Public Storage (PSA) 3 May 192019 Q1 Earnings call transcript

Company Profile

Participants

Ryan Burke	Vice President of Investor Relations
Joe Russell	Chief Executive Officer
Tom Boyle	Chief Financial Office
Shirley Wu	Bank of America Merrill Lynch
Smedes Rose	Citi
Todd Thomas	KeyBanc Capital Markets
Steve Sakwa	Evercore ISI
Hong Jiang	JP Morgan
Ryan Lumb	Green Street
Ian Gaule	SunTrust
Andrew Rosivach	Goldman Sachs
Jonathan Hughes	Raymond James
Todd Stender	Wells Fargo

Call transcript

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Public Storage First Quarter 2019 Earnings Conference Call. At this time, all participants have been placed in a listen-only mode and the floor will be opened for your questions following the presentation. [Operator Instructions] It is now my pleasure to turn the floor over to Ryan Burke, Vice President of Investor Relations. Ryan, you may begin.

Ryan Burke

Laurie. you, Thank everyone. Good day, for XXXX joining first you for us call. of earnings quarter Thank the I'm Russell with here Joe and Tom Boyle.

in we statements included and Before statements, subject to forward-looking begin, want of you are remind we risks of reconciliation the reports affect cause information, and described otherwise. number earnings release other XXXX, risks and financial that statements result with update other or is could or differ All our that in that than as to this this non-GAAP that the These May and release. yesterday's new to results uncertainties of we results in materially obligation our forward-looking of events only statements A from could on provide adversely fact X, a statement. to historical measures on actual included call, of those business are call revise future projected no by today, factors to filed all future speak whether as any SEC. statements, assume earnings are GAAP we our and the a forward-looking

the a publicstorage.com. the quarter, this Thanks, reports You webcast that, of audio release, for good like our thank you conference call And open With Ryan. questions. us. call turn website, had can and call joining SEC and I'll over We replay to on Great. find press our an Joe. to for all I'd

Operator

line Shirley America Lynch. Merrill you. [Operator first of Bank Thank Wu of from Your comes of Instructions] question the

Shirley Wu

taking the after, question. for Hey, good guys. Thanks

growth. revenue regards first So in my question to is

period stay data revenue $X.X range million XQ. in growth. would ranged suggest Over the And $X.X to between revenues last million few that for that you've of end your quarters,

going supply. could have it is been in new you play midst And any when like resilience seems things revenues out drop? of on given thoughts feel 'XX? the of all revenue how to in this fairly And demand, the So steady

Tom Boyle

can comment I Shirley. Thanks, on Great. that.

quarters, gave do growth I to what start April do a rent level. period-end summary would ended in historical the you at and which at quarter the you pretty a good contract of our the where growing rents previous be point of contract growth and we suggest revenue think a over been similar has place occupancy

strong think existing combination about by been of I our move-outs length So supported base. stay tenant -- encouraged being continued trends environment, In see customer by we we've economy. existing move out are balanced tougher there in really broader call, modestly performance like the really all by we a by tenants, labor a a good spoke of down last and and market there on our increasing macro

discussed and seen the we So in good through steady our contract last a occupancy operating we've reasonably consistent call, rent on trends growth quarter. what with

Shirley Wu

Got it.

Tom Boyle

on those we're from revenue and Terms XXXX big into of enter move-in update the at to trends May obviously and about a first into we'll end time here, call. you go our certainly our determinant busy and quarterly we where get of We're as be trends overall the we that'll next June on quarter. seasonally

Joe Russell

burdened this of that years. the Shirley, been three to other that's heavily shifting pleased have thing of maneuvering markets, the navigating we're through the impact 'XX seeing been many and of to we're again and some I'd we're we've maneuver similar and of two markets business been relative of traction add We last going over to or more commanding we say that capabilities environment. us see what to just seeing is, and the be we're through arena out certain supply markets that continues point, in But new somewhat parts through still like XXXX. the putting likely to to got Tom's and better see into we're other that ahead into are feeling what

Shirley Wu

Okay.

rates does So and How street even XQ into moving you're also to XQ rates. and well? as trended moving

Tom Boyle

Great.

as rates, down, Street in know, little paying move-in XX-Q street the X%. the X% but in they're actually you the closely. rates watch were as roll see up rent some In on were volume night will again well, we've time. of but last the modestly rent actually So, and in summer. as spoken down terms the move-in rates have on the quarters this the higher by moved customers quarter, through we down down rate quarter that rates That's rates Move-in over us. fact don't tend in previous performance folks And for offset that season bigger the disclosed move-out did quarter, one be we a as and in we moving of our we've is being roll given too best seen down rates the seasonally down calls, focused we volumes slower move-in to in

see modestly, continue did in deteriorated deceleration. the to the down again, of we roll which quarter but rent one performances in better roll down so rent And

Shirley Wu

Got it.

April So X% persisted, not as would into move-in have you rates well? negative say,

Tom Boyle

consistent April. all have which in really Yes, we in that's markets trends operations. And we've the seen of a balance

impacted Coast you continuing if into on see positive move-in a being the highlighted, And some markets, We performance. by then which move-in our to at an markets Joe of do new So West stronger look LA certain rent have the like supply. we're XXXX. negative Coast markets as East good rates

lump hurricane that in year, So into I were lapping benefit markets Houston as prior like well. group which would

Shirley Wu

color, the for Thanks it. Got guys.

Joe Russell

bet. You you. Thank

Operator

comes question line of the Jeremy of from Your BMO. Metz

Jeremy Metz

early give those views they've changed we views but into can XXXX? Hey, guys. just XXXX here look how and as navigating whether little further all moved the And supply read on year? changed have we've Joe, you as minute any on touched broader or on supply into at a a just your ago, you

Joe Russell

Yes, would no our even what, from sure, Jeremy. call. really is there's from ago I XX on last again, outlook change say days our

range, minus pretty deliveries, year another minus say XX to or or yet to million square XXX be plus again XXX of properties, billion we're tracking commanding plus everything feet. So $X that points XXXX from

So I ago, somewhat. minutes thing noted as the a it one shifting few is

deliveries all, we Charlotte, to like place were and at for fewer see Denver, if it's instance. Tampa, in which encouraging Houston, Austin So taking

So and there, Seattle are But Boston, there good York. has active more New Miami developers that's in some to Portland, news, starting been a pullback get

So lot new of we're in to last that are a still this entrants sector. keeping there next close eye is two this drivers going and likely residual coming have or over are into same any on three that fueled out of is a particular, the the supply has level supply into the which year years year. The impact

to and fundings like that new potential development there. are likely derive You've from yields the developers out got

little down, we're again, looking and So things we've it as potentially what's a track affecting the at are even the There eye acquisition bit conversations hand. a got the on a number a theme pronounced want into environment. maybe close keeping out. of more shift that start how at I'll that of you, laced it. a shifting year becoming are could I around see are We're that's tell but and XXXX which

revenue realization be a that going necessarily there. because to it's may out, maybe commanding got out have one it's They met. that is not expectations again, aren't stressful standpoint, performance it's situation to that get that pressure, level I've aren't some a at but a decision from or returns a lender maybe Now

and to we're effect to So a a that see. continue potentially is residual good going that thing

of the we So bankruptcy. exceeded acquiring didn't and are as XXXX, things through is, of One of time that quarter relative the part have instance if in what that we've you contract, now acquisition we're in first property collection several early a interesting we the at some part and all the even for look reported year, acquisitions. this of there under -- years, saw through we've to first out we what have you for even as volume

that nine bit was talked good few they about it at was entirely. surface to got the had of think basis, it wasn't of meet the a I've over that kind could get looked We to to and that was or us came on meaning bought little a and It right owners time to was acquisition it one meaning them was contract. first wanted do fair ownership the efficient that quarter, exit again an a that opportunity priced. we've term it we do the some level decided very in one we a long one So And great and top the was clean again basis they a that. assets, deal and properties, last evaluation, under for but ideal off-market deal portfolio but a sector it candidate an to deal, quarters, were a on negotiation, the

how see out. and the mix in year So encouraged there's And the more as rest of by we're that. we'll speak we plays of that the

Jeremy Metz

New pipeline, pound I it your it York, or maybe philosophy. looking core say that And here contract those is mean, would in of we're seeing of $XXX, equate mix, per stuff like in have is the your but like just $XX to looks just replacement something foot. market of know markets the just are at it terms on a I cost to the buying appear it the wouldn't you some driving call high-cost as around mean, $XX price the I some

factoring is into of that? that So any

Joe Russell

are prior driving assets, in that you've than -- we do seen average with not are of now not us higher properties saying, not or Well, failed higher mix any a more owners Again may that duplicate. located and type is OK, two we few expected markets of returns right actual think when but the the us years we what we in exceed acquisitions only same quarters met. urban development. three these theme, to not but newer They're means is, that our ago some the are little in in of or what well on to hard a assets, are maybe little very pipeline being very expectations by into meet coming and again put finished the

year. to pipeline of those So good feel throughout bit few kind a are you've And deals, right we're might we've again, hope on this markets we see well our assets, under seen that in average that us do more that higher located as still handful bought of the returns. activity extremely little other some get now great of but of A replacement them contract great got going various a we be to in of we cost assets.

Jeremy Metz

your between I at that of much least third-party? I that happening, one appreciate a if wondering seeing was on any just out are and quick update give actually there one you platforms the bigger really that on from the seen who Definitely on know could historically I of haven't any you that. you heard Last third-party front, but management initiative jumping operators a, do that have margin?

Joe Russell

So we quarter, in the properties into signed the XX platform.

things backlog learning program directly number new come as may I We're day through weighted at Our to that but heavily some be yes, you of development grow. are change the take into by deals And to It's a would itself. to seeing completion I tell the the owners the don't that that think certain and flags. actually includes, of which will continues end there quarters pulled a platform. of be lot interesting of to business, and do

So to another us platform. or public through either they're whether a coming third-party private

we some it's in what that assets of a for to part many correlated to at for of activity that a of various moment pull as that decided platform the the our deals the the see, to development. seeing in coming tell relative dominant We've are as wouldn't forms to type that, passed are of We I backlog, end we've number on in of the of we but properties day, highly to you are But like actually still reasons. us. the

itself. us think we've assets scale be markets cautious the good business other to but these grow go got we into around whether time, to that what to we'll choose keep again be So momentum continue to or some ability able not factors, over or and particularly I we about and feel those of of it to the come like

we where we as that's speak. stand So

Jeremy Metz

the time Great. Thanks for

Tom Boyle

bet. .You

Operator

next comes Your Rose Citi. the of of question from Smedes line

Smedes Rose

year-over-year. -- balance the just you expect it you're ways? are ask some that increases that, your a the some And it you I And you marketing continue I kind seeing the big wanted sounds I attribute other just you system mean, through thanks. guess color like bit. changes stabilization on with in Or little quarter, to that? I about maybe Do quarter marketing maybe expenses of Hi, the in pace along just throughout around year? Internet a do little to to of that the versus bit second pretty way

Tom Boyle

Sure.

take components. me that different let So in some

good saw we last rate that pretty quarter. really the quarter quarter, increase So the our was time, as in more increased reaction the search. competitive in the and spend online consistent in throughout with And a paid and online XXXX we to fourth as did our from great a brand of marketing demand environment, fourth combined that spend we search paid on we saw and response discussed that's

in on customers dynamic that of the cost supply and traffic. acquiring Ultimately, around based there some expect many decision-making well. new in is very increasing so and there our dynamics supply, cost you'd is -- market -- As absorbed as impacted local markets as is increases market is getting and some per click keywords by that

we're the of seeing quarter to into and not year, it's I'm increase as a tool we good second call the we returns use tool. are but a rest of today going So to continuing that get on the that rate for

of activity? seeing The of answer yes, that certainly is benefiting that to drive using were down the second we demand was, rates level that is the for of to a part question overall move-ins to your the our which but response do we're And promotions about like the again, our and we're traffic from quarter stores. X% advertising channel, for rates combination move-in

is trends third where guess, the of was I it so markets spend advertising challenging your that's markets and remain good which our around, and and helping aggregate? the trends seeing increased healthy. move-ins say, to in in we're move-in is are other terms of component stabilization In but portfolio many would where concentrated question move-ins, of in quite good I contributing

that In trends terms markets seen new by of some have the hit in the stabilization point, we were good early supply. some of

So Chicago basis markets year-over-year, is XXX points see us you'll Chicago in basis DC XXX Washington DC up points. occupancy like for up or is improving.

there. So we trends are seeing some improved

Smedes Rose

I a it. thanks lot. appreciate Okay,

Operator

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

Todd Thomas

in wanted but it you're specifically just Or decreased Public's activity I to that stores circle looking to here? the you expansion and a quarter, development just pipeline the development pipeline back more is to delivered thanks. is pipeline slowing is Hi, down and I timing backfill it know looks few -- how related?

Joe Russell

all, of we active an Yes, QX. Todd, first had

was what number So a to the we drove rebuilt's the Houston lot specifically. $XXX deliveries did the in really had million redevelopments and scrape of the builds. of quarter, about delivered we tied pipeline new volume and But for a heavily remaining

we first an elevated of So quarter volume. had level

activity are the markets, It performance, shift to able a but take taking and properties So we've so, the sites. we a just only that continued in more can to overall that seeing land one increase that down of or but degree, well extremely lot intentionally wouldn't you'd impacted potential flow. attributes basis, never two redevelopment as expand that intentionally there. close where lot some indication million into can or down we're Gen ebb of existing pipeline, X the an shifted quarter a to of get pipeline I where new and has activity, scale that did from good out $XXX taper we're not our and those where certain we otherwise, properties great be to call to our what product putting located that

we're looking is that. that plus so In the continued XX lands close land impact a activity variety we becoming tied the for are different percent eye of markets, expensive, a on on our teams pipeline in some very -- see So front. keeping and to that, development of Today more about active sites to markets. out

commanding. getting to is a number be that entitle the other thing The certainly more happening seems to markets, time of and is

Now some entrants of years. that over the ties which three some of with last of market reverse the have the to the either impact developers kind into or of that or come two

We fully we've than to are our for reverse getting land seen close more inquiries entitled recently sites.

is the every team's good got we've to continue again, opportunity opportunities we pipeline. focused development of the different driving investments see there, our and in out from a and that returns on kind bit very So healthy of collection

Todd Thomas

cost you that's us today acquire maybe a cost the Tom can trended? share that then continues customer to and to is mentioned rise, how with And -- what you Okay. and discuss

Tom Boyle

has modestly another component component. of advertising cost is increased certainly The a Sure. and the spend

large and our is are form two stores, track way the in first the in Public can comes promotional really drive components You Storage, a of that of our $X acquisition XX-Q the is disclosures which to costs. for the rent traffic for customer to discounts great those the month

our So you that take can at those a in are look filings.

Todd Thomas

plans lastly, run. then that's can just your you to talk just And Okay, fine. about

in the season you're busy and I think how Day discounting of sort are Memorial previously general? the -- month was for to what and whether up planning promotions this sale May, in shaping

Tom Boyle

Sure.

summer past. go sales to that through and the as we'll we good on do we've you quarter It's we'll returns update the we we So dynamically seen that through run as where we go typically go. some the as and assess months in something

trends, quarter. promotional decrease down volume In a promotional the rate change really dollars not and see is could terms strategy there. by you in of were driven That's

So we as obviously strategies into if that continue to know. anything year, traffic use expect I to consistent stores. changes, year drive would but you this let we'll our last special dollar

Todd Thomas

thank Okay, you.

Operator

from line Morgan comes Ronald of of Kamdem question next the Your Stanley.

Ronald Camden

curious, of where high of in go obviously I any back level it's going. if to there Hey, marketing But dollars terms themes the discernible is pretty the just spend, local. are kind

Coast and increased or West out? across pick more is it versus board way, all of challenge is more the another Coast to maybe said East hard spend supply So markets sort

Tom Boyle

Sure.

terms is located the increase geographically, it's where the of spend board. across In in

-- more customers that's are on is online others spend the increased competitive that for highlighted I as markets, other and competed driven by platforms. certain more as Google really are there and dynamic think than I

the higher it concentrated dynamics are competitive spend but intense. overall more in the markets across board, the is costs So where are

Ronald Camden

Great.

The be other this Company I to question quarter. a believe for website was there [indiscernible] was, just, the think I set refresh

idea been your the received hopefully and Maybe you was ability on it give that's can what think I how that an update there in us of to would to you're market tie kind online. seeing and

Joe Russell

can Sure, too. Ronald. I'll start to add and this Tom

So, website fifth our first would in delivered our the label I generation yes, what generation, quarter. we

et a variety out rolled different it's has platform. it testing as entire through we that of a gone project So through cetera the

give we've opportunity what an us All from we're be that us So to are capabilities from in able by the far to going a standpoint. standpoint it's a not to going provide we're quite but need tool additional ways. pleased thus seeing, indications to number of add, that's commanding are been going

through it. So go of continue if those you and to roll to we're this year give as on we the additional anxious out color rest Tom can

Tom Boyle

to over think I played with public Yes, think their out and as as have we customers it but out I well first see last we're to as the continue delivered it storage.com it's and that centric with to we transact to see that has pleased team decade built the us it that we're be something mobile happy quarter. new hard Joe, on trend move on you worked so continue covered pull and to and you'll up really play in phones the

Ronald Camden

sort the made question -- last Yes, you the some was think there. I interesting opportunities my out of comments environment and that -- about

that times. are assuming got When that, for you've you. what just, you are you're you the you few delivered, the just that or -- looking pro longer Obviously, forma can guys how about how us. and how quantify lease-up And so? running properties last about Just over lease-up has at market trended on thinking year lease-up times. that Thank no the a curious in and thinking does -- that's you're

Joe Russell

that -- then where really the back three that it way it markets lease. there's properties natural the is And you're assets still of from mature. it an some of markets that amount developer you any the doing elongated good it's tied we shifts what on that a well in and mix timeframes are to that part of maybe range that well. all. to then Yes, a good the of chose you're an have time -- but our to happen at then quite are, other factors expectations have that mature mean, the is traction may some property because property we're fundamental different from business is that under maybe that again, supply to are and very been can of are time ahead served needs we've I in two we certain maturity market I a stabilized, another itself. supply there's frankly, to from wouldn't in that a have that a reason seeing lease-up in again see fair you well out lease I lease-up, seeing growth, inherent first tied anywhere pronounced, whole ahead that leases property part clearly thing and see place. inventory to any going a good to And that, going say In that. -- number of the basis, specific typically not the average a on why the maybe our of a to alternatively, lease-up the do so is mean go got more take asset fair that It's but amount and, by the hand at factor not from there or itself impact only is of standpoint as The there frankly as needed because years

you've its that able and success. ultimate to So stabilized a got asset again, evaluate highly you're

Tom Boyle

the it other as been performance well, certainly to leased-up that see and can up quarter, you that can delivering. the -- evaluate vintages we active stabilize XX% continues well as they season can so This in disclosure, group you expansions Joe you that vintages for highlighted, developments we've in provide and and XX% of that is as those XXXX or in stores see so that the XXXX our that to development growth continue and as to they Tom, the

Ronald Camden

Helpful. Thank so you from That's all much. me.

Joe Russell

Ronald. Thanks,

Operator

line comes question from Sakwa of Steve Your Evercore next the of ISI.

Steve Sakwa

on number the out bond just balance Company. morning I and there. preferreds issuance And of been my wanted trying to you update your process to guess questions asked, fund have you've good touch used recently did historically the get Tom quickly. obviously operating Thanks, I mean, just longer-term there. kind a a sheet to on but I guys of thought sort

a You couple preferred that this callable year. do issuances I'm longer-term are more thought of just have wondering processes your about of using later what kind And debt?

Tom Boyle

Sure. Thanks, Steve.

So we have issued both the preferred and year. bonds throughout

We financing continue remain both to to committed tools. as markets good

great permanent finance talked past, in pipeline. to the and of sheet, the balance our we've external a acquisition have As activity, permanent incremental life. the the with capital we the preferred With debt of about as pipelines, add well as the great the to ability our is call long-term growth market features feature also both long-term source lots including development

So we'll forward. look capital going of to use both sources

some that highlighted outstanding. preferreds callable we do have You

did a preferred callable of some evaluate. in later the financing a the lowered month is as cost redemption as execute March, that X.X% a which we'll we our that aggregate preferred have In also preferred year of new We continued improvement. well

long-winded the a cash $XXX from which as is and both in of today, deduct you today million-ish through rest had get good liquidity saying, for if we the bond million sheet of $XXX shape the external of -- here issuance, in million balance with at a growth of cash fund gives great contract it's year. under XXX acquisitions we we the to like the forma markets So about we're pro us the sitting year-end $XXX million on way and

Steve Sakwa

staying I of of question about when sort real the MD&A here, you then just you X%. about you consistent a and the real in of any any Okay. second look kind markets, might seeing up forward guess And section kind bit? just start that in estate talked off about I to as taxes XX-Q estate tail are taxes. relief know But relatively

Joe Russell

consider taxes Relief seeing is in I we're not real today. what would what estate

this grow year. X% we property So to taxes around expect do

earlier that's seeing. prior reasonably is over do If we're you real consistent we've look think associated cash years to with of in cycle what that back that I an values with catch-up the flow seen. estate element there

forward we're And so have some certainly in down a in more any real going It's not but at this our markets. certain benefit markets, incomes of as quantity seeing supply see impacted point. we that maybe in possible, could come

Steve Sakwa

Thanks. Okay.

Operator

comes JP question from of Jiang next Morgan. Hong the line Your from

Hong Jiang

guys. Hi,

on question are that -- is third maybe another dropping you all This marketing spend, expense. your their cost respond all? the the started marketing the by the your quarter cost same you spend up ramping marketing at impressions increasing for seeing competitors up Just at

Tom Boyle

Yes.

question bit. on little I get So a more overall competitive. the There paid this touched no is environment Internet that search continues to

what So similar. as part that others something we and increase like of our we're certainly seen spending doing and are we've

we've continued push like demand So brand our term like and click environment to driving cost the response competitive there and seeing is per up we're seeing good online what year-over-year. But I we're said for earlier,

Hong Jiang

much click up roughly guys? for per for Would you how up has you cost gone gone know the --

Joe Russell

per Cost double digits. the is click up in

Hong Jiang

Thank Double? you.

Operator

Street. line comes of question the from Green next Your of Eric Frankel

Ryan Lumb

Hi, thanks. This Ryan is Lumb.

'XX, quantify back reinvestment investment us for the So that able capital total Just the of you involved maybe can anticipate in number are fifth to are we in that program and stores alone? of sort circling generation program, on the

Joe Russell

So again, two for years. half now it's testing, a the rollout and a that we've been year last say to

different existing of number overlaying it's signage, call test -- from fifth into some of assets, began is and product what tomorrow Champ we So with environments. better customer LEDs, updated improvements, changing environment more somewhat water to markets, our environment office through a also of meaning platform, environment XXXX, elements paperless. in utilities generation cabinets a usage key it filing our We've it's around number enhanced, which straightforward, property we taking today's -- schemes. gone through to our world need completely in We're because we've landscaping a don't platform, things X got We optimizing anymore. like new create today's space Web painting

different So we assets thus all number far or well in markets less through which that those things of of than the say we've play through tested that XX totals so XXXX. properties quite tested a

the here for rolling we're specifically, the got So we West we'll touch rollout surprising we We're markets it's et plus few a different and into reaction tied cetera, next XXX portfolio. in and be of and Coast. minus we in entire entire billion be and roll as the spend or about properties XXXX, next seeing employees, California, we all lighting XXX what years far. anywhere we've quarters over or starting it we're And from a this more $X.X million. to with like three customers, then the out from to the as literally it touch the number year, or the In say $XXX this to likely so wouldn't main plan feedback this in the cost years few here two is on next the

well enhance as things the standard itself seeing ways, the really number of in incredibly another amplify online to a we're doing that still we're we So have what consumers, retooled and the well. we but appeal, that like been new to an but it in not resonates matches it's that only it's early to seeing that properties residual this regard, are some and curb the benefit think basis brand way and all on

see program we've subsequent be to a years it's on to to amount in of likely a of a dedicated again, and this focus we're going lot fair got So that's effort. capital

Ryan Lumb

per basis? on maybe do foot a foot square spent have you in basis? Or your translate test Can on what square color. per you a spending you -- markets helpful anticipate That's what

Joe Russell

because call need yet I can because of can other Yes, we're point then to that or components many rebranding a and could of different be -- what properties asset may be, wouldn't components vary. thorough that number it more a properties, In it's some direction I it not touching it as would to itself. lighter the

So it specific you I basis number wouldn't point per to a yet. on a asset

Ryan Lumb

reinvesting And then, total assets you to like portfolio to and new that I your had be not would obviously, you of percentage roughly some those. developed recently touch, mean you in speaking? very is the What that going you're

Joe Russell

we as we're new or that elements the ultimately entire in form, out -- mainline purest speak. would we Well, portfolio again that's its of lift standard to rolling

take that's this why mentioned I So several years. could

product. we generations So five characterize what do would of have we as

our plus So some XX, been which of in X,XXX locations, hands XX years. for have

So those the of of a and elements going that case-by-case basis, going to cases to talked may not, But program be in I do of amount the to that property-to-property. some heavier on levels we're need, it's some enhancements may again

to out So of phases of assets early then at a and again, And choose roll most do we'll certain portfolio. it program what continue we'll ultimately make over the time. we'll point, you get sense and is the to moderate in the that

Ryan Lumb

. thanks Okay,

Joe Russell

Sure.

Operator

line of Instructions] SunTrust. question comes [Operator Bin Kim the Your Ki from of next

Ian Gaule

the back I'm Hey, guys, if driver meaningful And on Ki line I you've that to occupancy. kind on is just quarters, gains in expect going rate to Ian seen Bin. a be want Shirley's this questioning. the curious to last Or just side? of quarters? next go our with few more of The couple that's of be you

Tom Boyle

Sure. Sure.

either so occupancy not about we're we up As we've consistently points. the you with focused revenue available I and end tell on foot, basis XX will per about revenue were or at occupancy sitting April, rate. revenue talked by of we managed and

the here. that go to summer get quarter but from on gains we've the saw occupancy about hold continued April, starting the to fourth leasing we'll call end busier where season our and update we next we're with to of into as you So the through we

Ian Gaule

see around And payroll been any we the you has feeling side, call payroll the going last, payroll? are then thoughts Or on-site an markets expense three what any on kind of that? should pressure uptick quarters, your your in down it, in of forward, on are Okay.

Joe Russell

of queue. highlighted that the some inflationary most of We're employment a property the I Yes, X of of There's lines Champ optimization property tied number we've strategies forward increases to been question level and at efficiencies degree deploy more rolled we've we included of pressure arena would the of -- over by commanding XXXX. Web normalized rollout this going seen benefit property as Web to to the in say and increase see system Champ X a able mean in payroll. XXXX we're we've I to likely our cost the has what and no and in level again along the that last part the is And decade. in throughout

to around we're on productive team basis. So market-by-market that, not our a very strategies as we're assessing ways full possible. only looking We've as got vibrant of make a that number but efficiencies for cost

of way So pressure the the number of inflationary in of a we've I good particularly as opportunities. traction go seen using forward. technology a lot along more that, -- we're around would say that But lines to I would we something look

Ian Gaule

from Thank me. that's you. Okay, all

Joe Russell

Sure.

Operator

Rosivach Andrew the comes next of Sachs. from Your line Goldman from question

Andrew Rosivach

Storage. larger front a without the end, taking it thanks I pricing on I of of industrywide call. is premise? because they coming seems my or there It there, is in revenue and there's makeup lot think has the selling Am increase in-place right this looks Public are faster don't like just Even like power combination that the a with two. are growth Hey, been either the or for

Tom Boyle

others with and of Well, seen to existing some tenants we that are using think that customers attract stay I we've in I will that is trends overall think us. and tactics with good good the industry

I think of that the part of mix to we've seen. that customers relates probably

our look you stay is, housing the transaction a across our things housing that country, percentage customer shorter thing. sales meant, customers. margin, in of of movers highlight If base many reason which length fewer as the activity like deceleration at types in be to markets all tend of on the I a has those And movers of

in call, lower for increases. rate the earlier get that's real as eligible demand by sector. is existing Chicago, That in hit the staying there, thing hit resilience real gains program like which which I think through cycle. do I the were D.C. for through seeing occupancy development we've happening resulted reporting. our more certainly markets, as you're rate that those helpful and have other tenants things of they They are tenant is to in move-out some All volumes longer. been stay longer increased as supporting markets We're certainly earlier on highlighted XXXX. seeing or we the growth revenue were Washington, the new in facilities

factors. So has both of tenant a the increases. But as terms existing move-outs, been that you're as of helpful, mix well rate piece right in

Andrew Rosivach

the But start six rather term reduced you a doing anniversary, increase at than you're increase like doesn't the one-year to or which sound either rate months. increases like now it doing rates you've

Tom Boyle

how we're say managing the sending versus say I consistent are by year rate. more this factors I we would some earlier. last of I would volume we've used our year, year-over-year highlighted tactics and which is that driven

Andrew Rosivach

Got Thank. it.

Sorry, go ahed.

Tom Boyle

roll the all and XXXX of revenue, on properties the new I all those as disclosed of -- portfolio rates beginning NOI we trends. same-store this did impacted would, not We when properties in were metrics, maybe new the rolled-in revenue were also just they the the at quarter. so stabilized, were quarter first the those rolling operating growth, highlight if the the in by

Andrew Rosivach

sounds like changing. But it whose Got up too relative doesn't is increases, it. the that right? entire sound concern my upon dependent the to rents you industry that could go and now do it does And of what does only got if the in-place -- really rate fast Storage? like just mix it for I it, industry to somebody or that's, the really, have if they really gets where that's in your impact when reputation

Tom Boyle

trend concerning standpoint. Yes, seen a anything haven't we from

solid throughout solid of base As I've XXXX. has and very been the really said that tenant behavior year-to-date

Andrew Rosivach

guys. Great. Thanks,

Joe Russell

You bet.

Operator

Your next James. question line comes Hughes Jonathan Raymond of of from the

Jonathan Hughes

afternoon. good Hey,

Just one from me.

years mean, new five a XXXX I CapEx, since square I know year's part Ryan's CapEx the the budget spend if maintenance back on is you question items pain that sound of there what this of property of that XX%, and say but Joe, is Going and like million how a is of lot spend deferred program only tripled footage much standard is tomorrow program. on My to any, that initiative. over next as to question mentioned $XXX construction. that's signage

making if investment I'm initiative over to years. that under for determine is essentially up few So trying past the just

Joe Russell

it's mechanical portfolio which Yes, in I'm traditional in that that. again up catch of a that and and And the this noted electrical and And going X is into continue. feet that, through have, testing well talking those systems benefit of to toward standpoint, some to of CapEx into not. of bent relative is place things years. can per in LED, the that through successes we utilization that very square landscaping, way kinds kind property of the amplified our tomorrow's water the beyond is a CapEx products rate the our amount and brand things, additional again kind some good ongoing the,again couple $X.XX that that those really last Gen or seen matching commanding more so the a the in enhancements been also of go $X.XX elements will run other about making efficiency been mentioned keep simple upgrades to that it's the to is consistently we're any putting from it's done program we've simple as we that as that's we've for our I range over we've again what The the pain. will that longer What has is and cents drivers are include term just

Jonathan Hughes

Thanks time. enough. fair Okay, for the

Joe Russell

bet. You

Operator

from Todd of question line Wells the of next Stender comes Your Fargo.

Todd Stender

Thanks.

just of sheet using commercial some when REITs back of longer-term see some addressed go wanted for I guys larger financing. full your you maybe impression balance to time. be flow some of to And the give part I the on we then alternative two, cash to guess the short-term discussion touch expectations can for Just one. first sources other your the you free of part year. guys debt that'll paper addressed But the you

REITs. a more likely then of the self-funder other You're of some

Just your Thanks. there. thoughts

Tom Boyle

Sure.

like recently, add to debt media borrowing debt. preferred we're needs. question added on We've short-term to part so around to no our XX-year our and got balance add five long-term cash, sheet. long-term the about paper. $X short-term public and our of in debt we've we We of started right for plans balance billion no that plans now the really sheet, more balance sheet as of sitting We've nature commercial So on markets with the have

And for that's like to XXXX. terms several cash In flow free million to of been we retained past the XX-Q in cash night, flow, $XXX stable question last reasonably of something your number expect around million we over our disclosed years. $XXX continue

Todd Stender

Okay, thank you.

Operator

additional Thank closing you. to Ryan any or the Burke return I now will call for comments.

Ryan Burke

next Laurie Take joining you, you forward month to at of for seeing We conference. the of and care. to today. all NERI many thanks look Thank you us

Operator

Thank Call. you Earnings for participating Public Storage quarter in Conference XXXX the first

disconnect. now may You

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