UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 20202021
OR
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: 001-37351
National Storage Affiliates Trust
(Exact name of Registrant as specified in its charter)
Maryland46-5053858
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)

8400 East Prentice Avenue, 9th Floor
Greenwood Village, Colorado 80111
(Address of principal executive offices) (Zip code)

(720) 630-2600
(Registrant's telephone number including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbolsName of each exchange on which registered
Common Shares of Beneficial Interest, $0.01 par value per shareNSANew York Stock Exchange
Series A Cumulative Redeemable Preferred Shares of Beneficial Interest, par value $0.01 per shareNSA Pr ANew York Stock Exchange
Indicate by check mark whether the registrant (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 (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes   No 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  No 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Act.
Large Accelerated FilerAccelerated Filer
Non-accelerated FilerSmaller Reporting Company
Emerging Growth Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    
Yes   No 
As of August 6, 2020, 68,789,6883, 2021, 88,650,615 common shares of beneficial interest, $0.01 par value per share, were outstanding.




NATIONAL STORAGE AFFILIATES TRUST
TABLE OF CONTENTS
FORM 10-Q
Page
PART I. FINANCIAL INFORMATION
ITEM 1.Financial Statements
Condensed Consolidated Balance Sheets as of June 30, 20202021 and December 31, 20192020 (Unaudited)
Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 20202021 and 20192020 (Unaudited)
Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 20202021 and 20192020 (Unaudited)
Condensed Consolidated Statements of Changes in Equity for the Three and Six Months Ended June 30, 20202021 and 20192020 (Unaudited)
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 20202021 and 20192020 (Unaudited)
Notes to Condensed Consolidated Financial Statements (Unaudited)
ITEM 2.Management's Discussion and Analysis of Financial Condition and Results of Operations
ITEM 3.Quantitative and Qualitative Disclosures About Market Risk
ITEM 4.Controls and Procedures
PART II. OTHER INFORMATION
ITEM 1.Legal Proceedings
ITEM 1A.Risk Factors
ITEM 2.Unregistered Sales of Equity Securities and Use of Proceeds
ITEM 3.Defaults Upon Senior Securities
ITEM 4.Mine Safety Disclosures
ITEM 5.Other Information
ITEM 6.Exhibits
Signatures


2


PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements

NATIONAL STORAGE AFFILIATES TRUST
CONDENSED CONSOLIDATED BALANCE SHEETS
(dollars in thousands, except per share amounts)
(Unaudited)

June 30,December 31,June 30,December 31,
2020201920212020
ASSETSASSETSASSETS
Real estateReal estateReal estate
Self storage propertiesSelf storage properties$3,354,454  $3,091,719  Self storage properties$4,077,016 $3,639,192 
Less accumulated depreciationLess accumulated depreciation(389,828) (337,822) Less accumulated depreciation(504,498)(443,623)
Self storage properties, netSelf storage properties, net2,964,626  2,753,897  Self storage properties, net3,572,518 3,195,569 
Cash and cash equivalentsCash and cash equivalents17,271  20,558  Cash and cash equivalents22,410 18,723 
Restricted cashRestricted cash5,635  3,718  Restricted cash3,565 2,978 
Debt issuance costs, netDebt issuance costs, net2,900  3,264  Debt issuance costs, net2,113 2,496 
Investment in unconsolidated real estate venturesInvestment in unconsolidated real estate ventures210,114  214,061  Investment in unconsolidated real estate ventures195,567 202,533 
Other assets, netOther assets, net60,927  65,441  Other assets, net72,399 68,149 
Operating lease right-of-use assetsOperating lease right-of-use assets23,577  23,306  Operating lease right-of-use assets22,674 23,129 
Total assetsTotal assets$3,285,050  $3,084,245  Total assets$3,891,246 $3,513,577 
LIABILITIES AND EQUITYLIABILITIES AND EQUITYLIABILITIES AND EQUITY
LiabilitiesLiabilitiesLiabilities
Debt financingDebt financing$1,741,544  $1,534,047  Debt financing$2,058,573 $1,916,971 
Accounts payable and accrued liabilitiesAccounts payable and accrued liabilities42,641  37,966  Accounts payable and accrued liabilities48,058 47,043 
Interest rate swap liabilitiesInterest rate swap liabilities91,175  19,943  Interest rate swap liabilities53,638 77,918 
Operating lease liabilitiesOperating lease liabilities25,095  24,665  Operating lease liabilities24,379 24,756 
Deferred revenueDeferred revenue15,850  15,523  Deferred revenue19,072 16,414 
Total liabilitiesTotal liabilities1,916,305  1,632,144  Total liabilities2,203,720 2,083,102 
Commitments and contingencies (Note 11)Commitments and contingencies (Note 11)Commitments and contingencies (Note 11)00
EquityEquityEquity
Preferred shares of beneficial interest, par value $0.01 per share. 50,000,000 authorized, 8,732,719 and 8,727,119 issued and outstanding at June 30, 2020 and December 31, 2019, at liquidation preference218,318  218,178  
Common shares of beneficial interest, par value $0.01 per share. 250,000,000 authorized, 68,703,733 and 59,659,108 shares issued and outstanding at June 30, 2020 and December 31, 2019, respectively687  597  
Preferred shares of beneficial interest, par value $0.01 per share. 50,000,000 authorized, 8,736,719 and 8,732,719 issued and outstanding at June 30, 2021 and December 31, 2020, respectively, at liquidation preferencePreferred shares of beneficial interest, par value $0.01 per share. 50,000,000 authorized, 8,736,719 and 8,732,719 issued and outstanding at June 30, 2021 and December 31, 2020, respectively, at liquidation preference218,418 218,318 
Common shares of beneficial interest, par value $0.01 per share. 250,000,000 authorized, 77,708,831 and 71,293,117 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectivelyCommon shares of beneficial interest, par value $0.01 per share. 250,000,000 authorized, 77,708,831 and 71,293,117 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively777 713 
Additional paid-in capitalAdditional paid-in capital984,950  905,763  Additional paid-in capital1,244,269 1,050,714 
Distributions in excess of earningsDistributions in excess of earnings(228,924) (197,075) Distributions in excess of earnings(263,117)(251,704)
Accumulated other comprehensive lossAccumulated other comprehensive loss(57,462) (7,833) Accumulated other comprehensive loss(33,046)(49,084)
Total shareholders' equityTotal shareholders' equity917,569  919,630  Total shareholders' equity1,167,301 968,957 
Noncontrolling interestsNoncontrolling interests451,176  532,471  Noncontrolling interests520,225 461,518 
Total equityTotal equity1,368,745  1,452,101  Total equity1,687,526 1,430,475 
Total liabilities and equityTotal liabilities and equity$3,285,050  $3,084,245  Total liabilities and equity$3,891,246 $3,513,577 

See notes to condensed consolidated financial statements.

3


NATIONAL STORAGE AFFILIATES TRUST
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)

Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
June 30,
Six Months Ended
June 30,
20202019202020192021202020212020
REVENUEREVENUEREVENUE
Rental revenueRental revenue$95,302  $87,175  $190,704  $170,030  Rental revenue$127,310 $95,302 $240,437 $190,704 
Other property-related revenueOther property-related revenue3,418  3,128  6,789  5,952  Other property-related revenue4,829 3,418 8,966 6,789 
Management fees and other revenueManagement fees and other revenue5,697  5,116  11,146  10,009  Management fees and other revenue6,107 5,697 11,835 11,146 
Total revenueTotal revenue104,417  95,419  208,639  185,991  Total revenue138,246 104,417 261,238 208,639 
OPERATING EXPENSESOPERATING EXPENSESOPERATING EXPENSES
Property operating expensesProperty operating expenses30,257  27,190  60,849  53,647  Property operating expenses36,654 30,257 71,258 60,849 
General and administrative expensesGeneral and administrative expenses10,329  10,813  21,423  21,193  General and administrative expenses12,450 10,329 23,688 21,423 
Depreciation and amortizationDepreciation and amortization29,309  25,829  58,414  50,178  Depreciation and amortization36,051 29,309 68,475 58,414 
OtherOther462  357  851  743  Other310 462 707 851 
Total operating expensesTotal operating expenses70,357  64,189  141,537  125,761  Total operating expenses85,465 70,357 164,128 141,537 
OTHER (EXPENSE) INCOMEOTHER (EXPENSE) INCOMEOTHER (EXPENSE) INCOME
Interest expenseInterest expense(15,513) (13,947) (31,141) (27,158) Interest expense(17,339)(15,513)(34,131)(31,141)
Equity in earnings (losses) of unconsolidated real estate venturesEquity in earnings (losses) of unconsolidated real estate ventures52  (1,646) (288) (3,748) Equity in earnings (losses) of unconsolidated real estate ventures1,174 52 1,933 (288)
Acquisition costsAcquisition costs(252) (305) (1,085) (462) Acquisition costs(118)(252)(410)(1,085)
Non-operating expenseNon-operating expense(317) (169) (509) (267) Non-operating expense(148)(317)(321)(509)
Gain on sale of self storage properties—  2,814  —  2,814  
Other expenseOther expense(16,030) (13,253) (33,023) (28,821) Other expense(16,431)(16,030)(32,929)(33,023)
Income before income taxesIncome before income taxes18,030  17,977  34,079  31,409  Income before income taxes36,350 18,030 64,181 34,079 
Income tax expenseIncome tax expense(243) (244) (529) (736) Income tax expense(675)(243)(871)(529)
Net incomeNet income17,787  17,733  33,550  30,673  Net income35,675 17,787 63,310 33,550 
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests(7,365) (25,389) (16,480) (30,918) Net income attributable to noncontrolling interests(6,957)(7,365)(13,754)(16,480)
Net income (loss) attributable to National Storage Affiliates Trust10,422  (7,656) 17,070  (245) 
Net income attributable to National Storage Affiliates TrustNet income attributable to National Storage Affiliates Trust28,718 10,422 49,556 17,070 
Distributions to preferred shareholdersDistributions to preferred shareholders(3,274) (3,257) (6,547) (5,845) Distributions to preferred shareholders(3,276)(3,274)(6,551)(6,547)
Net income (loss) attributable to common shareholders$7,148  $(10,913) $10,523  $(6,090) 
Net income attributable to common shareholdersNet income attributable to common shareholders$25,442 $7,148 $43,005 $10,523 
Earnings (loss) per share - basicEarnings (loss) per share - basic$0.33 $0.10 $0.58 $0.16 
Earnings (loss) per share - dilutedEarnings (loss) per share - diluted$0.25 $0.10 $0.44 $0.16 
Earnings (loss) per share - basic and diluted$0.10  $(0.19) $0.16  $(0.11) 
Weighted average shares outstanding - basicWeighted average shares outstanding - basic76,712 68,210 74,267 64,004 
Weighted average shares outstanding - dilutedWeighted average shares outstanding - diluted129,578 68,210 126,396 64,004 
Weighted average shares outstanding - basic and diluted68,210  57,543  64,004  57,101  
Dividends declared per common shareDividends declared per common share$0.33  $0.32  $0.66  $0.62  Dividends declared per common share$0.38 $0.33 $0.73 $0.66 

See notes to condensed consolidated financial statements.

4


NATIONAL STORAGE AFFILIATES TRUST
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(dollars in thousands)
(Unaudited)

Three Months Ended
June 30,
Six Months Ended
June 30,
2020201920202019
Net income$17,787  $17,733  $33,550  $30,673  
Other comprehensive (loss) income
Unrealized loss on derivative contracts(10,423) (19,075) (76,792) (27,114) 
Reclassification of other comprehensive loss (income) to interest expense3,934  (1,277) 4,546  (2,553) 
Other comprehensive (loss) income(6,489) (20,352) (72,246) (29,667) 
Comprehensive (loss) income11,298  (2,619) (38,696) 1,006  
Comprehensive (income) loss attributable to noncontrolling interests(5,172) (18,029) 9,177  (20,160) 
Comprehensive income (loss) attributable to National Storage Affiliates Trust$6,126  $(20,648) $(29,519) $(19,154) 
Three Months Ended
June 30,
Six Months Ended
June 30,
2021202020212020
Net income$35,675 $17,787 $63,310 $33,550 
Other comprehensive income (loss)
Unrealized gain (loss) on derivative contracts(6,725)(10,423)14,175 (76,792)
Reclassification of other comprehensive loss to interest expense5,124 3,934 10,081 4,546 
Other comprehensive income (loss)(1,601)(6,489)24,256 (72,246)
Comprehensive income (loss)34,074 11,298 87,566 (38,696)
Comprehensive (income) loss attributable to noncontrolling interests(6,481)(5,172)(21,295)9,177 
Comprehensive income (loss) attributable to National Storage Affiliates Trust$27,593 $6,126 $66,271 $(29,519)

See notes to condensed consolidated financial statements.

5


NATIONAL STORAGE AFFILIATES TRUST
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(dollars in thousands, except share amounts)
(Unaudited)

AccumulatedAccumulated
AdditionalDistributionsOtherAdditionalDistributionsOther
Preferred SharesCommon SharesPaid-inIn Excess OfComprehensiveNoncontrollingTotalPreferred SharesCommon SharesPaid-inIn Excess OfComprehensiveNoncontrollingTotal
NumberAmountNumberAmountCapitalEarnings(Loss) IncomeInterestsEquityNumberAmountNumberAmountCapitalEarnings(Loss) IncomeInterestsEquity
Balances, December 31, 20186,900,000  $172,500  56,654,009  $567  $844,276  $(114,122) $13,618  $485,460  $1,402,299  
Balances, December 31, 2019Balances, December 31, 20198,727,119 $218,178 59,659,108 $597 $905,763 $(197,075)$(7,833)$532,471 $1,452,101 
OP equity issued for property acquisitions:OP equity issued for property acquisitions:OP equity issued for property acquisitions:
Series A-1 preferred units, OP units and subordinated performance units, net of offering costs—  —  —  —  —  —  —  32,856  32,856  
OP units and subordinated performance units, net of offering costsOP units and subordinated performance units, net of offering costs— — — — — — — 6,206 6,206 
LTIP unitsLTIP units— — — — — — — 1,011 1,011 
Redemptions of OP unitsRedemptions of OP units—  —  29,910  —  250  —   (257) —  Redemptions of OP units— — 118,961 1,437 — (62)(1,376)
Issuance of common shares, net of offering costsIssuance of common shares, net of offering costs— — 125,000 4,248 — — — 4,249 
Merger and internalization of PRO, net of issuance costsMerger and internalization of PRO, net of issuance costs— — 8,105,192 81 43,499 — (402)(33,583)9,595 
Redemptions of Series A-1 preferred unitsRedemptions of Series A-1 preferred units5,600 140 — — — — — (140)
Effect of changes in ownership for consolidated entitiesEffect of changes in ownership for consolidated entities—  —  —  —  (5,385) —  (182) 5,567  —  Effect of changes in ownership for consolidated entities— — — — 15,857 — (2,265)(13,592)
Equity-based compensation expenseEquity-based compensation expense—  —  —  —  90  —  —  1,022  1,112  Equity-based compensation expense— — — — 76 — — 698 774 
Issuance of LTIP units for acquisition expensesIssuance of LTIP units for acquisition expenses—  —  —  —  —  —  —    Issuance of LTIP units for acquisition expenses— — — — — — — 40 40 
Issuance of restricted common sharesIssuance of restricted common shares—  —  18,218  —  —  —  —  —  —  Issuance of restricted common shares— — 21,861 — — — — — 
Vesting and forfeitures of restricted common shares, netVesting and forfeitures of restricted common shares, net—  —  (3,451) —  (69) —  —  —  (69) Vesting and forfeitures of restricted common shares, net— — (2,910)— (94)— — — (94)
Reduction in receivables from partners of the operating partnership—  —  —  —  —  —  —  139  139  
Preferred share dividendsPreferred share dividends—  —  —  —  —  (2,588) —  —  (2,588) Preferred share dividends— — — — — (3,273)— — (3,273)
Common share dividendsCommon share dividends—  —  —  —  —  (17,010) —  —  (17,010) Common share dividends— — — — — (19,747)— — (19,747)
Distributions to noncontrolling interestsDistributions to noncontrolling interests—  —  —  —  —  —  —  (17,181) (17,181) Distributions to noncontrolling interests— — — — — — — (19,813)(19,813)
Other comprehensive lossOther comprehensive loss—  —  —  —  —  —  (5,917) (3,398) (9,315) Other comprehensive loss— — — — — — (42,293)(23,464)(65,757)
Net incomeNet income—  —  —  —  —  7,411  —  5,529  12,940  Net income— — — — — 6,648 — 9,115 15,763 
Balances, March 31, 20196,900,000  $172,500  56,698,686  $567  $839,162  $(126,309) $7,526  $509,742  $1,403,188  
Issuance of preferred shares, net of offering costs1,785,680  44,642  —  —  (1,018) —  —  —  43,624  
Balances, March 31, 2020Balances, March 31, 20208,732,719 $218,318 68,027,212 $680 $970,786 $(213,447)$(52,855)$457,573 $1,381,055 
OP equity issued for property acquisitions:OP equity issued for property acquisitions:OP equity issued for property acquisitions:
Series A-1 preferred units, OP units and subordinated performance units, net of offering costs—  —  —  —  —  —  —  15,515  15,515  
OP units and subordinated performance units, net of offering costsOP units and subordinated performance units, net of offering costs— — — — — — — 5,842 5,842 
Redemptions of OP unitsRedemptions of OP units—  —  224,618   1,839  —  28  (1,869) —  Redemptions of OP units— — 292,291 3,438 — (238)(3,203)
See notes to condensed consolidated financial statements.

6


NATIONAL STORAGE AFFILIATES TRUST
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(dollars in thousands, except share amounts)
(Unaudited)
AccumulatedAccumulated
AdditionalDistributionsOtherAdditionalDistributionsOther
Preferred SharesCommon SharesPaid-inIn Excess OfComprehensiveNoncontrollingTotalPreferred SharesCommon SharesPaid-inIn Excess OfComprehensiveNoncontrollingTotal
NumberAmountNumberAmountCapitalEarnings(Loss) IncomeInterestsEquityNumberAmountNumberAmountCapitalEarnings(Loss) IncomeInterestsEquity
Issuance of common shares, net of offering costsIssuance of common shares, net of offering costs—  —  2,375,000  24  70,613  —  —  —  70,637  Issuance of common shares, net of offering costs— — 387,000 11,912 — — — 11,916 
Effect of changes in ownership for consolidated entitiesEffect of changes in ownership for consolidated entities—  —  —  —  (9,179) —  (28) 9,207  —  Effect of changes in ownership for consolidated entities— — — — (1,286)— (73)1,359 
Issuance of OP units—  —  —  —  —  —  —  8,540  8,540  
Equity-based compensation expenseEquity-based compensation expense—  —  —  —  82  —  —  1,026  1,108  Equity-based compensation expense— — — — 100 — — 1,051 1,151 
Issuance of LTIP units for acquisition expenses—  —  —  —  —  —  —  56  56  
Vesting and forfeitures of restricted common shares, netVesting and forfeitures of restricted common shares, net—  —  (1,335) —  —  —  —  —  —  Vesting and forfeitures of restricted common shares, net— — (2,770)— — — — 
Reduction in receivables from partners of the operating partnershipReduction in receivables from partners of the operating partnership— — — — — — — 225 225 
Preferred share dividendsPreferred share dividends—  —  —  —  —  (3,257) —  —  (3,257) Preferred share dividends— — — — — (3,274)— — (3,274)
Common share dividendsCommon share dividends—  —  —  —  —  (18,970) —  —  (18,970) Common share dividends— — — — — (22,625)— — (22,625)
Distributions to noncontrolling interestsDistributions to noncontrolling interests—  —  —  —  —  —  —  (19,038) (19,038) Distributions to noncontrolling interests— — — — — — — (16,843)(16,843)
Other comprehensive lossOther comprehensive loss—  —  —  —  —  —  (12,992) (7,360) (20,352) Other comprehensive loss— — — — — (4,296)(2,193)(6,489)
Net (loss) income—  —  —  —  —  (7,656) —  25,389  17,733  
Balances, June 30, 20198,685,680  $217,142  59,296,969  $593  $901,499  $(156,192) $(5,466) $541,208  $1,498,784  
Net incomeNet income— — — — — 10,422 — 7,365 17,787 
Balances, June 30, 2020Balances, June 30, 20208,732,719 $218,318 68,703,733 $687 $984,950 $(228,924)$(57,462)$451,176 $1,368,745 
See notes to condensed consolidated financial statements.

7


NATIONAL STORAGE AFFILIATES TRUST
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(dollars in thousands, except share amounts)
(Unaudited)
AccumulatedAccumulated
AdditionalDistributionsOtherAdditionalDistributionsOther
Preferred SharesCommon SharesPaid-inIn Excess OfComprehensiveNoncontrollingTotalPreferred SharesCommon SharesPaid-inIn Excess OfComprehensiveNoncontrollingTotal
NumberAmountNumberAmountCapitalEarnings(Loss) IncomeInterestsEquityNumberAmountNumberAmountCapitalEarnings(Loss) IncomeInterestsEquity
Balances, December 31, 20198,727,119  $218,178  59,659,108  $597  $905,763  $(197,075) $(7,833) $532,471  $1,452,101  
Balances, December 31, 2020Balances, December 31, 20208,732,719 $218,318 71,293,117 $713 $1,050,714 $(251,704)$(49,084)$461,518 $1,430,475 
OP equity issued for property acquisitions:OP equity issued for property acquisitions:OP equity issued for property acquisitions:
OP units and subordinated performance units, net of offering costsOP units and subordinated performance units, net of offering costs—  —  —  —  —  —  —  6,206  6,206  OP units and subordinated performance units, net of offering costs— — — — — — — 22,897 22,897 
LTIP units—  —  —  —  —  —  —  1,011  1,011  
Redemptions of OP unitsRedemptions of OP units—  —  118,961   1,437  —  (62) (1,376) —  Redemptions of OP units— — 190,248 2,332 — (108)(2,226)
Issuance of common shares, net of offering costsIssuance of common shares, net of offering costs—  —  125,000   4,248  —  —  —  4,249  Issuance of common shares, net of offering costs— — 3,692,216 37 122,375 — — — 122,412 
Merger and internalization of PRO, net of issuance costs—  —  8,105,192  81  43,499  —  (402) (33,583) 9,595  
Contributions from noncontrolling interestsContributions from noncontrolling interests— — — — — — — 103 103 
Redemption of Series A-1 preferred units5,600  140  —  —  —  —  —  (140) —  
Effect of changes in ownership for consolidated entitiesEffect of changes in ownership for consolidated entities—  —  —  —  15,857  —  (2,265) (13,592) —  Effect of changes in ownership for consolidated entities— — — — (18,983)— (290)19,273 
Equity-based compensation expenseEquity-based compensation expense—  —  —  —  76  —  —  698  774  Equity-based compensation expense— — — — 92 — — 1,194 1,286 
Issuance of LTIP units for acquisition expenses—  —  —  —  —  —  —  40  40  
Issuance of restricted common sharesIssuance of restricted common shares—  —  21,861  —  —  —  —  —  —  Issuance of restricted common shares— — 15,369 — — — — — 
Vesting and forfeitures of restricted common shares, netVesting and forfeitures of restricted common shares, net—  —  (2,910) —  (94) —  —  —  (94) Vesting and forfeitures of restricted common shares, net— — (4,823)— (152)— — — (152)
Preferred share dividendsPreferred share dividends—  —  —  —  —  (3,273) —  —  (3,273) Preferred share dividends— — — — — (3,275)— — (3,275)
Common share dividendsCommon share dividends—  —  —  —  —  (19,747) —  —  (19,747) Common share dividends— — — — — (25,014)— — (25,014)
Distributions to noncontrolling interestsDistributions to noncontrolling interests—  —  —  —  —  —  —  (19,813) (19,813) Distributions to noncontrolling interests— — — — — — — (20,604)(20,604)
Other comprehensive loss—  —  —  —  —  —  (42,293) (23,464) (65,757) 
Other comprehensive incomeOther comprehensive income— — — — — — 17,840 8,017 25,857 
Net incomeNet income—  —  —  —  —  6,648  —  9,115  15,763  Net income— — — — — 20,838 — 6,797 27,635 
Balances, March 31, 20208,732,719  $218,318  68,027,212  $680  $970,786  $(213,447) $(52,855) $457,573  $1,381,055  
Balances, March 31, 2021Balances, March 31, 20218,732,719 $218,318 75,186,127 $752 $1,156,378 $(259,155)$(31,642)$496,969 $1,581,620 
OP equity issued for property acquisitions:OP equity issued for property acquisitions:OP equity issued for property acquisitions:
OP units and subordinated performance units, net of offering costsOP units and subordinated performance units, net of offering costs—  —  —  —  —  —  —  5,842  5,842  OP units and subordinated performance units, net of offering costs— — — — — — — 24,102 24,102 
Redemptions of OP unitsRedemptions of OP units—  —  292,291   3,438  —  (238) (3,203) —  Redemptions of OP units— — 121,923 1,554 — (52)(1,503)
Issuance of common shares, net of offering costsIssuance of common shares, net of offering costs— — 2,390,000 24 103,646 — — — 103,670 
Redemptions of Series A-1 preferred unitsRedemptions of Series A-1 preferred units4,000 100 — — — — — (100)
Effect of changes in ownership for consolidated entitiesEffect of changes in ownership for consolidated entities— — — — (17,420)— (227)17,647 
See notes to condensed consolidated financial statements.

8


NATIONAL STORAGE AFFILIATES TRUST
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(dollars in thousands, except share amounts)
(Unaudited)
AccumulatedAccumulated
AdditionalDistributionsOtherAdditionalDistributionsOther
Preferred SharesCommon SharesPaid-inIn Excess OfComprehensiveNoncontrollingTotalPreferred SharesCommon SharesPaid-inIn Excess OfComprehensiveNoncontrollingTotal
NumberAmountNumberAmountCapitalEarnings(Loss) IncomeInterestsEquityNumberAmountNumberAmountCapitalEarnings(Loss) IncomeInterestsEquity
Issuance of common shares, net of offering costs—  —  387,000   11,912  —  —  —  11,916  
Effect of changes in ownership for consolidated entities—  —  —  —  (1,286) —  (73) 1,359  —  
Equity-based compensation expenseEquity-based compensation expense—  —  —  —  100  —  —  1,051  1,151  Equity-based compensation expense— — — — 113 — — 1,235 1,348 
Issuance of restricted common sharesIssuance of restricted common shares— — 13,255 — — — — — 
Vesting and forfeitures of restricted common shares, netVesting and forfeitures of restricted common shares, net— — (2,474)— (2)— — — (2)
Vesting and forfeitures of restricted common shares, net—  —  (2,770) —  —  —  —  —  —  
Reduction in receivables from partners of the operating partnership—  —  —  —  —  —  —  225  225  
Preferred share dividendsPreferred share dividends—  —  —  —  —  (3,274) —  —  (3,274) Preferred share dividends— — — — — (3,276)— — (3,276)
Common share dividendsCommon share dividends—  —  —  —  —  (22,625) —  —  (22,625) Common share dividends— — — — — (29,404)— — (29,404)
Distributions to noncontrolling interestsDistributions to noncontrolling interests—  —  —  —  —  —  —  (16,843) (16,843) Distributions to noncontrolling interests— — — — — — — (24,606)(24,606)
Other comprehensive lossOther comprehensive loss—  —  —  —  —  (4,296) (2,193) (6,489) Other comprehensive loss— — — — — — (1,125)(476)(1,601)
Net incomeNet income—  —  —  —  —  10,422  —  7,365  17,787  Net income— — — — — 28,718 — 6,957 35,675 
Balances, June 30, 20208,732,719  $218,318  68,703,733  $687  $984,950  $(228,924) $(57,462) $451,176  $1,368,745  
Balances, June 30, 2021Balances, June 30, 20218,736,719 $218,418 77,708,831 $777 $1,244,269 $(263,117)$(33,046)$520,225 $1,687,526 

See notes to condensed consolidated financial statements.

9


NATIONAL STORAGE AFFILIATES TRUST
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
(Unaudited)

Six Months Ended
June 30,
Six Months Ended
June 30,
2020201920212020
OPERATING ACTIVITIESOPERATING ACTIVITIESOPERATING ACTIVITIES
Net incomeNet income$33,550  $30,673  Net income$63,310 $33,550 
Adjustments to reconcile net income to net cash provided by operating activities:Adjustments to reconcile net income to net cash provided by operating activities:Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortizationDepreciation and amortization58,414  50,178  Depreciation and amortization68,475 58,414 
Amortization of debt issuance costsAmortization of debt issuance costs1,521  1,414  Amortization of debt issuance costs1,626 1,521 
Amortization of debt discount and premium, netAmortization of debt discount and premium, net(711) (708) Amortization of debt discount and premium, net(357)(711)
Gain on sale of self storage properties—  (2,814) 
Mark-to-market changes in value on equity securitiesMark-to-market changes in value on equity securities142  —  Mark-to-market changes in value on equity securities142 
Equity-based compensation expenseEquity-based compensation expense1,925  2,220  Equity-based compensation expense2,634 1,925 
Equity in losses of unconsolidated real estate ventures288  3,748  
Equity in (earnings) losses of unconsolidated real estate venturesEquity in (earnings) losses of unconsolidated real estate ventures(1,933)288 
Distributions from unconsolidated real estate venturesDistributions from unconsolidated real estate ventures6,761  7,065  Distributions from unconsolidated real estate ventures8,899 6,761 
Change in assets and liabilities, net of effects of self storage property acquisitions:Change in assets and liabilities, net of effects of self storage property acquisitions:Change in assets and liabilities, net of effects of self storage property acquisitions:
Other assetsOther assets1,212  119  Other assets(715)1,212 
Accounts payable and accrued liabilitiesAccounts payable and accrued liabilities3,093  2,893  Accounts payable and accrued liabilities1,526 3,093 
Deferred revenueDeferred revenue(512) (1,313) Deferred revenue794 (512)
Net Cash Provided by Operating ActivitiesNet Cash Provided by Operating Activities105,683  93,475  Net Cash Provided by Operating Activities144,259 105,683 
INVESTING ACTIVITIESINVESTING ACTIVITIESINVESTING ACTIVITIES
Acquisition of self storage propertiesAcquisition of self storage properties(239,138) (307,791) Acquisition of self storage properties(383,702)(239,138)
Capital expendituresCapital expenditures(8,583) (10,443) Capital expenditures(13,187)(8,583)
Investments in and advances to unconsolidated real estate venturesInvestments in and advances to unconsolidated real estate ventures(3,125) —  Investments in and advances to unconsolidated real estate ventures(3,125)
Distributions from unconsolidated real estate ventures—  1,017  
Deposits and advances for self storage property and other acquisitionsDeposits and advances for self storage property and other acquisitions(294) (175) Deposits and advances for self storage property and other acquisitions(1,100)(294)
Proceeds from sale of equity securitiesProceeds from sale of equity securities7,560  —  Proceeds from sale of equity securities7,560 
Expenditures for corporate furniture, equipment and otherExpenditures for corporate furniture, equipment and other(318) (416) Expenditures for corporate furniture, equipment and other(147)(318)
Acquisition of interest in reinsurance company and related cash flows—  (6,600) 
Proceeds from sale of self storage properties—  6,335  
Net Cash Used In Investing ActivitiesNet Cash Used In Investing Activities(243,898) (318,073) Net Cash Used In Investing Activities(398,136)(243,898)
FINANCING ACTIVITIESFINANCING ACTIVITIESFINANCING ACTIVITIES
Proceeds from issuance of common sharesProceeds from issuance of common shares16,165  70,637  Proceeds from issuance of common shares226,082 16,165 
Proceeds from issuance of preferred shares—  43,624  
Borrowings under debt financingsBorrowings under debt financings311,000  499,000  Borrowings under debt financings546,000 311,000 
Receipts for OP unit subscriptions661  318  
Contributions from noncontrolling interestsContributions from noncontrolling interests103 661 
Principal payments under debt financingsPrincipal payments under debt financings(103,911) (306,538) Principal payments under debt financings(405,073)(103,911)
Payment of dividends to common shareholdersPayment of dividends to common shareholders(42,372) (35,980) Payment of dividends to common shareholders(54,418)(42,372)
Distributions to preferred shareholdersDistributions to preferred shareholders(6,547) (5,845) Distributions to preferred shareholders(6,551)(6,547)
Distributions to noncontrolling interestsDistributions to noncontrolling interests(36,431) (36,080) Distributions to noncontrolling interests(45,336)(36,431)
Debt issuance costsDebt issuance costs(835) (987) Debt issuance costs(495)(835)
Equity offering costsEquity offering costs(885) (161) Equity offering costs(2,161)(885)
Net Cash Provided By Financing ActivitiesNet Cash Provided By Financing Activities136,845  227,988  Net Cash Provided By Financing Activities258,151 136,845 
Increase (Decrease) in Cash, Cash Equivalents and Restricted CashIncrease (Decrease) in Cash, Cash Equivalents and Restricted Cash4,274 (1,370)
CASH, CASH EQUIVALENTS AND RESTRICTED CASHCASH, CASH EQUIVALENTS AND RESTRICTED CASH
Beginning of periodBeginning of period21,701 24,276 
End of periodEnd of period$25,975 $22,906 
See notes to condensed consolidated financial statements.

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NATIONAL STORAGE AFFILIATES TRUST
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in thousands)
(Unaudited)
(Decrease) Increase in Cash, Cash Equivalents and Restricted Cash(1,370) 3,390  
CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Beginning of period24,276  16,363  
End of period$22,906  $19,753  

Supplemental Cash Flow and Noncash InformationSupplemental Cash Flow and Noncash InformationSupplemental Cash Flow and Noncash Information
Cash paid for interestCash paid for interest$30,366  $25,999  Cash paid for interest$31,612 $30,366 
Operating lease right-of-use assets on balance sheet due to implementation of leases standard—  22,971  
Operating lease liabilities on balance sheet due to implementation of leases standard—  24,152  
Merger and internalization of PRO:Merger and internalization of PRO:Merger and internalization of PRO:
Redemptions and conversions of partnership interestsRedemptions and conversions of partnership interests33,583  —  Redemptions and conversions of partnership interests33,583 
Issuance of common shares for management platformIssuance of common shares for management platform10,301  —  Issuance of common shares for management platform10,301 

See notes to condensed consolidated financial statements.

11


NATIONAL STORAGE AFFILIATES TRUST
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 20202021
(Unaudited)





1. ORGANIZATION AND NATURE OF OPERATIONS
National Storage Affiliates Trust was organized in the state of Maryland on May 16, 2013 and is a fully integrated, self-administered and self-managed real estate investment trust focused on the self storage sector. As used herein, "NSA," the "Company," "we," "our," and "us" refers to National Storage Affiliates Trust and its consolidated subsidiaries, except where the context indicates otherwise. The Company has elected and believes that it has qualified to be taxed as a real estate investment trust for U.S. federal income tax purposes ("REIT") commencing with its taxable year ended December 31, 2015.
Through its controlling interest as the sole general partner of NSA OP, LP (its "operating partnership"), a Delaware limited partnership formed on February 13, 2013, the Company is focused on the ownership, operation, and acquisition of self storage properties located within the top 100 metropolitan statistical areas throughout the United States. Pursuant to the Agreement of Limited Partnership (as amended, the "LP Agreement") of its operating partnership, the Company's operating partnership is authorized to issue preferred units, Class A Units ("OP units"), different series of Class B Units ("subordinated performance units"), and Long-Term Incentive Plan Units ("LTIP units"). The Company also owns certain of its self storage properties through other consolidated limited partnership subsidiaries of its operating partnership, which the Company refers to as "DownREIT partnerships." The DownREIT partnerships issue equity ownership interests that are intended to be economically equivalent to the Company's OP units ("DownREIT OP units") and subordinated performance units ("DownREIT subordinated performance units").
The Company owned 607687 consolidated self storage properties in 2933 states and Puerto Rico with approximately 36.642.5 million rentable square feet in approximately 291,000334,000 storage units as of June 30, 2020.2021. These properties are managed with local operational focus and expertise by the Company and its participating regional operators ("PROs"). These PROs are Kevin Howard Real Estate Inc., d/b/a Northwest Self Storage and its controlled affiliates ("Northwest"), Optivest Properties LLC and its controlled affiliates ("Optivest"), Guardian Storage Centers LLC and its controlled affiliates ("Guardian"), Move It Self Storage and its controlled affiliates ("Move It"), Arizona Mini Storage Management Company d/b/a Storage Solutions and its controlled affiliates ("Storage Solutions"), Hide-Away Storage Services, Inc. and its controlled affiliates ("Hide-Away"), an affiliate of Shader Brothers Corporation d/b/a Personal Mini Storage ("Personal Mini"), Southern Storage Management Systems, Inc. d/b/a Southern Self Storage ("Southern") and, affiliates of Investment Real Estate Management, LLC d/b/a Moove In Self Storage of York, Pennsylvania ("Moove In").
On March 31, 2020, the Company closed on the mergers of its largest PRO, SecurCare and Blue Sky Self Storage, Inc.a strategic partnership between Argus Professional Storage Management and its controlled affiliatesGYS Development LLC ("SecurCare"Blue Sky"), and DLAN Corporation ("DLAN") with and into wholly-owned subsidiaries of the Company. As a result of the mergers, SecurCare's property management platform and related intellectual property were internalized by the Company, and the Company no longer pays any supervisory and administrative fees or reimbursements to SecurCare. In addition, distributions on the series of subordinated performance units related to SecurCare's managed portfolio were discontinued. As part of the internalization, most of SecurCare's employees and other key persons were offered and provided employment by the Company and continue managing SecurCare's portfolio of properties under the brand SecurCare as members of the Company's existing property management platform..
As of June 30, 2020,2021, the Company also managed through its property management platform an additional portfolio of 177 properties owned by the Company's unconsolidated real estate ventures. These properties contain approximately 12.612.7 million rentable square feet, configured in approximately 104,000 storage units and located across 21 states. The Company owns a 25% equity interest in each of its unconsolidated real estate ventures.
As of June 30, 2020,2021, in total, the Company operated and held ownership interests in 784864 self storage properties located across 3536 states and Puerto Rico with approximately 49.255.2 million rentable square feet in approximately 394,000438,000 storage units.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying condensed consolidated financial statements are presented on the accrual basis of accounting in accordance with U.S. generally accepted accounting principles ("GAAP") and have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC") regarding interim financial reporting. Accordingly, certain information and footnote disclosures required by GAAP for

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complete financial statements have been condensed or omitted in accordance with such rules and regulations. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the condensed consolidated financial statements have been included. The Company's results of operations for the quarterly and year to date periods are not necessarily indicative of the results to be expected for the full year or any other future period.

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Principles of Consolidation
The Company's financial statements include the accounts of its operating partnership and its controlled subsidiaries. All significant intercompany balances and transactions have been eliminated in the consolidation of entities.
When the Company obtains an economic interest in an entity, the Company evaluates the entity to determine if the entity is deemed a variable interest entity ("VIE"), and if the Company is deemed to be the primary beneficiary, in accordance with authoritative guidance issued on the consolidation of VIEs. When an entity is not deemed to be a VIE, the Company considers the provisions of additional guidance to determine whether the general partner controls a limited partnership or similar entity when the limited partners have certain rights. The Company consolidates all entities that are VIEs and of which the Company is deemed to be the primary beneficiary. The Company has determined that its operating partnership is a VIE. The sole significant asset of National Storage Affiliates Trust is its investment in its operating partnership, and consequently, substantially all of the Company’s assets and liabilities represent those assets and liabilities of its operating partnership.
As of June 30, 2020 and December 31, 2019,2021, the Company's operating partnership was the primary beneficiary of, and therefore consolidated, 22 partnerships that are considered VIEs, which owned 48 self storage properties. As of December 31, 2020, the Company's operating partnership was the primary beneficiary of, and therefore consolidated, 21 DownREIT partnerships that are considered VIEs, which owned 34 self storage properties. The net book value of the real estate owned by these VIEs was $229.2$434.0 million and $233.1$225.1 million as of June 30, 20202021 and December 31, 2019,2020, respectively. For certain DownREIT partnerships which are subject to fixed rate mortgages payable, the carrying value of such fixed rate mortgages payable held by these VIEs was $135.4$100.7 million and $136.4$100.7 million as of June 30, 20202021 and December 31, 2019,2020, respectively. The creditors of the consolidated VIEs do not have recourse to the Company's general credit.
Reclassifications
Certain amounts in the condensed consolidated financial statements and related notes have been reclassified to conform to the current year presentation. Such reclassifications do not impact the Company's previously reported financial position or net income (loss).
Revenue Recognition
Rental revenue
Rental revenue consists of space rentals and related fees. Management has determined that all of the Company's leases are operating leases. Substantially all leases may be terminated on a month-to-month basis and rental income is recognized ratably over the lease term using the straight-line method. Rents received in advance are deferred and recognized on a straight-line basis over the related lease term associated with the prepayment. Promotional discounts and other incentives are recognized as a reduction to rental income over the applicable lease term.
Other property-related revenue
Other property-related revenue primarily consists of ancillary revenues such as tenant insurance and/or tenant warranty protection-related access fees, and sales of storage supplies and truck rentals which are recognized in the period earned.
The Company and certain of the Company’s PROs have tenant insurance- and/or tenant warranty protection plan-related arrangements with insurance companies and the Company’s tenants. During the three months ended June 30, 20202021 and 2019,2020, the Company recognized $2.7$3.6 million and $2.2$2.7 million, respectively, of tenant insurance and tenant warranty protection plan revenues and during the six months ended June 30, 20202021 and 2019,2020, the Company recognized $5.3$6.7 million and $4.3$5.3 million, respectively, of tenant insurance and tenant warranty protection plan revenues.
The Company sells boxes, packing supplies, locks, and other retail merchandise and rents moving trucks at its properties. During the three months ended June 30, 20202021 and 2019,2020, the Company recognized retail sales of $0.4$0.7 million and $0.5$0.4 million, respectively, and during the six months ended June 30, 20202021 and 2019,2020, the Company recognized retail sales of $1.2 million and $0.8 million, and $0.9 million, respectively.

13


Management fees and other revenue
Management fees and other revenue consist of property management fees, platform fees, call center fees, acquisition fees, and a portion of tenant warranty protection or tenant insurance proceeds that the Company earns for managing and operating its unconsolidated real estate ventures.
With respect to both the 2018 Joint Venture and the 2016 Joint Venture (as each is defined in Note 5), the Company provides supervisory and administrative property management services, centralized call center services,

13


and technology platform and revenue management services to the properties in the unconsolidated real estate ventures. The property management fees are equal to 6% of monthly gross revenues and net sales revenues from the assets of the unconsolidated real estate ventures, and the platform fees are equal to $1,250 per month per unconsolidated real estate venture property. With respect to the 2016 Joint Venture only, the call center fees are equal to 1% of each of monthly gross revenues and net sales revenues from the 2016 Joint Venture properties. During the three months ended June 30, 20202021 and 2019,2020, the Company recognized property management fees, call center fees and platform fees of $3.2$3.6 million and $3.2 million, respectively, and during the six months ended June 30, 20202021 and 2019,2020, the Company recognized property management fees, call center fees and platform fees of $6.4$7.1 million and $6.4 million, respectively.
For acquisition fees, the Company provides sourcing, underwriting and administration services to the unconsolidated real estate ventures. The 2016 Joint Venture paid the Company a $4.1 million acquisition fee equal to 0.65% of the gross capitalization (including debt and equity) of the original 66-property 2016 Joint Venture portfolio (the "Initial 2016 JV Portfolio") in 2016, at the time of the Initial 2016 JV Portfolio acquisition. The 2018 Joint Venture paid the Company a $4.0 million acquisition fee related to the initial acquisition of properties by the 2018 Joint Venture (the "Initial 2018 JV Portfolio") in 2018, at the time of the Initial 2018 JV Portfolio acquisition. These fees are refundable to the unconsolidated real estate ventures, on a prorated basis, if the Company is removed as the managing member during the initial four year life of the unconsolidated real estate ventures and as such, the Company's performance obligation for these acquisition fees are satisfied over a four year period. Accordingly, the Company's performance obligation related to the Initial 2016 JV Portfolio was satisfied during the year ended December 31, 2020. As of June 30, 20202021 and December 31, 2019,2020, the Company had deferred revenue related to the acquisition fees of $1.9$0.9 million and $2.8$1.3 million, respectively.
The Company also earns acquisition fees for properties acquired by the unconsolidated real estate ventures subsequent to the Initial 2016 JV Portfolio and the Initial 2018 JV Portfolio. These fees are based on a percentage of the gross capitalization of the acquired assets determined by the members of the 2016 Joint Venture and the 2018 Joint Venture, and are generally earned when the unconsolidated real estate ventures obtain title and control of an acquired property. During the three months ended June 30, 20202021 and 2019,2020, the Company recognized acquisition fees of $0.4$0.2 million and $0.5$0.4 million, respectively, and during the six months ended June 30, 20202021 and 2019,2020, the Company recognized acquisition fees of $0.9$0.4 million and $1.0$0.9 million, respectively.
An affiliate of the Company facilitates tenant warranty protection or tenant insurance programs for tenants of the properties in the unconsolidated real estate ventures in exchange for 50% of all proceeds from such programs at each unconsolidated real estate venture property. During the three months ended June 30, 20202021 and 2019,2020, the Company recognized $1.9$2.2 million and $1.2$1.9 million, respectively, of revenue related to these activities and during the six months ended June 30, 20202021 and 2019,2020, the Company recognized $3.5$4.1 million and $2.4$3.5 million, respectively, of revenue related to these activities.
Gain on sale of self storage properties
The Company recognizes gains from disposition of facilities only upon closing in accordance with the guidance on sales of nonfinancial assets. Profit on real estate sold is recognized upon closing when all, or substantially all, of the promised consideration has been received and is nonrefundable and the Company has transferred control of the facilities to the purchaser.
Investments in Unconsolidated Real Estate Ventures
The Company’s investments in its unconsolidated real estate ventures are recorded under the equity method of accounting in the accompanying condensed consolidated financial statements. Under the equity method, the Company’s investments in unconsolidated real estate ventures are stated at cost and adjusted for the Company’s share of net earnings or losses and reduced by distributions. Equity in earnings (losses) is recognized based on the Company’s ownership interest in the earnings (losses) of the unconsolidated real estate ventures. The Company follows the "nature of the distribution approach" for classification of distributions from its unconsolidated real estate

14


ventures in its condensed consolidated statements of cash flows. Under this approach, distributions are reported on the basis of the nature of the activity or activities that generated the distributions as either a return on investment, which are classified as operating cash flows, or a return of investment (e.g., proceeds from the unconsolidated real estate ventures' sale of assets) which are reported as investing cash flows.

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Noncontrolling Interests
All of the limited partner equity interests ("OP equity") in the operating partnership not held by the Company are reflected as noncontrolling interests. Noncontrolling interests also include ownership interests in DownREIT partnerships held by entities other than the operating partnership or its subsidiaries. In the condensed consolidated statements of operations, the Company allocates net income (loss) attributable to noncontrolling interests to arrive at net income (loss) attributable to National Storage Affiliates Trust.
For transactions that result in changes to the Company's ownership interest in its operating partnership, the carrying amount of noncontrolling interests is adjusted to reflect such changes. The difference between the fair value of the consideration received or paid and the amount by which the noncontrolling interest is adjusted is reflected as an adjustment to additional paid-in capital on the condensed consolidated balance sheets.
Allocation of Net Income (Loss)
The distribution rights and priorities set forth in the operating partnership's LP Agreement differ from what is reflected by the underlying percentage ownership interests of the unitholders. Accordingly, the Company allocates GAAP income (loss) utilizing the hypothetical liquidation at book value ("HLBV") method, in which the Company allocates income or loss based on the change in each unitholders’ claim on the net assets of its operating partnership at period end after adjusting for any distributions or contributions made during such period. The HLBV method is commonly applied to equity investments where cash distribution percentages vary at different points in time and are not directly linked to an equity holder’s ownership percentage.
The HLBV method is a balance sheet-focused approach to income (loss) allocation. A calculation is prepared at each balance sheet date to determine the amount that unitholders would receive if the operating partnership were to liquidate all of its assets (at GAAP net book value) and distribute the resulting proceeds to its creditors and unitholders based on the contractually defined liquidation priorities. The difference between the calculated liquidation distribution amounts at the beginning and the end of the reporting period, after adjusting for capital contributions and distributions, is used to derive each unitholder's share of the income (loss) for the period. Due to the stated liquidation priorities and because the HLBV method incorporates non-cash items such as depreciation expense, in any given period, income or loss may be allocated disproportionately to unitholders as compared to their respective ownership percentage in the operating partnership, and net income (loss) attributable to National Storage Affiliates Trust could be more or less net income than actual cash distributions received and more or less income or loss than what may be received in the event of an actual liquidation. Additionally, the HLBV method could result in net income (or net loss) attributable to National Storage Affiliates Trust during a period when the Company reports consolidated net loss (or net income), or net income (or net loss) attributable to National Storage Affiliates Trust in excess of the Company's consolidated net income (or net loss). The computations of basic and diluted earnings (loss) per share may be materially affected by these disproportionate income (loss) allocations, resulting in volatile fluctuations of basic and diluted earnings (loss) per share.
Other Comprehensive Income (Loss)
The Company has cash flow hedge derivative instruments that are measured at fair value with unrealized gains or losses recognized in other comprehensive income (loss) with a corresponding adjustment to accumulated other comprehensive income (loss) within equity, as discussed further in Note 12. Under the HLBV method of allocating income (loss) discussed above, a calculation is prepared at each balance sheet date by applying the HLBV method including, and excluding, the assets and liabilities resulting from the Company's cash flow hedge derivative instruments to determine comprehensive income (loss) attributable to National Storage Affiliates Trust. As a result of the distribution rights and priorities set forth in the operating partnership's LP Agreement, in any given period, other comprehensive income (loss) may be allocated disproportionately to unitholders as compared to their respective ownership percentage in the operating partnership and as compared to their respective allocation of net income (loss).

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Restricted Cash
The Company's restricted cash consists of escrowed funds deposited with financial institutions for real estate taxes, insurance and other reserves for capital improvements in accordance with the Company's loan agreements.

15


Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Recent Accounting Pronouncements
In March 2020, the Financial Accounting Standards Board issued ASU 2020-04, Reference Rate Reform (Topic 848). ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During the six months ended June 30, 2020, the Company elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. See Note 12 for additional detail about the Company's derivatives.
3. SHAREHOLDERS' EQUITY AND NONCONTROLLING INTERESTS
Shareholders' Equity
InternalizationForward Equity Offering
On September 22, 2020, the Company entered into an underwriting agreement, as well as certain forward sale agreements, with a syndicate of banks acting as underwriters, forward sellers, and/or forward purchasers in connection with an underwritten public offering of 4,500,000 common shares of beneficial interest, $0.01 par value per share of the Company ("common shares") at a public offering price of $33.15 per share (the "forward offering"). The underwriters were granted a 30-day option to purchase up to an additional 675,000 common shares at the same price, which they partially exercised for an additional 400,000 common shares on October 6, 2020. Therefore, the forward sellers or their affiliates, at the Company's request, borrowed from third parties and Acquisitionsold to the underwriters an aggregate of PRO4,900,000 common shares, which the underwriters sold at an offering price of $33.15 per share, for proceeds of approximately $162.4 million. As a result of this forward construct, the Company did not receive any proceeds from the sale of such shares at closing. The Company has determined that the forward sale agreements are not considered to be derivative instruments under the guidance within ASC 815.
On December 30, 2020, the Company settled a portion of the forward offering by physically delivering 1,850,510 common shares to the forward purchasers for net proceeds of approximately $60.0 million. On March 22, 2021, the Company settled the remaining portion of the forward offering by physically delivering 3,049,490 common shares to the forward purchasers for net proceeds of approximately $97.3 million.
Common Share Offering
As discussed in Note 1 and further below,13, on March 31, 2020,July 23, 2021, the Company closed ona follow-on public offering of 10,120,000 of its common shares, which included 1,320,000 common shares sold upon the previously announced mergersexercise in full by the underwriters of SecurCaretheir option to purchase additional common shares, at a public offering price of $51.25 per share. The Company received aggregate net proceeds from the offering of approximately $497.4 million after deducting the underwriting discount and DLAN with and into wholly-owned subsidiaries of the Company. In connectionadditional expenses associated with the mergers, the Company issued 8,105,192 common shares to the owners of SecurCare and DLAN, which represented a 1% discount to an aggregate of 8,187,052 OP units that each of SecurCare and DLAN owned or was entitled to receive immediately prior to the mergers (after rounding up to the next whole number of common shares). Of the total number of common shares issued to the owners of SecurCare, 4,063,571 common shares were issued to Arlen Nordhagen, the Company's executive chairman and former chief executive officer, who owned approximately 53% of SecurCare's outstanding shares, and 1,858,737 common shares were issued to David Cramer, the Company's chief operating officer, who owned approximately 24% of SecurCare's outstanding shares. In connection with the mergers and the issuance of the Company's common shares to Mr. Nordhagen and Mr. Cramer, the Company formed a special committee of independent and disinterested trustees (the "Special Committee") to evaluate the merits and terms of the proposed transaction. In analyzing the proposed transaction, the Special Committee engaged an independent third party financial advisor to assist the Special Committee in analyzing and assessing the transaction, and to opine on the fairness to the Company of the consideration to be paid by the Company in the mergers. The Special Committee approved and recommended that the Company's board of trustees approve the proposed transaction. The transaction was approved unanimously by the disinterested trustees of the Company's board of trustees on February 19, 2020.offering.
At the Market ("ATM") Program
On February 27, 2019, the Company entered into a sales agreement with certain sales agents, pursuant to which the Company may sell from time to time up to an aggregate of $250.0 million of the Company's common shares of beneficial interest, $0.01 par value per share ("common shares") and 6.000% Series A cumulative redeemable preferred shares of beneficial interest ("Series A preferred shares") in sales deemed to be "at the market" offerings.offerings (the "sales agreement"). The sales agreement contemplates that, in addition to the issuance and sale by the Company of offered shares to or through the sale agents, the Company may enter into separate forward sale agreements with any forward purchaser. Forward sale agreements, if any, will include only the Company's common shares and will not include any Series A preferred shares. If the Company enters into a forward sale agreement with any forward purchaser, such forward purchaser will attempt to borrow from third parties and sell, through the related agent, acting as sales agent for such forward purchaser (each, a "forward seller"), offered shares, in an amount equal to the offered shares subject to such forward

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sale agreement, to hedge such forward purchaser’s exposure under such forward sale agreement. The Company may offer the common shares and Series A preferred shares through the agents, as the Company's sales agents, or, as applicable, as forward seller, or directly to the agents or forward sellers, acting as principals, by means of, among others, ordinary brokers’ transactions on the NYSE or otherwise at market prices prevailing at the time of sale or at negotiated prices.
Under the sales agreement, the Company offered and sold shares having an aggregate gross sales price of approximately $219.0 million from February 27, 2019 through May 19, 2021, leaving offered shares having an aggregate gross sales price of up to approximately $31.0 million available for offer and sale under the sales agreement (the "remaining available offered shares"). On May 19, 2021, the Company entered into an amendment to the sales agreement with certain sales agents, whereby the Company increased the aggregate gross sale price under the program to $400.0 million, which includes the remaining available offered shares.

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During the sixthree months ended June 30, 2020,2021, the Company sold 512,000 of its2,390,000 common shares through the ATM program at an average offering price of $32.41$43.86 per share, resulting in net proceeds to the Company of approximately $16.2$103.7 million, after deducting compensation payable by the Company to such agents and offering expenses. During the six months ended June 30, 2021, the Company sold 3,032,726 common shares through the ATM program at an average offering price of $42.92 per share, resulting in net proceeds to the Company of approximately $129.1 million, after deducting compensation payable by the Company to such agents and offering expenses.
Noncontrolling Interests
All of the OP equity in the Company's operating partnership not held by the Company are reflected as noncontrolling interests. Noncontrolling interests also include ownership interests in DownREIT partnerships held by entities other than the Company's operating partnership. NSA is the general partner of its operating partnership and is authorized to cause its operating partnership to issue additional partner interests, including OP units and subordinated performance units, at such prices and on such other terms as it determines in its sole discretion.
As of June 30, 20202021 and December 31, 2019,2020, units reflecting noncontrolling interests consisted of the following:
June 30, 2020December 31, 2019June 30, 2021December 31, 2020
Series A-1 preferred unitsSeries A-1 preferred units637,382  642,982  Series A-1 preferred units633,382 637,382 
OP unitsOP units29,714,696  30,188,305  OP units30,069,539 29,616,809 
Subordinated performance unitsSubordinated performance units8,715,751  11,014,195  Subordinated performance units9,510,894 9,030,872 
LTIP unitsLTIP units765,840  743,566  LTIP units778,362 734,196 
DownREIT unitsDownREIT unitsDownREIT units
DownREIT OP unitsDownREIT OP units1,924,918  1,848,261  DownREIT OP units1,924,918 1,924,918 
DownREIT subordinated performance unitsDownREIT subordinated performance units4,337,111  4,371,622  DownREIT subordinated performance units4,337,111 4,337,111 
TotalTotal46,095,698  48,808,931  Total47,254,206 46,281,288 
Series A-1 Preferred Units
The 6.000% Series A-1 Cumulative Redeemable Preferred Units ("Series A-1 preferred units") rank senior to OP units and subordinated performance units in the Company's operating partnership with respect to distributions and liquidation. The Series A-1 preferred units have a stated value of $25.00 per unit and receive distributions at an annual rate of 6.000%. These distributions are cumulative. The Series A-1 preferred units are redeemable at the option of the holder after the first anniversary of the date of issuance, which redemption obligations may be satisfied at the Company’s option in cash in an amount equal to the market value of an equivalent number of the Series A preferred shares or the issuance of Series A preferred shares on a 1-for-one basis, subject to adjustments. The Series A preferred shares are redeemable by the Company for a cash redemption price of $25.00 per share, plus accrued but unpaid dividends. The decrease in Series A-1 preferred units outstanding from December 31, 20192020 to June 30, 20202021 was due to the redemption of 5,6004,000 Series A-1 preferred units for an equal number of Series A preferred shares.
OP Units and DownREIT OP units
OP units in the Company's operating partnership are redeemable for cash or, at the Company's option, exchangeable for the Company's common shares on a 1-for-one basis, and DownREIT OP units are redeemable for cash or, at the Company's option, exchangeable for OP units in its operating partnership on a 1-for-one basis, subject to certain adjustments in each case. The holders of OP units are generally not entitled to elect redemption until one year after the issuance of the OP units. The holders of DownREIT OP units are generally not entitled to elect redemption until five years after the date of the contributor's initial contribution.
The decreaseincrease in OP units outstanding from December 31, 20192020 to June 30, 20202021 was due to the redemptionissuance of 411,252559,463 OP units for common shares and the exchange of 368,500 DownREIT OP units in redemption of an equivalent number of outstanding OP units, which were subsequently retired by the operating partnership, offset by the following: 445,701 OP units issued upon the conversion of 332,738 subordinated performance units (as discussed further below), 356,392 OP units issued in connection with the acquisition of self storage properties, and 214,512142,405 LTIP units which were converted into an equivalent number of OP units. In addition, in connection withunits and 63,033 OP units issued upon the completionconversion of 32,741 subordinated performance units (as discussed further below) partially offset by the SecurCare and DLAN mergers, the Company's operating partnership retired 710,462redemption of 312,171 OP Units.units for an equal number of common shares.

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The increase in DownREIT OP units outstanding from December 31, 2019 to June 30, 2020 was due to the exchange of 368,500 DownREIT OP units held by the operating partnership in redemption of an equivalent number of outstanding OP Units, which were subsequently retired by the operating partnership, and the issuance of 115,888 DownREIT OP units related to the conversion of 34,511 DownREIT subordinated performance units (as discussed further below) partially offset by the contribution of 407,731 DownREIT OP units (which were previously included in the above table because they were not held by the Company) to the operating partnership in connection with the SecurCare and DLAN mergers.
Subordinated Performance Units and DownREIT Subordinated Performance Units
Subordinated performance units may also, under certain circumstances, be convertible into OP units which are exchangeable for common shares as described above, and DownREIT subordinated performance units may, under certain circumstances, be exchangeable for subordinated performance units on a 1-for-one basis. Subordinated performance units are only convertible into OP units after a two year lock-out period and then generally (i) at the holder’s election only upon the achievement of certain performance thresholds relating to the properties to which such subordinated performance units relate or (ii) at the Company's election upon a retirement event of a PRO that holds such subordinated performance units or upon certain qualifying terminations. The holders of DownREIT subordinated performance units are generally not entitled to elect redemption until at least five years after the date of the contributor's initial contribution.
Following such lock-out period, a holder of subordinated performance units in the Company's operating partnership may elect a voluntary conversion one time each year on or prior to December 1st to convert a pre-determined portion of such subordinated performance units into OP units in the Company's operating partnership, with such conversion effective January 1st of the following year, with each subordinated performance unit being converted into the number of OP units determined by dividing the average cash available for distribution, or CAD, per unit on the series of specific subordinated performance units over the one-yearone-year period prior to conversion by 110% of the CAD per unit on the OP units determined over the same period. CAD per unit on the series of specific subordinated performance units and OP units is determined by the Company based generally upon the application of the provisions of the LP Agreement applicable to the distributions of operating cash flow and capital transactions proceeds.
The decreaseincrease in subordinated performance units outstanding from December 31, 20192020 to June 30, 20202021 was due to the retirement of 2,001,441 subordinated performance units in connection with the SecurCare merger and the voluntary conversion of 332,738 subordinated performance units into 445,701 OP units, partially offset by the issuance of 35,735512,763 subordinated performance units for co-investment by the Company's PROs in connection with the acquisition of self storage properties.
The decrease in DownREIT subordinated performance units outstanding from December 31, 2019 to June 30, 2020 was due toproperties partially offset by the voluntary conversion of 34,511 DownREIT32,741 subordinated performance units into 115,888 DownREIT63,033 OP units.
LTIP Units
LTIP units are a special class of partnership interest in the Company's operating partnership that allow the holder to participate in the ordinary and liquidating distributions received by holders of the OP units (subject to the achievement of specified levels of profitability by the Company's operating partnership or the achievement of certain events). LTIP units may also, under certain circumstances, be convertible into OP units on a 1-for-one basis, which are then exchangeable for common shares as described above.
The increase in LTIP units outstanding from December 31, 20192020 to June 30, 20202021 was due to the issuance of 186,571 compensatory LTIP units to employees and trustees, net of forfeitures, partially offset by the conversion of 214,512142,405 LTIP units into an equivalent number of OP units partially offset by the issuance of 236,786 compensatory LTIP units to employees, trustees and consultants, net of forfeitures.units.

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4. SELF STORAGE PROPERTIES
Self storage properties are summarized as follows (dollars in thousands):
June 30, 2020December 31, 2019June 30, 2021December 31, 2020
LandLand$687,330  $649,938  Land$790,748 $738,863 
Buildings and improvementsBuildings and improvements2,659,837  2,435,171  Buildings and improvements3,277,794 2,892,490 
Furniture and equipmentFurniture and equipment7,287  6,610  Furniture and equipment8,474 7,839 
Total self storage propertiesTotal self storage properties3,354,454  3,091,719  Total self storage properties4,077,016 3,639,192 
Less accumulated depreciationLess accumulated depreciation(389,828) (337,822) Less accumulated depreciation(504,498)(443,623)
Self storage properties, netSelf storage properties, net$2,964,626  $2,753,897  Self storage properties, net$3,572,518 $3,195,569 
Depreciation expense related to self storage properties amounted to $26.3$31.5 million and $22.7$26.3 million during the three months ended June 30, 20202021 and 2019,2020, respectively, and $52.0$60.9 million and $44.2$52.0 million during the six months ended June 30, 20202021 and 2019,2020, respectively.

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5. INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES
2018 Joint Venture
As of June 30, 2020,2021, the Company's unconsolidated real estate venture, formed in September 2018 with an affiliate of Heitman America Real Estate REIT LLC (the "2018 Joint Venture"), owned and operated a portfolio of 103 self storage properties containing approximately 7.77.8 million rentable square feet, configured in approximately 64,000 storage units and located across 17 states.
2016 Joint Venture
As of June 30, 2020,2021, the Company's unconsolidated real estate venture, formed in September 2016 with a state pension fund advised by Heitman Capital Management LLC (the "2016 Joint Venture"), owned and operated a portfolio of 74 properties containing approximately 4.9 million rentable square feet, configured in approximately 40,000 storage units and located across 13 states.
The 2016 Joint Venture acquired 2 self storage properties for $12.1 million during the six months ended June 30, 2020. The 2016 Joint Venture financed these acquisitions with capital contributions from the 2016 Joint Venture members, of which the Company contributed $3.1 million for its 25% proportionate share.
The following table presents the combined condensed financial position of the Company's unconsolidated real estate ventures as of June 30, 20202021 and December 31, 20192020 (in thousands):
June 30, 2020December 31, 2019
ASSETS
Self storage properties, net$1,818,225  $1,835,235  
Other assets23,945  22,413  
Total assets$1,842,170  $1,857,648  
LIABILITIES AND EQUITY
Debt financing$989,601  $989,182  
Other liabilities20,386  20,487  
Equity832,183  847,979  
Total liabilities and equity$1,842,170  $1,857,648  


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June 30, 2021December 31, 2020
ASSETS
Self storage properties, net$1,769,759 $1,799,522 
Other assets25,969 24,397 
Total assets$1,795,728 $1,823,919 
LIABILITIES AND EQUITY
Debt financing$1,000,916 $1,000,464 
Other liabilities20,951 21,612 
Equity773,861 801,843 
Total liabilities and equity$1,795,728 $1,823,919 
The following tables present the combined condensed operating information of the Company's unconsolidated real estate ventures for the three and six months ended June 30, 20202021 and 20192020 (in thousands):
Three Months Ended June 30,Three Months Ended June 30,
2020201920212020
Total revenueTotal revenue$39,730  $40,858  Total revenue$46,086 $39,730 
Property operating expensesProperty operating expenses11,371  12,544  Property operating expenses12,523 11,371 
Net operating incomeNet operating income28,359  28,314  Net operating income33,563 28,359 
Supervisory, administrative and other expensesSupervisory, administrative and other expenses(2,640) (2,706) Supervisory, administrative and other expenses(3,014)(2,640)
Depreciation and amortizationDepreciation and amortization(15,245) (21,888) Depreciation and amortization(15,360)(15,245)
Interest expenseInterest expense(10,300) (9,941) Interest expense(10,415)(10,300)
Acquisition and other expensesAcquisition and other expenses(20) (419) Acquisition and other expenses(136)(20)
Net income (loss)$154  $(6,640) 
Net incomeNet income$4,638 $154 

Six Months Ended June 30,
20202019
Total revenue$79,968  $80,653  
Property operating expenses24,549  25,088  
Net operating income55,419  55,565  
Supervisory, administrative and other expenses(5,309) (5,359) 
Depreciation and amortization(30,391) (43,714) 
Interest expense(20,564) (19,961) 
Loss on sale of self storage properties—  (806) 
Acquisition and other expenses(419) (827) 
Net loss$(1,264) $(15,102) 
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Six Months Ended June 30,
20212020
Total revenue$89,781 $79,968 
Property operating expenses24,311 24,549 
Net operating income65,470 55,419 
Supervisory, administrative and other expenses(5,896)(5,309)
Depreciation and amortization(30,882)(30,391)
Interest expense(20,820)(20,564)
Acquisition and other expenses(257)(419)
Net income (loss)$7,615 $(1,264)

6. ACQUISITIONS
Self Storage Property Acquisitions
The Company acquired 4043 self storage properties with an estimated fair value of $259.0$435.4 million during the six months ended June 30, 2020.2021. Of these acquisitions, 37 self storage properties with an estimated fair value of $25.1$48.5 million were acquired by the Company from its PROs. The 4043 self storage property acquisitions were accounted for as asset acquisitions and accordingly, $4.2$2.8 million of transaction costs related to the acquisitions were capitalized as part of the basis of the acquired properties. The Company recognized the estimated fair value of the acquired assets and assumed liabilities on the respective dates of such acquisitions. The Company allocated the total purchase price to the estimated fair value of tangible and intangible assets acquired and liabilities assumed. The Company allocated a portion of the purchase price to identifiable intangible assets consisting of customer in-place leases which were recorded at estimated fair value of $5.3$10.8 million, resulting in a total fair value of $253.7$424.6 million allocated to real estate.

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The following table summarizes the investment in self storage property acquisitions completed by the Company during the six months ended June 30, 20202021 (dollars in thousands):
Acquisitions Closed During the Three Months Ended:Acquisitions Closed During the Three Months Ended:Number of PropertiesSummary of InvestmentAcquisitions Closed During the Three Months Ended:Number of PropertiesSummary of Investment
Cash and Acquisition Costs
Value of OP Equity(1)
Other LiabilitiesTotalAcquisitions Closed During the Three Months Ended:Number of PropertiesCash and Acquisition CostsOther LiabilitiesTotal
Acquisitions Closed During the Three Months Ended:Number of PropertiesCash and Acquisition Costs
Value of OP Equity(1)
Other LiabilitiesTotal
March 31, 202036$214,584  $7,217  $972  $222,773  
June 30, 2020430,198  5,842  207  36,247  
March 31, 2021March 31, 202123$141,928 $22,897 $1,138 $165,963 
June 30, 2021June 30, 202120243,580 24,102 1,711 269,393 
TotalTotal40$244,782  $13,059  $1,179  $259,020  Total43$385,508 $46,999 $2,849 $435,356 
(1)Value of OP equity represents the fair value of LTIP units, OP units and subordinated performance units.
Acquisition of PRO Management Company
As discussed in Note 1 and Note 3, on March 31, 2020, the Company closed on the previously announced mergers of SecurCare and DLAN with and into wholly-owned subsidiaries of the Company. The mergers were accounted for as a business combination whereby the Company acquired additional interests in its operating partnership and DownREIT partnerships. Accordingly, this portion of the transaction was accounted for as a change in ownership of a consolidated subsidiary, resulting in a reduction to noncontrolling interests equal to the net book value of the acquired subsidiary interests.
In connection with the mergers, SecurCare's property management platform and related intellectual property were internalized by the Company. Under the terms of the Company's facilities portfolio management agreement with SecurCare, in connection with a retirement event leading to the internalization of SecurCare's property management platform, SecurCare was entitled to receive OP units in exchange for its property management platform and related intellectual property based on a contractual formula. Using this formula, the Company determined that SecurCare was entitled to receive an equivalent of 348,020 OP units totaling $10.3 million, based on the acquisition date closing price of the Company's common shares. The Company allocated the total purchase price to the estimated fair value of tangible and intangible assets acquired, and liabilities assumed. The Company allocated a portion of the purchase price to tangible fixed assets of $0.1 million and intangible assets consisting of a management contract with an estimated fair value of $4.6 million and the SecurCare trade name with an estimated fair value of $3.2 million. The excess of the aggregate consideration paid over the identified assets acquired and liabilities assumed, equal to $2.4 million, was allocated to goodwill. The tangible and intangible assets related to the internalization are reported in other assets, net in the Company's condensed consolidated balance sheets.
The Company’s fair value measurements were based, in part, on valuations prepared by an independent valuation firm and the allocation of the purchase price required a significant amount of judgment. The Company measured the fair value of the management contract asset based on discounted future cash flows expected under the management contract from a market participant perspective. The management contract asset will be charged to amortization expense on a straight-line basis over 15 years, which represents the time period over which the majority of value was attributed in the Company’s discounted cash flow model. The Company measured the fair value of the trade name, which has an indefinite life and is not amortized, using the relief from royalty method.
The allocation of the purchase price requires judgment and was based on the Company's valuations, estimates and assumptions of the acquisition date fair value of the tangible and intangible assets acquired and liabilities assumed.

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7. OTHER ASSETS
Other assets consist of the following (dollars in thousands):
June 30, 2020December 31, 2019June 30, 2021December 31, 2020
Customer in-place leases, net of accumulated amortization of $3,336 and $7,267, respectively$3,751  $3,704  
Customer in-place leases, net of accumulated amortization of $6,327 and $5,322, respectivelyCustomer in-place leases, net of accumulated amortization of $6,327 and $5,322, respectively$10,854 $6,460 
Receivables:Receivables:Receivables:
Trade, netTrade, net2,776  2,809  Trade, net2,800 2,734 
PROs and other affiliatesPROs and other affiliates1,476  2,773  PROs and other affiliates2,848 2,974 
Receivables from unconsolidated real estate venturesReceivables from unconsolidated real estate ventures4,385  4,765  Receivables from unconsolidated real estate ventures4,691 5,825 
Property acquisition and other depositsProperty acquisition and other deposits294  4,438  Property acquisition and other deposits1,100 1,087 
Interest rate swaps—  980  
Equity securities—  7,703  
Prepaid expenses and otherPrepaid expenses and other5,190  4,762  Prepaid expenses and other9,129 7,099 
Corporate furniture, equipment and other, netCorporate furniture, equipment and other, net1,998  1,925  Corporate furniture, equipment and other, net1,481 1,673 
Trade namesTrade names6,380  3,200  Trade names6,380 6,380 
Management contracts, net of accumulated amortization of $2,715 and $2,274, respectively12,505  8,349  
Tenant reinsurance intangible, net of accumulated amortization of $610 and $317, respectively13,990  14,283  
Management contracts, net of accumulated amortization of $3,730 and $3,222, respectivelyManagement contracts, net of accumulated amortization of $3,730 and $3,222, respectively11,490 11,998 
Tenant reinsurance intangible, net of accumulated amortization of $1,196 and $903, respectivelyTenant reinsurance intangible, net of accumulated amortization of $1,196 and $903, respectively13,444 13,737 
GoodwillGoodwill8,182  5,750  Goodwill8,182 8,182 
TotalTotal$60,927  $65,441  Total$72,399 $68,149 
Amortization expense related to customer in-place leases amounted to $2.4$4.0 million and $2.8$2.4 million for the three months ended June 30, 20202021 and 2019,2020, respectively, and $5.3$6.4 million and $5.3 million during the six months ended June 30, 20202021 and 2019,2020, respectively. Amortization expense related to management contracts amounted to $0.3$0.2 million and $0.2$0.3 million for the three months ended June 30, 20202021 and 2019,2020, respectively, and $0.5 million and $0.4$0.5 million during the six months ended June 30, 20202021 and 2019,2020, respectively. Amortization expense related to the tenant reinsurance intangible amounted to $0.1$0.2 million and less than $0.1 million for the three months ended June 30, 20202021 and 2019,2020, respectively, and $0.2$0.3 million and less than $0.1$0.2 million during the six months ended June 30, 2021 and 2020, and 2019, respectively.


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8. DEBT FINANCING
The Company's outstanding debt as of June 30, 20202021 and December 31, 20192020 is summarized as follows (dollars in thousands):
Interest Rate(1)
June 30, 2020December 31, 2019
Interest Rate(1)
June 30, 2021December 31, 2020
Credit Facility:Credit Facility:Credit Facility:
Revolving line of creditRevolving line of credit1.46%$211,000  $—  Revolving line of credit1.40%$265,500 $174,000 
Term loan ATerm loan A3.74%125,000  125,000  Term loan A3.74%125,000 125,000 
Term loan BTerm loan B2.91%250,000  250,000  Term loan B2.91%250,000 250,000 
Term loan CTerm loan C2.80%225,000  225,000  Term loan C2.91%225,000 225,000 
Term loan DTerm loan D3.57%175,000  175,000  Term loan D3.57%175,000 175,000 
2023 Term loan facility2023 Term loan facility2.83%175,000  175,000  2023 Term loan facility2.83%175,000 175,000 
2028 Term loan facility2028 Term loan facility4.62%75,000  75,000  2028 Term loan facility4.62%75,000 75,000 
2029 Term loan facility2029 Term loan facility4.27%100,000  100,000  2029 Term loan facility4.27%100,000 100,000 
2029 Senior Unsecured Notes2029 Senior Unsecured Notes3.98%100,000  100,000  2029 Senior Unsecured Notes3.98%100,000 100,000 
2031 Senior Unsecured Notes4.08%50,000  50,000  
2030 Senior Unsecured Notes2030 Senior Unsecured Notes2.99%150,000 150,000 
August 2031 Senior Unsecured NotesAugust 2031 Senior Unsecured Notes4.08%50,000 50,000 
2032 Senior Unsecured Notes2032 Senior Unsecured Notes3.09%100,000 100,000 
2033 Senior Unsecured Notes2033 Senior Unsecured Notes3.10%55,000 
Fixed rate mortgages payableFixed rate mortgages payable4.18%260,349  264,260  Fixed rate mortgages payable4.24%218,041 223,614 
Total principalTotal principal1,746,349  1,539,260  Total principal2,063,541 1,922,614 
Unamortized debt issuance costs and debt premium, netUnamortized debt issuance costs and debt premium, net(4,805) (5,213) Unamortized debt issuance costs and debt premium, net(4,968)(5,643)
Total debtTotal debt$1,741,544  $1,534,047  Total debt$2,058,573 $1,916,971 

(1)
(1)Represents the effective interest rate as of June 30, 2020.2021. Effective interest rate incorporates the stated rate plus the impact of interest rate cash flow hedges and discount and premium amortization, if applicable. For the revolving line of credit, the effective interest rate excludes fees for unused borrowings.
As of June 30, 2020,2021, the Company's unsecured credit facility provided for total borrowings of $1.275 billion (the "credit facility"). The credit facility consists of the following components: (i) a revolving line of credit (the "Revolver") which provides for a total borrowing commitment up to $500.0 million, under which the Company may borrow, repay and re-borrow amounts, (ii) a $125.0 million tranche A term loan facility (the "Term Loan A"), (iii) a $250.0 million tranche B term loan facility (the "Term Loan B"), (iv) a $225.0 million tranche C term loan facility (the "Term Loan C"), and (v) a $175.0 million tranche D term loan facility (the "Term Loan D"). As of June 30, 2020,2021, the Company had an expansion option under the credit facility, which, if exercised in full, would provide for a total credit facility of $1.750 billion.
As of June 30, 2020,2021, the Company had outstanding letters of credit totaling $5.7 million and would have had the capacity to borrow remaining Revolver commitments of $283.3$228.8 million while remaining in compliance with the credit facility's financial covenants. At June 30, 2020,2021, the Company was in compliance with all such covenants.
ForAs discussed in Note 13, in July 2021, the Company received commitments from a summarysyndicated group of lenders to partially exercise the expansion option under its unsecured credit facility for a $100.0 million tranche E term loan facility.

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2026, May 2031 and 2033Senior Unsecured Notes
On May 3, 2021, the operating partnership as issuer, and the Company, entered into a Note Purchase Agreement (the "Note Purchase Agreement") which provides for the private placement of $35.0 million of 2.16% senior unsecured notes due May 4, 2026 (the "2026 Notes"), $90.0 million of 3.00% senior unsecured notes due May 4, 2031 (the "May 2031 Notes") and $55.0 million of 3.10% senior unsecured notes due May 4, 2033 (the "2033 Notes" and together with the 2026 Notes and May 2031 Notes the "Senior Unsecured Notes") to certain institutional investors. The Senior Unsecured Notes are governed by the Note Purchase Agreement and on May 26, 2021 the operating partnership issued the 2033 Notes. As discussed in Note 13, on July 26, 2021 the operating partnership issued the 2026 Notes and the May 2031 Notes.
Interest is paid semiannually, on May 31st and November 30th of each year, commencing on November 30, 2021. The Senior Unsecured Notes are senior unsecured obligations of the Company and are jointly and severally guaranteed by certain of the Company's financial covenants and additional detail regardingsubsidiaries, as subsidiary guarantors. The Senior Unsecured Notes rank pari passu with the Company's credit facility, 2023 Term Loan Facility, 2028 Term Loan Facility, 2029 Term Loan Facility, 2029 Senior Unsecured Notes, 2030 Senior Unsecured Notes, August 2031 Senior Unsecured Notes and fixed rate mortgages payable, please see Note 8 to the Company's most recent Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC.
2030 And 2032 Senior Unsecured NotesNotes. The Note Purchase Agreement contains financial covenants that are substantially similar to those of the Company's credit facility. In addition, the terms of the Note Purchase Agreement contain customary affirmative and negative covenants that, among other things, limit the Company's ability to make distributions or certain investments, incur debt, incur liens and enter into certain transactions.
Fixed Rate Mortgage Payable
As discussed in Note 14,13, on August 4, 2020,July 9, 2021, the Company's operating partnershipCompany entered into an agreement to issue $150.0with a single lender for an $88.0 million debt financing secured by a first lien on 8 of 2.99% senior unsecured notes due August 5, 2030the Company's self storage properties. This interest-only loan matures in July 2028 and $100.0 millionhas a fixed interest rate of 3.09% senior unsecured notes due August 5, 2032 in a private placement to certain institutional investors.

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2.77%.
Future Debt Obligations
Based on existing debt agreements in effect as of June 30, 2020,2021, the scheduled principal and maturity payments for the Company's outstanding borrowings are presented in the table below (in thousands):
Year Ending December 31,Year Ending December 31,Scheduled Principal and Maturity PaymentsAmortization of Premium and Unamortized Debt Issuance CostsTotalYear Ending December 31,Scheduled Principal and Maturity PaymentsAmortization of Premium and Unamortized Debt Issuance CostsTotal
Remainder of 2020$36,736  $(749) $35,987  
20217,603  (1,510) 6,093  
Remainder of 2021Remainder of 2021$2,096 $(843)$1,253 
202220224,205  (1,512) 2,693  20224,374 (1,689)2,685 
20232023377,049  (1,159) 375,890  2023376,813 (1,333)375,480 
20242024482,964  (790) 482,174  2024537,464 (960)536,504 
20252025227,185  (218) 226,967  2025227,185 (384)226,801 
20262026177,322 (260)177,062 
ThereafterThereafter610,607  1,133  611,740  Thereafter738,287 501 738,788 
$1,746,349  $(4,805) $1,741,544  $2,063,541 $(4,968)$2,058,573 


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9. EARNINGS PER SHARE
The following table sets forth the computation of basic and diluted earnings (loss) per common share for the three and six months ended June 30, 20202021 and 20192020 (in thousands, except per share amounts):
Three Months Ended
June 30,
Six Months Ended
June 30,
2020201920202019
Earnings (loss) per common share - basic and diluted
Numerator
Net income$17,787  $17,733  $33,550  $30,673  
Net income attributable to noncontrolling interests(7,365) (25,389) (16,480) (30,918) 
Net income (loss) attributable to National Storage Affiliates Trust10,422  (7,656) 17,070  (245) 
Distributions to preferred shareholders(3,274) (3,257) (6,547) (5,845) 
Distributed and undistributed earnings allocated to participating securities(11) (9) (23) (18) 
Net income (loss) attributable to common shareholders - basic and diluted$7,137  $(10,922) $10,500  $(6,108) 
Denominator
Weighted average shares outstanding - basic and diluted68,210  57,543  64,004  57,101  
Earnings (loss) per share - basic and diluted$0.10  $(0.19) $0.16  $(0.11) 
Three Months Ended
June 30,
Six Months Ended
June 30,
2021202020212020
Earnings (loss) per common share - basic and diluted
Numerator
Net income$35,675 $17,787 $63,310 $33,550 
Net income attributable to noncontrolling interests(6,957)(7,365)(13,754)(16,480)
Net income attributable to National Storage Affiliates Trust28,718 10,422 49,556 17,070 
Distributions to preferred shareholders(3,276)(3,274)(6,551)(6,547)
Distributed and undistributed earnings allocated to participating securities(16)(11)(27)(23)
Net income attributable to common shareholders - basic25,426 7,137 42,978 10,500 
Effect of assumed conversion of dilutive securities6,593 13,045 
Net income attributable to common shareholders - diluted$32,019 $7,137 $56,023 $10,500 
Denominator
Weighted average shares outstanding - basic76,712 68,210 74,267 64,004 
Effect of dilutive securities:
Weighted average effect of outstanding forward offering agreement199 
Weighted average OP units outstanding29,963 29,857 
Weighted average DownREIT OP unit equivalents outstanding1,925 1,925 
Weighted average LTIP units outstanding91 112 
Weighted average subordinated performance units and DownREIT subordinated performance unit equivalents20,887 20,036 
Weighted average shares outstanding - diluted129,578 68,210 126,396 64,004 
Earnings (loss) per share - basic$0.33 $0.10 $0.58 $0.16 
Earnings (loss) per share - diluted$0.25 $0.10 $0.44 $0.16 
As discussed in Note 2, the Company allocates GAAP income (loss) utilizing the HLBV method, in which the Company allocates income or loss based on the change in each unitholders' claim on the net assets of its operating partnership at period end after adjusting for any distributions or contributions made during such period. Due to the stated liquidation priorities and because the HLBV method incorporates non-cash items such as depreciation expense, in any given period, income or loss may be allocated disproportionately to National Storage Affiliates Trust and noncontrolling interests, resulting in volatile fluctuations of basic and diluted earnings (loss) per share.

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Outstanding equity interests of the Company's operating partnership and DownREIT partnerships are considered potential common shares for purposes of calculating diluted earnings (loss) per share as the unitholders

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may, through the exercise of redemption rights, obtain common shares, subject to various restrictions. Basic earnings per share is calculated based on the weighted average number of common shares outstanding during the period. Diluted earnings per share is calculated by further adjusting for the dilutive impact using the treasury stock method for unvested LTIP units subject to a service condition outstanding during the period and the if-converted method for any convertible securities outstanding during the period.
Generally, following certain lock-out periods, OP units in the Company's operating partnership are redeemable for cash or, at the Company's option, exchangeable for common shares on a 1-for-one basis, subject to certain adjustments and DownREIT OP units are redeemable for cash or, at the Company's option, exchangeable for OP units in its operating partnership on a 1-for-one basis, subject to certain adjustments in each case.
LTIP units may also, under certain circumstances, be convertible into OP units on a 1-for-one basis, which are then exchangeable for common shares as described above. Certain LTIP units vested prior to or upon the completion of the Company's initial public offering and certain LTIP units have vested upon the satisfaction of a service or market condition or will vest upon the satisfaction of future service and market conditions. Vested LTIP units and unvested LTIP units that vest based on a service or market condition are allocated income or loss in a similar manner as OP units. Unvested LTIP units subject to a service or market condition are evaluated for dilution using the treasury stock method. For the three and six months ended June 30, 2020, 420,2802021, 445,618 unvested LTIP units that vest based on a service or market condition are excluded from the calculation of diluted earnings (loss) per share as they are not dilutive to earnings (loss) per share. In addition, certain LTIP units vest upon the future acquisition of properties sourced by PROs or the completion of expansion projects. For the three and six months ended June 30, 2020,2021, 252,894 unvested LTIP units that vest upon the future acquisition of properties, or the completion of expansion projects, are excluded from the calculation of diluted earnings (loss) per share because the contingency for the units to vest has not been attained as of the end of the reported periods.
Subordinated performance units may also, under certain circumstances, be convertible into OP units which are exchangeable for common shares as described above, and DownREIT subordinated performance units may, under certain circumstances, be exchangeable for subordinated performance units on a 1-for-one basis. Subordinated performance units are only convertible into OP units, after a two year lock-out period and then generally (i) at the holder’s election only upon the achievement of certain performance thresholds relating to the properties to which such subordinated performance units relate or (ii) at the Company's election upon a retirement event of a PRO that holds such subordinated performance units or upon certain qualifying terminations. Although subordinated performance units may only be convertible after a two year lock-out period, the Company assumes a hypothetical conversion of each subordinated performance unit (including each DownREIT subordinated performance unit) into OP units (with subsequently assumed redemption into common shares) for the purposes of calculating diluted weighted average common shares. This hypothetical conversion is calculated using historical financial information, and as a result, is not necessarily indicative of the results of operations, cash flows or financial position of the Company upon expiration of the two-yeartwo-year lock out period on conversions.
For the three and six months ended June 30, 2020, and 2019, potential common shares totaling 46.9 million and 54.0 million, respectively, related to OP units, DownREIT OP units, subordinated performance units, DownREIT subordinated performance units and vested LTIP units have been excluded from the calculation of diluted earnings (loss) per share as they are not dilutive to earnings (loss) per share. For the six months ended June 30, 2020 and 2019, potential common shares totaling 49.0 million and 53.2 million, respectively, related to OP units, DownREIT OP units, subordinated performance units, DownREIT subordinated performance units and vested LTIP units have been excluded from the calculation of diluted earnings (loss) per share as they are not dilutive to earnings (loss) per share.
Participating securities, which consist of unvested restricted common shares, receive dividends equal to those received by common shares. The effect of participating securities for the periods presented above is calculated using the two-class method of allocating distributed and undistributed earnings.

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10. RELATED PARTY TRANSACTIONS
Supervisory and Administrative Fees
For the self storage properties that are managed by the PROs, the Company has entered into asset management agreements with the PROs to provide leasing, operating, supervisory and administrative services. The asset management agreements generally provide for fees ranging from 5% to 6% of gross revenue for the managed self storage properties. During the three months ended June 30, 20202021 and 2019,2020, the Company incurred $3.5$4.9 million and $4.9$3.5 million, respectively, for supervisory and administrative fees to the PROs and during the six months ended June 30, 20202021 and 2019,2020, the Company incurred $8.8$9.1 million and $9.6$8.8 million, respectively, for supervisory and administrative fees to the PROs. Such fees are included in general and administrative expenses in the accompanying condensed consolidated statements of operations.

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Payroll Services
For the self storage properties that are managed by the PROs, the employees responsible for operations are employees of the PROs who charge the Company for the costs associated with the respective employees. For the three months ended June 30, 20202021 and 2019,2020, the Company incurred $5.5$6.6 million and $7.9$5.5 million, respectively, for payroll and related costs reimbursable to these PROs and for the six months ended June 30, 20202021 and 2019,2020, the Company incurred $14.3$13.0 million and $15.7$14.3 million, respectively, for payroll and related costs reimbursable to these PROs. Such costs are included in property operating expenses in the accompanying condensed consolidated statements of operations.
Due Diligence Costs
During the three months ended June 30, 20202021 and 2019,2020, the Company incurred less than$0.2 million and $0.1 million and $0.3 million, respectively, of expenses payable to certain PROs related to self storage property acquisitions sourced by the PROs and during the six months ended June 30, 20202021 and 2019,2020, the Company incurred $0.2$0.5 million and $0.6$0.2 million, respectively, of expenses payable to certain PROs related to self storage property acquisitions sourced by the PROs. These expenses, which are based on the volume of transactions sourced by the PROs, are intended to reimburse the PROs for due diligence costs incurred in the sourcing and underwriting process. These due diligence costs are capitalized as part of the basis of the acquired self storage properties.
Self Storage Property Acquisitions
During the six monthsyear ended June 30,December 31, 2020, the Company acquired 1 self storage property for $7.5 million from a company in which an entity thatcontrolled by J. Timothy Warren, a trustee of the Company, was partially owned by Arlen Nordhagen, the Company's executive chairman and former chief executive officer, and David Cramer, the Company's chief operating officer. Of thean investor. Mr. Warren's adult children held an ownership interest in such investor entity. The total consideration payable by the Company for this property was subject to an earnout payable in 3 tranches based on the performance of the property over six, 12 and 18 month periods. During the six months ended June 30, 2021, in connection with the 12 month tranche of the earnout, the Company paid aggregate consideration totaling approximately $2.0 million, and the interest of Mr. Nordhagen's and Mr. Cramer's interestWarren's children was approximately 58,37613,105 OP Units with a value of $1.5 million and 29,689 OP Units with a value $0.7 million, respectively.approximately $0.6 million.
During the six months ended June 30, 2020,2021, the Company acquired 1 self storage property for $6.6$8.8 million from a company in which an entity controlled by J. Timothy Warren, a trustee of the Company, was an investor. Mr. Warren's adult childernchildren held an ownership interest in such investor entity. Of the total consideration paid, the interest of Mr. Warren's children was approximately 15,51229,123 OP Units with a value of $0.4$1.1 million.
11. COMMITMENTS AND CONTINGENCIES
Legal Proceedings
The Company is subject to litigation, claims, and assessments that may arise in the ordinary course of its business activities. Such matters include contractual matters, employment related issues, and regulatory proceedings. Although occasional adverse decisions or settlements may occur, the Company believes that the final disposition of such matters will not have a material adverse effect on the Company's financial position, results of operations, or liquidity.


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12. FAIR VALUE MEASUREMENTS
Recurring Fair Value Measurements
The Company sometimes limits its exposure to interest rate fluctuations by entering into interest rate swap agreements. The interest rate swap agreements moderate the Company's exposure to interest rate risk by effectively converting the interest on variable rate debt to a fixed rate. The Company measures its interest rate swap derivatives at fair value on a recurring basis. The changes in the fair value of derivatives designated and that qualify as cash flow hedges are recorded in accumulated other comprehensive income (loss) and are subsequently reclassified into earnings in the period that the hedged transaction affects earnings.

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Information regarding the Company's interest rate swaps measured at fair value, which are classified within Level 2 of the GAAP fair value hierarchy, is presented below (dollars in thousands):
Fair value at December 31, 20182019$14,195 (18,963)
Gains on interest rate swaps reclassified into interest expense from accumulated other comprehensive (loss) incomeSwap ineffectiveness(2,553)34 
Unrealized losses on interest rate swaps included in accumulated other comprehensive (loss) income(27,114)
Fair value at June 30, 2019$(15,472)
Fair value at December 31, 2019$(19,083)
Losses on interest rate swaps reclassified into interest expense from accumulated other comprehensive (loss) incomeloss4,546 
Unrealized losses on interest rate swaps included in accumulated other comprehensive (loss) income(76,792)
Fair value at June 30, 2020$(91,329)(91,175)
Fair value at December 31, 2020$(77,918)
Swap ineffectiveness24 
Losses on interest rate swaps reclassified into interest expense from accumulated other comprehensive loss10,081 
Unrealized gains on interest rate swaps included in accumulated other comprehensive (loss) income14,175 
Fair value at June 30, 2021$(53,638)
As of June 30, 20202021 and December 31, 2019,2020, the Company had outstanding interest rate swaps with aggregate notional amounts of $1,125.0 million and $1,125.0 million, respectively, designated as cash flow hedges. As of June 30, 2020,2021, the Company's swaps had a weighted average remaining term of approximately 3.83.3 years. The fair value of these swaps are presented as interest rate swap liabilities in the Company's balance sheets, and the Company recognizes any changes in the fair value as an adjustment of accumulated other comprehensive income (loss) within equity. If the forward rates at June 30, 20202021 remain constant, the Company estimates that during the next 12 months, the Company would reclassify into earnings approximately $19.8$20.2 million of the unrealized losses included in accumulated other comprehensive income (loss). If market interest rates increase above the 1.90%1.92% weighted average fixed rate under these interest rate swaps, the Company will benefit from net cash payments due from its counterparties to the interest rate swaps.
There were no transfers between levels of the three-tier fair value measurement hierarchy during the six months ended June 30, 20202021 and 2019.2020. For financial assets and liabilities that utilize Level 2 inputs, the Company utilizes both direct and indirect observable price quotes, including LIBOR yield curves. The Company uses valuation techniques for Level 2 financial assets and liabilities which include LIBOR yield curves at the reporting date as well as assessing counterparty credit risk. Counterparties to these contracts are highly rated financial institutions. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with the Company's derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and the counterparties. As of June 30, 2020,2021, the Company determined that the effect of credit valuation adjustments on the overall valuation of its derivative positions are not significant to the overall valuation of its derivatives. Therefore, the Company has determined that its derivative valuations are appropriately classified in Level 2 of the fair value hierarchy.
Fair Value Disclosures
The carrying values of cash and cash equivalents, restricted cash, trade receivables, and accounts payable and accrued liabilities reflected in the balance sheets at June 30, 20202021 and December 31, 2019,2020, approximate fair value due to the short term nature of these financial assets and liabilities. The carrying value of variable rate debt financing reflected in the balance sheets at June 30, 20202021 and December 31, 20192020 approximates fair value as the changes in

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their associated interest rates reflect the current market and credit risk is similar to when the loans were originally obtained.
The combined principal balance of the Company's fixed rate mortgages payable was approximately $260.3$218.0 million as of June 30, 20202021 with a fair value of approximately $284.7$239.5 million (categorized within Level 2 of the fair value hierarchy). In determining the fair value, the Company estimated a weighted average market interest rate of approximately 2.50%2.23%, compared to the weighted average contractual interest rate of 4.83%4.67%. The combined principal

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balance of the Company's fixed rate mortgages was approximately $264.3$223.6 million as of December 31, 20192020 with a fair value of approximately $280.9$249.7 million. In determining the fair value as of December 31, 2019,2020, the Company estimated a weighted average market interest rate of approximately 3.28%2.12%, compared to the weighted average contractual interest rate of 4.81%4.69%.
13. LEASES
The Company determines if a contractual arrangement is a lease at inception. As a lessee, the Company has non-cancelable lease agreements for real estate and its corporate office space that are classified as operating leases. The Company's operating leases are included in operating lease right-of-use ("ROU") assets and operating lease liabilities in its condensed consolidated balance sheets. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As the Company's operating leases do not provide an implicit rate, the Company used its incremental borrowing rate based on the information available at commencement date in determining the discount rate for the present value of the lease payments. To the extent that the lease agreements provide for fixed increases throughout the term of the lease, the Company recognizes lease expense on a straight-line basis over the expected lease terms.
Real Estate Leasehold Interests
The Company has 8 properties that are subject to non-cancelable leasehold interest agreements with remaining lease terms ranging from 14 to 72 years, inclusive of extension options that the Company anticipates exercising. Rent expense under these leasehold interest agreements is included in property operating expenses in the accompanying condensed consolidated statements of operations and amounted to $0.5 million and $0.4 million for the three months ended June 30, 2020 and 2019, respectively, and $0.9 million and $0.8 million for the six months ended June 30, 2020 and 2019, respectively.
Office Leases
The Company has entered into non-cancelable lease agreements for its corporate office space with remaining lease terms ranging from two to nine years. Rent expense related to these office leases is included in general and administrative expenses in the accompanying condensed consolidated statements of operations and amounted to $0.1 million and $0.1 million for the three months ended June 30, 2020 and 2019, respectively, and $0.2 million and $0.2 million for the six months ended June 30, 2020 and 2019, respectively.
The weighted-average remaining lease term and the weighted-average discount rate for the Company's operating leases as of June 30, 2020 are as follows:
June 30, 2020
Weighted-average remaining lease term
Real estate leasehold interests28 years
Office leases7 years
Weighted-average remaining discount rate
Real estate leasehold interests4.9 %
Office leases3.8 %

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As of June 30, 2020, the future minimum lease payments under the Company's operating leases, for which the Company is a lessee, are as follows (in thousands):
Year Ending December 31,Real Estate Leasehold InterestsOffice LeasesTotal
Remainder of 2020$715  $205  $920  
20211,444  471  1,915  
20221,459  465  1,924  
20231,464  430  1,894  
20241,470  450  1,920  
2025 through 209236,728  1,080  37,808  
Total lease payments$43,280  $3,101  $46,381  
Less imputed interest(20,905) (381) (21,286) 
Total$22,375  $2,720  $25,095  
As of December 31, 2019, the future minimum lease payments under the Company's operating leases, for which the Company is a lessee, are as follows (in thousands):
Year Ending December 31,Real Estate Leasehold InterestsOffice LeasesTotal
2020$1,419  $286  $1,705  
20211,444  387  1,831  
20221,459  381  1,840  
20231,464  346  1,810  
20241,470  353  1,823  
2025 through 209236,728  691  37,419  
Total lease payments$43,984  $2,444  $46,428  
Less imputed interest(21,440) (323) (21,763) 
Total$22,544  $2,121  $24,665  

14. SUBSEQUENT EVENTS
2030 And 2032Self Storage Property Acquisitions
Subsequent to June 30, 2021, the Company acquired 7 self storage properties for approximately $68.6 million. Consideration for these acquisitions included approximately $57.1 million of net cash, the assumption of approximately $0.2 million of other working capital liabilities and OP equity of approximately $11.3 million (consisting of the issuance of 189,322 OP units and 10,870 subordinated performance units). Of these acquisitions, 1 self storage property for $11.7 million was acquired from a company in which an entity controlled by J. Timothy Warren, a trustee of the Company, was an investor. Mr. Warren's adult children held an ownership interest in such investor entity. Of the total consideration paid, the interest of Mr. Warren's children was approximately 9,290 OP Units with a value of $0.5 million.
Common Share Offering
On July 23, 2021, the Company closed a follow-on public offering of 10,120,000 of its common shares, which included 1,320,000 common shares sold upon the exercise in full by the underwriters of their option to purchase additional common shares, at a public offering price of $51.25 per share. The Company received aggregate net proceeds from the offering of approximately $497.4 million after deducting the underwriting discount and additional expenses associated with the offering. The Company used the net proceeds for self storage property acquisitions, general corporate purposes and to repay borrowings outstanding under its Revolver.
ATM Program
Subsequent to June 30, 2021, the Company sold 782,000 of its common shares through the ATM program at an average offering price of $51.82 per share, resulting in net proceeds to the Company of approximately $40.0 million, after deducting compensation payable by the Company to such agents and offering expenses. The Company used the net proceeds for self storage property acquisitions and to repay borrowings outstanding under its Revolver.
2026 and May 2031 Senior Unsecured Notes
On August 4, 2020,July 26, 2021 the operating partnership as issuer,issued the 2026 Notes and the Company, entered into aMay 2031 Notes. See Note Purchase Agreement (the "Note Purchase Agreement") which provides8 for additional detail regarding the private placement of $150.0 million of 2.99% senior unsecured notes due August 5, 2030 (the "2030 Notes") and $100.0 million of 3.09% senior unsecured notes due August 5, 2032 (the "2032 Notes" and together with the 20302026 Notes the "Senior Unsecured Notes") to certain institutional investors. The Senior Unsecured Notes are governed by the Note Purchase Agreement and the sale and purchase of the Senior Unsecured Notes is expected to occur on or before October 22, 2020, subject to customary closing conditions.May 2031 Notes. The Company plans to useused the proceeds to repay outstanding amounts on its revolving line of credit and for general corporate purposes.
InterestFixed Rate Mortgage Payable
On July 9, 2021, the Company entered into an agreement with a single lender for an $88.0 million debt financing secured by a first lien on 8 of the Company's self storage properties. This interest-only loan matures in July 2028 and has a fixed interest rate of 2.77%. The Company used the net proceeds to repay borrowings outstanding under its Revolver.
Term Loan Commitment
The Company received commitments in July 2021 from a syndicated group of lenders to partially exercise the expansion option under its unsecured credit facility for a $100.0 million tranche E term loan facility (the "Term Loan E"). The Term Loan E is expected to be payable semiannually, on August 30thclose during the third quarter of 2021 and February 28th of each year, commencing on February 28, 2021.mature in early 2027. The Senior Unsecured Notes will be senior unsecured obligationscredit facility's existing financial covenants are not expected to change as a result of the expansion. The Company and will be jointly and severally guaranteed by certain ofplans to use the Company's subsidiaries, as subsidiary guarantors, upon issuance. The Senior Unsecured Notes are expected to rank pari passu withproceeds from the credit facility, 2023 Term Loan Facility, 2028 Term Loan Facility, 2029 Term Loan Facility, 2029 Senior Unsecured NotesE for self storage property acquisitions and 2031 Senior Unsecured Notes. The Note Purchase Agreement contains financial covenants that are substantially similar to those of the Company's credit facility. In addition, the terms of the Note Purchase Agreement contain customary affirmative and negative covenants that, among other things, limit the Company's ability to make distributions or certain investments, incur debt, incur liens and enter into certain transactions.

for general corporate purposes.

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ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
We make forward-looking statements in this report that are subject to risks and uncertainties. These forward-looking statements include information about possible or assumed future results of our business, financial condition, liquidity, results of operations, plans and objectives. When we use the words "believe," "expect," "anticipate," "estimate," "plan," "continue," "intend," "should," "may," or similar expressions, we intend to identify forward-looking statements.
The forward-looking statements contained in this report reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions, and changes in circumstances that may cause our actual results to differ significantly from those expressed in any forward-looking statement. One of the most significant factors is the ongoing and potential impact of the current outbreak of the COVID-19 pandemic on the economy, the self storage industry and the broader financial markets, which may have a significant negative impact on the Company's financial condition, results of operations and cash flows. The Company is unable to predict whether the continuing effects of the COVID-19 pandemic will trigger a further economic slowdown or a recession and to what extent the Company will experience disruptions related to the COVID-19 pandemic infor the third quarterremainder of 2021 or thereafter. In particular, it is difficult to fully assess the impact of COVID-19 at this time due to, among other factors, uncertainty regarding the severity and duration of the outbreak domestically and internationally, uncertainty regarding the effectiveness of federal, state and local governments' efforts to contain the spread of COVID-19 and respond to its direct and indirect impact on the U.S. economy and economic activity, including the timing of the successful distribution of an effective vaccine, the rate and level of persons receiving vaccinations and the efficacy of such vaccines. The current outbreak of COVID-19 pandemic has also impacted, and is likely to continue to impact, directly or indirectly, many of the other important factors below and the risks described in the Company's Annual Report on Form 10-K for the year ended December 31, 20192020 filed with the SEC on February 26, 2020 (the "Annual Report"), the risk factor set forth in this quarterly report under Item 1A below, and the Company's subsequent filings under the Exchange Act.
Statements regarding the following subjects, among others, may be forward-looking:
market trends in our industry, interest rates, the debt and lending markets or the general economy;
our business and investment strategy;
the acquisition of properties, including those under contract, and the ability of our acquisitions to achieve underwritten capitalization rates and our ability to execute on our acquisition pipeline;
the timing of acquisitions;
the internalization of retiring PROs into the Company;
our relationships with, and our ability and timing to attract additional, PROs;
our ability to effectively align the interests of our PROs with us and our shareholders;
the integration of our PROs and their managed portfolios into the Company, including into our financial and operational reporting infrastructure and internal control framework;
our operating performance and projected operating results, including our ability to achieve market rents and occupancy levels, reduce operating expenditures and increase the sale of ancillary products and services;
our ability to access additional off-market acquisitions;
actions and initiatives of the U.S. federal, state and local government and changes to U.S. federal, state and local government policies and the execution and impact of these actions, initiatives and policies;
the state of the U.S. economy generally or in specific geographic regions, states, territories or municipalities;
economic trends and economic recoveries;
our ability to obtain and maintain financing arrangements on favorable terms;
general volatility of the securities markets in which we participate;

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the negative impacts from the continued spread of COVID-19 on the economy, the self storage industry, the broader financial markets, the Company's financial condition, results of operations and cash flows and the ability of the Company's tenants to pay rent;
changes in the value of our assets;
projected capital expenditures;

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the impact of technology on our products, operations, and business;
the implementation of our technology and best practices programs (including our ability to effectively implement our integrated Internet marketing strategy);
changes in interest rates and the degree to which our hedging strategies may or may not protect us from interest rate volatility;
impact of and changes in governmental regulations, tax law and rates, accounting guidance and similar matters;
our ability to continue to qualify and maintain our qualification as a REIT for U.S. federal income tax purposes;
availability of qualified personnel;
the timing of conversions of subordinated performance units in our operating partnership and subsidiaries of our operating partnership into OP units in our operating partnership, the conversion ratio in effect at such time and the impact of such convertibility on our diluted earnings (loss) per share;
the risks of investing through joint ventures, including whether the anticipated benefits from a joint venture are realized or may take longer to realize than expected;
estimates relating to our ability to make distributions to our shareholders in the future; and
our understanding of our competition.
The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. Forward-looking statements are not predictions of future events. These beliefs, assumptions, and expectations can change as a result of many possible events or factors, not all of which are known to us. Readers should carefully review our financial statements and the notes thereto, as well as the sections entitled "Business," "Risk Factors," "Properties," and "Management's Discussion and Analysis of Financial Condition and Results of Operations," described in the Company's Annual Report, , and the other documents we file from time to time with the SEC. If a change occurs, our business, financial condition, liquidity and results of operations may vary materially from those expressed in our forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for us to predict those events or how they may affect us. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Except as required by law, we are not obligated to, and do not intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Overview
National Storage Affiliates Trust is a fully integrated, self-administered and self-managed real estate investment trust organized in the state of Maryland on May 16, 2013. We have elected and we believe that we have qualified to be taxed as a REIT commencing with our taxable year ended December 31, 2015. We serve as the sole general partner of our operating partnership, a Delaware limited partnership formed on February 13, 2013 to conduct our business, which is focused on the ownership, operation, and acquisition of self storage properties located within the top 100 metropolitan statistical areas throughout the United States.
Our executive chairman of the board of trustees and former chief executive officer, Arlen D. Nordhagen, co-founded SecurCare Self Storage, Inc. in 1988 to invest in and manage self storage properties. While growing SecurCare to over 150 self storage properties, Mr. Nordhagen recognized a market opportunity for a differentiated public self storage REIT that would leverage the benefits of national scale by integrating multiple experienced regional self storage operators with local operational focus and expertise. We believe that his vision, which is the foundation of the Company, aligns the interests of our participating regional operators ("PROs"), with those of our

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public shareholders by allowing our PROs to participate alongside our shareholders in our financial performance and the performance of our PROs' managed portfolios. This structure offers our PROs a unique opportunity to serve as regional property managers for their managed portfolios and directly participate in the potential upside of those properties while simultaneously diversifying their investment to include a broader portfolio of self storage properties.

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COVID-19
We are closely monitoring the impact of the COVID-19 pandemic on all aspects of our business. The outbreak of COVID-19 in many countries, including the United States, has adversely impacted economic activity. The effect of the outbreak has been rapidly evolving and, as cases of COVID-19 have continued to be identified, most states and municipalities have reacted by instituting quarantines, mandating business and school closures, requiring restrictions on travel, "shelter-in-place" and/or "stay-at-home" orders, and imposing restrictions on the types of businesses that may continue to operate. These containment measures generally do not apply to businesses, like ours, which are designated as "essential," but may apply to certain of our tenants, employees, vendors, lenders and joint venture partners.
As of the date of this report, our stores continue to operate and we are in compliance with federal, state and local COVID-19 guidelines and mandates. In response to the pandemic, we have increased the level and frequency of cleaning and sanitation of our self storage facilities and enacted recommended social distancing guidelines. Many of our stores feature online rental capabilities whereby a customer can complete the entire rental process online and receive an access code to the storage facility. For the remainder of our stores that do not yet benefit from the online rental feature, the combination of call center and email communication eliminates the need for any physical contact between customers and employees.
Due to the pandemic, we experienced a moderate slowdown in overall business activity during the three months ended June 30, 2020. Specifically, our same store portfolio (as defined below) operations were affected as follows:
Same store move-in volume decreased approximately 14% during the three months ended June 30, 2020, compared to the three months ended June 30, 2019;
Same store move-out volume decreased approximately 18% during the three months ended June 30, 2020, compared to the three months ended June 30, 2019.
Same store period-end occupancy was 89.8% as of June 30, 2020, a decrease of approximately 100 basis points compared to June 30, 2019.
Same store average occupancy was 88.1% for the three months ended June 30, 2020, a decrease of approximately 140 basis points compared to the three months ended June 30, 2019.
Our July 2020 same store portfolio (as defined below) operations were affected as follows:
Same store move-in volume increased approximately 8% in July 2020, compared to the same period in 2019.
Same store move-out volume decreased approximately 20% in July 2020, compared to the same period in 2019.
Same store period-end occupancy was 91.1% as of July 31, 2020, which was a 130 basis point increase compared to June 30, 2020 and a increase of approximately 80 basis points compared to July 31, 2019.
We continue to take proactive measures to maintain the strength of our business and manage the impact of COVID-19 on our operations and liquidity, including the following:
We have resumed rental rate increases for in-place tenants at the vast majority of our stores during the third quarter of 2020;
We have closely monitored our liquidity position. As of July 31, 2020, we had the capacity to borrow remaining Revolver commitments of approximately $257 million with less than $5 million of debt maturing through 2022;
We have entered into an agreement to issue $150.0 million of 2.99% senior unsecured notes due August 5, 2030 and $100.0 million of 3.09% senior unsecured notes due August 5, 2032 in a private placement, as discussed further in Note 14 to Item 1;
We are continuing to diligently manage operating expenses, including store-level personnel costs, marketing and repairs and maintenance expenses. We have also continued to incur lower corporate travel costs compared to expectations at the beginning of the year.
We remain committed to acquiring properties at appropriate risk-adjusted returns. We expect in the near-term there may be a lower volume of acquisition transactions in the self storage sector generally due to uncertainty from the pandemic. We believe our acquisition opportunities through our captive pipeline and relationship-

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based third-party deals sourced by our PROs will continue to be a differentiating factor for us to prudently deploy capital, including through the issuance of OP equity.
The above discussion is intended to provide shareholders with certain information regarding the impacts of the COVID-19 pandemic on our business and management’s efforts to respond to those impacts. We are unable to predict the impact of the COVID-19 pandemic on our business for the balance of the third quarter of 2020 and thereafter. We will continue to monitor its effects and will adjust our operations as necessary. As a result of the rapid development, fluidity and uncertainty surrounding this situation, we expect that such information will change, potentially significantly, going forward and may not be indicative of the actual impact of the COVID-19 pandemic on our financial condition, results of operations and cash flows for the third quarter of 2020 and future periods. See "Risk Factors" under Item 1A.
Our Structure
Our structure promotes operator accountability as subordinated performance units issued to our PROs in exchange for the contribution of their properties are entitled to distributions only after those properties satisfy minimum performance thresholds. In the event of a material reduction in operating cash flow, distributions on our subordinated performance units will be reduced before or disproportionately to distributions on our common shares held by our common shareholders. In addition, we expect our PROs will generally co-invest subordinated equity in the form of subordinated performance units in each acquisition that they source, and the value of these subordinated performance units will fluctuate with the performance of their managed portfolios. Therefore, our PROs are incentivized to select acquisitions that are expected to exceed minimum performance thresholds, thereby increasing the value of their subordinated equity stake. We expect that our shareholders will benefit from the higher levels of property performance that our PROs are incentivized to deliver.
Our Property Management Platform
Through our property management platform, we direct, manage and control the day-to-day operations and affairs of certain consolidated properties and our unconsolidated real estate ventures. As of June 30, 2021, our property management platform managed and controlled 293 of our consolidated properties and 177 of our unconsolidated real estate venture properties.
We earn certain customary fees for managing and operating the properties in the unconsolidated real estate ventures and we facilitate tenant insurance and/or tenant warranty protection programs for tenants at these properties in exchange for half of all proceeds from such programs.
Our PROs
The Company had nineten PROs as of June 30, 2020:2021: Northwest, Optivest, Guardian, Move It, Storage Solutions, Hide Away, Personal Mini, Southern, Moove In and Moove In. As discussed in Note 1 in Item 1, on March 31, 2020, we closed on the merger and internalization of the management platform of SecurCare, which prior to the merger and internalization was our largest PRO. As part of the internalization, we offered and provided employment to most of SecurCare's employees, including its key persons, to continue managing SecurCare's managed portfolio under the brand SecurCare as members of our existing property management platform. As a result of the merger, we no longer pay any fees or reimbursements to SecurCare and distributions on the series of subordinated performance units related to SecurCare's managed portfolio were discontinued.
Blue Sky. We seek to further expand our platform by continuing to recruit additional established self storage operators, while integrating our operations through the implementation of centralized initiatives, including management information systems, revenue enhancement, and cost optimization programs. Our national platform allows us to capture cost savings by eliminating redundancies and utilizing economies of scale across the property management platforms of our PROs while also providing greater access to lower-cost capital.
Our Consolidated Properties
We seek to own properties that are well located in high quality sub-markets with highly accessible street access and attractive supply and demand characteristics, providing our properties with strong and stable cash flows that are less sensitive to the fluctuations of the general economy. Many of these markets have multiple barriers to entry against increased supply, including zoning restrictions against new construction and new construction costs that we believe are higher than our properties' fair market value. We have an attractive, high quality potential acquisition pipeline that we expect will continue to drive our future growth.
As of June 30, 2020,2021, we owned a geographically diversified portfolio of 607687 self storage properties, located in 2933 states and Puerto Rico, comprising approximately 36.642.5 million rentable square feet, configured in approximately 291,000334,000 storage units. Of these properties, 268283 were acquired by us from our PROs, 338403 were acquired from third-party sellers and one was acquired from the 2016 Joint Venture.
During the six months ended June 30, 2020,2021, we acquired 4043 self storage properties for $259.0$435.4 million, comprising approximately 2.03.2 million rentable square feet, configured in approximately 16,00025,000 storage units. Of these acquisitions, threeseven were acquired from our PROs and 3736 were acquired from third-party sellers.

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Our Unconsolidated Real Estate Ventures
We seek to opportunistically partner with institutional funds and other institutional investors to acquire attractive portfolios utilizing a promoted return structure. We believe there is significant opportunity for continued

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external growth by partnering with institutional investors seeking to deploy capital in the self storage industry. In addition, we consider the 75% third-party interest in the Company's unconsolidated real estate ventures, which currently own 177 properties, to present a potential acquisition opportunity. This 75% third-party share of gross real estate assets is approximately $1.5 billion based on the historical book value of the joint ventures. Were we to pursue an acquisition of these interests, it could potentially drive our future growth.
2018 Joint Venture
As of June 30, 2020,2021, our 2018 Joint Venture, in which we have a 25% interest, owned and operated a portfolio of 103 properties containing approximately 7.77.8 million rentable square feet, configured in approximately 64,000 storage units and located across 17 states.
2016 Joint Venture
As of June 30, 2020,2021, our 2016 Joint Venture, in which we have a 25% ownership interest, owned and operated a portfolio of 74 properties containing approximately 4.9 million rentable square feet, configured in approximately 40,000 storage units and located across 13 states.
DuringCOVID-19
We continue to closely monitor the six months ended June 30, 2020,impact of the COVID-19 pandemic on all aspects of our 2016 Joint Venture acquired twobusiness. The outbreak of COVID-19 in many countries, including the United States, has adversely impacted economic activity. As cases of COVID-19 have increased, most states and municipalities have reacted by instituting, extending or reinstating quarantines, mandating business and school closures, requiring restrictions on travel, "shelter-in-place" and/or "stay-at-home" orders, and imposing restrictions on the types of businesses that may continue to operate. These containment measures generally do not apply to businesses, like ours, which are designated as "essential," but may apply to certain of our tenants, employees, vendors, lenders and joint venture partners.
As of the date of this report, our stores continue to operate and we are in compliance with federal, state and local COVID-19 guidelines and mandates. In response to the pandemic, we have continued to maintain increased levels and frequency of cleaning and sanitation of our self storage properties containing less than 0.1 million rentable square feet, configuredfacilities and the recommended social distancing guidelines. Many of our stores feature online rental capabilities whereby a customer can complete the entire rental process online and receive an access code to the storage facility. For the remainder of our stores that do not yet benefit from the online rental feature, the combination of call center and email communication eliminates the need for any physical contact between customers and employees.
Due to the pandemic, we experienced a slowdown in approximately 500 storage units and locatedoverall business activity during the second quarter of 2020. However, we observed sustained improvement in one state.
Our Property Management Platform
Through our property management platform, we direct, manageoperating results during the third and controlfourth quarters of 2020 and continuing through the day-to-day operations and affairssecond quarter of certain consolidated properties and our unconsolidated real estate ventures. As of June 30, 2020, our property management platform managed and controlled 266 of our consolidated properties and 177 of our unconsolidated real estate venture properties.
We earn certain customary fees for managing and operating the properties in the unconsolidated real estate ventures and we facilitate tenant insurance and/or tenant warranty protection programs for tenants at these properties in exchange for half of all proceeds from such programs.2021.
Results of Operations
When reviewing our results of operations it is important to consider the timing of acquisition activity. We acquired 4043 self storage properties during the six months ended June 30, 20202021 and 6977 self storage properties during the year ended December 31, 2019.2020. As a result of these and other factors, we do not believe that our historical results of operations discussed and analyzed below are comparable or necessarily indicative of our future results of operations or cash flows.
To help analyze the operating performance of our self storage properties, we also discuss and analyze operating results relating to our same store portfolio. Our same store portfolio is defined as those properties owned and operated on a stabilized basis since the first day of the earliest year presented, excludingpresented. We consider a property to be stabilized once it has achieved an occupancy rate that is representative of similar properties in the applicable market. We exclude any properties sold, expected to be sold or subject to significant changes such as expansions or casualty events which cause the portfolio's year-over-year operating results to no longer be comparable. As of June 30, 2020,2021, our same store portfolio consisted of 500560 consolidated self storage properties.
The following discussion and analysis of the results of our operations and financial condition should be read in conjunction with the accompanying condensed consolidated financial statements in Item 1. Certain figures, such as interest rates and other percentages, included in this section have been rounded for ease of presentation. Percentage figures included in this section have not in all cases been calculated on the basis of such rounded figures but on the basis of such amounts prior to rounding. For this reason, percentage amounts in this section may vary slightly from

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those obtained by performing the same calculations using the figures in our condensed consolidated financial statements or in the associated text. Certain other amounts that appear in this section may similarly not sum due to rounding.

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Three Months Ended June 30, 20202021 compared to the Three Months Ended June 30, 20192020
Net income was $35.7 million for the three months ended June 30, 2021, compared to $17.8 million for the three months ended June 30, 2020, compared to $17.7 million for the three months ended June 30, 2019, an increase of $0.1 million.$17.9 million. The increase was primarily due to an increase in net operating income ("NOI") resultinggenerated from an additional 5380 self storage properties acquired between July 1, 20192020 and June 30, 20202021 and same store NOI growth, partially offset by increases in depreciation and amortization and a decrease in gains from the sale of self storage properties.amortization. For a description of NOI, see "Non-GAAP Financial Measures – NOI".
The following table illustrates the changes in rental revenue, other property-related revenue, management fees and other revenue, property operating expenses, and other expenses for the three months ended June 30, 20202021 compared to the three months ended June 30, 20192020 (dollars in thousands):
Three Months Ended June 30,Three Months Ended June 30,
20202019Change20212020Change
Rental revenueRental revenueRental revenue
Same store portfolioSame store portfolio$80,141  $81,038  $(897) Same store portfolio$103,470 $89,174 $14,296 
Non-same store portfolioNon-same store portfolio15,161  6,137  9,024  Non-same store portfolio23,840 6,128 17,712 
Total rental revenueTotal rental revenue95,302  87,175  8,127  Total rental revenue127,310 95,302 32,008 
Other property-related revenueOther property-related revenueOther property-related revenue
Same store portfolioSame store portfolio2,860  2,921  (61) Same store portfolio3,912 3,153 759 
Non-same store portfolioNon-same store portfolio558  207  351  Non-same store portfolio917 265 652 
Total other property-related revenueTotal other property-related revenue3,418  3,128  290  Total other property-related revenue4,829 3,418 1,411 
Property operating expensesProperty operating expensesProperty operating expenses
Same store portfolioSame store portfolio24,780  25,052  (272) Same store portfolio28,859 27,676 1,183 
Non-same store portfolioNon-same store portfolio5,477  2,138  3,339  Non-same store portfolio7,795 2,581 5,214 
Total property operating expensesTotal property operating expenses30,257  27,190  3,067  Total property operating expenses36,654 30,257 6,397 
Net operating incomeNet operating incomeNet operating income
Same store portfolioSame store portfolio58,221  58,907  (686) Same store portfolio78,523 64,651 13,872 
Non-same store portfolioNon-same store portfolio10,242  4,206  6,036  Non-same store portfolio16,962 3,812 13,150 
Total net operating incomeTotal net operating income68,463  63,113  5,350  Total net operating income95,485 68,463 27,022 
Management fees and other revenueManagement fees and other revenue5,697  5,116  581  Management fees and other revenue6,107 5,697 410 
General and administrative expensesGeneral and administrative expenses(10,329) (10,813) 484  General and administrative expenses(12,450)(10,329)(2,121)
Depreciation and amortizationDepreciation and amortization(29,309) (25,829) (3,480) Depreciation and amortization(36,051)(29,309)(6,742)
OtherOther(462) (357) (105) Other(310)(462)152 
Other (expense) incomeOther (expense) incomeOther (expense) income
Interest expenseInterest expense(15,513) (13,947) (1,566) Interest expense(17,339)(15,513)(1,826)
Equity in earnings (losses) of unconsolidated real estate ventures52  (1,646) 1,698  
Equity in earnings of unconsolidated real estate venturesEquity in earnings of unconsolidated real estate ventures1,174 52 1,122 
Acquisition costsAcquisition costs(252) (305) 53  Acquisition costs(118)(252)134 
Non-operating expenseNon-operating expense(317) (169) (148) Non-operating expense(148)(317)169 
Gain on sale of self storage properties—  2,814  (2,814) 
Other expenseOther expense(16,030) (13,253) (2,777) Other expense(16,431)(16,030)(401)
Income before income taxesIncome before income taxes18,030  17,977  53  Income before income taxes36,350 18,030 18,320 
Income tax expenseIncome tax expense(243) (244)  Income tax expense(675)(243)(432)
Net incomeNet income17,787  17,733  54  Net income35,675 17,787 17,888 
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests(7,365) (25,389) 18,024  Net income attributable to noncontrolling interests(6,957)(7,365)408 
Net income (loss) attributable to National Storage Affiliates Trust10,422  (7,656) 18,078  
Distributions to preferred shareholders(3,274) (3,257) (17) 
Net income (loss) attributable to common shareholders$7,148  $(10,913) $18,061  
Net income attributable to National Storage Affiliates TrustNet income attributable to National Storage Affiliates Trust28,718 10,422 18,296 

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Three Months Ended June 30,
20212020Change
Distributions to preferred shareholders(3,276)(3,274)(2)
Net income attributable to common shareholders$25,442 $7,148 $18,294 
Total Revenue
Our total revenue increased by $9.0$33.8 million, or 9.4%32.4%, for the three months ended June 30, 2020,2021, as compared to the three months ended June 30, 2019.2020. This increase was primarily attributable to incremental revenue from 5380 self storage properties acquired between July 1, 20192020 and June 30, 2020, regular rental increases for in-place tenants, partially offset by a decrease2021 and an increase in total portfolio average occupancy from 89.1% for the three months ended June 30, 2019 to 87.5% for the three months ended June 30, 2020.2020 to 94.8% for the three months ended June 30, 2021. Average occupancy is calculated based on the average of the month-end occupancy immediately preceding the period presented and the month-end occupancies included in the respective period presented.
Rental Revenue
Rental revenue increased by $8.1$32.0 million, or 9.3%33.6%, for the three months ended June 30, 2020,2021, as compared to the three months ended June 30, 2019.2020. The increase in rental revenue was due to a $9.0$17.7 million increase in non-same store rental revenue which was primarily attributable to incremental rental revenue of $5.9$10.4 million from 4960 self storage properties acquired between July 1, 20192020 and March 31, 2020,2021 and $0.3$5.2 million from four20 self storage properties acquired during the three months ended June 30, 2020.2021. Same store portfolio rental revenues decreased $0.9increased $14.3 million, or 1.1%16.0%, due to a decreasean increase in average occupancy from 89.5% for the three months ended June 30, 2019 to 88.1%87.8% for the three months ended June 30, 2020 partially offset byto 95.4% for the three months ended June 30, 2021 and a 0.4%6.8% increase, from $11.94$11.97 to $11.99,$12.78, in annualized same store rental revenue (including fees and net of any discounts and uncollectible customer amounts) divided by average occupied square feet ("average annualized rental revenue per occupied square foot"), driven primarily by increased contractual lease rates for in-place tenants.
Other Property-Related Revenue
Other property-related revenue represents ancillary income from our self storage properties, such as tenant insurance-related access fees and sales of storage supplies. Other property-related revenue increased by $0.3$1.4 million, or 9.3%41.3%, for the three months ended June 30, 2020,2021, as compared to the three months ended June 30, 2019.2020. This increase primarily resulted from a $0.4$0.8 million increase in same store other property-related revenue and a $0.7 million increase in non-same store other property-related revenue which was primarily attributable to incremental other property-related revenue of $0.3$0.4 million from 4960 self storage properties acquired between July 1, 20192020 and March 31, 2020.2021 and $0.2 million from 20 self storage properties acquired during the three months ended June 30, 2021.
Management Fees and Other Revenue
Management fees and other revenue, which are primarily related to managing and operating the unconsolidated real estate ventures, were $6.1 million for the three months ended June 30, 2021, compared to $5.7 million for the three months ended June 30, 2020, comparedan increase of $0.4 million. This increase was primarily attributable to $5.1increases in tenant insurance fees and dividends.
Property Operating Expenses
Property operating expenses were $36.7 million for the three months ended June 30, 2019, an increase of $0.6 million. This increase was primarily attributable2021 compared to incremental tenant insurance fees and dividends from an investment in a tenant reinsurance company made during the three months ended June 30, 2019.
Property Operating Expenses
Property operating expenses were $30.3 million for the three months ended June 30, 2020, compared to $27.2 million for the three months ended June 30, 2019, an increase of $3.1$6.4 million, or 11.3%21.1%. The increase in property operating expenses primarily resulted from a $3.3$5.2 million increase in non-same store property operating expenses that was primarily attributable to incremental property operating expenses of $2.5$3.8 million from 4960 self storage properties acquired between July 1, 20192020 and March 31, 2020,2021 and $0.1$1.2 million from four20 self storage properties acquired during the three months ended June 30, 2020.2021. Same store portfolio operating expenses increased $1.2 million, or 4.3%, due to increases in personnel expense, property taxes and repairs and maintenance expense offset by decreases in marketing expense.

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General and Administrative Expenses
General and administrative expenses decreased $0.5increased $2.1 million, or 4.5%20.5%, for the three months ended June 30, 2020,2021, compared to the three months ended June 30, 2019.2020. This decreaseincrease was attributable to decreasesincreases in supervisory and administrative fees charged by our PROs primarily as a result of the merger and internalization of the management platform of SecurCare on March 31, 2020, as discussed in Note 1 in Item 1.

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personnel costs.
Depreciation and Amortization
Depreciation and amortization increased $3.5$6.7 million, or 13.5%23.0%, for the three months ended June 30, 2020,2021, compared to the three months ended June 30, 2019.2020. This increase was primarily attributable to incremental depreciation expense related to the 5380 self storage properties we acquired between July 1, 20192020 and June 30, 20202021, and partially offset by a decreasean increase in amortization of customer in-place leases from $2.8 million for the three months ended June 30, 2019 to $2.4 million for the three months ended June 30, 2020.2020 to $4.0 million for the three months ended June 30, 2021.
Interest Expense
Interest expense increased $1.6$1.8 million, or 11.2%11.8%, for the three months ended June 30, 2020,2021, compared to the three months ended June 30, 2019.2020. The increase in interest expense was primarily attributable to additional borrowings in October 2020 consisting of $155.0the issuance of $150.0 million of additional term loan borrowings under the Company's credit facility in July 2019,2.99% senior unsecured notes due August 5, 2030 and $100.0 million of borrowings under the 2029 Term Loan Facility in April 2019 and the issuance of the $150.0 million Senior Unsecured Notes in a private placement in3.09% senior unsecured notes due August 2019. The increase in interest expense from these additional borrowings was partially offset by lower outstanding borrowings under the Revolver.5, 2032.
Equity In Earnings (Losses) Of Unconsolidated Real Estate Ventures
Equity in earnings (losses) of unconsolidated real estate ventures represents our share of earnings and losses incurred through our 25% ownership interests in the 2018 Joint Venture and the 2016 Joint Venture. During the three months ended June 30, 2020,2021, we recorded $0.1$1.2 million of equity in earnings from our unconsolidated real estate ventures compared to $1.6$0.1 million of lossesearnings for the three months ended June 30, 2019. This was primarily the result of incremental losses from our 2018 Joint Venture during the three months ended June 30, 2019 driven by real estate depreciation and amortization of customer in-place leases following the acquisition of the Initial 2018 Joint Venture portfolio in September 2018.
Gain On Sale of Self Storage Properties
Gain on sale of self storage properties was $2.8 million for the three months ended June 30, 2019. During the three months ended June 30, 2019, we sold one self storage property to an unrelated third party for gross proceeds of $6.5 million.2020.
Net Income Attributable to Noncontrolling Interests
As discussed in Note 2 in Item 1, we allocate GAAP income (loss) utilizing the HLBV method, in which we allocate income or loss based on the change in each unitholders' claim on the net assets of our operating partnership at period end after adjusting for any distributions or contributions made during such period.
Due to the stated liquidation priorities and because the HLBV method incorporates non-cash items such as depreciation expense, in any given period, income or loss may be allocated disproportionately to noncontrolling interests. Net income attributable to noncontrolling interests was $7.0 million for the three months ended June 30, 2021, compared to $7.4 million for the three months ended June 30, 2020, compared to $25.4 million for the three months ended June 30, 2019.2020.
Six Months Ended June 30, 20202021 compared to the Six Months Ended June 30, 20192020
Net income was $63.3 million for the six months ended June 30, 2021, compared to $33.6 million for the six months ended June 30, 2020, compared to $30.7 million for the six months ended June 30, 2019, an increase of $2.9$29.7 million. The increase was primarily due to an increase in NOI resultinggenerated from an additional 5380 self storage properties acquired between July 1, 20192020 and June 30, 20202021 and same store NOI growth, partially offset by increases in depreciation and amortization and interest expense.amortization.
The following table illustrates the changes in rental revenue, other property-related revenue, management fees and other revenue, property operating expenses, and other expenses for the six months ended June 30, 20202021 compared to the six months ended June 30, 20192020 (dollars in thousands):
Six Months Ended June 30,Six Months Ended June 30,
20202019Change20212020Change
Rental revenueRental revenueRental revenue
Same store portfolioSame store portfolio$161,750  $160,376  $1,374  Same store portfolio$201,374 $179,854 $21,520 
Non-same store portfolioNon-same store portfolio28,954  9,654  19,300  Non-same store portfolio39,063 10,850 28,213 
Total rental revenueTotal rental revenue190,704  170,030  20,674  Total rental revenue240,437 190,704 49,733 
Other property-related revenueOther property-related revenue
Same store portfolioSame store portfolio7,525 6,347 1,178 
Non-same store portfolioNon-same store portfolio1,441 442 999 
Total other property-related revenueTotal other property-related revenue8,966 6,789 2,177 

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Six Months Ended June 30,Six Months Ended June 30,
20202019Change20212020Change
Other property-related revenue
Same store portfolio5,767  5,601  166  
Non-same store portfolio1,022  351  671  
Total other property-related revenue6,789  5,952  837  
Property operating expensesProperty operating expensesProperty operating expenses
Same store portfolioSame store portfolio50,518  50,271  247  Same store portfolio57,692 56,337 1,355 
Non-same store portfolioNon-same store portfolio10,331  3,376  6,955  Non-same store portfolio13,566 4,512 9,054 
Total property operating expensesTotal property operating expenses60,849  53,647  7,202  Total property operating expenses71,258 60,849 10,409 
Net operating incomeNet operating incomeNet operating income
Same store portfolioSame store portfolio116,999  115,706  1,293  Same store portfolio151,207 129,864 21,343 
Non-same store portfolioNon-same store portfolio19,645  6,629  13,016  Non-same store portfolio26,938 6,780 20,158 
Total net operating incomeTotal net operating income136,644  122,335  14,309  Total net operating income178,145 136,644 41,501 
Management fees and other revenueManagement fees and other revenue11,146  10,009  1,137  Management fees and other revenue11,835 11,146 689 
General and administrative expensesGeneral and administrative expenses(21,423) (21,193) (230) General and administrative expenses(23,688)(21,423)(2,265)
Depreciation and amortizationDepreciation and amortization(58,414) (50,178) (8,236) Depreciation and amortization(68,475)(58,414)(10,061)
OtherOther(851) (743) (108) Other(707)(851)144 
Other (expense) incomeOther (expense) incomeOther (expense) income
Interest expenseInterest expense(31,141) (27,158) (3,983) Interest expense(34,131)(31,141)(2,990)
Equity in losses of unconsolidated real estate ventures(288) (3,748) 3,460  
Equity in earnings (losses) of unconsolidated real estate venturesEquity in earnings (losses) of unconsolidated real estate ventures1,933 (288)2,221 
Acquisition costsAcquisition costs(1,085) (462) (623) Acquisition costs(410)(1,085)675 
Non-operating expenseNon-operating expense(509) (267) (242) Non-operating expense(321)(509)188 
Gain (loss) on sale of self storage properties—  2,814  (2,814) 
Other expenseOther expense(33,023) (28,821) (4,202) Other expense(32,929)(33,023)94 
Income before income taxesIncome before income taxes34,079  31,409  2,670  Income before income taxes64,181 34,079 30,102 
Income tax expenseIncome tax expense(529) (736) 207  Income tax expense(871)(529)(342)
Net incomeNet income33,550  30,673  2,877  Net income63,310 33,550 29,760 
Net income attributable to noncontrolling interestsNet income attributable to noncontrolling interests(16,480) (30,918) 14,438  Net income attributable to noncontrolling interests(13,754)(16,480)2,726 
Net income (loss) attributable to National Storage Affiliates Trust17,070  (245) 17,315  
Net income attributable to National Storage Affiliates TrustNet income attributable to National Storage Affiliates Trust49,556 17,070 32,486 
Distributions to preferred shareholdersDistributions to preferred shareholders(6,547) (5,845) (702) Distributions to preferred shareholders(6,551)(6,547)(4)
Net income (loss) attributable to common shareholders$10,523  $(6,090) $16,613  
Net income attributable to common shareholdersNet income attributable to common shareholders$43,005 $10,523 $32,482 
Total Revenue
Our total revenue increased by $22.6$52.6 million, or 12.2%25.2%, for the six months ended June 30, 2020,2021, as compared to the six months ended June 30, 2019.2020. This increase was primarily attributable to incremental revenue from 5380 self storage properties acquired between July 1, 20192020 and June 30, 2020, regular rental increases for in-place tenants, partially offset by a decrease2021 and an increase in total portfolio average occupancy from 88.2% for the six months ended June 30, 2019 to 87.2% for the six months ended June 30, 2020.

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2020 to 93.4% for the six months ended June 30, 2021.
Rental Revenue
Rental revenue increased by $20.7$49.7 million, or 12.2%26.1%, for the six months ended June 30, 2020,2021, as compared to the six months ended June 30, 2019.2020. The increase in rental revenue was due to a $19.3$28.2 million increase in non-same store rental revenue which was primarily attributable to incremental rental revenue of $3.2$12.8 million from 1337 self storage properties acquired between July 1, 20192020 and December 31, 2019,2020 and $7.8$10.4 million from 4043 self storage properties acquired during the six months ended June 30, 2020.2021. Same store portfolio rental revenues increased $1.4$21.5 million, or 0.9%12.0%, due to an increase in average occupancy from 87.4% for the six months ended June 30, 2020 to 94.0% for the six months ended June 30, 2021 and a 1.6%4.1% increase, from 11.96$12.12 to 12.15,$12.62, in average annualized rental revenue per occupied square foot, driven primarily by increased contractual lease rates for in-place tenants partially offset by a decrease in average occupancy from 88.5% for the six months ended June 30, 2019 to 87.7% for the six months ended June 30, 2020.tenants.

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Other Property-Related Revenue
Other property-related revenue represents ancillary income from our self storage properties, such as tenant insurance-related access fees and sales of storage supplies. Other property-related revenue increased by $0.8$2.2 million, or 14.1%32.1%, for the six months ended June 30, 2020,2021, as compared to the six months ended June 30, 2019.2020. This increase primarily resulted from a $0.7$1.2 million increase in same store other property-related revenue and a $1.0 million increase in non-same store other property-related revenue which was primarily attributable to incremental other property-related revenue of $0.1$0.4 million from 1337 self storage properties acquired between July 1, 20192020 and December 31, 2019,2020 and $0.3 million from 4043 self storage properties acquired during the six months ended June 30, 2020.2021.
Management Fees and Other Revenue
Management fees and other revenue, which are primarily related to managing and operating the unconsolidated real estate ventures, were $11.8 million for the six months ended June 30, 2021, compared to $11.1 million for the six months ended June 30, 2020, comparedan increase of $0.7 million. This increase was primarily attributable to $10.0increases in tenant insurance fees and dividends.
Property Operating Expenses
Property operating expenses were $71.3 million for the six months ended June 30, 2019, an increase of $1.1 million. This increase was primarily attributable2021 compared to incremental tenant insurance fees and dividends from an investment in a tenant reinsurance company made during the three months ended June 30, 2019.
Property Operating Expenses
Property operating expenses were $60.8 million for the six months ended June 30, 2020, compared to $53.6 million for the six months ended June 30, 2019, an increase of $7.2$10.4 million, or 13.4%17.1%. The increase in property operating expenses primarily resulted from a $7.0$9.1 million increase in non-same store property operating expenses that was primarily attributable to incremental property operating expenses of $1.2$4.7 million from 1337 self storage properties acquired between July 1, 20192020 and December 31, 2019,2020 and $3.2 million from 4043 self storage properties acquired during the six months ended June 30, 2020.2021. Same store portfolio operating expenses increased $1.4 million, or 2.4%, due to increases in personnel expense, property taxes and repairs and maintenance expense offset by decreases in marketing expense.
General and Administrative Expenses
General and administrative expenses increased $0.2$2.3 million, or 1.1%10.6%, for the six months ended June 30, 2020,2021, compared to the six months ended June 30, 2019.2020. This increase was primarily attributable to increases in payrollequity based compensation expense and related costs partially offset by decreases in supervisory and administrative fees charged by our PROs primarily as a result of the merger and internalization of the management platform of SecurCare on March 31, 2020, as discussed in Note 1 in Item 1.personnel costs.
Depreciation and Amortization
Depreciation and amortization increased $8.2$10.1 million, or 16.4%17.2%, for the six months ended June 30, 2020,2021, compared to the six months ended June 30, 2019.2020. This increase was primarily attributable to incremental depreciation expense related to the 5380 self storage properties we acquired between July 1, 20192020 and June 30, 2020.2021, and an increase in amortization of customer in-place leases from $5.3 million for the six months ended June 30, 2020 to $6.4 million for the six months ended June 30, 2021.
Interest Expense
Interest expense increased $4.0$3.0 million, or 14.7%9.6%, for the six months ended June 30, 2020,2021, compared to the six months ended June 30, 2019.2020. The increase in interest expense was primarily attributable to higher outstanding borrowings including additional borrowings in October 2020 consisting of $155.0the issuance of $150.0 million of additional term loan borrowings under the Company's credit facility in July 2019,2.99% senior unsecured notes due August 5, 2030 and $100.0 million of borrowings under the 2029 Term Loan Facility in April 2019 and the issuance of the $150.0 million Senior Unsecured Notes in a private placement in3.09% senior unsecured notes due August 2019. The increase in interest expense from these additional borrowings was partially offset by lower outstanding borrowings under the Revolver.

39


5, 2032.
Equity In Earnings (Losses) Of Unconsolidated Real Estate Ventures
Equity in earnings (losses) of unconsolidated real estate ventures represents our share of earnings and losses incurred through our 25% ownership interests in the 2018 Joint Venture and the 2016 Joint Venture. During the six months ended June 30, 2020,2021, we recorded $0.3$1.9 million of equity in lossesearnings from our unconsolidated real estate ventures compared to $3.7$0.3 million of losses for the six months ended June 30, 2019. This was primarily the result of incremental losses from our 2018 Joint Venture during the six months ended June 30, 2019 driven by real estate depreciation and amortization of customer in-place leases following the acquisition of the Initial 2018 Joint Venture portfolio in September 2018.
Gain On Sale of Self Storage Properties
Gain on sale of self storage properties was $2.8 million for the six months ended June 30, 2019. During the six months ended June 30, 2019, we sold one self storage property to an unrelated third party for gross proceeds of $6.5 million.2020.
Net Income Attributable to Noncontrolling Interests
As discussed in Note 2 in Item 1, we allocate GAAP income (loss) utilizing the HLBV method, in which we allocate income or loss based on the change in each unitholders' claim on the net assets of our operating partnership at period end after adjusting for any distributions or contributions made during such period.

37


Due to the stated liquidation priorities and because the HLBV method incorporates non-cash items such as depreciation expense, in any given period, income or loss may be allocated disproportionately to noncontrolling interests. Net income attributable to noncontrolling interests was $13.8 million for the six months ended June 30, 2021, compared to $16.5 million for the six months ended June 30, 2020, compared to $30.9 million for the six months ended June 30, 2019.2020.
Non-GAAP Financial Measures
FFO and Core FFO
Funds from operations, or FFO, is a widely used performance measure for real estate companies and is provided here as a supplemental measure of our operating performance. The December 2018 Nareit Funds From Operations White Paper - 2018 Restatement, which we refer to as the White Paper, defines FFO as net income (as determined under GAAP), excluding: real estate depreciation and amortization, gains and losses from the sale of certain real estate assets, gains and losses from change in control, mark-to-market changes in value recognized on equity securities, impairment write-downs of certain real estate assets and impairment of investments in entities when it is directly attributable to decreases in the value of depreciable real estate held by the entity and after items to record unconsolidated partnerships and joint ventures on the same basis. Distributions declared on subordinated performance units and DownREIT subordinated performance units represent our allocation of FFO to noncontrolling interests held by subordinated performance unitholders and DownREIT subordinated performance unitholders. For purposes of calculating FFO attributable to common shareholders, OP unitholders, and LTIP unitholders, we exclude distributions declared on subordinated performance units, DownREIT subordinated performance units, preferred shares and preferred units. We define Core FFO as FFO, as further adjusted to eliminate the impact of certain items that we do not consider indicative of our core operating performance. These further adjustments consist of acquisition costs, organizational and offering costs, gains on debt forgiveness, gains (losses) on early extinguishment of debt, and after adjustments for unconsolidated partnerships and joint ventures.
Management uses FFO and Core FFO as key performance indicators in evaluating the operations of our properties. Given the nature of our business as a real estate owner and operator, we consider FFO and Core FFO as key supplemental measures of our operating performance that are not specifically defined by GAAP. We believe that FFO and Core FFO are useful to management and investors as a starting point in measuring our operational performance because FFO and Core FFO exclude various items included in net income (loss) that do not relate to or are not indicative of our operating performance such as gains (or losses) from sales of self storage properties and depreciation, which can make periodic and peer analyses of operating performance more difficult. Our computation of FFO and Core FFO may not be comparable to FFO reported by other REITs or real estate companies.
FFO and Core FFO should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as total revenues, operating income and net income (loss). FFO and Core FFO do not represent cash generated from operating activities determined in accordance with GAAP and are not a measure of liquidity or an indicator of our ability to make cash distributions. We believe that to further

40


understand our performance, FFO and Core FFO should be compared with our reported net income (loss) and considered in addition to cash flows computed in accordance with GAAP, as presented in our consolidated financial statements.

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The following table presents a reconciliation of net income (loss) to FFO and Core FFO for the three and six months ended June 30, 20202021 and 20192020 (in thousands, except per share and unit amounts):
Three Months Ended
June 30,
Six Months Ended
June 30,
2020201920202019
Net income$17,787  $17,733  $33,550  $30,673  
Add (subtract):
Real estate depreciation and amortization28,955  25,510  57,719  49,537  
Company's share of unconsolidated real estate venture real estate depreciation and amortization3,811  5,472  7,598  10,929  
Gain on sale of self storage properties—  (2,814) —  (2,814) 
Mark-to-market changes in value on equity securities—  —  142  —  
Company's share of unconsolidated real estate venture loss on sale of properties—  —  —  202  
Distributions to preferred shareholders and unitholders(3,514) (3,461) (7,028) (6,214) 
FFO attributable to subordinated performance unitholders(1)
(6,030) (8,462) (14,694) (15,755) 
FFO attributable to common shareholders, OP unitholders, and LTIP unitholders41,009  33,978  77,287  66,558  
Add:
Acquisition costs252  305  1,085  462  
Core FFO attributable to common shareholders, OP unitholders, and LTIP unitholders$41,261  $34,283  $78,372  $67,020  
Weighted average shares and units outstanding - FFO and Core FFO:(2)
Weighted average shares outstanding - basic68,210  57,543  64,004  57,101  
Weighted average restricted common shares outstanding34  29  29  29  
Weighted average OP units outstanding29,720  30,213  30,215  30,081  
Weighted average DownREIT OP unit equivalents outstanding1,925  1,848  1,887  1,848  
Weighted average LTIP units outstanding534  537  576  641  
Total weighted average shares and units outstanding - FFO and Core FFO100,423  90,170  96,711  89,700  
FFO per share and unit$0.41  $0.38  $0.80  $0.74  
Core FFO per share and unit$0.41  $0.38  $0.81  $0.75  


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Three Months Ended
June 30,
Six Months Ended
June 30,
2021202020212020
Net income$35,675 $17,787 $63,310 $33,550 
Add (subtract):
Real estate depreciation and amortization35,698 28,955 67,768 57,719 
Company's share of unconsolidated real estate venture real estate depreciation and amortization3,840 3,811 7,721 7,598 
Mark-to-market changes in value on equity securities— — — 142 
Distributions to preferred shareholders and unitholders(3,517)(3,514)(7,034)(7,028)
FFO attributable to subordinated performance unitholders(1)
(12,093)(6,030)(21,255)(14,694)
FFO attributable to common shareholders, OP unitholders, and LTIP unitholders59,603 41,009 110,510 77,287 
Add:
Acquisition costs118 252 410 1,085 
Core FFO attributable to common shareholders, OP unitholders, and LTIP unitholders$59,721 $41,261 $110,920 $78,372 
Weighted average shares and units outstanding - FFO and Core FFO:(2)
Weighted average shares outstanding - basic76,712 68,210 74,267 64,004 
Weighted average restricted common shares outstanding33 34 29 29 
Weighted average effect of forward offering agreement(3)
— — 199 — 
Weighted average OP units outstanding29,963 29,720 29,858 30,215 
Weighted average DownREIT OP unit equivalents outstanding1,925 1,925 1,925 1,887 
Weighted average LTIP units outstanding536 534 561 576 
Total weighted average shares and units outstanding - FFO and Core FFO109,169 100,423 106,839 96,711 
FFO per share and unit$0.55 $0.41 $1.03 $0.80 
Core FFO per share and unit$0.55 $0.41 $1.04 $0.81 
(1) Amounts represent distributions declared for subordinated performance unitholders and DownREIT subordinated performance unitholders for the periods presented.
(2) NSA combines OP units and DownREIT OP units with common shares because, after the applicable lock-out periods, OP units in the Company's operating partnership are redeemable for cash or, at NSA's option, exchangeable for common shares on a one-for-one basis and DownREIT OP units are also redeemable for cash or, at NSA's option, exchangeable for OP units in our operating partnership on a one-for-one basis, subject to certain adjustments in each case. Subordinated performance units, DownREIT subordinated performance units, and LTIP units may also, under certain circumstances, be convertible into or exchangeable for common shares (or other units that are convertible into or exchangeable for common shares). See footnote(1) in the following table for additional discussion of subordinated performance units, DownREIT subordinated performance units, and LTIP units in the calculation of FFO and Core FFO per share and unit.
(3) Represents the dilutive effect of the forward offering from the application of the treasury stock method.

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The following table presents a reconciliation of earnings (loss) per share - diluted to FFO and Core FFO per share and unit for the three and six months ended June 30, 20202021 and 2019:2020:
Three Months Ended
June 30,
Six Months Ended
June 30,
2020201920202019
Earnings (loss) per share - diluted$0.10  $(0.19) $0.16  $(0.11) 
Impact of the difference in weighted average number of shares(1)
(0.03) 0.07  (0.06) 0.04  
Impact of GAAP accounting for noncontrolling interests, two-class method and treasury stock method(2)
0.07  0.28  0.17  0.35  
Add real estate depreciation and amortization0.29  0.28  0.60  0.55  
Add Company's share of unconsolidated venture real estate depreciation and amortization0.04  0.06  0.08  0.12  
Subtract gain on sale of self storage properties—  (0.03) —  (0.03) 
FFO attributable to subordinated performance unitholders(0.06) (0.09) (0.15) (0.18) 
FFO per share and unit0.41  0.38  0.80  0.74  
Add acquisition costs—  —  0.01  0.01  
Core FFO per share and unit$0.41  $0.38  $0.81  $0.75  

Three Months Ended
June 30,
Six Months Ended
June 30,
2021202020212020
Earnings (loss) per share - diluted$0.25 $0.10 $0.44 $0.16 
Impact of the difference in weighted average number of shares(1)
0.04 (0.03)0.09 (0.06)
Impact of GAAP accounting for noncontrolling interests, two-class method and treasury stock method(2)
— 0.07 — 0.17 
Add real estate depreciation and amortization0.33 0.29 0.63 0.60 
Add Company's share of unconsolidated venture real estate depreciation and amortization0.04 0.04 0.07 0.08 
FFO attributable to subordinated performance unitholders(0.11)(0.06)(0.20)(0.15)
FFO per share and unit0.55 0.41 1.03 0.80 
Add acquisition costs— — 0.01 0.01 
Core FFO per share and unit$0.55 $0.41 $1.04 $0.81 
(1) Adjustment accounts for the difference between the weighted average number of shares used to calculate diluted earnings per share and the weighted average number of shares used to calculate FFO and Core FFO per share and unit. Diluted earnings per share is calculated using the two-class method for the company's restricted common shares and the treasury stock method for certain unvested LTIP units, and assumes the conversion of vested LTIP units into OP units on a one-for-one basis and the hypothetical conversion of subordinated performance units, and DownREIT subordinated performance units into OP units, even though such units may only be convertible into OP units (i) after a lock-out period and (ii) upon certain events or conditions. For additional information about the conversion of subordinated performance units, DownREIT subordinated performance units and LTIP units into OP units, see Note 9 in Item 1. The computation of weighted average shares and units for FFO and Core FFO per share and unit includes all restricted common shares and LTIP units that participate in distributions and excludes all subordinated performance units and DownREIT subordinated performance units because their effect has been accounted for through the allocation of FFO to the related unitholders based on distributions declared.
(2) Represents the effect of adjusting the numerator to consolidated net income (loss) prior to GAAP allocations for noncontrolling interests, after deducting preferred share and unit distributions, and before the application of the two-class method and treasury stock method, as described in footnote(1).
NOI
Net operating income, or NOI, represents rental revenue plus other property-related revenue less property operating expenses. NOI is not a measure of performance calculated in accordance with GAAP.
We believe NOI is useful to investors in evaluating our operating performance because:
NOI is one of the primary measures used by our management and our PROs to evaluate the economic productivity of our properties, including our ability to lease our properties, increase pricing and occupancy and control our property operating expenses;
NOI is widely used in the real estate industry and the self storage industry to measure the performance and value of real estate assets without regard to various items included in net income that do not relate to or are

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not indicative of operating performance, such as depreciation and amortization, which can vary depending upon accounting methods, the book value of assets, and the impact of our capital structure; and
We believe NOI 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 the cost basis of our assets from our operating results.
There are material limitations to using a non-GAAP 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 (loss). We compensate for these

40


limitations by considering the economic effect of the excluded expense items independently as well as in connection with our analysis of net income (loss). NOI should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as total revenues and net income (loss).
The following table presents a reconciliation of net income (loss) to NOI for the three and six months ended June 30, 20202021 and 20192020 (dollars in thousands):
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
June 30,
Six Months Ended
June 30,
20202019202020192021202020212020
Net incomeNet income$17,787  $17,733  $33,550  $30,673  Net income$35,675 $17,787 $63,310 $33,550 
(Subtract) Add:(Subtract) Add:(Subtract) Add:
Management fees and other revenueManagement fees and other revenue(5,697) (5,116) (11,146) (10,009) Management fees and other revenue(6,107)(5,697)(11,835)(11,146)
General and administrative expensesGeneral and administrative expenses10,329  10,813  21,423  21,193  General and administrative expenses12,450 10,329 23,688 21,423 
OtherOther462  357  851  743  Other310 462 707 851 
Depreciation and amortizationDepreciation and amortization29,309  25,829  58,414  50,178  Depreciation and amortization36,051 29,309 68,475 58,414 
Interest expenseInterest expense15,513  13,947  31,141  27,158  Interest expense17,339 15,513 34,131 31,141 
Equity in (earnings) losses of unconsolidated real estate venturesEquity in (earnings) losses of unconsolidated real estate ventures(52) 1,646  288  3,748  Equity in (earnings) losses of unconsolidated real estate ventures(1,174)(52)(1,933)288 
Acquisition costsAcquisition costs252  305  1,085  462  Acquisition costs118 252 410 1,085 
Income tax expenseIncome tax expense243  244  529  736  Income tax expense675 243 871 529 
Gain on sale of self storage properties—  (2,814) —  (2,814) 
Non-operating expenseNon-operating expense317  169  509  267  Non-operating expense148 317 321 509 
Net Operating IncomeNet Operating Income$68,463  $63,113  $136,644  $122,335  Net Operating Income$95,485 $68,463 $178,145 $136,644 
Our consolidated NOI shown in the table above does not include our proportionate share of NOI for our unconsolidated real estate ventures. For additional information about our 2018 Joint Venture and 2016 Joint Venture see Note 5 to the condensed consolidated financial statements in Item 1.
EBITDA and Adjusted EBITDA
We define EBITDA as net income (loss), as determined under GAAP, plus interest expense, loss on early extinguishment of debt, income taxes, depreciation and amortization expense and the Company's share of unconsolidated real estate venture depreciation and amortization. We define Adjusted EBITDA as EBITDA plus acquisition costs, organizational and offering expenses, equity-based compensation expense, losses on sale of properties and impairment of long-lived assets, minus gains on sale of properties and debt forgiveness, and after adjustments for unconsolidated partnerships and joint ventures. These further adjustments eliminate the impact of items that we do not consider indicative of our core operating performance. In evaluating EBITDA and Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. Our presentation of EBITDA and Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items.
We present EBITDA and Adjusted EBITDA because we believe they assist investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. EBITDA and Adjusted EBITDA have limitations as an analytical tool. Some of these limitations are:

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EBITDA and Adjusted EBITDA do not reflect our cash expenditures, or future requirements, for capital expenditures, contractual commitments or working capital needs;
EBITDA and Adjusted EBITDA do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debts;
although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements;

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Adjusted EBITDA excludes equity-based compensation expense, which is and will remain a key element of our overall long-term incentive compensation package, although we exclude it as an expense when evaluating our ongoing operating performance for a particular period;
EBITDA and Adjusted EBITDA do not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; and
other companies in our industry may calculate EBITDA and Adjusted EBITDA differently than we do, limiting their usefulness as comparative measures.
We compensate for these limitations by considering the economic effect of the excluded expense items independently as well as in connection with our analysis of net income (loss). EBITDA and Adjusted EBITDA should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as total revenues and net income (loss).
The following table presents a reconciliation of net income (loss) to EBITDA and Adjusted EBITDA for the three and six months ended June 30, 20202021 and 20192020 (dollars in thousands):
Three Months Ended
June 30,
Six Months Ended
June 30,
Three Months Ended
June 30,
Six Months Ended
June 30,
20202019202020192021202020212020
Net incomeNet income$17,787  $17,733  $33,550  $30,673  Net income$35,675 $17,787 $63,310 $33,550 
Add:Add:Add:
Depreciation and amortizationDepreciation and amortization29,309  25,829  58,414  50,178  Depreciation and amortization36,051 29,309 68,475 58,414 
Company's share of unconsolidated real estate venture depreciation and amortizationCompany's share of unconsolidated real estate venture depreciation and amortization3,811  5,472  7,598  10,929  Company's share of unconsolidated real estate venture depreciation and amortization3,840 3,811 7,721 7,598 
Interest expenseInterest expense15,513  13,947  31,141  27,158  Interest expense17,339 15,513 34,131 31,141 
Income tax expenseIncome tax expense243  244  529  736  Income tax expense675 243 871 529 
EBITDAEBITDA66,663  63,225  131,232  119,674  EBITDA93,580 66,663 174,508 131,232 
Add:Add:Add:
Acquisition costsAcquisition costs252  305  1,085  462  Acquisition costs118 252 410 1,085 
Gain on sale of self storage properties—  (2,814) —  (2,814) 
Company's share of unconsolidated real estate venture loss on sale of properties—  —  —  202  
Equity-based compensation expenseEquity-based compensation expense1,151  1,108  1,925  2,220  Equity-based compensation expense1,348 1,151 2,634 1,925 
Adjusted EBITDAAdjusted EBITDA$68,066  $61,824  $134,242  $119,744  Adjusted EBITDA$95,046 $68,066 $177,552 $134,242 

Liquidity and Capital Resources
Liquidity Overview
Liquidity is the ability to meet present and future financial obligations. Our primary source of liquidity is cash flow from our operations. Additional sources are proceeds from equity and debt offerings, and debt financings including borrowings under the credit facility, 2023 Term Loan Facility, 2028 Term Loan Facility and 2029 Term Loan Facility.

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Our short-term liquidity requirements consist primarily of property operating expenses, property acquisitions, capital expenditures, general and administrative expenses and principal and interest on our outstanding indebtedness. A further short-term liquidity requirement relates to distributions to our common and preferred shareholders and holders of preferred units, OP units, LTIP units, subordinated performance units, DownREIT OP units and DownREIT subordinated performance units. We expect to fund short-term liquidity requirements from our operating cash flow, cash on hand and borrowings under our credit facility.
Our long-term liquidity needs consist primarily of the repayment of debt, property acquisitions, and capital expenditures. We acquire properties through the use of cash, preferred units, OP units and subordinated performance units in our operating partnership or DownREIT partnerships. We expect to meet our long-term liquidity requirements with operating cash flow, cash on hand, secured and unsecured indebtedness, and the issuance of equity and debt securities.

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The availability of credit and its related effect on the overall economy may affect our liquidity and future financing activities, both through changes in interest rates and access to financing. Currently, interest rates are low compared to historical levels. Our ability to access capital on favorable terms as well as to use cash from operations to continue to meet our liquidity needs, all of which are highly uncertain and cannot be predicted, could be affected by various risks and uncertainties, including, but not limited to, the effects of the COVID-19 pandemic. We believe that, as a publicly-traded REIT, we will have access to multiple sources of capital to fund our long-term liquidity requirements, including the incurrence of additional debt and the issuance of debt and additional equity securities. However, we cannot assure you that this will be the case.
Cash Flows
At June 30, 2020,2021, we had $17.3$22.4 million in cash and cash equivalents and $5.6$3.6 million of restricted cash, a decreasean increase in cash and cash equivalents of $3.3$3.7 million and an increase in restricted cash of $1.9$0.6 million from December 31, 2019.2020. Restricted cash primarily consists of escrowed funds deposited with financial institutions for real estate taxes, insurance, and other reserves for capital improvements in accordance with our loan agreements. The following discussion relates to changes in cash due to operating, investing, and financing activities, which are presented in our condensed consolidated statements of cash flows included in Item 1 of this report.
Operating Activities
Cash provided by our operating activities was $144.3 million for the six months ended June 30, 2021 compared to $105.7 million for the six months ended June 30, 2020, compared to $93.5 million for the six months ended June 30, 2019, an increase of $12.2$38.6 million. Our operating cash flow increased primarily due to the 1337 self storage properties that were acquired between July 1, 20192020 and December 31, 20192020 that generated cash flow for the entire six months ended June 30, 2020, and2021, an additional 4043 self storage properties acquired during the six months ended June 30, 2020.2021 and same store NOI growth. Because these 5380 self storage properties were acquired after June 30, 2019,2020, our operating results for the six months ended June 30, 20192020 were not impacted by them. The increase in our operating cash flows was partially offset by higher cash payments for interest expense.
Investing Activities
Cash used in investing activities was $398.1 million for the six months ended June 30, 2021 compared to $243.9 million for the six months ended June 30, 2020 compared to $318.1 million2020. The primary uses of cash for the six months ended June 30, 2019.2021 were for our acquisition of 43 self storage properties for cash consideration of $383.7 million, capital expenditures of $13.2 million, and deposits for potential acquisitions of $1.1 million. The primary uses of cash for the six months ended June 30, 2020 were for our acquisition of 40 self storage properties for cash consideration of $239.1 million, capital expenditures of $8.6 million, investments in our 2016 Joint Venture of $3.1 million, expenditures for corporate furniture, equipment and other of $0.3 million and deposits for potential acquisitions of $0.3 million partially offset by $7.6 million of proceeds from the sale of equity securities. The primary uses of cash for the six months ended June 30, 2019 were for our acquisition of 56 self storage properties for cash consideration of $307.8 million, capital expenditures of $10.4 million, acquisition of the interest in a reinsurance company and related cash flows of $6.6 million, capital expenditures of corporate furniture and equipment of $0.4 million and deposits for potential acquisitions of $0.2 million, partially offset by $6.3 million of net proceeds from the sale of a self storage property and distributions received from our 2016 Joint Venture of $1.0 million.
Capital expenditures totaled $8.6$13.2 million and $10.4$8.6 million during the six months ended June 30, 20202021 and 2019,2020, respectively. We generally fund post-acquisition capital additions from cash provided by operating activities.

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We categorize our capital expenditures broadly into three primary categories:
recurring capital expenditures, which represent the portion of capital expenditures that are deemed to replace the consumed portion of acquired capital assets and extend their useful life;
value enhancing capital expenditures, which represent the portion of capital expenditures that are made to enhance the revenue and value of an asset from its original purchase condition; and
acquisitions capital expenditures, which represent the portion of capital expenditures capitalized during the current period that were identified and underwritten prior to a property's acquisition.

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A summary of the capital expenditures for these categories, along with a reconciliation of the total for these categories to the capital expenditures reported in the accompanying condensed consolidated statements of cash flows for the six months ended June 30, 20202021 and 2019,2020, are presented below (dollars in thousands):
Six Months Ended
June 30,
Six Months Ended
June 30,
2020201920212020
Recurring capital expendituresRecurring capital expenditures$3,438  $4,757  Recurring capital expenditures$4,359 $3,438 
Value enhancing capital expendituresValue enhancing capital expenditures2,037  2,152  Value enhancing capital expenditures4,880 2,037 
Acquisitions capital expendituresAcquisitions capital expenditures3,600  4,328  Acquisitions capital expenditures4,051 3,600 
Total capital expendituresTotal capital expenditures9,075  11,237  Total capital expenditures13,290 9,075 
Change in accrued capital spendingChange in accrued capital spending(492) (794) Change in accrued capital spending(103)(492)
Capital expenditures per statement of cash flowsCapital expenditures per statement of cash flows$8,583  $10,443  Capital expenditures per statement of cash flows$13,187 $8,583 
Financing Activities
Cash provided by our financing activities was $258.2 million for the six months ended June 30, 2021 compared to $136.8 million for the six months ended June 30, 2020 compared to $228.0 million2020. Our sources of financing cash flows for the six months ended June 30, 2019.2021 primarily consisted of $491.0 million of borrowings under our Revolver, the $55.0 million 2033 Notes and $226.1 million of proceeds from the issuance of common shares. Our primary uses of financing cash flows for the six months ended June 30, 2021 were for principal payments on existing debt of $405.1 million (which included $399.5 million of principal repayments under the Revolver, a $3.5 million payoff of a fixed rate mortgage and $2.1 million of fixed rate mortgage principal payments), distributions to noncontrolling interests of $45.3 million, payments of dividends to common shareholders of $54.4 million and distributions to preferred shareholders of $6.6 million. Our sources of financing cash flows for the six months ended June 30, 2020 primarily consisted of $311.0 million of borrowings under our Revolver and $16.2 million of proceeds from the issuance of common shares. Our primary uses of financing cash flows for the six months ended June 30, 2020 were for principal payments on existing debt of $103.9 million (which included $100.0 million of principal repayments under the Revolver and $3.9 million of fixed rate mortgage principal payments), distributions to noncontrolling interests of $36.4 million, payments of dividends to common shareholders of $42.4 million and distributions to preferred shareholders of $6.5 million. Our sources of financing cash flows for the six months ended June 30, 2019 primarily consisted of $399.0 million of borrowings under our credit facility, $100.0 million of borrowings under our 2029 Term Loan Facility, $70.6 million of proceeds from the issuance of common shares and $43.6 million of proceeds from the issuance of Series A preferred shares. Our primary uses of financing cash flows for the six months ended June 30, 2019 were for principal payments on existing debt of $306.5 million (which included $304.0 million of principal repayments under the Revolver and $2.5 million of scheduled fixed rate mortgage principal payments), distributions to noncontrolling interests of $36.1 million, distributions to common shareholders of $36.0 million and distributions to preferred shareholders of $5.8 million.
Credit Facility and Term Loan Facilities
As of June 30, 2020,2021, our credit facility provided for total borrowings of $1.275 billion, consisting of five components: (i) a Revolver which provides for a total borrowing commitment up to $500.0 million, whereby we may borrow, repay and re-borrow amounts under the Revolver, (ii) a $125.0 million Term Loan A, (iii) a $250.0 million Term Loan B, (iv) a $225.0 million Term Loan C and (v) a $175.0 million Term Loan D. The Revolver matures in January 2024; provided that we may elect to extend the maturity to July 2024 by paying an extension fee of 0.075% of the total borrowing commitment thereunder at the time of extension and meeting other customary conditions with respect to compliance. The Term Loan A matures in January 2023, the Term Loan B matures in July 2024, the Term Loan C matures in January 2025 and the Term Loan D matures in July 2026. The Revolver, Term Loan A, Term Loan B, Term Loan C and Term Loan D are not subject to any scheduled reduction or amortization payments prior to maturity. As of June 30, 2020,2021, we have an expansion option under the credit facility, which, if exercised in full, would provide for a total credit facility of $1.750 billion. As of June 30, 2020,2021, we would have had the capacity to borrow remaining Revolver commitments of $283.3$228.8 million while remaining in compliance with the credit facility's financial covenants.

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As discussed in Note 13 in Item 1, in July 2021, we received commitments from a syndicated group of lenders to partially exercise the expansion option under our unsecured credit facility for a $100.0 million Term Loan E.
We have a 2023 Term Loan Facility that matures in June 2023 and is separate from the credit facility in an aggregate amount of $175.0 million. As of June 30, 20202021 the entire amount was outstanding under the 2023 Term Loan Facility with an effective interest rate of 2.83%. We have an expansion option under the 2023 Term Loan Facility, which, if exercised in full, would provide for total borrowings in an aggregate amount of $400.0 million.

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We have a 2028 Term Loan Facility that matures in December 2028 and is separate from the credit facility and 2023 Term Loan Facility in an aggregate amount of $75.0 million. As of June 30, 20202021 the entire amount was outstanding under the 2028 Term Loan Facility with an effective interest rate of 4.62%. We have an expansion option under the 2028 Term Loan Facility, which, if exercised in full, would provide for total borrowings in an aggregate amount up to $125.0 million.
We have a 2029 Term Loan Facility that matures in April 2029 and is separate from the credit facility, 2023 Term Loan Facility and 2028 Term Loan Facility in an aggregate amount of $100.0 million. As of June 30, 20202021 the entire amount was outstanding under the 2029 Term Loan Facility with an effective interest rate of 4.27%.
2029 Andand August 2031 Senior Unsecured Notes
On August 30, 2019, our operating partnership issued $100.0 million of 3.98% senior unsecured notes due August 30, 2029 and $50.0 million of 4.08% senior unsecured notes due August 30, 2031 in a private placement to certain institutional accredited investors.
2030 Andand 2032 Senior Unsecured Notes
As discussed in Note 14 in Item 1, on August 4,On October 22, 2020, our operating partnership entered into an agreement to issueissued $150.0 million of 2.99% senior unsecured notes due August 5, 2030 and $100.0 million of 3.09% senior unsecured notes due August 5, 2032 in a private placement to certain institutional accredited investors.
2026, May 2031 and 2033Senior Unsecured Notes
As discussed in Note 8 in Item 1, on May 3, 2021, our operating partnership entered into an agreement to issue the 2026 Notes, the May 2031 Notes and the 2033 Notes to certain institutional investors. On May 26, 2021, the operating partnership issued the 2033 Notes and as discussed in Note 13 on July 26, 2021 our operating partnership issued the 2026 Notes and the May 2031 Notes.
Fixed Rate Mortgage Payable
On July 9, 2021, we entered into an agreement with a single lender for an $88.0 million debt financing secured by eight of our self storage properties. This interest-only loan matures in July 2028 and has a fixed interest rate of 2.77%.
Equity Transactions
Issuance of Common Shares and Series A Preferred Shares
As discussed in Note 313 in Item 1, on March 31, 2020,July 23, 2021, we closed ona follow-on public offering of 10,120,000 of common shares, which included 1,320,000 common shares sold upon the mergersexercise in full by the underwriters of SecurCaretheir option to purchase additional common shares, at a public offering price of $51.25 per share. We received aggregate net proceeds from the offering of approximately $497.4 million after deducting the underwriting discount and DLAN with and into wholly-owned subsidiaries of the Company. In connectionadditional expenses associated with the mergers, we issued 8,105,192 common shares to the former owners of SecurCare and DLAN.offering.
During the six months ended June 30, 2020,2021, we sold 512,0003,032,726 of our common shares through at the market offerings. The common shares were sold at an average offering price of $32.41$42.92 per share, resulting in net proceeds to us of approximately $16.2$129.1 million after deducting compensation payable by us to the agents and offering expenses. As discussed in Note 13 in Item 1, subsequent to June 30, 2021, we sold 782,000 common shares through the ATM program at an average offering price of $51.82 per share, resulting in net proceeds to us of approximately $40.0 million, after deducting compensation payable by us to the agents and offering expenses.
During September 2020, we completed an underwritten public offering of 4,500,000 common shares under forward sale agreements at a public offering price of $33.15 per share. The underwriters were granted a 30-day option to purchase up to an additional 675,000 common shares at the same price, which they partially exercised for an additional 400,000 common shares on October 6, 2020. On December 30, 2020, the Company settled a portion of the forward offering by physically delivering 1,850,510 common shares to the forward purchasers for net proceeds of approximately $60.0 million. On March 22, 2021 the Company settled the remaining portion of the forward offering by physically delivering 3,049,490 common shares to the forward purchasers for net proceeds of approximately $97.3 million.

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During the six months ended June 30, 2020,2021, after receiving notices of redemption from certain OP unitholders, we elected to issue 411,252312,171 common shares to such holders in exchange for 411,252312,171 OP units in satisfaction of the operating partnership's redemption obligations.
During the six months ended June 30, 2020, after receiving notices of redemption from certain Series A-1 preferred unitholders, we elected to issue 5,600 Series A preferred shares to such holders in exchange for 5,600 Series A-1 preferred units in satisfaction of the operating partnership's redemption obligations.
Issuance of OP Equity
In connection with the 4043 properties acquired during the six months ended June 30, 2020,2021, we issued $13.1$47.0 million of OP equity (consisting of 356,392559,463 OP units 28,892 LTIP units and 35,735512,763 subordinated performance units). In addition, we issued 28,894 LTIP units to consultants that will vest upon the completion of expansion projects.
As discussed in Note 3 in Item 1, during the six months ended June 30, 2020,2021, the Company issued 445,70163,033 OP units issued upon the conversion of 332,73832,741 subordinated performance units and 214,512142,405 OP units upon the conversion of an equivalent number of LTIP units.

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Dividends and Distributions
On May 21, 202027, 2021, our board of trustees declared a cash dividend and distribution, respectively, of $0.33$0.38 per common share and OP unit to shareholders and OP unitholders of record as of June 15, 2020.2021. On May 21, 2020,27, 2021, our board of trustees also declared cash distributions of $0.375 per Series A Preferred Share and Series A-1 Preferred Unitpreferred unit to shareholders and unitholders of record as of June 15, 2020.2021. On June 10, 2020,14, 2021, our board of trustees declared cash distributions of $6.0$12.1 million, in aggregate, to subordinated performance unitholders of record as of June 15, 2020.2021. Such dividends and distributions were paid on June 30, 2020.2021.
Cash Distributions from our Operating Partnership
Under the LP Agreement of our operating partnership, to the extent that we, as the general partner of our operating partnership, determine to make distributions to the partners of our operating partnership out of the operating cash flow or capital transaction proceeds generated by a real property portfolio managed by one of our PROs, the holders of the series of subordinated performance units that relate to such portfolio are entitled to share in such distributions. Under the LP Agreement of our operating partnership, operating cash flow with respect to a portfolio of properties managed by one of our PROs is generally an amount determined by us, as general partner of our operating partnership, equal to the excess of property revenues over property related expenses from that portfolio. In general, property revenue from the portfolio includes:
(i)all receipts, including rents and other operating revenues;
(ii)any incentive, financing, break-up and other fees paid to us by third parties;
(iii)amounts released from previously set aside reserves; and
(iv)any other amounts received by us, which we allocate to the particular portfolio of properties.
In general, property-related expenses include all direct expenses related to the operation of the properties in that portfolio, including real property taxes, insurance, property-level general and administrative expenses, employee costs, utilities, property marketing expense, property maintenance and property reserves and other expenses incurred at the property level. In addition, other expenses incurred by our operating partnership will also be allocated by us, as general partner, to the property portfolio and will be included in the property-related expenses of that portfolio. Examples of such other expenses include:
(i)corporate-level general and administrative expenses;
(ii)out-of-pocket costs, expenses and fees of our operating partnership, whether or not capitalized;
(iii)the costs and expenses of organizing and operating our operating partnership;
(iv)amounts paid or due in respect of any loan or other indebtedness of our operating partnership during such period;
(v)extraordinary expenses of our operating partnership not previously or otherwise deducted under item (ii) above;
(vi)any third-party costs and expenses associated with identifying, analyzing, and presenting a proposed property to us and/or our operating partnership; and
(vii)reserves to meet anticipated operating expenditures, debt service or other liabilities, as determined by us.

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To the extent that we, as the general partner of our operating partnership, determine to make distributions to the partners of our operating partnership out of the operating cash flow of a real property portfolio managed by one of our PROs, operating cash flow from a property portfolio is required to be allocated to OP unitholders and to the holders of series of subordinated performance units that relate to such property portfolio as follows:
First, an amount is allocated to OP unitholders in order to provide OP unitholders (together with any prior allocations of capital transaction proceeds) with a cumulative preferred allocation on the unreturned capital contributions attributed to the OP units in respect of such property portfolio. The preferred allocation for all of our existing portfolios is 6%. As of June 30, 2020,2021, our operating partnership had an aggregate of $1,730.4$2,101.6 million of unreturned capital contributions with respect to common shareholders and OP unitholders, with respect to the various property portfolios.

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Second, an amount is allocated to the holders of the series of subordinated performance units relating to such property portfolio in order to provide such holders with an allocation (together with prior distributions of capital transaction proceeds) on their unreturned capital contributions. Although the subordinated allocation for the subordinated performance units is non-cumulative from period to period, if the operating cash flow from a property portfolio related to a series of subordinated performance units is sufficient, in the judgment of the general partner (with the approval of a majority of our independent trustees), to fund distributions to the holders of such series of subordinated performance units, but we, as the general partner of our operating partnership, decline to make distributions to such holders, the amount available but not paid as distributions will be added to the subordinated allocation corresponding to such series of subordinated performance units. The subordinated allocation for the outstanding subordinated performance units is 6%. As of June 30, 2020,2021, an aggregate of $117.8$151.5 million of unreturned capital contributions has been allocated to the various series of subordinated performance units.
Thereafter, any additional operating cash flow is allocated to OP unitholders and the applicable series of subordinated performance units equally.
Following the allocation described above, we as the general partner of our operating partnership, will generally cause our operating partnership to distribute the amounts allocated to the relevant series of subordinated performance units to the holders of such series of subordinated performance units. We, as the general partner, may cause our operating partnership to distribute the amounts allocated to OP unitholders or may cause our operating partnership to retain such amounts to be used by our operating partnership for any purpose. Any operating cash flow that is attributable to amounts retained by our operating partnership pursuant to the preceding sentence will generally be available to be allocated as an additional capital contribution to the various property portfolios.
The foregoing description of the allocation of operating cash flow between the OP unitholders and subordinated performance unitholders is used for purposes of determining distributions to holders of subordinated performance units but does not necessarily represent the operating cash flow that will be distributed to OP unitholders (or paid as dividends to holders of our common shares). Any distribution of operating cash flow allocated to the OP unitholders will be made at our discretion (and paid as dividends to holders of our common shares at the discretion of our board of trustees).
Under the LP Agreement of our operating partnership, capital transactions are transactions that are outside the ordinary course of our operating partnership's business, involve the sale, exchange, other disposition, or refinancing of any property, and are designated as capital transactions by us, as the general partner. To the extent the general partner determines to distribute capital transaction proceeds, the proceeds from capital transactions involving a particular property portfolio are required to be allocated to OP unitholders and to the series of subordinated performance units that relate to such property portfolio as follows:
First, an amount determined by us, as the general partner, of such capital transaction proceeds is allocated to OP unitholders in order to provide OP unitholders (together with any prior allocations of operating cash flow) with a cumulative preferred allocation on the unreturned capital contributions attributed to the OP unitholders in respect of such property portfolio that relate to such capital transaction plus an additional amount equal to such unreturned capital contributions.
Second, an amount determined by us, as the general partner, is allocated to the holders of the series of subordinated performance units relating to such property portfolio in order to provide such holders with a non-cumulative subordinated allocation on the unreturned capital contributions made by such holders in respect of such property portfolio that relate to such capital transaction plus an additional amount equal to such unreturned capital contributions.

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The preferred allocation and subordinated allocation with respect to capital transaction proceeds for each portfolio is equal to the preferred allocation and subordinated allocation for distributions of operating cash flow with respect to that portfolio.
Thereafter, any additional capital transaction proceeds are allocated to OP unitholders and the applicable series of subordinated performance units equally.
Following the allocation described above, we, as the general partner of our operating partnership, will generally cause our operating partnership to distribute the amounts allocated to the relevant series of subordinated performance units to the holders of such series of subordinated performance units. We, as general partner of our operating partnership, may cause our operating partnership to distribute the amounts allocated to the OP unitholders

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or may cause our operating partnership to retain such amounts to be used by our operating partnership for any purpose. Any capital transaction proceeds that are attributable to amounts retained by our operating partnership pursuant to the preceding sentence will generally be available to be allocated as an additional capital contribution to the various property portfolios.
The foregoing allocation of capital transaction proceeds between the OP unitholders and subordinated performance unitholders is used for purposes of determining distributions to holders of subordinated performance units but does not necessarily represent the capital transaction proceeds that will be distributed to OP unitholders (or paid as dividends to holders of our common shares). Any distribution of capital transaction proceeds allocated to the OP unitholders will be made at our discretion (and paid as dividends to holders of our common shares at the discretion of our board of trustees).
Allocation of Capital Contributions
We, as the general partner of our operating partnership, in our discretion, have the right to increase or decrease, as appropriate, the amount of capital contributions allocated to our operating partnership in general and to each series of subordinated performance units to reflect capital expenditures made by our operating partnership in respect of each portfolio, the sale or refinancing of all or a portion of the properties comprising the portfolio, the distribution of capital transaction proceeds by our operating partnership, the retention by our operating partnership of cash for working capital purposes and other events impacting the amount of capital contributions allocated to the holders. In addition, to avoid conflicts of interests, any decision by us to increase or decrease allocations of capital contributions must also be approved by a majority of our independent trustees.
Off-Balance Sheet Arrangements
Except as disclosed in the notes to our financial statements, as of June 30, 2020,2021, we did not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purposes entities, which typically are established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. Further, except as disclosed in the notes to our financial statements, as of June 30, 2020,2021, we have not guaranteed any obligations of unconsolidated entities, nor made any commitments to provide funding to any such entities, that creates any material exposure to any financing, liquidity, market or credit risk.
Seasonality
The self storage business is subject to minor seasonal fluctuations. A greater portion of revenues and profits are generally realized from May through September. Historically, our highest level of occupancy has typically been in July, while our lowest level of occupancy has typically been in February. Results for any quarter may not be indicative of the results that may be achieved for the full fiscal year.
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
Market risk refers to the risk of loss from adverse changes in market prices and interest rates. Our future income, cash flows, and fair values of financial instruments are dependent upon prevailing market interest rates. The primary market risk to which we believe we are exposed is interest rate risk. Interest rate risk is highly sensitive to many factors, including governmental monetary and tax policies, domestic and international economic and political considerations, and other factors beyond our control. We use interest rate swaps to moderate our exposure to interest rate risk by effectively converting the interest on variable rate debt to a fixed rate. We make limited use of other derivative financial instruments and we do not use them for trading or other speculative purposes.

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As of June 30, 2020,2021, we had $211.0$265.5 million of debt subject to variable interest rates (excluding variable-rate debt subject to interest rate swaps). If one-month LIBOR were to increase or decrease by 100 basis points, the increase or decrease in interest expense on the variable-rate debt (excluding variable-rate debt subject to interest rate swaps) would decrease or increase future earnings and cash flows by approximately $2.1$2.7 million annually.
Interest rate risk amounts were determined by considering the impact of hypothetical interest rates on our financial instruments. These analyses do not consider the effect of any change in overall economic activity that could occur. Further, in the event of a change of that magnitude, we may take actions to further mitigate our exposure to the change. However, due to the uncertainty of the specific actions that would be taken and their possible effects, these analyses assume no changes in our financial structure.

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ITEM 4. Controls and Procedures
Disclosure Controls and Procedures
The Company's management, with the participation of the Company's chief executive officer and chief financial officer, has evaluated the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on that evaluation, the chief executive officer and chief financial officer concluded that the Company's disclosure controls and procedures, as of the end of the period covered by this report, are effective.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended June 30, 20202021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Notwithstanding the foregoing, a control system, no matter how well designed and operated, can provide only reasonable, not absolute assurance that it will detect or uncover failures within the Company to disclose material information otherwise required to be set forth in our periodic reports.
PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings
We are not currently subject to any legal proceedings that we consider to be material.
ITEM 1A. Risk Factors
For a discussion of the Company'sour potential risks and uncertainties, see the information below and in the Company's Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC under the heading Item 1A. "Risk Factors" beginning on page 15, which is accessible on the SEC's website at www.sec.gov.
The current outbreak of COVID-19 or the future outbreak of any other highly infectious or contagious diseases, could adversely impact or cause significant disruption to our financial condition, results of operations and cash flows. The spread of the COVID-19 outbreak has disrupted, and is likely to further cause severe disruptions in, the economy and financial markets and create widespread business continuity and viability issues.
The potential impact and duration of COVID-19 or another pandemic could have significant repercussions across the economy and financial markets, and could trigger a period of economic slowdown or recessions. The outbreak of COVID-19 in many countries continues to adversely impact economic activity and has contributed to significant volatility and negative pressure in financial markets. The impact of the outbreak has been rapidly evolving and, as cases of the virus have continued to increase around the world, many countries, including the United States, have reacted by instituting, among other things, quarantines and restrictions on travel.
Most states and municipalities, including where we have our headquarters (Colorado) and in regions of the United States where our properties and tenants are located, have also reacted by instituting quarantines, mandating business and school closures, requiring restrictions on travel, "shelter in place" or "stay-at-home" orders, and imposing restrictions on the types of business that may continue to operate. Although many of these jurisdictions, including Colorado, are gradually relaxing a number of these restrictions, many of these restrictions are being re-instituted or are still in place in regions where our properties and tenants are located.
As a result, the COVID-19 pandemic, or a future pandemic, could adversely impact our financial condition, results of operations and cash flows due to, among other factors:
reduced economic activity that may severely impact the Company's tenants and may cause a portion of our tenants to be unable to meet their obligations to us in full, or at all, or to otherwise seek modifications of such obligations, which could increase uncollectible receivables and cause subsequent reductions in revenue;
reduced economic activity could result in a prolonged recession, which could negatively impact consumer discretionary spending, which could reduce move-in volumes at our stores or limit our ability to minimize exposure to uncollectible receivables;

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governmental or health and safety requirements or recommendations could compel a complete or partial closure of, or other operational issues at, one or more of our properties or prohibit us from charging late fees, conducting auctions and increasing prices;
any of the above factors, or a combination thereof, could cause the Company to recognize impairment in value of its tangible or intangible assets;
a general decline in business activity and demand for property acquisitions, expansions, and the addition of new PROs and/or joint venture partners could adversely affect our ability or desire to grow our portfolio of properties;
interrupted availability of personnel, including our executive officers, other employees and the employees of our PROs, and an inability of us or our PROs to recruit, attract and retain additional skilled personnel to manage our business and/or properties;
the potential negative impact on the health of our or our PROs' personnel, particularly if a significant number of them are impacted, could result in a deterioration in our ability to ensure business continuity during this disruption;
the inability of other third-party vendors we rely on to conduct our business to operate effectively and continue to support our business and operations, including vendors that provide IT services, legal and accounting services, or other operational support services;
difficulty accessing debt and equity capital on attractive terms, or at all, and severe disruption or instability in the financial markets or a deterioration in credit and financing conditions may affect our access to capital necessary to fund business operations, potential acquisitions, or other growth opportunities or address maturing liabilities on a timely basis; and
the financial impact of the COVID-19 pandemic, including potential decreases in cash from operations resulting therefrom, could negatively impact our future compliance with the financial covenants in our credit facility and other debt agreements and result in a default and potential acceleration of indebtedness, which could negatively impact our ability to make additional borrowings under our revolving credit facility and pay dividends.
The rapid development and fluidity of the circumstances resulting from this pandemic preclude any prediction as to the ultimate adverse impact of COVID-19. Nevertheless, COVID-19 and the current financial, economic and capital markets environment, and future developments in these and other areas present material uncertainty and risk with respect to our performance, financial condition, results of operations and cash flows and our tenants' ability to pay rent.
The factors described above, as well as additional factors that the Company may not currently be aware of, could materially negatively impact the Company’s ability to collect rent and could lead to termination of leases by tenants, tenant defaults, tenant bankruptcies, decreases in demand for storage space at the Company’s properties, difficulties in accessing capital, impairment of the Company’s tangible or intangible assets and other impacts that could materially and adversely affect the Company’s financial condition, results of operations and cash flows.
To the extent the COVID-19 pandemic adversely affects our business and financial results, it may also have the effect of heightening many of the other risks described in the Risk Factors section in the Annual Report, such as those relating to economic or other conditions in the markets in which we do business, changes in interest rates, demand for self storage space generally, illiquidity of real estate investments, our ability to obtain debt financing, our dependence on external sources of capital and our ability to pay dividends.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
Unregistered Sales of Equity Securities
During the three months ended June 30, 2020,2021, the Company, in its capacity as general partner of its operating partnership, caused the operating partnership to issue 292,291121,923 common shares to satisfy redemption requests from certain limited partners.
On June 30, 2020,April 23, 2021, the operating partnership issued 120,30043,430 OP Units and 22,630 subordinated performance units to unrelated third parties and certain affiliates of Investment Real Estate Management, LLC d/b/a Moove In,Northwest, one of the Company's existing PROs, ("Moove In"),representing OP units earned pursuant to an earnout agreement in connection with the acquisition of one self storage property. The issuance included 13,105 OP units to an affiliate of J. Timothy Warren, a trustee the Company.
On May 19, 2021, the operating partnership issued 113,717 OP units to unrelated third parties as partial consideration for the acquisition of a self storage property.
On May 18, 2021, the operating partnership issued 6,312 subordinated performance units to an affiliate of Moove In, one of the Company's existing PROs, in exchange for cash.
On May 20, 2021, the operating partnership issued 15,258 subordinated performance units to an affiliate of Moove In, one of the Company's existing PROs, in exchange for cash.

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On July 1, 2020,May 24, 2021, the operating partnership issued 1,28950,859 OP units to an unrelated third party as partial consideration for the acquisition of a self storage property.
On June 18, 2021, the operating partnership issued 52,142 subordinated performance units to affiliatesan affiliate of Moove In,Personal Mini, one of the Company's existing PROs, in exchange for cash.
On July 15, 2021, the operating partnership issued 117,021 OP units to unrelated third parties as partial consideration for the acquisition of a self storage property.
On July 14, 2020,16, 2021, the operating partnership issued 7,837 subordinated performance44,370 OP units to affiliates of Moove In,unrelated third parties as partial consideration for the acquisition of a self storage property.
On July 16, 2021, the operating partnership issued 10,870 subordinated performance units to an affiliate of Moove In, one of the Company's existing PROs, as partial consideration for the acquisition of a self storage property.
On July 28, 2021, the operating partnership issued 27,931 OP units to unrelated third parties and certain affiliates of Northwest, one of the Company's existing PROs, as partial consideration for the acquisition of a self storage property. The issuance included 9,290 OP units to an affiliate of J. Timothy Warren, a trustee the Company.
Following a specified lock up period after the date of issuance set forth above, the OP units issued by the operating partnership may be redeemed from time to time by holders for a cash amount per OP unit equal to the market value of an equivalent number of common shares. The Company has the right, but not the obligation, to assume and satisfy the redemption obligation of the operating partnership described above by issuing one common share in exchange for each OP unit tendered for redemption.
The Company has elected to report early the private placement of its common shares that may occur if the Company elects to assume the redemption obligation of the operating partnership as described above in the event that OP units are in the future tendered for redemption.
Following a two-year lock-up period, holders of subordinated performance units may elect, only upon the achievement of certain performance thresholds relating to the properties to which such subordinated performance units relate, to convert all or a portion of such subordinated performance units into OP units one time each year by submitting a completed conversion notice prior to December 1 of such year. All duly submitted conversion notices will become effective on the immediately following January 1. For additional information about the conversion or exchange of subordinated performance units into OP units, see Note 9 in Item 1 of this report.
As of August 6, 2020,3, 2021, other than those OP units held by the Company, after reflecting the transactions described herein, 32,318,88932,918,141 OP units of its operating partnership were outstanding (including 765,840778,362 outstanding LTIP units in the operating partnership and 1,924,918 outstanding OP units ("DownREIT OP units") in certain consolidated subsidiaries of the operating partnership, which are convertible into, or exchangeable for, OP units on a one-for-basis, subject to certain conditions) and 13,061,98813,858,875 subordinated performance units (including 4,337,111 subordinated performance units in certain subsidiaries of the operating partnership ("DownREIT subordinated performance units").
These issuances were exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended.
Use of Proceeds
Not applicable.
Issuer Purchases of Equity Securities
Not applicable.
ITEM 3. Defaults Upon Senior Securities
Not applicable.
ITEM 4. Mine Safety Disclosures
Not applicable.
ITEM 5. Other Information
Not applicable.


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ITEM 6. Exhibits
The following exhibits are filed with this report:
Exhibit NumberExhibit Description
101.INS*XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

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101.SCH*Inline XBRL Taxonomy Extension Schema
101.CAL*Inline XBRL Taxonomy Extension Calculation Linkbase
101.DEF*Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB*Inline XBRL Taxonomy Extension Label Linkbase
101.PRE*Inline XBRL Taxonomy Extension Presentation Linkbase
104*Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
*Filed herewith.
**Furnished herewith.


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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

National Storage Affiliates Trust
By:/s/ TAMARA D. FISCHER
Tamara D. Fischer
president and chief executive officer
(principal executive officer)
By:/s/ BRANDON S. TOGASHI
Brandon S. Togashi
chief financial officer
(principal accounting and financial officer)
Date: August 7, 20204, 2021

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