CubeSmart (CUBE) 28 Apr 232023 Q1 Earnings call transcript

Company Profile

Participants

Josh Schutzer	Vice President, Finance
Chris Marr	President and CEO
Tim Martin	Chief Financial Officer
Michael Goldsmith	UBS
Samir Khanal	Evercore
Smedes Rose	Citi
Juan Sanabria	BMO Capital Markets
Ki Bin Kim	Truist
Spenser Allaway	Green Street
Todd Thomas	KeyBanc
Jonathan Hughes	Raymond James
Jeff Spector	Bank of America
Nick Joseph	Citi

Call transcript

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Operator

Hello, everyone. And welcome to the CubeSmart First Quarter 2023 Earnings Call. My name is Charlie, and I will be coordinating the call today.

You will have the opportunity to ask the question at the end of the presentation. [Operator Instructions]

over to host, begin. hand President Schutzer, now Finance, of will to Josh our Vice I Josh, go please ahead.

Josh Schutzer

today’s Marr, Thank you, and XXXX on quarter to Tim CubeSmart’s include Charlie. Good Officer. morning, earnings everyone. Martin, Chief call. Executive and Chief President Welcome Financial first call Officer; Chris Participants

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

to supplemental Investor data www.cubesmart.com. financial under the operating Relations website our of is release, company’s was which earnings addition and In issued evening, the section yesterday available at

forward-looking certain involve include from regarding earnings other will that that remarks company’s statements. the materially statements and strategy to risks, factors The these forward-looking differ and uncertainties actual may cause results

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

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

to I over now will turn the Chris. call

Chris Marr

everyone. Thank you, Good Josh. morning,

growth. the helped performance income net of coupled on expense of Our end trends, key operations strong continued across to Funds focus metrics. performance steady in high generate same-store our first as XXXX of from at quarter share can our be solid characterized control our operating all as with occupancy per guidance, came

economy. customers are post-COVID resiliently Our an navigating uncertain

to in created portfolio perform markets to historically positioned rates macro Volatility low. us in and our the demographics rate resulting environments. market and remain a the unemployment has well pushes focus housing inflation, slowing single-family While on purchases cool sales. believe strong uncertain prices home has high, up We as rates throughout stubbornly mortgage all Fed interest an remains top

metrics wage customer sheets solid unemployment, credit household our across growth good historically Low base. balance continued and translate into

such and XXXX. fees we at charged first the the over of quarter levels quarter, days delinquency metrics due During XX as are first below what experienced past late in receivables

be existing Vacates Another years, pool quarter the of first continues comparable store customer the down potentially XXXX. points of stickiness of and two on first the base. X.X% year. our were our customers been during down a to receive bright longer quarter to the quarter from last time to have year basis This of spot X.X% of rate up customers with a increase. basis larger a XX.X% in us this last XXX than results from

were demand historical a trends had been last with February time patterns as solid less period we same-store expected. consistent months rentals of have Top through first same than the We year. consistent of couple funnel with

us In and home to led slowed weighed that failures demand. offsetting cautious rental line activity a lower weather, sales activity, with in March, were driven trends which by slower-than-expected trends was as on year, vacate to but existing bank last impacting approach mostly rental March consumer more storage rates. confidence occupancy March

seen trends April, with levels into and consumer Rental have market returned the line with in has housing moved on a we we reservation last and As more activity normal as trajectory. back have confidence. both signs been year’s in stabilizing

XXX occupancy, rental our and a As are to moving result, busy season points to as ramp narrowing rates up. last basis year begins grown to we we gap the have up the

season. in have The we so this far to trend next us outlook trends April. earnings few signs prior saw performance year the is show the and of on We our during only in for year. noted we the have cautiously the heavily unusual rental dependent half demand as in but slowed call, January reigniting February during optimistic, experienced the months momentum March, back of of Recent

on performance. our was properties customers experiencing MSA, our New resilient occupancy compared the of most impacted year. positive first MSA. borough level growth Jersey somewhat to effective with quarter last to in Touching MSA market and Long the offset by was Island This markets York and new net softness The overall rents North briefly in both supply within

Virginia, While average above-average Southern and and experienced Maryland decelerating in growth has Arizona, where to COVID-induced in impacted levels, off migration experience We in clearly we Florida, growth waned. of the their continue below markets. Texas tremendous XXXX California revenue supply our DC, markets

quality are assets We of continue of for to disconnected underwrite strategy meet capital. our our but the requirements expectations seller cost from that still good a portfolio transactions, number of current

are and cost management capital deploy remain our redevelopments choice best pipeline in as be as are opportunities. maintained in efficiency third-party part for this portfolio consistently deployment the reputation cycle. high ways industry scale new of accretively proving within to our capital robust We saving existing to of full partner a has the of systems finding We the to opportunity building upgrades our

Our matter operating is to platform maximize no macro environment. performance, prime the

platform Our to portfolio across positions focus and quality generate differentiated long-term. shareholder well on value us our strategic over the

turn Thanks remarks. over Martin, for to now Officer, I Chief our and the for his Tim call Financial listening will

Tim Martin

your continued of and few Thanks, a thank with to Chris. the minutes today. you your for call everyone on And time us interest for spending

largely the more continue in touched we discussion operating over and last fundamentals on, quarters. our in a with our experience seasonality line consistent the normal business, quarter to the expectations return with Chris were several As first during to

the XX.X% year. share and per quarter, which growth $X.XX guidance FFO reported the over We was for end high last adjusted of quarter the range at our first as represents of

with as in mild revenue X.X% on X% X.X% combined can expense a efficient resulted in produced same-store with along income. focus growth, which as a when operating being be, same-store healthy winter growth net we continuing Our growth

XXXX. during Month-to-month quarter of trends largely quarter the of those first occupancy the mirrored

points Our same-store ending basis quarter from of occupancy fourth portfolio quarter, gained XX at sequentially first the XX.X%. the

growth no external with quarter. the opportunities pursuit transaction activity of in report our in disciplined remain to We first

went active, process that down volume be first XX% underwriting was team quarter although through to XXXX. deal continues compared of about our the Our investment to

the and are past we generally in of we not continue over We opportunities couple years. the bid-ask seeing see the generally seeing high were to a quality spread that disconnect

third-party XX added front, to managed store first we bringing third-party stores the total count the in XXX. management quarter, our On

the us current good relative news is position pursue opportunities no In sheet environment, sheets see growth comes we news a external it very balance attractive balance returns. putting when when to great our and corporate healthy, to remains in

X.X maturity debt debt very debt-to-EBITDA. remain fixed average of and our XX% is no November XXXX times at we of levels have years, is Our until rate, significant leverage maturities X our low

and night. last included in our were release earnings XXXX our related of guidance assumptions Details

Our provided forward February. with in the the year guidance consistent for remains guidance we late

patient up, busy here good and the and sheet to summer. external our wrapping rental is growth opportunities in great ready energized in balance quarter, team So shape, find season our into is sector’s ready attractive in-line first heading and

again Thanks some joining us morning. call open At why for the Charlie, this call on this for time, we questions. the up don’t

Operator

Instructions] Thank UBS. question comes open. Our course. Michael, ahead. of you. your first Of Goldsmith Michael from [Operator is Please line go

Michael Goldsmith

more more a are from, back what the Thanks run sounds how the coming can for April question I in of market, provide rates in slower, And is guess, on March quantify normal slowdown line. in April, you well, moving talked during like a morning. with is I of you seeing about in you you color the about are back returned My things demand rates ECRIs are kind kind of more you question. did bit think, now housing was then and where about like, to March kind little that first you rent that? it taking little April? a as about Good talked down trajectory your higher, bit come thinking can normal that my

Chris Marr

That Thanks. was a unpacked there. Sure. little bit

see them me questions can all remember Let the and I if all. answer

we rate that backwards, existing in I our high the to That mid-teens from the going increase would quarter. with teens year first perspective, a we quarter was last XXXX. think, have consistent for first averaged in of the fourth So, and the down quarter average the of from averaged customer

in you if XQ a kind the about expectation, first is keep so think in quarter averaged of we XXXX. the range pointing So we we historical around of as to pre-COVID metric, expected, XXXX, XX%

So customers as the rate from to year, in we saw what increases think, in continue existing about, great come talked that the will the to is historically the a earlier expectation I XXXX. we outpace down have pre-COVID, but

market. customer by terms In a of demand, it obviously is varies lot

made So absolutely the that you thrilled of with a type boroughs. the this have York for portfolio New There climate. a just is performance construct in

in we We and market, not perform so quite is a have transactionally that and the very there customer would conditions. sticky moving, there to so well expected, continues have focused current that as on a customer

expected you markets, we where and performance be of country, coming historically. the some that, continues what the are moving the March, of didn’t I have from shorter-term Certainly, from Belt Sun to say would customer. the in see customers Rest the just would

We signs customer again, an continue that returned to get and are was college in obviously, will that April May we pay here bit. to And this into attention will picked that as is March close starting, point the that students at we a up for have anomaly, June. little perhaps moving continue and or we

Michael Goldsmith

up the down bit And sequentially on XXX points basis follow-up just New XXX on a sequentially. question, New helpful. you York kind is very my York but it, portfolio, points of was was little NOI That’s for a talked about same-store basis

Now to same-store the you also eight pool. added properties

of So a York have kind a about about time this that I of expected? on trends New you am market York out moderation how outperformed, -- as in is going and New often is playing just in that talked is curious of the you at kind

Chris Marr

playing and a are supply Jersey MSA, basis on the on as out as North the think, in reported, city -- in bit pool the expected. you boroughs, we we suffering old I Long accelerated again, the and the the Those is with the It XX but impact stores performance. city, Yeah. the pool out stores, points the are thrilled little in new of in Island,

expected that and so far out good or it’s playing We year expectation better. at a

Michael Goldsmith

much. Thank you very

Operator

you. Thank

line Evercore. Samir your Our next go Khanal question Samir, from Please comes ahead. open. is of

Samir Khanal

Chris. Hi, you. Thank

So saw haven’t rent year-over-year, decline occupancy in-place sequentially but and in you we fell also that while. a the seen

here, maybe to much this of starting sort to decline I even guess you us can back business maybe how unpack the weaken I versus related is this? going seasonality of help normal think Thanks. XXXX. many to quarters,

Chris Marr

Yeah.

got the January focused pool, make Xst. on On have you obviously, sure that the fact occupancy, on XXXX are you to changed again, the

we basis, started you of where by was at if January X year last down end X March. the it about January on of about as an apples-to-apples the So same the think year was versus occupancy

more quarter and XXXX trends really the to relative during occupancy the So earlier. didn’t normal which change, is

from rather QX at you QX. If typically fall XXXX, look just seasonality XXXX did to to year rates quarter, every from and every

see in the you the the So are adjust patterns. very pool typical change for if patterns type that you in pre-COVID QX, to

Samir Khanal

ask to I things us as that. X.X% part you I the through by? but up same-store second to look doing was do the for and to When Thanks. pool on upside This question, expense surprising X% at guess you close Thank look us goes think, for your guidance. an just you did year Tim, at. end or as can X% standpoint actually about there year, last depending you year, I more are I from the growth. you and is you are X% to year you control expense the did Maybe And initial guiding the that walk guided, my of it you X% wanted

Tim Martin

Well, what can I we are I there several as proud don’t think we for can Chris controlling surprise from line I would control has the we your expense do the It’s But upon expectation on been just items many and quarters that of suppose. all are and to we an that. have touched -- now standpoint of you. always focused, results relative what know

lower-than-expected The we up mild of saw winter the which costs. first snow a in removal benefit costs both lower-than-expected showed utility quarter, and

I the tax that process we going insurance renewal it even days year surprise we out, we I going winter as suppose rather, had think Those surprise, than ago. that costs a a thought our as about a to are come also XX think there nice for costs, property have through. we while think year plays the are or rest property offsets had about have would on higher in little of how the we we negative bit

So other. those each kind offset of

about think you like balance think attractive spend look I a the you some into are we the good to of then seeing opportunities and deploy marketing item line marketing returns. year expense, with

makes it times So push do we that’s continue us an so. area to when that to sense on will for at

really store side that technology, to item line operational our we jumps have quarters hours, are up combine the rent out with has ways item. find tools platform think at on in using our and center, us lot past to show we personnel I we help the we are that has stores, of sales to staff continued how you customers using and been couple the online the our how over of how with continued line personnel with a our to

to Of course, as focus, are report X% we growth. to more areas item expense But in we to comps are same-store going that difficult have big get pleased those start year. are later we of the on the and again, line

Samir Khanal

Thank you.

Chris Marr

Thanks.

Operator

is go Our of next your Rose open. question Smedes, Citi. comes from line Smedes Please ahead.

Smedes Rose

based like cautious consumers as on go of you, maybe into Thanks. of have just said. the asking little sounds that rates, remarks busy some a kind your to Hi. more it you are wanted you I ask

go folks in So how you of would that? sort you to are get order about maybe lower or thinking in

Chris Marr

of looking are we know we that’s Smedes, they we customer markets, great see here to really Week-to-week, Yeah. properties great over going perspective, the next demographic of out and so focus months us. have a the from couple point in as are is,

top decision customer to we a we that a or as rent, So is making efficiently that are that are them and a that opportunity pricing then through. then in that go getting operating that reservation way possible keenly of and the really on inquiry conversion and our that so focused week-to-week we decision when the they to sure funnel maximizes into it’s make rental of as as

done of As beginning we about through year. rates essentially have April think last about have increased and that’s about from today, with consistent the April, we we X% what would

going we week-to-week that year-to-date, that maximizing have again, focus continue unusual an to keen it’s continues are make as so, focus are it. demand But that we to to conversion So sure opportunity. as long support on the been and are and going we and

Smedes Rose

Okay. Thanks.

a to wanted I know a surprised just just just being added more you continuing on to it I thing basis the like XX to hasn’t platform. so assets with net it you was or just on am transaction I comment other been The lot it but like stores, you ask there management Are eight you, maybe that? sold because sounds see volatility looks third-party of like just could activity,

Tim Martin

it’s is a the handful come see over of It Yeah. been to have hate things starting them Hey, that -- sign. of time. hate brand And pace a again, of name are to We as have pace thing, off we is the said good Smedes. on those our in our see. of stores the we being one past, see to we There stores, bittersweet which marketed. down

keep realize create we the what and with acquire those At on clients cases, they which job we have to them and a third-party a to that upon us sheet. expect brand love our in of the done done to and do, is help time, them good would balance Many for same sale. them value CubeSmart

as been we particularly touched on earlier. active We haven’t

services management stores hard hard the seeking owners have pipeline we to So to job done to that very because service. to predict of providers healthy of the control premier what us when as who stores of are and and pipeline a keeping those it’s platform. come viewing that now going I and off a third-party healthy new is are have number, very of platform right can we one do net coming What predict we of on good the think are

Chris Marr

the know third-party or stores you give think, data chose sold either relationship. sales left were platform, Of who to the I were there. different little the actual another bit of a XX that of where XX to party had to I self-manage just a stores And the management

during So while were the certainly, that closed activity there took transactions is XX muted, quarter. place that

Smedes Rose

Thank Okay. guys. you,

Chris Marr

Thanks.

Operator

comes your Our go Juan is Capital Juan, question Markets. BMO Please next of from Sanabria line open. ahead.

Juan Sanabria

time. guys. you Hi, for the Thank

trends. April us can give you Just curious if the

First where us fits, the how year-over-year Street Street if rates, you don’t help for rates mind contextualize? the and kind occupancy to of just spot quarter, giving that trended and just throughout

Chris Marr

Sure.

quarter, customers mid-teens. around net March. mid-teens trend, March, to year, the in first that more week-to-week, trends bounces last from effective low rates down to rate When got, down we again, time same but period the the similar to again, for range So the in in compared

as then have more X% I did we of April, is mentioned, the last in And year. through rates pushed month, today the we first which slightly than up since just

type end believe, last I that of of yesterday. as basis to the XXX range. gap -- to the gap points in remains at from April mid-teens From the to occupancy So an of kind basis points, to XXX of perspective, XXXX have year we of March reduced

Juan Sanabria

And I Thanks. of in in capacity, it I maybe a wanted stay like to testing maybe ask, four then you so. period that time, months but seems to are for customers or -- locking just rate. initial asking you some Yeah, guess

that curious out. you testing Just has on chose to that offer gone, how why option

strategy helpful? Just around the some would be there thought

Chris Marr

test they for Yeah. about we Good two number consumer are thinking additional and some product get Juan, of using significant as reasons. behaviors sense a important to decisions the We insight are quite question. get make want they to important how our a different from is, what’s as and which what their through to them. most thanks. to The of strategies

-- four time be so be would end four-month to period. four-year, their at months to inclined could segment awesome, across more do second the is a rate its would designed of terms have how always obviously, test particular make rather in That to then all of four-year four-year time can of they see period around inclined of you more longer customer knowing would for And happen a if what was strategies our a customer maximize base. revenue been commitment the that and

good have where to of stores things we many of throughout and of the one behavior customer data point very of kind at a just helpful to are It’s that all in we will ongoing that different and test, It’s portfolio. these a perspective us again. for some continue get from out shakes sense

Juan Sanabria

were a just are customers And customers the were for sign versus weed and take-up or just out quick month, follow-up, as am trying Okay. a in you I willing but to who on months to out assuming curious up four for the expectations. just

Chris Marr

properties. Yeah. I process would in in again, it still say, is certain

the to certain customer around definitive does So intention question, and to the at It the that is knows attraction has or also who attract has certainty customer, their move more a have point. a is out. in who we don’t at certainly own answer least absolute this It in an a one stay move their longer. though, minds of

So vacate period. end tended that you the of at down to the see X-month time

So again, an test each for revenue array again, we to one country that across to of many of to, continue always properties will it’s we we maximize continue customer at creatively ways to find do the so try to and things get.

Juan Sanabria

you. Thank Chris. it, Appreciate

Operator

Thank you.

Our Ki is comes open. ahead. of Please Kim, Bin next question Ki your line Bin from Truist. go Kim

Ki Bin Kim

Thanks and good morning.

up you about you follow a of curious question, have the you dynamic? funnel that dynamic more top points cadence it less of saw just quarter am demand was of April. I or share market on into and last about touch where it to So into the guys coming the Was type throughout

Chris Marr

and and would less of have than then expected as we in From January demand our March. like was, in was February, expected would Yeah. we felt funnel have perspective, top

returned… has Now

Ki Bin Kim

Okay.

Chris Marr

expectations. to …

Ki Bin Kim

pick in what April? up caused And to so

Chris Marr

that What at for housing, decline March, certainly we can a things on It’s example. look -- at and right? basis in macro can caused you in the March occurred look

their March homebuilders that have one call April. a larger for in traded slow pickup last publicly demand They of was the in now unusually seen commented So on week them. earnings

it normal. we XXXX it that trends XXXX rates, was been know. to was bit was have banking odd through odd. to crisis, anything and more And a a expected was navigate don’t again, weather, but certainly, the was it trying over March several So years, would a was what we last are odd, mortgage post-COVID XXXX relative April lot seems of have consistent

Ki Bin Kim

allocation. second I to And question, and about want your ask capital Okay. leverage

the thinking And has it sheet shape price. maybe comments and spread, quality kind an didn’t Can your asset us narrow latest understand standpoint, being or is, balance your us great might times capital it the gap wide X.X driven I remind is other Your obviously a release from bid-ask include levered, of you if or a in on help your bit of press be? what is traditionally is disciplined market on that to demographically allocation, about to still it can you scope want or widened appreciate how assets own? you just still

Tim Martin

It’s we Yeah. of focus, Bin. our -- haven’t areas changed Ki

existing attractive not MSAs, There that we as have markets, do love complementary attractive top footprint. we XX those the opportunities would haven’t focused been -- are to typically to on great to are are we that for in We infill in be, looking opportunities some markets our found that.

The bid-ask spread, it’s transaction of amount difficult, activity. total lower

for So know are, little are price sale I where exactly many and and out the to all. of a aren’t trading things because think bit things that crazy I think, are it’s at of things a price some at so sometimes a the there, difficult

where a So exactly little know difficult it’s are. you bit to

But needs a our little broker of that least gap I broker a deal off where can transaction like but change. XX%, suggest end of being say, feels often our to where would quite it up bit and so at would we XX% a trade

of as made little would us We in are closer for to that lot price in prepared on risk opportunities. sense we an see bit to mentioned quite just I And some adjusted point underwriting my were opportunities a basis. high active that awful a are -- love quality a remarks, we

the right the ground. at all fully look we that for something So opportunities spectrum where return, we out stable of are to way at wide of came the something open that’s a would is just

is us markets heard or limitations don’t we So for desire or our of what up consistent pretty time. and have for take to assets are to have some that But lease look the some from at acquisitions. the looking the you we from to on restrictions any stabilized quality

Ki Bin Kim

leasing kind having these based you where if markets, That’s margin a Thank I what was you. the like want would you, that And secondary changes from lower touchless perhaps can own, about is technology asking the use that business color. lately seen the one markets of people? of have including Internet companies, and in great because we you other would expand, to versus with software

Chris Marr

Kind me, Yeah. I day, not an mean, of of flavor around office the XXXX. to a is of the since idea right? at been having store

whether So is whether be been there. phone be new, out it not the it or some use and of concept technology, the again, it’s so,

to at the certainly suburbs tertiary areas. look might much the it dense less urban that applicable in continue We is more where in and apply it’s than

-- not new, of certainly, of conversation last over it’s a So lot several got months. it’s lot generated the it’s a

Ki Bin Kim

Okay. Thanks again.

Operator

Thanks.

[ph] ahead. Hong is your Our of from open. JPMorgan. question comes Hong, Please next go line Liang

Unidentified Analyst

forward guys. in Hey, that’s think I going we you do savings expense side, expect Are or guess the talked line Yeah. largely on that you personnel savings. capped? any about further should technology there

Chris Marr

Hey. It’s Chris.

no meet where categories. focus our one-third We in of to cycle, your to continue in closing And be look they when -- to to at you want terms you the at again, the this they customers, talk with them. three transaction customer and ways do groups life in point surprise, to continue each met be about

face-to-face bedroom ask having to is is very of and who time of category dinner kids without what down face-to-face from the their a the customer stairs is conversation. my to technology, using a interaction, walking very transacting used texting comfortable instead it’s It’s

they are person We live can decision-making want a third opposite a have store teammate. They that through the They at they the their not know going want questions to They with spectrum. another ask end of who the the conversation. as of have surprisingly to to want to are they complete customers any want interact process.

long the group digital way as back your your then are the hotel and floor into doesn’t hotel conversation your immediately. XXth other to and not, are think problem that and to a that third folks. solved of of key it frustrated, at if it’s have and as kind phone lobby happy and they to the get you kind use should you seamlessly, They work to And it you of have works fall a come of kind the want room, it of when down

all we of do. So we working as are through that

and obviously we savings continued for think, I to find providing we will also obviously, ways gets think, the create that have customer We are while or do the service the of we up. as will that, there the to of improvement tree fruit from to continue rate efficiencies level known higher slow

Unidentified Analyst

as function it. been just Got on revenues, all new and then seems that? normal And it a late to other given like fees, pay there’s particularly post-COVID, relates property the that’s fees. down step think it you just delinquencies auto late and Do

Chris Marr

some have definitely on prior Yeah. of than years. question. We That’s in seen the a side great that seen of equation, revenues lower have the we would

I of customer into credit really down, higher is a as per a is the a are down, delinquencies two-part One but positive, late receivables health it’s customer lower is, se fees, good, a said, issue. quality are translates So which perspective. from that

kiosk, tend be but and great, their customers, or through they folks rentals to to rental And as service phone go technology the be side, they come push down. or smart customers, we paying or either talk some from way, shape pay is one reps are ACH or they self-service again, which then in from more fee late form, on time, they our a will of to auto on can the tend choose into to

economic go cycles? answer next that of would part of least suspect the that couple as through parts we different over economic cycle of change Is that will first the at I to see going years. the as we

Unidentified Analyst

Yeah. Thanks. Great quarter.

Tim Martin

you. Thank

Chris Marr

you. Thank

Operator

Green of comes Allaway Street. Spenser from question next Our

Your is name -- your line ahead. open. -- Please sorry, your go

Spenser Allaway

you. Thank Yeah.

could further? started some see of to hear market quarter, could these high still as arise occurred looking to little be you but such, the private properties. interest mentioned burdened these offload loans, you curious some elaborate be and continue opportunities sell to -- bit construction that just expenses it they are you or know if that on were there Have players could with We or transactions in I is fairly quiet? there a

Tim Martin

-- Yeah. more little morning, that I there’s some think think of I it’s would be that there yet. discussion of more I Good not Spenser. Hi. a at would you and quite I of chatter is a bit say -- It think I would stage, activity. think, it’s mean this

store I reality is there somebody cycle I that this who to some translate motivated earlier, might would our be for throughout think parts who seller probably a price. when the their you At sector, alluded high different look clear who’s, to into market the motivation. really that will do of as least a might somebody what for have more sell the versus is

So a going I don’t you are you more a motivated desperate might have think have seller. seller. to

just business think I good. our is too

operating and think fundamentals good options. are too people have I

don’t -- of for would have opportunity things to folks there bunch are suspect that don’t fire would they be think a that anybody I sale on So whole that. like a

thinking in fantastic and perhaps, for our But seller perspective, opportunities quality us. in but that more looking again, markets wishful if have would those and and from you and that little for, maybe more are assets perhaps high bit motivated a we be were

Spenser Allaway

the maybe Phoenix. color of the maybe lower provided level, and but Vegas That’s thank such looking for occupancy, you all some markets helpful. at just with Okay. And market as the you at

Just curious color in if driving be you what markets these on the lower than any trends have might average operating occupancy? or

Chris Marr

rate. amount the and be markets those those influx also markets. movement, of just a about where more certainly a XXXX normal markets, after think a it’s would the you most There return tremendous in in in XXXX of to aggressive push seeing When folks saw market Yeah. you tremendous

certainly, market most So significant in in and the period. the rate seen when in you in those in saw changes that years, time markets those have of Sun markets -- you Belt rather over the would over Phoenix general, couple think rates last push about

I XX%. the example, up So give point Sun were we just about XX% Florida still XXXX you Phoenix, about are -- Lauderdale about first XX%, you a when about think about into quarter Miami, Tucson, even markets, example, in the Fort markets, get Belt are in when South rates of you where you versus of up think for

seen really normalize not -- you seeing really, on in also XXXX -- have movement are and that strong seen would And started XXXX. you seeing the rates again, more those same have to So would just push not normalize. just some markets are are you starting in markets that to

Operator

you. Thank

comes of line from KeyBanc. Thomas Please is question your ahead. open. next go Our Todd, Todd

Todd Thomas

Hi. in the morning. certain I that circle discussed across to just portfolio? across March. the the was Thanks. wanted you back geographies concentrated to Good that Was trends you experienced more broad-based that it country, in or

Chris Marr

been of the assets York broad-based climate, were outlier, City Yeah. borough which, portfolio. where across year, positive were we again, occupancy in rest mentioned, but last quarter saw would It in gains kind of relative there’s really territory this of the of really to and was first I New have the If last the that as assets, kind it an the moved rental in the same. all first rates country year the over the quarter of market

Todd Thomas

Okay.

so bit, move-outs, you and volatility mentioned, mentioned the were little think so, sounded I down what digits. in if rates did the a Street asking about you net-net, less rates in happened, altogether, think, And movement move-ins but that or you both decrease like were we low-double

compare your sort that March how did I net-net, a high-teens, in benefit, of mentioned the But, believe. You what a volatility? to March way, into result a in did March, it as moved setback any happened create mid-teens budget results maybe for of or

Chris Marr

expected deliver. would what we in March, We net-net, slightly Yeah. better able were performance have to than

Todd Thomas

Okay.

of so year your results within So slightly fell sort the March in budget context far? of below the

Chris Marr

Yeah.

Todd Thomas

question, then the the you the see guess, which at of right? about I in year throughout growth year, midyear ending of changed talked view higher, April? guidance, you the revenue growth just And stabilization trajectory potential the your previously growth, around you the last throughout gradually stepping or starting later So just and sit year, Do as maintained, the decelerating looking Okay. at has here lower. today end year year the back we

Chris Marr

that quarters. we expectation view than at the year, the deceleration the were more you I has look see half. challenging through to that pool will not year, first mean, we continue last the half I No. the go same-store second of the the entire as the obviously, again, mean comps high of across changed -- level terms has of level from some view in a

Todd Thomas

Thank Great. Okay. you.

Tim Martin

Todd. Thanks,

Operator

your is Our next of go from question comes line open. Jonathan, James. Hughes ahead. Raymond Jonathan Please

Jonathan Hughes

to higher properties almost XXX Good on added and growth you performance same-store of back lower basis portfolio. into Hey. I all like savings was expense Does were the the morning. the metrics in this points growth believe pool. in talk from you Storage NOI occupancy that or than that of bps the looks which about when I to bps same-store rents properties, could is almost XXXX XX pool to West XXX year, was for and XX hoping is most that growth, it revenue those add so

occupancy off for the range Storage So occupancy that maybe us just ago? am just rate months properties a Can but update and West surprised and there on those the trade the occupancy was little I XX of maybe you was portfolio. versus by in there, outlook mid-XX% recovery a

Chris Marr

Yeah.

assets aggressive movement. reasonably that be terms you a a the are were continued rate of those I very call responded first in some of inflow the in You rate, some significant markets through in very, that think, are talking as mean spot saw of occupancy. and quarter, about on. I on to population give to of markets, saw previous I went We on we aggressive back a

to the the quarter, are absolutely some the occupancy here, go balance the a as of on April and we trends are sacrifice forward to as we we we are result. side and where we versus we will how on those And willing July But demand occupancy. rate where focused out in markets, see in again, through work on were try during rate

Jonathan Hughes

mean, line the expectations the new And or of to that is a I from pool, at in in Okay. the the benefit was with those downside? surprise start stores year the the or upside

Chris Marr

Very with much the start expectation the of in year. line the at

Jonathan Hughes

think the X% same-store on sheet is below is and implied Bin’s great that high in times delevering X the trading shape, times NAV rate. in organic the balance lower mentioned about and then remarks. NOI of The stock acquisition lack question end opportunities you talked quality cap prepared XX% the target And there in today your Ki and out capital a to Okay. X consensus growth of high is allocation, range, leverage near I driving

to the discounted market given continues month question So acquisition dynamic Board six hoped for next you and valuation my repurchasing leverage or shares capacity? have that the is, if as XX don’t the opportunities come months, would consider the

Tim Martin

Yeah.

to think repurchase have I shares. an to we in-place be program able

-- a discussed I think, that place and is to not think there’s have time utilized we repurchase And I a before, a there have yet. share as We certainly, program. program consider

I think it is us the for on that touched -- ingredients there. of you some are

for it’s think I dislocation. that duration the

those we to we will for -- were be our work that’s consider. the at environment find we sheet quality are look But it were longer opportunities. high remain growth optimistic that to balance period put that course, and a of of would we and exacerbated if were in able something external We then to and time, it

Jonathan Hughes

Okay. Great. Thanks. I appreciate it.

Chris Marr

Thank you.

Operator

comes question of of your from next is Our line America. proceed. Jeff, Bank Spector Please open. Jeff

Jeff Spector

management, in your third-party how or in is industry question impacts you first and you about type of my just Cube what are the consolidation or the Chris, on whole, terms just you. minimal do really a industry thinking as expect portfolio? on Thank that Great. strategy of

Chris Marr

could try I sure again? answering that Jeff, am am making the you question. sorry, one I I specific So am

Jeff Spector

was your scale really or of it you impact that are the thinking change terms side on your there’s on Yes. about minimal given third-party how given management asking your the just consolidation your your markets, in in Basically about, business? seat, I from strategy. anything the Does industry, in

Chris Marr

Yeah.

I at public of again management certainly a third-party private. both think when there’s no bunch of general under because about assets than providers we There’s certainly, whole management and third-party in look just shortage different consolidation angles, from can that we today more think and ever.

when that high level where you that’s think scale scale our most to our you or strong markets think, there focus or just when consolidation however markets quite our But about and and I think are and in those quality we absolutely on portfolio impactful. think and you density scale again, significant it’s term our benefits. want is I I think recognition our about have coverage it, those time, think within over top markets, within a the on brand submarket and I a building Cube, quality

think enter I perhaps side would for us especially rate I on of that opportunity grow choices, with that fewer a anticipated the at XXXX. terms create nice faster than us, certainly to think for we in a third-party have could we as opportunities program

Jeff Spector

sounds again. then the things clarify about the year wanted you. Thank And half initial second like thinking guidance. and it normalized in just Great. April of Again, the have of the I to kind

been comps initial say really you have did guidance, that? remember, decel when comment I half and you provided that We can’t or half or into the bottom on discussing tougher you the didn’t reflect did the the recession second

Chris Marr

tie really to Yeah. conditions. Didn’t -- don’t or didn’t -- bottom directly macroeconomic necessarily top

how it one to consumer I and customers the think into impacts it’s economic consumer across, our here, expectation whether then specific for a range of self-storage outcomes directly behavior behavior outcome. tied and on move movement translates how economy it But however, really that may based nothing of basically.

Jeff Spector

Okay. Thank you.

Operator

Please follow-up from ahead. line Smedes, now Smedes We Rose. a your go you. have Thank open. is

Nick Joseph

of here broadly impact banking lending end. was taking call is the opportunities. you This acquisition and earlier with at you. kind a on question actually Thank the There Smedes. regional Joseph Nick I appreciate on the maybe of

And and so given of supply in may you and just those be expect would lending curious contraction starts idea new to how kind the the similar but on trend environment?

Chris Marr

within what’s going I to self-storage got, tailwind and have the obviously, about think how think environment Yeah. being self-storage. you developers they Certainly, starts strong development And lending going about in how they new directly projects the continued think on or fundamentals impacts forward.

cost, delays level. regional headwind the materials against cost and raw capital, raw again, local is the at labor material of with that and think, particularly the supply and chain and I lending certainly

money banks causing with is overall about banks certain seen product other for are issues lenders, I think, the While estate center larger real have there lot one we you have a talk self-storage are that of not and of them. commercial types problems seen exposure,

it’s So healthy I think balance. a

that believe slow continues think to of in I our things to what expectation as XXXX, supply XXXX are in of result, front are certainly seeing where numbers in the puts and new think it here headwinds will some terms and today. and we continue development deliveries a over given I

Nick Joseph

Thank much. you very

Operator

you. Thank

question. the question Sanabria of Markets Capital from and follow-up of a final comes it’s day BMO Our Juan

Juan Sanabria

guys. lot, a Thanks

points perspective. existing that we terms in tick to guys one that that at the just how your the what’s that reaccelerate think of should effective continue for are in-place from year guidance Is to of customers expect you of modeling ticked on up guess, modeling the on now the perspective? we was to sequentially. from or rates a the should in Q&A, assumed for or that going balance and I moderate how raised the Just net down top that about of

Chris Marr

Yeah.

were levels, for rates am -- was to about? new expect customer sorry, customer the customer be I at that new you you lower asking We were or it existing

Juan Sanabria

Existing, the just this in-place or of assumptions per should square sequentially quarter, down as it rent balance for guidance evolve the how ticked your that and the guidance? per foot that year

Chris Marr

Yeah.

year. the throughout in-place grow the it seasonally as should normally the So the of -- here existing does balance

Juan Sanabria

Thank you.

Chris Marr

You are welcome.

Operator

the all remarks. over time final That’s have we hand questions any you. I back for Thank Marr so to Chris for, will

Chris Marr

listening. thanks for you Thank and

of and that the are in seeing types that are right we States. construct shines we portfolio now type in the really seeing markets believe we economy United of Our the

base there the really again to that customer this really the forward with we second when end And portfolio. we are So customer climate. looking of particularly the our to in thrilled quarter. you performed performance, and urban We well think speaking is

have weekend. and a thank you So great

Operator

Ladies and gentlemen, you this concludes for today’s Thank call. joining.

your You disconnect may lines. now

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