The following table provides information pertaining to our Same-Store portfolio for 2007 and 2006:
Same-store revenues increased from Same-store property operating expenses increased from Non-GAAP Financial Measures NOI We define net operating income, which we refer to as “NOI,” as total continuing revenues less continuing property operating expenses. NOI also can be calculated by We use NOI as a measure of operating performance at each of our facilities, and for all of our facilities in the We believe NOI is useful to investors in evaluating our operating performance because: 44 · It is one of · It is widely used in the real estate industry and the self-storage industry to · We believe it helps our investors to meaningfully compare the results of our operating performance from period to period by removing the impact of our capital structure (primarily interest expense on our outstanding indebtedness) and depreciation of our basis in our assets from our operating results. There are material limitations to using a measure such as NOI, including the difficulty associated with comparing results among more than one company and the inability to analyze certain significant items, including depreciation and interest expense, that directly affect our net income. We compensate for these limitations by considering the economic effect of the excluded expense items independently as well as in connection with
Cash Flows Comparison of the Year Ended December 31,
Cash provided by operations decreased from
Cash Cash provided by financing activities decreased from $104.3 million in 2006 to $75.5 million in 2007, a decrease of $28.8 million, or 28%. This decrease is primarily attributable to the net additional borrowings during 2006 of $176.4 million as compared to the net additional borrowings during 2007 of $150.6 million. This fluctuation is a result of the 2006 Acquisition activity. Comparison of the Year Ended December 31, 2006 to the Year Ended December 31,2005
A comparison of cash flow operating, investing and financing activities for the years ended December 31,
45
Cash provided by operations increased from
Cash used in investing activities decreased from Cash provided by financing activities decreased from $516.5 million in 2005 to $104.3 million in 2006, a decrease of $412.2 million, or 79.8%. This decrease is primarily attributable to
Liquidity and Capital Resources
In
In November 2006, we and In November 2006, we and our Operating Partnership entered into a three-year, $450.0 million unsecured credit facility with Wachovia Capital Markets, LLC and Keybanc Capital Markets, replacing our existing $250.0 million unsecured revolving credit facility. The facility consists of a $200 million term loan and a $250 million revolving credit facility. The new facility has a three-year term with a one-year extension option and scheduled termination in November 2009. Borrowings under the credit facility bear interest, at our option, at either an alternative base rate or a Eurodollar rate, in each case, plus an applicable margin based on our leverage ratio or our credit rating. The alternative base interest rate is a fluctuating rate equal to the higher of the prime rate or the sum of the federal funds effective rate plus 50 basis points. The applicable margin for 46 months based on the LIBOR rate determined two business days prior to Our ability to borrow under this credit facility will be subject to our ongoing compliance with the following financial covenants, among others:
· maximum total indebtedness to total asset value of 65%;
· minimum interest coverage ratio of 2.0:
· minimum fixed charge coverage ratio of
· minimum tangible net worth of
In September 2007, we and our Operating Partnership entered into a secured term loan agreement which allows for term loans in the aggregate principal amount of up to $50 million. Each term loan matures in November 2009, subject to extension at the sole discretion of the lenders. Each term loan bears interest at either an alternative base rate or a Eurodollar rate, at our option, in each case plus an applicable margin at terms identical to the unsecured credit facility. As of September 30, 2007, there was one term loan outstanding for $47.4 million. The outstanding term loan is secured by a pledge by our Operating Partnership of all equity interests in YSI RT LLC, the wholly-owned subsidiary of our Operating Partnership that acquired eight self-storage facilities in September 2007. At December 31, 2007, the outstanding term loan had an interest rate of 6.18%. Financial covenants for the secured term loan are identical to the financial covenants for the unsecured credit facility described above. During August and September 2007, the Company entered into interest rate swap agreements designated as cash flow hedges that are designed to reduce the impact of interest rate changes on its variable rate debt. At December 31, 2007, the Company had an interest rate swap agreements for notional principal amounts aggregating $75 million. The swap agreements effectively fix the 30-day LIBOR interest rate on $50 million of credit facility borrowings at 4.7725% per annum and on $25 million of credit facility borrowings at 4.716% per annum, in each case until November 2009. The interest rate cap agreement effectively limits the interest rate on $40 million of credit facility borrowings at 5.50% through June 2008. The notional amount at December 31, 2007 provides an indication of the extent of the Company’s involvement in these instruments at that time, but does not represent exposure to credit, interest rate or market risks. Our cash flow from operations has historically
purposes, we are required to distribute at least 90% of our REIT taxable income, excluding capital gains, to our shareholders on an annual basis or pay federal income tax. The nature of
47 investments. We will have to satisfy these needs through either additional borrowings, including borrowings under
Other Material Changes in Financial Position
Storage facilities increased $80.3 million, cash and cash equivalents decreased $15.2 million, our revolving credit facility increased $128.5 million and the secured term loan increased $47.4 million primarily as a result of the 2007 Acquisitions. The change in other assets is primarily attributable to intangible assets assumed in conjunction with the 2007 acquisitions, which had a net carrying value of $4.6 million at December 31, 2007, as well as an increase in prepaid expenses, which is related to the timing of certain expenditures. The change in the revolving credit facility and secured term loan is also attributable to the repayment of multiple mortgage notes during 2007. Distributions payable decreased as a result of a board approved dividend decrease from $0.29 per share in the third quarter of 2007 to $0.18 per share in the fourth quarter of 2007. 48 Contractual Obligations
The following table summarizes our known contractual obligations as of December 31,
(a) Amounts do not include unamortized discounts/premiums.
We expect that the contractual obligations owed in
We do not currently have any off-balance sheet
The Company’s future income, cash flows and fair values relevant to financial instruments depend upon prevailing interest rates.
Market Risk Our investment policy relating to cash and cash equivalents is to preserve principal and liquidity while maximizing the return through investment of available funds. We did not hold any auction rate securities at December 31, 2006 or December 31, 2007. Effect of Changes in Interest Rates on our Outstanding Debt
The analysis below presents the sensitivity of the market value of our financial instruments to selected changes in market rates. The range of changes chosen reflects our view of changes which are reasonably possible over a one—year period. Market values are the present value of projected future cash flows based on the market rates chosen. Our financial instruments consist of both fixed and variable rate debt. As of December 31, 49 change in interest rates on the If market rates of interest on our variable rate debt increase by 1%, the increase in annual interest If market rates
ITEM 8.
Financial statements required by this item appear with an Index to Financial Statements and Schedules, starting on page
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING ANDFINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
Changes in Internal
During the fourth quarter, we completed the remediation of the material weaknesses in internal control relating to the requisite skills and competencies or appropriate depth of experience of our accounting department personnel to assure the preparation of accurate interim and annual financial statements on a timely basis in accordance with generally accepted accounting principles; inadequate monitoring controls and the appropriate personnel with the requisite skills and competencies to execute an adequate level of oversight to accurately account for the results of our operations, which adversely affected our ability to report our financial results in a timely and accurate manner; and our lack of robust risk assessment processes, including strategic plans, that clearly defined and communicated our goals and objectives throughout our organization identified as of December 31, 2006. There Management’s Report on Internal Control over Financial Reporting Management’s report on internal control over financial reporting
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ITEM 10. TRUSTEES AND EXECUTIVE OFFICERS
We have adopted a Code of Ethics,
The remaining information required by this item regarding trustees,
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item is hereby incorporated by reference to the material appearing in the Proxy Statement under the captions
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENTAND RELATED SHAREHOLDER MATTERS
The information regarding security ownership of certain beneficial owners and management required by this item is hereby incorporated by reference to the material appearing in the Proxy Statement under the caption
The following table sets forth certain information regarding our equity compensation plans as of December 31,
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this item is hereby incorporated by reference to the material appearing in the Proxy Statement under the
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by this item is hereby incorporated by reference to the material appearing in the Proxy Statement under the
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ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a) Documents filed as part of this report:
1. Financial Statements.
The response to this portion of Item 15 is submitted as a separate section of this report.
2. Financial Statement Schedules.
The response to this portion of Item 15 is submitted as a separate section of this report.
3. Exhibits.
The list of exhibits filed with this report is set forth in response to Item 15(b). The required exhibit index has been filed with the exhibits.
(b) Exhibits. The following documents are filed as exhibits to this report:
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55
56
57
58
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Date: February 29, 2008 Pursuant to the requirements of
61 FINANCIAL STATEMENTS
F-1 MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under Section 404 of the Sarbanes-Oxley Act of 2002, the Company’s management is required to assess the effectiveness of the Company’s internal control over financial reporting as of the end of each fiscal year, and report on the basis of that assessment whether the Company’s internal control over financial reporting is effective. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. The Company’s internal control over financial reporting includes those policies and procedures that: · pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and the disposition of the assets of the Company; · provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that the receipts and expenditures of the Company are being made only in accordance with the authorization of the Company’s management and its Board of Trustees; and · provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements. There are inherent limitations in the effectiveness of any system of internal control, including the possibility of human error and the circumvention or overriding of controls. Accordingly, even an effective internal control system can provide only reasonable assurance with respect to financial statement preparation. Further, because of changes in conditions, the effectiveness of an internal control system may vary over time. Under the supervision, and with the participation, of the Company’s management, including the principal executive officer and principal financial officer, we conducted a review, evaluation and assessment of the effectiveness of our internal control over financial reporting as of December 31, 2007, based upon the Committee of Sponsoring Organizations of the Treadway Commission (COSO) criteria. In performing its assessment of the effectiveness of internal control over financial reporting, management has concluded that, as of December 31, 2007, our internal control over financial reporting was effective based on the COSO framework. The effectiveness of our internal control over financial reporting as of December 31, 2007, has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report that appears herein. February 29, 2008 F-2 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trustees and Shareholders of
We have audited the internal control over financial reporting of U-Store-It Trust and subsidiaries (the “Company”), as of December 31, 2007 based on criteria established in InternalControl — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying management’s report of internal control over financial reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. A company’s internal control over financial reporting is a process designed by, or under the supervision of, the company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the company’s board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2007, based on the criteria established in InternalControl — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet as of December 31, 2007, and the related consolidated statements of operations, shareholders’ equity, and cash flows for the year ended December 31, 2007, and the financial statement schedule as of and for the year ended December 31, 2007 of the Company and our report dated February 29, 2008 expressed an unqualified opinion on those financial statements and financial statement schedule.
F-3 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Trustees and Shareholders of
We have audited the accompanying consolidated balance
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.
In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Company’s internal control over financial reporting as of December 31, 2007, based on the criteria established in
U-STORE-IT TRUST AND SUBSIDIARIES
(in thousands, except share data)
See accompanying notes to the consolidated F-5 U-STORE-IT TRUST AND SUBSIDIARIES
OPERATIONS
See accompanying notes to the consolidated F-6 U-STORE-IT TRUST AND SUBSIDIARIES
CONSOLIDATED (in thousands)
See accompanying notes to the consolidated F-7 U-STORE-IT TRUST AND SUBSIDIARIES
CONSOLIDATED (
See accompanying notes to the consolidated F-8 U-STORE-IT TRUST AND SUBSIDIARIES
NOTES TO CONSOLIDATED
1. ORGANIZATION AND NATURE OF OPERATIONS
U-Store-It Trust, The Company owns substantially all of its assets through U-Store-It, L.P., a Delaware limited partnership (the “Operating Partnership”). The Company is the sole general partner of the Operating Partnership and, as of December 31, 2007, owned a 91.9% interest in the Operating Partnership. The Company manages its assets through YSI Management, LLC (the “Management Company”), a wholly owned subsidiary of the Operating Partnership. In addition to managing the Properties, the Management Company managed approximately 1.1 million rentable square feet related to facilities owned by related partiesp as of December 31, 2007. The Company owns 100% of U-Store-It Mini Warehouse Co. (the “TRS”), which it has elected to treat as a taxable REIT subsidiary. In general, a taxable REIT subsidiary may perform non-customary services for tenants, hold assets that the Company cannot hold directly and generally may engage in any real estate or non-real estate related business. The Company was formed in July 2004 to succeed the self-storage operations owned directly and indirectly by Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdell and their affiliated entities and related family trusts In October 2005, the Company completed a
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation The accompanying consolidated financial statements include all of the accounts of the Company,
Estimates The preparation of financial
Storage Facilities Storage facilities are
Purchase Price Allocation When facilities are acquired, the purchase price is allocated to the tangible and intangible assets acquired and liabilities assumed based on estimated fair values. In allocating the purchase price, the Company determines whether the
Depreciation and Amortization The costs of self-storage facilities and improvements are depreciated using the straight-line method based on useful lives ranging from five to 40 years. Impairment of Long-Lived Assets We evaluate long-lived assets
Long-Lived Assets Held for Sale We consider long-lived assets to be “held for sale” upon satisfaction of the following criteria: (a) management commits to a plan to sell a facility (or group of facilities), (b) the facility is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such facilities, (c) an active program to locate a buyer and other actions required to complete the plan to sell the facility have been initiated, (d) the sale of the facility is probable and transfer of the asset is expected to be completed within
Typically these criteria are all met when the relevant asset is under contract, significant non-refundable deposits have been made by the potential buyer, the assets are immediately available for transfer and there are no contingencies related to the sale that may prevent the transaction from closing. In most transactions, these conditions or criteria are not satisfied until the actual closing of the
During
Cash and Cash Equivalents Cash and cash equivalents are highly-liquid investments with original maturities of three months or less. The Company maintains cash equivalents in financial institutions in excess of insured limits, but believes this risk is mitigated by only investing in or through major financial institutions. Restricted Cash Restricted cash consists of purchase deposits and cash deposits required for debt service requirements, capital replacement,
F-10 Loan Procurement Costs Loan procurement costs related to borrowings consist of Marketable Securities The Company accounts for its investments in debt and equity securities according to the provisions of SFAS No. 115, Accounting for Certain Investments in Debt and Equity Securities, which requires securities classified as “available-for-sale” to be stated at fair value. Adjustments to fair value of available-for-sale securities are recorded as a component of other comprehensive income (loss). A decline in the market value of equity securities below cost, that is deemed to be other than temporary, results in a reduction in the carrying amount to fair value. The impairment is charged to earnings and a new cost basis for the security is established. At December 31, 2005, we had $95.2 million in auction rate securities (“ARS”) and variable rate demand notes classified as available-for-sale securities that were all sold in 2006. We had no realized or unrealized gains or losses related to these securities during the years ended December 31, 2007 and 2006. All income related to these investments was recorded as interest income.
Other Assets Other assets consist primarily of accounts receivable, prepaid expenses and
Environmental Costs Our
Revenue Recognition Management has determined that all of our leases are operating leases. Rental income is
Costs Associated with Exit or Disposal Activities In October 2006, the Company committed to a plan to relocate its accounting, finance and information technology functions to the Philadelphia, Pennsylvania area. As part of the relocation of these functions, the Company provided severance arrangements for certain existing employees related to those functions. At the time the severance arrangements were entered into, the Company estimated a total expense of $470,000, of which $45,000 was paid in 2006 and the remainder was paid in 2007. In August 2007, the Company abandoned certain office space in Cleveland, OH that was previously used for its corporate offices. The related leases have expiration dates ranging from December 31, 2008 through December 31, 2014. Upon vacating the space, the Company entered into a sub-lease agreement with a sub-tenant to lease the majority of the space for the duration of the term. As a result of this exit activity, the Company recognized a “Lease abandonment charge” of $1.3 million. The charge is comprised of approximately $0.8 million of costs that represent the present value of the net cash flows associated with leases and the sub-lease agreement (“Contract Termination Costs”) and approximately $0.5 million of costs associated with the write-off of certain assets related to the abandoned space (“Other Associated Costs”). The Contract Termination Costs of $0.8 million are presented as “Accounts payable and accrued rent” and the Other Associated Costs of $0.5 million were F-11 accounted for as a reduction of “Storage facilities.” The Company will amortize the Contract Termination Costs against rental expense over the remaining life of the respective leases. Advertising Costs The Company incurs advertising costs primarily attributable to print advertisements in telephone books. The Company recognizes the costs when the related telephone book is first published. The Company recognized $4.3 million, $4.4 million and $3.6 million in advertising expenses for the years ended 2007, 2006 and 2005, respectively. Equity Underwriting discount and commissions, financial advisory fees and
Other Property Related Income Other property related income consists Capitalized Interest The Company capitalizes interest incurred that is directly associated with construction activities until the asset is placed into service. Interest is capitalized to the related
Derivative Financial Instruments We carry all derivatives on the balance sheet at fair value. We
Income Taxes The Company Earnings and
The Company TRS’s are subject to federal and state income
Minority Interests include income allocated to holders of the
F-12 Operating Partnership” in our Consolidated Statements of Shareholders’ Equity and Owners’ Equity (Deficit) (rather than separately allocating the minority interest for each individual capital transaction). Additionally, the Company accounts for its minority interests subject to redemption provisions under the “Disclosure Only” approach and accordingly has not adjusted the carrying value of the Company’s minority interests for changes in the fair value of the related redemption provisions. Earnings per Share Basic earnings per share is calculated based on the weighted average number of
Share We apply the fair value method of accounting for
The
Recent Accounting Pronouncements In December 2007, the FASB issued Statement of Financial Accounting Standards No. 141 (Revised 2007), Business Combinations (“FAS 141(R)”). FAS 141(R) establishes principles and requirements for recognizing identifiable assets acquired, liabilities assumed, noncontrolling interest in the acquiree, goodwill acquired in the combination or the gain from a bargain purchase, and disclosure requirements. Under this revised statement, all costs incurred to effect an acquisition will be recognized separately from the acquisition. Also, restructuring costs that are expected but the acquirer is not obligated to incur will be recognized separately from the acquisition. FAS 141(R) is effective for the Company beginning with its quarter ending March 31, 2009. The Company is currently assessing the potential impacts, if any, on its consolidated financial statements. In December 2007, the FASB issued Statement of In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities — including an amendment of FASB Statement No. 115 (“SFAS No. 159”). SFAS No. 159 permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value, with unrealized gains and losses related to these financial instruments reported in earnings at each subsequent reporting date. This Statement is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007. The Company is in the process of evaluating the impact of SFAS No. 159 on its financial statements. In September 2006, the FASB issued SFAS No. 157, Fair Value Measurements (“SFAS No. 157”). SFAS No. 157 provides guidance for using fair value to measure assets and liabilities. This statement clarifies the principle that fair value should be based on the assumptions that market participants would use when pricing the asset or liability. SFAS No. 157 establishes a F-13 fair value hierarchy, giving the highest priority to quoted prices in active markets and the lowest priority to unobservable data. SFAS No. 157 applies whenever other standards require assets or liabilities to be measured at fair value. This statement is effective in fiscal years beginning after November 15, 2007. The Company believes that the In June 2006, the FASB issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an Interpretation of FASB Statement No. 109 (“FIN 48”). FIN 48 clarifies the accounting for uncertainty in income taxes recognized in a company’s financial statements and prescribes a recognition threshold and measurement attribute for the
The Company
Concentration of Credit Risk The storage facilities are located in major metropolitan and rural areas and have numerous tenants per facility. No single tenant represents 1% or more of the Company’s revenues. The facilities in Florida, California, Texas and Illinois provided total revenues of approximately 19%, 15%, 8% and 7%, respectively, for the year ended December 31, 2007. The facilities in Florida, California, Illinois and New Jersey provided total revenues of approximately 19%, 16%, 7% and 6%, respectively for the year ended December 31, 2006. 3. STORAGE FACILITIES
The following summarizes the real estate assets of the Company as of December 31, 2007 and
The carrying value of storage facilities has increased from December 31, F-14 The Company completed the following acquisitions, dispositions and consolidations for the years ended December 31, 2006 and 2007:
The following table summarizes the change in
4. INTANGIBLE ASSETS In conjunction with the Company’s 2007 acquisitions, the Company has allocated a portion of the purchase price to finite-lived intangible assets related to the value of in-place leases, valued at approximately $6.8 million. The Company recognized approximately $2.2 million of amortization expense during 2007. The amortization period of these assets is 12 months and the estimated remaining amortization expense that will be recognized during 2008 is $4.6 million. F-15 5. REVOLVING CREDIT FACILITY AND UNSECURED TERM LOAN As of December 31, 2007, the Company and its operating partnership had in place a three-year $450 million unsecured credit facility, which was entered into in November 2006, including $200 million in an unsecured term loan and $250 million in unsecured revolving loans. The outstanding balance on the Company’s credit facility was $419 million and was comprised of $200 million of term loan borrowings and $219 million of unsecured revolving loans. As of December 31, 2007, approximately $31 million was available under the Company’s credit facility. Borrowings under the credit facility bear interest, at our option, at either an alternative base rate or a Eurodollar rate, in each case, plus an applicable margin based on our leverage ratio or our credit rating. The alternative base interest rate is a fluctuating rate equal to the higher of the prime rate or the sum of the federal funds effective rate plus 50 basis points. The applicable margin for the alternative base rate will vary from 0.00% to 0.50% depending on our leverage ratio prior to achieving an investment grade rating, and will vary from 0.00% to 0.25% depending on our credit rating after achieving an investment grade rating. The Eurodollar rate is a rate of interest that is fixed for interest periods of one, two, three or six months based on the LIBOR rate determined two business days prior to the commencement of the applicable interest period. The applicable margin for the Eurodollar rate will vary from 1.00% to 1.50% depending on our leverage ratio prior to achieving an investment grate rating, and will vary from 0.425% to 1.00% depending on our credit rating after achieving an investment grade rating. This credit facility is scheduled to terminate on November 20, 2009, with an option for the Company to extend the termination date to November 20, 2010. At December 31, 2007, borrowings under the unsecured credit facility had a weighted average interest rate of 6.06%. On September 14, 2007, the Company and its Operating Partnership entered into a secured term loan agreement that allows for term loans in the aggregate principal amount of up to $50 million. Each term loan matures on November 20, 2009, subject to extension in the sole discretion of the lenders. Each term loan bears interest at either an alternative base rate or a Eurodollar rate, at our option, in each case plus an applicable margin at terms identical to the unsecured revolving credit facility. As of December 31, 2007, there was one term loan outstanding for $47.4 million. The outstanding term loan is secured by a pledge by our Operating Partnership of all equity interests in YSI RT LLC, the wholly-owned subsidiary of the Operating Partnership that acquired eight self-storage facilities in
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The
As of December 31, 2007 and 2006, the Company’s mortgage loans payable were collateralized by certain of its self-storage facilities with net book values of approximately $725 million $795 million, respectively. F-17 The following table presented below represents the future principal payment requirements on the outstanding mortgage loans and notes payable
In conjunction with the formation of the Company, certain former owners contributed
In conjunction with the National Self Storage acquisition, National Self Storage received 3,674,497 operating partnership units. As provided in the partnership agreement of the operating partnership, these units are redeemable by the unitholders for cash or, at the Company’s option, common shares, beginning one year after the date of issuance (i.e., effective July 2006), on a one-for-one basis. The National Self Storage acquisition purchase agreement also included a provision which granted the F-18 sellers a special redemption right permitting the sellers, under certain circumstances, beginning one year after issuance of the units, to redeem a portion of their units by requiring the Company to purchase, and simultaneously transfer to them, real estate properties to be identified by them at a price equal to the fair value of units redeemed (the “Special Redemption Right”).
8. RELATED PARTY TRANSACTIONS
Amsdell Settlement/Rising Tide Acquisition On September 14, 2007, the Company settled all pending state and federal court litigation involving the Company and the interests of Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdell and Kyle Amsdell, son of Robert and brother of Todd Amsdell (collectively, the “Amsdells”), and Rising Tide Development LLC, In addition, on September 14, 2007, the Operating Partnership purchased 14 self-storage facilities from Rising Tide (the “Rising Tide Properties”) for an aggregate purchase price of $121 million pursuant to a purchase and sale agreement. In connection with the settlement agreement and acquisition of the 14 self storage facilities, the Company considered the provisions of EITF 04-01, Accounting for Pre-existing relationships between the Parties to a Business Combination, and determined that all consideration paid was allocable to the purchase of the storage facilities. Pursuant to a Settlement Agreement and Mutual Release, dated August 6, 2007, (the “Settlement Agreement”) which was conditioned upon the acquisition of the 14 self-storage facilities from Rising Tide for $121 million, each of the parties to the agreement executed various agreements. A summary of the various agreements follows: ·Standstill Agreement. Robert J. Amsdell, Barry L. Amsdell and Todd C. Amsdell agreed that through June 30, 2008, they would not commence or participate in any proxy solicitation or initiate any shareholder proposal; take any action to convene a meeting of shareholders; or take any actions, including making any public or private proposal or announcement, that could result in an extraordinary corporate transaction relating to the Company. ·First Amendment to Lease. The Operating Partnership and Amsdell and Amsdell, an entity owned by Robert and Barry Amsdell, entered into a First Amendment to Lease which modified certain terms of all of the lease agreements the Operating Partnership has with Amsdell and Amsdell for office space in Cleveland, Ohio. The First Amendment provided the Operating Partnership the ability to assign or sublease the office space previously used for its corporate office and certain operations. Separately, Amsdell and Amsdell consented to the Operating Partnership’s proposed sublease to an unrelated party of approximately 22,000 square feet of office space covered by the aforementioned leases. ·Termination of Option Agreement. The Operating Partnership and Rising Tide entered into an Option Termination Agreement that terminated an Option Agreement dated October 27, 2004, by and between the Operating Partnership and Rising Tide. The Option Agreement provided the Operating Partnership with an option to acquire F-19 Rising Tide’s right, title and interest to 18 properties, including: the 14 Rising Tide Properties discussed above; three properties that the Operating Partnership acquired in 2005 pursuant to exercise of its ·Termination of Property Management Agreement, and Marketing and Ancillary Services Agreement. Certain of the Company’s
The Modification and Noncompetition Agreement and Termination of Employment Agreement with each of Robert J. Amsdell and Todd C. Amsdell also terminates the employment agreements the Company Additional Acquisitions of Facilities The Company, in accordance with a contract signed on April 3, 2006, acquired nine self-storage facilities from Jernigan Property Group on July 27, 2006 for consideration of approximately $45.3 million. Our President and Chief Executive Officer, Dean Jernigan, served as President of Jernigan Property Group. Mr. Jernigan has agreed that he will not expand his interest, ownership or activity in the self-storage business. Given Mr. Jernigan’s appointment as a Trustee and the Construction Services Historically, the Company engaged Amsdell Construction, a company owned by Robert J. Amsdell F-20 Corporate Office Leases Pursuant to lease agreements that the Operating Partnership entered into with Amsdell and Amsdell during 2005 and 2006, we rented office space from Amsdell and Amsdell at The Parkview Building, a multi-tenant office building of approximately 40,000 square feet located at 6745 Engle Road, an office building of approximately 18,000 square feet located at 6751 Engle Road, and an office building of approximately 28,000 square feet located at 6779 Engle Road. Each of these properties is part of Airport Executive Park, a 50-acre office and flex development located in Cleveland, Ohio, which is owned by Amsdell and Amsdell. Our independent Trustees approved the terms of, and entry into, each of the office lease agreements by the Operating Partnership. The table below shows the office space subject to these lease agreements and certain key provisions, including the term of each lease agreement, the period for which the Operating Partnership may extend the term of each lease agreement, and the minimum and maximum rents payable per month during the term.
(1)Our operating partnership may extend the lease agreement beyond the termination date by the period set forth in this column at prevailing market rates upon the same terms and conditions contained in each of the lease agreements. (2)In June 2007, the Operating Partnership terminated this lease agreement which had a month-to-month term. In addition to monthly rent, the office lease agreements provide that our Operating Partnership reimburse Amsdell and Amsdell for certain maintenance and improvements to the leased office space. The total
Total future minimum rental payments under the
Aircraft Lease The Company F-21 mutual agreement of the parties thereto and was replaced on July 1, 2005 with a non-exclusive aircraft lease agreement with Aqua Sun (the “Aircraft Lease”). The Company’s disinterested Trustees approved the terms of, and the entry into, the non-exclusive aircraft lease agreement by the operating partnership. The Operating Partnership was able to lease for corporate use from time to time an airplane owned by Aqua Sun at an hourly rate of $1,450 per flight hour. Aqua Sun was responsible for various costs associated with operation of the airplane, including insurance, storage and maintenance and repair, but the Operating Partnership was responsible for fuel costs and the costs of pilots and other cabin personnel required for its use of the airplane. The Aircraft Lease, which was effective as of July 1, 2005, had a one-year term and was terminated on June 30, 2006. The total Other During 2006 and 2007, the Company engaged a consultant to assist us in establishing certain development protocols and processes. In connection with that assignment, our outside consultant utilized the services of Dean Jernigan’s son-in-law. Our payments for his son-in-law’s services totaled approximately $149,000 in 2007 and $4,750 in 2006. The Company engaged Dunlevy Building Systems Inc., a company owned by John Dunlevy, a brother-in-law of Robert J. Amsdell and Barry L. Amsdell, for construction, zoning consultant and general contractor services at certain of its self-storage facilities. The total payments incurred by the Company to Dunlevy Building Systems Inc. for the years ended December 31, The Company engaged Deborah Dunlevy Designs, a company owned by Deborah Dunlevy, a sister of Robert J. Amsdell and Barry L. Amsdell, for interior design services at certain of its self-storage facilities and offices. Total payments incurred by the Company to Deborah Dunlevy Designs for the year ended December 31, 2005 was approximately
Registration Rights Robert J. Amsdell, Barry L. Amsdell, Todd C. Amsdell and the In addition, Rising Tide Development received registration
The fair value of financial instruments, including cash and cash equivalents, marketable securities, accounts receivable and accounts payable approximates their respective book values at December 31,
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During 2005, the
The results of operations of the storage facilities through the sale date have been presented in the following table. Interest expense and related amortization of loan procurement costs have been attributed to the sold storage facilities as applicable based upon the transaction and included in discontinued operations.
The results of operations of the
The Company has capital lease obligations for security camera systems with a cost of $2.6 million. These systems are included in equipment in the accompanying balance sheet and are being depreciated over five years.
The Company currently owns
Total future minimum rental payments under
The Company has entered into interest rate
The Company formally assesses, both at inception of the hedge and on an on-going basis, whether each derivative is highly-effective in offsetting changes in cash flows of the hedged item. If management determines that a derivative is highly-effective as a hedge, it accounts for the derivative using hedge accounting, pursuant to which gains or losses inherent in the derivative do not impact the Company’s results of operations. If management determines that a derivative is not highly-effective as a hedge or if a derivative ceases to be a highly-effective hedge, the Company will discontinue hedge accounting prospectively and will reflect in its statement of At December 31, 2007, the Company had interest rate swap agreements for notional principal amounts aggregating $75 million. The The following table summarizes the terms and fair values of the Company’s derivative financial instruments at December 31,
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On May 9, 2007, the Company’s shareholders approved an equity-based employee compensation plan, the 2007 Equity Incentive Plan (the “2007 Plan”). On October 19, 2004, the Company’s sole shareholder approved a share-based employee compensation plan, the 2004 Equity Incentive Plan (the
The Under the
Share Options The fair
The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. In addition, option-pricing models require the input of highly subjective F-25 assumptions, including the expected stock price volatility.
In
The table below summarizes the option activity under the Plan for the
At December 31, 2007, the aggregate intrinsic value of options outstanding, of options that vested or expected to vest and of options that were exercisable was $0.0 million. Restricted Shares
The
On December 22, 2005, 163,677 restricted share units were granted to certain executives. The restricted share units were granted in the form of deferred share units, entitling the holders thereof to receive common shares at a future date. Holders of the deferred share units are not entitled to any of the rights of a shareholder with respect to the deferred share units unless and until the common shares relating to the deferred share unit award have been delivered to such holder. However, the holders of the deferred share units are entitled to receive dividend equivalent payments, upon the Company’s payment of a cash dividend on outstanding common shares.
F-26 shares vest ratably over a five-year period, one-fifth per year on each of the first five anniversaries of the grant date. The market-based shares vest ratably over a five-year period, one-fifth per year on each of the first five anniversaries of the grant date if the average annual total shareholder return for the Company equals or exceeds ten percent. Additionally, any market-based shares that do not vest on a previous anniversary will vest on a subsequent anniversary date if the average annual total shareholder return from grant date equals or exceeds ten percent. Certain restricted share units awarded to the former Chief Executive Officer vest upon his retirement from the Company and since he reached the retirement age set forth in his award agreement prior to December 31, 2005, Robert J. Amsdell’s 72,745 restricted shares, valued at approximately $1.5 million, were recognized as share compensation expense in 2005. During 2006, certain unvested shares vested early related to the termination of several executives under the terms of their respective employment agreements. Accordingly, the Company recognized the related compensation expense in 2006. As of December 31, 2006 the Company had no remaining unrecognized compensation cost related to the December 22, 2005 restricted share units. The fair value for restricted share units granted in 2005 and 2007 were estimated at the time the units were granted. Awards that contain a market feature were valued using a Monte Carlo-pricing model applying the following weighted average assumptions:
In May 2005, the Company implemented the Deferred Trustees Plan, a component of the Plan, upon the approval of the Company’s Board of Trustees. Pursuant to the terms of the Deferred Trustees Plan, each non-employee member of the Board of Trustees may elect to receive all of his annual cash retainers and meeting fees payable for service on the Board of Trustees or any committee of the Board of Trustees in the form of either all common shares or all deferred share units. Pursuant to the terms of the Deferred Trustees Plan, under the equity incentive plan, certain Trustees elected to receive their Board of Trustee fees in 2005 and 2006 in the form of deferred share units. On December 31, 2006 an aggregate of 8,564 deferred share units were granted to those Trustees and were valued at $20.55 per share and on December 31, 2005 and aggregate of 3,876 deferred share units were granted and were valued at $21.05 per share.
During 2004, there were an aggregate of 20,315 restricted shares granted to our
In 2007, 2006 and 2005, the Company recognized compensation expense related to restricted shares and restricted share units issued to employees and Trustees of approximately $1.1 million, $0.7 million and $1.7 million, respectively; these amounts were recorded in General and administrative expense. Included in compensation expense for 2005 is approximately $1.5 million which represents the vested portion of the fair value of the restricted share units granted of 163,677 at a range of $13.82 to $20.62 per restricted share units to certain members of the Company’s management team. The following table presents non-vested restricted share activity during 2007:
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The following is a summary of the elements used in calculating basic and diluted earnings per
The 15. INCOME TAXES Deferred income taxes are established for temporary differences between financial reporting basis and tax basis of assets and liabilities at the enacted tax rates expected to be in effect when the temporary differences reverse. A valuation allowance for deferred tax assets is provided if the Company believes that it is more likely than not that all or some portion of the deferred tax asset will not be realized. No valuation allowance was recorded at December 31, 2007 or 2006. The
The unaudited condensed consolidated pro forma financial information set forth below reflects adjustments to
each respective year. The unaudited pro forma information
The following table summarizes, on a pro forma basis, our consolidated results of operations for the years ended December 31,
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As a result of hurricanes that occurred during the third quarter of 2005, the Company incurred damage at certain of its self-storage facilities located in Alabama, Louisiana and Mississippi. Under the provisions of SFAS No. 144, “Accounting for the Impairment of or Disposal of Long-Lived Assets” (“SFAS No. 144”), the Company determined that there were indicators of impairment and accordingly tested the assets for recoverability. After an assessment of the damage sustained at the Waveland, Mississippi facility, the Company determined that a charge for impairment of approximately $2.3 million was required because the estimated undiscounted future cash flows did not support the carrying value of the assets. The Company expected that insurance proceeds from its comprehensive insurance for property damage would satisfy the entire loss incurred, and in 2005 appropriately recorded the impairment charge and an offsetting insurance recovery of $2.3 million, of which $0.5 million was received in October 2005. The related insurance receivable was included in other assets as of December 31, 2005, and the asset impairment charge and related insurance recovery were presented net in operating expenses for the year ended December 31, 2005. During 2006, insurance proceeds were sufficient to cover the insurance receivable and there is no balance remaining as of December 31, 2006. During 2007 the Company recorded $0.4 million of impairment charges related to property damage incurred at six properties as a result of either a fire or flood. 18. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
The following is a summary of
In its corporate offices. The
F-30 U-STORE-IT SCHEDULE III REAL ESTATE AND RELATED DEPRECIATION DECEMBER 31, (
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Activity in real estate facilities during
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