EXHIBIT 99.1
NEWS RELEASE
Public Storage
701 Western Avenue
Glendale, CA 91201-2349
www.publicstorage.com
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For Release: Immediately
Date: March 31, 2008
Contact: Clemente Teng
(818) 244-8080
PUBLIC STORAGE COMPLETES TRANSFER OF 51% INTEREST IN
EUROPEAN OPERATIONS TO THE NEW YORK COMMON RETIREMENT FUND
GLENDALE, California--Public Storage (NYSE: PSA) announced the acquisition by
the New York Common Retirement Fund (NYCRF) of a 51% interest in Public
Storage's Shurgard Europe operations for approximately (euro)383.2 million ($606
million), plus an adjustment for operating results of Shurgard Europe from
December 31, 2007 through March 31, 2008.
Public Storage will own the remaining 49% interest and be the managing member of
the newly formed joint venture that will own Shurgard Europe's operations. The
existing Shurgard Europe management team will continue operations in Brussels,
Belgium. The new joint venture includes Shurgard's 20% equity interest in two
existing ventures which are the subject of previously disclosed arbitration. If
the remaining interests in those ventures can be acquired, they may be
incorporated into the newly-formed entity.
In connection with the transaction, the intercompany debt owed by Shurgard
Europe to Public Storage was modified to (i) fix the interest rate at 7.5% per
year, (ii) adjust the outstanding balance from approximately (euro)381 million
at December 31, 2007 to (euro)391 million ($620 million) as of March 31, 2008,
and (iii) modify the term of the loans to one year with an additional one year
extension. In addition, Public Storage is committed to provide additional loans
to Shurgard Europe, under these terms, up to (euro)305 million to fund Shurgard
Europe's obligations to repay existing third-party indebtedness owed by the two
previously mentioned ventures (a total of (euro)256 million at December 31,
2007) and the possible acquisition of the remaining interest in those two
ventures. Shurgard Europe intends to repay all of its intercompany debt to
Public Storage through the issuance of third-party debt as soon as market
conditions permit, but no later than March 31, 2010.
Shurgard Europe also entered into a licensing agreement with Public Storage
effective January 1, 2008, under which it will pay Public Storage a fee equal to
1.0% of its pro rata share of revenues in exchange for the rights to use the
"Shurgard Europe" trade name.
Public Storage expects to record a gain from the sale; however, the timing and
amount have not yet been determined. In addition, any increase or decrease in
the U.S. dollar versus the Euro is expected to be recorded as a currency gain or
loss on the loan to Shurgard Europe.
Shurgard Europe's operating results for the year ended December 31, 2007
included approximately $194.3 million and $92.2 million, respectively, of
revenues and cost of operations related to the self-storage facilities; and
$17.6 million and $5.2 million, respectively, of ancillary revenues and cost of
operations. Included in these amounts are approximately $57.0 million and $37.3
million, respectively, of self-storage revenues and cost of operations, and $6.1
million and $1.8 million, respectively, in ancillary revenues and cost of
operations, relating to self-storage facilities owned by the JVs in which
Shurgard Europe has a 20% interest. These amounts were based upon the weighted
average exchange rate of the dollar relative to the Euro of approximately 1.3698
to 1.000.
"Public Storage is very pleased to be teaming up once again with the New York
Common Retirement Fund, a premier institutional investor, who shares the same
goals and objectives with respect to our investments in Shurgard Europe. In
1998, we teamed up with NYCRF to successfully expand and take our affiliate, PS
Business Parks, Inc., public. We believe the European market presents excellent
growth opportunities and look forward to partnering with NYCRF to accelerate
Shurgard Europe's development program and grow the European business," said
Ronald L. Havner, Jr., President and Chief Executive Officer of Public Storage.
Steven De Tollenaere, President and Chief Executive Officer of Shurgard Europe,
commented, "We are perfectly positioned with great shareholders and strong
funding to accelerate our development program and undertake acquisitions,
increasing product and brand awareness in Europe."
ABOUT PUBLIC STORAGE AND SHURGARD EUROPE
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Public Storage, a member of the S&P 500 and the Forbes Global 2000, is a fully
integrated, self-administered and self-managed real estate investment trust that
primarily acquires, develops, owns and operates self-storage facilities. Public
Storage's headquarters are located in Glendale, California. Self-storage
facilities for both companies are located in 38 states and seven Western
European nations. At December 31, 2007, Public Storage had interests in 2,012
self-storage facilities with approximately 126 million net rentable square feet
in the United States and Shurgard Europe had 174 storage facilities with
approximately nine million net rentable square feet in Europe.
Additional information about Public Storage and Shurgard Europe is available on
the Internet. The respective web sites are www.publicstorage.com and
www.shurgard.eu.
FORWARD-LOOKING STATEMENTS
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This press release contains "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These forward-looking statements are subject to a number
of risks and uncertainties, many of which are beyond Public Storage's control,
which could cause actual results to differ materially from those set forth in,
or implied by, such forward-looking statements. All statements other than
statements of historical fact included in this press release are forward-looking
statements and speak only as of the date of this press release. Public Storage
undertakes no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise. Risks and
uncertainties that could impact these forward looking statements include risks
related to international businesses and the risks the parties will be unable for
any reason to achieve the anticipated benefits of the transaction. Additional
information about risks and uncertainties that could adversely affect Public
Storage's forward-looking statements are described in reports filed by Public
Storage with the Securities and Exchange Commission, including its 2007 Annual
Report on Form 10-K and subsequent reports on Form 10-Q and Form 8-K.
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