Earnings call transcript Q4 2022

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Operator

Good morning. Thank you for attending today's CubeSmart Fourth Quarter 2022 Earnings Call. My name is Alicia, and I'll be your moderator for today's call. [Operator Instructions]

I would now like to pass the conference over to your host, Josh Schutzer, Vice President of Finance with CubeSmart.

proceed. now may You

Josh Schutzer

Chief Good Call. Welcome include Participants Chief Tim President Alicia. Quarter Chris CubeSmart's XXXX and Martin, and Officer; Earnings on Executive Officer. morning, you, to everyone. Fourth Marr, Financial Thank today's call

a Our session. followed Q&A prepared be remarks will by

financial our section and earnings of company's website www.cubesmart.com. forward-looking is addition the supplemental actual to issued remarks evening, the involve differ risks, factors that results other cause The certain strategy regarding release, company's and earnings In available forward-looking will was these under which from yesterday and operating to data Relations statements statements. materially may include Investor at uncertainties that the

cause the X-K we The Commission, and company documents report our the to Risk actual Form the results company's from Securities XX-K. specifically on section filed to the morning, the provided X-K this risks earnings could the differ files annual or and release in and with of furnishes factors Exchange Form with our with together forward-looking that filed materially statements Factors are Form

reference at the in non-GAAP financial remarks posted quarter the include company's be GAAP to measures addition, In between fourth measures. A found the on supplement www.cubesmart.com. and non-GAAP company's website reconciliation can

over I to will the now turn call Chris.

Chris Marr

morning, Thanks Thanks, Josh. Good everyone. for joining.

results for growth the our for revenue guidance. their teammates came year Our of outstanding and of all service. end performance year capped Same-store high excellent quarter off another our in platform, dedication fourth thank by our of I CubeSmart the customer at and

in same-store for an resulting contained operational rate on to NOI the above of at guidance. in excellence focus growth Our our XX.X% annual year coming growth X%, expense

last with business, each we impact of and financial forecast, have business X historical to facing domestic have returned we certainly of seasonality to while COVID significant faced Entering have the such aspects shocks. are had the patterns, we of the for performed our and the our and behaviors. changing potential consumer typical surrounding so do planning resulting years, more XXXX, geopolitical uncertainties as economic As many uncertainty and certainly related delinquency these

We the risk-adjusted best high-quality foster the maintaining economic fixed-rate fact people throughout culture over conservative that consisting believe portfolio with leverage above-average balance that a cycles. returns produce and high-quality maturities a and well-staggered of an systems and strategy we owning our in the long of markets, innovative sheet term high-quality will

valued high-quality submarkets today in over message been of sound familiar those with who in Our position these few to robust entering therefore stores demographics stakeholders located of sector-leading have Cube our XXXX. believe will We you last excellent years us in have outperformance. an

deliveries York and waning supply exhausted. New impact is market, up and recent supply. we the The Operational are green our pipeline see almost the remained shoots the experience from to beginning new delivery performance positively steady, new to of largest starting nicely has MSA, leasing been

and and for back X York is levels We're expectation from by more the transaction, portfolio the our we Storage the remain boroughs the growth of fit the City to And will performing couldn't platform. absolute average. on with the New half on above be strategic pleased year Our be of West assets year, steady. the

significant stabilized was the platform. despite there of rents on expected, upside to our occupancies As assets, the

the X.X expectation a including exceptional average that tenure low billion were yield back 'XX rates, into XXXX that and X.XX% to our long-term the which beyond achieving generating weighted accelerating be mid-Xs they are a able continued an yield positioned in meaningful capital saw years. accretion of properties given had year bond at deal, well of we the an $X growth average lock and they for through end These by of growth half and of will and with

just fixed and over rate, with We of net XXXX of maturity debt-to-EBITDA debt being of X XX% a years average our entered with X.Xx. weighted

and operate economic entered We period will businesses and XXXX have a with be to agile focus thesis uncertainty. that will that the excellent. succeed We lean of during operationally being best on continue positioned to

low and operational Our our in expense expansion XXXX are focus that reflective and of for XXXX efficiency. growth outlook margin on sector

Such the few strategies as times, many appear can years heady make we've [indiscernible]. over experienced last

seeing of generate are We the sector-leading our growth. strategy continue our as demographics stable benefit to portfolio

and risk-adjusted tertiary to times, boom growth risk returns. those markets will volatility While cash in markets of secondary our and flows on and in times top a focus generate is most high-quality attractive, may uncertainty, increased long-term elevated we there believe during portfolio generate the

through Cube judged among viewed industry In that historical and above average. and us and option the produce for are positioned metrics XXXX the well when support. that best for to our operating years XX-year entering our XXXX, in XXXX, valued specifically this There XXXX stakeholders' appreciate attractive in investors, think an We the spite my we no makes uncertainty opinion, is believe of the a historical world, lens, be doubt I will business.

that, to for over it to Officer, quarter on year Martin, commentary the our the Financial With Chief me please Tim and ahead. allow on turn additional

Tim Martin

of solid Good the a Thanks steady to we've seasonal normal return the with spend quarter seen of results a Piling it commentary, operating to morning, year, what taking everyone. day overall us. Chris. and fourth for on fundamentals. to in more your Thanks, out throughout few a patterns reflected Chris' minutes continuation

. Same-store of normal X.X%, was same-store remain very XXX growth growth included down we points XX.X% year basis to quarter. expenses compared the healthy, at results grew Headline as continuing to NOI the X.X%, occupancy and -- expected given levels last more for revenue seasonality. was return

fourth occupancy XX.X%. XX.X% the at Same-store ended the in quarter quarter averaged and

was being all our than side some and from do work across efficiencies quarter main the wins assessments all was the country. X.X% better exception. year up with property we on what personnel expense the continued to no and and expected, drivers nice the fourth control expense on we can the costs, in the Our challenge tax growth quarter showed our consistent of Same-store managing results focus for

the as last for over $X.XX share FFO quarter, of adjusted growth XX% representing reported year. We per

During yesterday's a On close, $X.XX we increase to in dividend our represents the yield. dividend, also an up a per that quarter, share. announced XX% quarterly annualized X.X%

growth front, in saw a opportunities a quarter, of external of attractive us. last a we activity continuation lack we slowdown about of talked the for and the quarter, transaction fourth On what

Our busy looking fit find team pricing at that to remains deals that works. our model

over opportunities Our required cost risk-adjusted naturally strategy today's profile available of necessary resulted transactional not has in less return the environment. us disciplined investment in returns being elevated where of last meet the capital year does the

ended fourth XXX third-party management the added and On the quarter third-party with XX stores in under the management. quarter front, we stores

we position manner sheet to growth our our balance strong consistent BBB/BaaX with focus ratings. in conservative funding a on continue as Our that's remains credit

size closed the basis last $XXX revolver based maturity discussed October, on As to in by was ratings extended pricing levels. points our February to we grew and improved facility. million, The quarter, the a current leverage XX.X revolving credit credit the expanded of and new of XX on

dividends conservative Our has the balance sheet and environment. entered volatile as strategy market we capital paid financing current really into

All is fixed. of the revolver except debt, our

XXXX So significant outstanding We as our face that's average as maturity X.X years. Chris started November mentioned, of until rate weighted only X% no we have a and of variable debt maturities of XXXX. was

finance growth debt-to-EBITDA, X.Xx at to present low and attractive ones liquidity when we capacity opportunities very is level themselves. leverage future have and ample Our

were of in included forward, night. details Looking related our XXXX release and our assumptions earnings last guidance

West acquisition XX by we late in including stores, XX portfolio stores same-store the XXXX from pool that Our closed increased Storage XXXX.

as with years, 'XX prior competitive asset-by-asset, approach delivered the consider XXXX, are at well impact supply 'XX in level, deliveries based stores. our if will our ground-up on of with compete the detailed the of forecasts Consistent new and that a store impact any, as

our of with XX% that for in new expectations of same-store is the same-store approximately XXXX our Embedded portfolio. impact will supply compete

by last peak down year of stores and that stores of of back impacted context, in For XX% down the supply XX% is XXXX. impacted XX% from from

disposition FFO speculative impact guidance predict. as timing of include any and to does activity or are the of difficult levels activity Our not acquisition

Wrapping XXXX. our this a up, work pursuit as successful excellence us help opportunities the on all hard our in of and call. thanks joining us business in Thanks operational we again to team, to to of maximize we're to throughout on see morning great talented objectives position for a of execution lead the XXXX, to continue the and teammates our

why we open up the call time, some questions. for don't Alicia, this At

Operator

Jeff first The the Bank comes Instructions] question from of with of Spector America. line [Operator

Jeff Spector

you're Great. Tim, there's Can here as Chris we talk lot about, confidence of February, Clearly I guess, and -- what seeing you're 'XX. started through a you've

seem Your to your does a approach couple to guidance peers. a than different of be bit

again, more Just recession. figure just recognizing right if signposts out trying seeing or not you're now of industry-specific . company-specific, any to that's

Chris Marr

Yes. Thanks, Jeff.

other comment they're So or on portfolios I outlook. their viewing how can't

think continue good pretty our signs we consumer see I perspective, to of strength. from

muted. stay of pattern and been construct, elongate, I relatively has think lengths portfolio of its our continue vacates to the

that. by encouraged we're So

as the second the to little as back get what the think is think quarter my half trying of outlook the consumer our the look I you certainly opening of in outlook, said less bit obviously, remarks, I about in will a in Same the past certain. year. We're 'XX. ranges in how our had year And react challenge back 'XX of think may and the the we capture half expectation like. guidance I

about don't I planning at our by a we're recession a really going perspective, to macro do macro a whether think or more into level. thinking enter we from not we're

a as to is their how that the I will respond of terms anything have think at broader product, our doing created the at do our what time. by life not more we we may whole that with host know, events of or which, consumer is throughout all in look year for need may economy

captured a cloudy, of it I'm we more we outlook is are bottoms-up half think a looking is today. of little where is year. our everybody is say little first process. the to think, we've think I a I feel range about process at for a bit sure and half good back clear And So more kind the I but the certainly, And

were were January, year. better than and when the our February we In what the started expectations at results or

start, which balance how think of lot So the year and I think and encouraging the good really to quarter the beginning a season, will we'll the busy unfold. to that's evolves forward of will tell a see how looking off the about we us

Jeff Spector

secondary versus what Can helpful. of the more are very My second about in more of questions little you hearing the versus, tertiary in you on bit were lots demographics secondary on markets? Chris, bit get that, tertiary, demographics about your of a That's or say, dig And I We of you seeing let's markets. versus, say, little talk we demographics positioning. tertiary, referring let's market importance of issues terms in strength a or comments question, your secondary? can to guess,

Chris Marr

Yes.

homeownership. versus supply good basis, our household lower capita tend foot we incomes create risk-adjusted with of of living cash when time. per a in over rental self-storage customers long-term on housing percentage stable a levels of populations, flow markets returns, of and look longer Those of So significant a square good to backdrop a at period

think City you markets, New think I last today today could a here sit effective When we were example, York think our rents point new than as where that's has occupancy, market when year again, at this customers the assets. point we that you that you have about where higher net at higher were is about we we on use And year, physical where of as the major York than City. New market this last are an

were shift in of you're seeing last than year. that lower seeing the a that the contrast and bit occupancy bit can You a COVID with ] last you you're waned demand lower had were Southwest we year and just markets the asking than rents some [ where where as

I and delve supply, new our and tertiary then they're they're just over expectation So and susceptible more you more secondary time, markets. into volatile to think is,

to things normalize, demographic strong the think more expect we as so outperform. markets I will And

Operator

line question comes of with from next Goldsmith UBS. The the Michael

Michael Goldsmith

on New York maybe MSA on the but a NOI same-store average more Digging sequentially, sequentially growth. revenue bit same-store underperformed into portfolio growth, the little outperformed

that as the So the is think of market you. outperformer Or if market in this of the have outlook thinking due you for are about as going is sort there trends MSA for the process you stability upcoming key thought on this to you another moderate? to year, this an be

Chris Marr

answered I is look than strength to New I we create customer impact, combination the out, response country. profile is market other of question the in in parts supply think the a as as that previous the York positive a of stickier the think waning I of demographics,

is exists good backdrop that is you've And the demand of best-in-class think in I market. a and the think got to drivers. that in capture portfolio I positioned terms obviously well demand

So I better. going think continue get it's to to

in relatively in I the third 'XX on we think the quarter comp quarter. we talked third call, had about a easy

was not New say deceleration in broadly to the in just a York quarter, everything bit. do. So portfolio more fourth expectations MSA XXX% to would we the I third exceeded slight our QX expected it the

starting high-flying for just normalized a on of to ending New our about and in So think markets and top high a here performers. again up spot more return bubble York February will good note, January real levels, to as other the

Michael Goldsmith

Metro. in down, have basis number a growth? do your And points or really this despite And does much impacted impacting percentage XXX point good That's of how year. the moves the of add -- change of that translate a XX like revenue helpful. points that XXX this can supply as your to you benchmark be is -- by expected the noted growth? same-store revenue York in kind this basis percentage you locations supply of down that there -- that of how X to Is to New same-store the Is portfolio

Chris Marr

unpack. Okay. a That lot was to

Let decline to about from from from When frankly, range. is way. quantify doing of XX% The wide exposure it such perspective, it's me range. XX% track budgetary difficult some in that can -- we go impact it's a to of a It any a these. think

the local market some market, outperformed impact reasons. supply that have We that properties new actually have submarket, of for

It's then positively their an and of they that largely that so brand to have strategy we competitor, have impact pricing try are dependent assets, as can the impacted. negatively. upon other And properties directly more or up lease the also

to of number So it's on that put hard specific basis impact. points a

in the and 'XX, just think part throughout expect narrative getting is improvement we're City continued to supply to I We In mirror. supply the it new about the any stores Cube Bronx, the don't on that's expectation of borough, by in by of end. focusing the in has in think think you answer new Brooklyn, our 'XX. closer impacted When And impact be of I'll been York the by New and rearview XXXX. of -- I

impact an opening on 'XX existing Queens, to will that I an I but with compete will XXXX in in think continue think then there there's stores. And we'll new declining, one have be Cube. our

are impact think to openings CubeSmart. will X in an expect we -- there existing on Queens I have that new that an

we're remarks, the very the I said about as to that's opening So starting excited in future really and there. wane

Operator

The with of comes from next Street the question Allaway Spenser Green line Advisors.

Spenser Allaway

the of being Can color underwritten occupancy you high at end and provide what's low for little both a on guidance?

Chris Marr

again, the occupancy don't is input. output, we not Yes, normally, -- Spenser, the broken record guidance rather,

beat got browbeat last into we think as good we noted, out year. a amount. finished pretty throwing the number a And year as where I by to we the end of that Tim

depend. So it will

the of pool. I think year, will that that what end being go from XX ended will I the XXXX was new XXX so or pool down in throughout think year. in expectation the that points and occupancy for to within as range the is year prior then narrow it on where basis And we we and the points basis new we'll

Spenser Allaway

second. supply out any you in back whether on circling just NOI those on to to or can of maybe just due current Maybe again are there focusing comment concerning levels stand then And markets pricing occupancy more expectations, current power utilization. that without markets but for as a

Chris Marr

Yes.

fact, New Philadelphia -- most the today sorry, we the of think D.C. felt supply brands those in both Northern and it volume up Malvern; the Washington, want Jersey. Virginia approach those they stores stores is, I new greater then Northern our pockets to then I'm will portfolio of sunny the area, of stores how impact in and to in where of the pockets likely area; in new lease the their and of

Operator

Alina BMO Juan from comes Markets. Capital Sanabria question next with The

Juan Sanabria

should And will quarters hit -- a is the fare of you the that as growth expect or York subset And within we that New how report to comment of cadence the would growth? year? part accelerate throughout can on decelerate that, if wanted Just answer. you as of

Chris Marr

Yes.

growth so rates a at cadence same-store comparing for at, that be . then then we growth of and in expect we XXXX. through go in obviously, our its as the QX will was as peak growth, would of in revenue terms think deceleration I our you're steady and look trying the to out XXXX, to what portfolio

clarity QX least the clarity we Obviously, most into results. the into have and the QX

So here. busy progresses and how we'll out see starts the season

of trend City, market consistent we the that on For expect get the would as that, back York with will just overall New the end be basis, again, up the outperforming would relative that then pool half overall into a year. we

Juan Sanabria

to switch the acquisitions. wanted I And just or to gears investments then

sounded you You more I the invest -- or about of Southwest your your at confidence more of release of But Any And words are what in comments could stabilizing? at guess, bit in looking of types I'm if markets opportunities at? call. wrong, you be I the a capital? to earlier me for opportunities correct Is it you your mouth. want to geographic more in existing enthusiastic focus coastal don't sense seem put talking lease-up press what's versus your the the -- some least

Tim Martin

markets. we it We've the Juan, in I where focus many, expand in which we're high be optimistic XX primary been not our or think I'm in from focus looking, was in is expectation included sure be any to solid pessimistic. consistent many looking demographic to a are grow surprise. awfully markets of our of top release shouldn't MSA that in continues and that our quality,

awfully achievable, giant the be is, in working able there. team be guidance as think an number that I -- the the will market But or you a we'll volatile here or that some conditions that It's something range release there growth find is is to the put opportunities number. it's expect hard. I be to out is not We we And expect we external XXXX believe know. think indicator, hope and it are disciplined. as but we if pretty

looking to we our We're external maybe some hope find growth that in did it yields investment opportunities more and than relative make our more a that if And hope, opportunity us our that have in cost to for 'XX to strategy, it's fit we'll is capital. of little sense bit expectation 'XX.

Juan Sanabria

if I the fourth rates And on you've effective sneak in year-to-date? what experienced the street just here. could rates and just you net in Can or extra quarter one comment

Chris Marr

Certainly.

in new the just December X%. XX%. effective February were down running been for quarter bit And down rents about XX%. of customers down They for in over as a net in little the about we've So yesterday, were month same the period of fourth 'XX, below

Operator

The next question with Rose Citi. the Smedes from comes of line

Unidentified Analyst

This is talk Natty you little the and about components [ph] thinking about How benefits increases. on Could other line a you labor for increases, property taxes, Smedes. are items? of bit cost

Tim Martin

Yes. Thanks question. the for

most We continue We in Property on expect for up to the on renewal there us of the certainly probably comes be most in insurance, real consistent property anticipate expenses with operating industry. insurance pressure probably May. the estate insurance area. to pressure

We utilities, to levels. continue to pressure gas inflationary continue for me continue utility electric be higher expect say, of than the to item -- express as line we to cost . easy on

standpoint, a I more as drive less and in certainly staff and an primarily from cost continued continue margin that efficiencies are efficiency standpoint we to we item on finding line great wage, but stores. there's focus think pressure to personnel from opportunities on doing a have improvement, with

initiatives And continue expect fruit many as so to in XXXX. expense lot we we these helped and standpoint us that bear will get from has into control of XXXX, a an

X% continue estate years are at area awful about that are area -- an it's an that real several an range think to that be of on predict course, difficult that that tax that X% big increases. to in pressure but Real it's we range item, we've is estate in and will for times, line talked taxes, to of

Operator

KeyBanc line comes The of Todd Capital Markets. with from next question Thomas the

Todd Thomas

First, where same-store share just year-over-year I Apologies new looks this. the is you occupancy But the I that missed in are from portfolio and was pool? wondering. what if able to today like

Chris Marr

Yes.

You didn't miss it.

new occupancy January rather, as January, end portfolio the XX. is that points is of new same-store that yesterday, at XX.X%, basis pool the down of about running from occupancy at which in pool's for around at the of XXX end So the

Todd Thomas

Okay.

little a season in rental you where the is And the peak to end season. also at point the a and a pick of so occupancy up decrease little bit are from starting the here. I peak begin bit really a are know But sequential this that's rents? When year. starting at ahead bit of uptick little doesn't of you in occupancy rental see longer for that to

Chris Marr

Yes.

February, We That's pool. all obviously, different points and -- I -- statement haven't say of weather I correct seen beginnings We used that's that really XX it don't to to sorts think your -- things. the mean, the with dealing sequent entirely season it's there. yet. an sequentially. rental a basis still hard other of pretty different is factually that and have

So of to kind it's apples oranges.

I early moving But haven't start kick to March, is think, to it we I yes, start when season typically spring yet. mid-March, seen see March, and the in.

past I prior think on question, side, in think as moved as movement starting January. the are you the we've I in I answered the to rent rents positive see

Todd Thomas

terms And there what around New rental comments demand supply in a back expecting throughout hear of and and impact activity. a talk City having bit to Okay. little I York you're a about rental positive little trends then occupancy diminishing York you on there New the the City, rate Can bit, new to year?

Chris Marr

Yes.

year. to positive are or over stores. a I about the up year City one last basis small Rents and again, It's in customers, question, York answer are to same occupancy number. prior some think up versus New points occupancies it's prior market new so the the with X%, only of

January and are we've think the that X were markets doing in of rents got point I February relative 'XX. where what the at positive place And of only we this in to top

pretty there Occupancies demand be is constructive. good. continues Vacate pattern very to are good. So

Todd Thomas

last New New able what an portfolio portfolio in balance customers the relative of you outsized to to existing be relative to relative the York within rate York also did year of Will the you this year? increase sort to rents and

Chris Marr

rate do higher in but necessarily what did shift to seeing that markets a any 'XX, different I'm relative is in other at the than population think I are moving. way Yes, sure not we

in have New markets, we I do some a . opportunity those markets. the in particular suburban of think urban than we greater York in

Operator

The comes line Keegan Research. the next of Wolfe Carl question from with

Keegan Carl

And [ you anticipated magnitude versus 'XX. ECRI what Maybe your did first throughout and here, to how cadence that of guys ] is one just going in out what's stack 'XX?

Chris Marr

Yes.

Our process I quite there, would is call, dynamic.

day, every is rate a portfolio got having So we've a proposed increase our them. customer in to who

Don't So portfolio of from are change, a and perspective, testing to timing cadence market. variety both significant predynamic, wide continue expect we a but the and amount by throughout

we out that what and we're of was seeing incredible, of normalization of last the just that the of historical expectation for think that terms our reflective described, guidance first it percentage magnitude as in robust continue that's than expectations our along In above basis those, be lower passing would 'XX but on be half of kind what a I year, of general will to fact average, coming is 'XX. we demand of the embedded we our did and

Keegan Carl

Got it. your Maybe third-party to shifting platform. management

peers for demand demand today expectations seeing Just and kind know of forward. that are I than kind you're year-to-date, of your where expected. curious one the at better what their is going mentioned it of

Just the curious are if guys same. seeing you

Tim Martin

Yes.

cycle peak. little stores of a away have little gets further shift new to of -- opportunities see to We're the a contracts. potential percentage development less by management continuing that a . those, add of new to add in developments as the nice way as I from We certainly pipeline new bit think a a

number interest of to a help third-party owners have who able for for level us platform are their value and to of high we property. a create storage in come to from add our looking be But

commentary what of are also in we think expect see little the going result is as churn bit expect market is, properties transaction in less a fewer portfolio of do to of sales earlier a to just on. which see we XXXX, I on the there

stores little our stay cooled So market bit management we'll as off bit. platform platform on on longer perhaps are has a that the a transaction our

Operator

Evercore. line from with Steve Sakwa question next The comes of the

Steve Sakwa

I market. expected close you from higher back Chris, think How changed? as presumably accept circling yourself? bid-ask the can willing about to yields maybe are do transaction spread talk Just sellers to such are just how you has And is the on you finding pricing where companies public what today? guess,

Tim Martin

Steve, it's Yes. Tim.

able are the the think rate on just and the fewer that many bridge different out It's that are to seller world market there, now of and certainly than I closing whole overall deals gap was transactions Certainly, buyer and little in a and how between right a in -- expectations. cloudy. bit of XXXX. there being the today those hit it are back

we difference ourselves many XX% off sure in or by to cost the things number. underwriting expectations? what's driving Is from Is know whether we're a ours, difficult in also way their all expectations that. that we the trade. right that hard believe a to Often, relative capital relative us for that. of And to that find that's to difference to the know tend where for on way It's underwriting somebody's to XX% return And deals to trade. it's it hard through for exact really that expectations opportunity particular triangulate we're

have our with it couple have that things on XX XX last of been frankly, the market, as combine the been of preceded that haven't average in just months. perspective, themselves high from then years as the presented And opportunities in -- that to a quality the

fairly and those fit I opportunities us So mentioned at being that strategy things capital. find led can to a of low investment to earlier, XXXX, relative cost pricing of of that us in on makes see start lot things whereas hopeful our it's sense our we to that that some we're a our combination opportunities to

Steve Sakwa

property I a talked the you -- employee question was growth. curious, a know back, you circling a side. touched you I'm do Chris, much going more just just the there at on kind maybe guess, savings of But technological FTE from more I perspective here how bit technology, then And from . as cost sort savings use of Okay. or And on expense forward. and little get

Chris Marr

That's question. Yes. evolving the

and And relates do and product, how out do to awful consumer figure to be does with. how it think engaged an awful of of on use of an What sides. to lot our what are doing they balance. and the lot work we I want that both testing they want

population surprising, It's their necessarily different been to a to want demographically there's absolutely there's smart our a who it's but in-person on, with entirely comfortable made upstairs focused what and needs. service team no segment of portion related, of time is. to efficiently. more dinner rental in not a it's combination a and self-service from and really that kids find assist try there's than and storage store a want chat that texting know are And asking it's with to And not video, using our our entirely that model, of what available customers of combination we've is a them who it's balance

So a store in our it's ever don't entirely attack to up model that done, date, to operational we've continue and able in end testing just teammate. we've self-service. I it's been continue XXXX. where we through I really to that going find here that. just up some we're To one navigate good efficiencies we're to don't an model entirely think ever in-person where the being to going think through ends

and balance. I market think property ultimately, find we'll will and by it vary by that

good though opportunity still there's be continue us more to for efficient. to think I

Operator

line the comes next Kim with question from The Bin Ki of Truist.

Ki Bin Kim

just that's on were trying type of curious your Or personnel fully of the of a line just down if were couple expenses path not that forward XQ, to kind In front. X%. efficiency-driven questions you understand for staffed? metric? I'm Just I'm an item? the expense

Tim Martin

issue into a overread that path to Yes. little I the bit do that comp year. has from with a being forward last wouldn't

to bit less easier this last year what little were do an comp. do were it's with a think I to we and with creating what and we doing year more So doing

Ki Bin Kim

in expense Okay. even expense guidance was your your and beating for peers. X%, is your XXXX growth And than only XXXX, your lower guidance

lower. are So that I'm your if of other Or curious a geographic-driven is it to those on little comments, things back think working keeping item? you're other bit expenses you that's a going

Chris Marr

Ki I are Bin, comment doing. can't peers it's our on what Chris.

those institutionally, through that and thesis operational what to companies operating focus being back be excellence, more smarter. best on my at going But doing lean that You a on had for focus have positioned of the beginning opening their keen ask things economic to 'XX just we uncertain focusing And is. had navigate efficiently, them comments, a agile to we times. to are

question you with to of be can. I And that as do to as ways we the combine think lean -- in we served. how the the you about think how think do how previous to continue answer be wants I possibly you to terms found customer about And think

test I got a think as of and techniques. in possibilities there variety try we always we we do, will different continued XXXX, will we've some --

And we'll some learn of not, them don't and move that learn some will them on. work, those of will from and

you on -- it's focus. put do if something right on for the a So you can And just great things. focus it's it, people us,

Ki Bin Kim

that's removal working X%. and I that as pool repairs expenses snow cost X% your account I'm your some other when end at like some item that as weather-driven That's on? if maintenance And been same-store revenues. you've in lower curious high for or type be total look driven other at a things might of of about competitors the

Chris Marr

how have -- Yes. answer what any Again, what idea do. to other don't folks

-- is, You'd our help obviously, they'll theirs care have industry. of take perspective, our great best-in-class them. properties, them take have ask we to From out. We in why I'm and great you we sure

repaired, having trying those saves the that perhaps things day-to-day to we be incur to from and And them need repair us longer term immediately ignore things. over so costs by to incremental when

focus. So it's always been a point of

in is excellent we stores an maintaining And team services and you're with product way sure our world-class. an believe your excellent making providing product facility being of in best the is obviously, Our possible. part customer

Operator

of the with question Mueller line last JPMorgan. from Mike comes The

Mike Mueller

portfolio earlier your a on few through years? York to is little Or outlook guess than better for bit be about New comment little that multiyear XXXX? next I I move being of the performance intended more bit as comment of was a that average. XXXX a Chris, guess, you more a the

Chris Marr

of normalized comments, first saw in markets in said the opening will think the in that in a performance think what again, The as I of markets back XXXX, 'XX. in of some half tend we 'XX I the saw the high-quality markets, of will our 'XX, couple environment outperform. to of more think beginning 'XX beta, the I expectation for the great boroughs, the I versus outperform into and low demographic more that, urban months And

Mike Mueller

it. Got

-- Okay. And then last question.

Can pipeline? to evolve? couple we coming will year. next of year? the about have You beginning a likely Are of How starts this developments think online you talk see any that do you

Tim Martin

our and a to pipeline have the of focused been fair new amount continue diminish. have will -- focused fair have we at. has And new a on of And markets. development supply Tim. it's just amount that look Mike, supply, markets very on been that if handful think that a we area look of an It's seen seen we historically, you

that need though locations that developed are trying already pocket position to in on handful complementary are that we focused infill past. opportunities to a existing that expand where or enhance portfolio find there the our so in of can an us great we've markets dominant and is for are We a the

be that So a hard several the clearly, year whether add to for opportunities, opportunities development but looking to don't to past to be it pop pipeline. the to out. predict we you surprised projects find We're shouldn't here off taper and the tapered X. off years. as to we'll list expect see up couple over to of on plays it's able But

Operator

questions no registered. are There further

to So for at this time, conference closing I'll pass management the team back remarks.

Chris Marr

joining for us Thank you, today. everyone,

over and look participation. Thanks throughout serving to of stores just appreciate industry sheet great you for forward XXXX. that that the support your is have and coming successful months. to teams to our high-quality balance speaking weeks and and people, have for country continued year. an wonderful well many we We your Our us positioned look the We another properties, customers forward simply the our

Operator

for That conference your participation. you Thank concludes call. today's

You may now disconnect your lines.

CubeSmart (CUBE) 24 Feb 232022 Q4 Earnings call transcript