NSA - Earnings call transcript Q2 2020 | National Storage Affiliates Trust

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Operator

Greetings, and welcome to the National Storage Affiliates Second Quarter 2020 Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It's now my pleasure to introduce your host, George Hoglund, Vice President, Investor Relations for National Storage Affiliates. Mr. you, Thank begin. may Hoglund, you

George Hoglund

Good morning the what of depending good you're on. afternoon country on side or

of As earnings you out for thank follow like to the the city some facilitate looking for into joining to recent conference be of and Trust. quarter National We'd self-storage second trend us on remind this life's you Storage today of is suburbs, transitions. Affiliates you moving the of call that big may the XXXX I'd call available to to like

addition forward-looking the to today's an Relations Investor details including be uncertainties, containing management's call, questions that and duration package actions may In risks materially the to yesterday, or those that may your press we and On uncertainty severity from may actual the differ additional are the X-K mitigate our section prepared forward-looking related taken COVID-XX release remarks filed on with contain subject on distributed and which in to any SEC our company our results, cautions scope, the with website impact. answers the found The in nationalstorageaffiliates.com. pandemic, supplemental at contain of the and statement. results statements to indirect projected to direct

For the our forward-looking SEC. additional detail statements, with concerning to public filings our please refer

package the information as our SEC measures, We in FFO also supplemental encourage on listeners in and contained to our and Relations reconciliations FFO, section core such in and operating review non-GAAP financial the definitions filings. of website the net Investor income available

COO, CFO, Togashi. Dave here me today and with NSA's Brandon are Tamara line the Fischer; CEO, On Cramer;

registered the now Tammy. over prepared management call from financial I analysts. will accept turn Following remarks, will to questions

Tamara Fischer

team given thank deliver our a acknowledge challenging who very quarter I'd to and the a environment solid members everyone, to many continue what PROs our call George, is we first today. and work to in circumstances. joining our you, diligently Thanks, and thank like for believe

what magnitude and decline consistent satisfied quarter. by and being downside share challenging result, the team historically, that per flow of NOI structure, the risk impact with the negative the imagine cash core extraordinary I PROs effort a disproportionate second and in with PROs absorb minimize our While never same-store Further, during mitigating FFO we've the through on times. share of discussed negative our our members

in PRO FFO year. result, primarily X.X% last per core the in a to structure. to As second compared driven in which NOI, and largely is result quarter spite same-store positive share due our are decline increased three by of second the the X.X% quarter This factors,

to $X.XX First, volume robust NOI second, same-store share consistently our internalization units. distributions accretive quarter; second PROs disproportionate acquisition SP is in of and a absorbed our third, the our accretive per decline the share ongoing by reduced on was PRO approximately the FFO the of in through per SecurCare share;

clearly unique common Our bad, stakeholders of saw our second we in of this good and our was to shareholders, the in designed structure to and special all priority align giving demonstrated interest quarter. times in the

pandemic and We've coronavirus driven employees our the environment safety impact our remain customers key to the in and its by a the our and the would that risk top is I While proactively changing these the of And challenging we're the with pleased on performance emphasize times, rapidly addressing priority. health overall economy business. been pandemic.

by avoid been in the safety, state since in pay remain occupancy options. across to were auction late stores moratoriums to executive our portion been rental steadily of states compared One and have reduced Further, year-over-year XX have many manner and modified in back steadily flat restrictions for steadily all crossed year-over-year. We've pending about for tenants operating down into us auctioned or by XX% same-store and opportunities Both delinquent our reopening. by We that local improved in units, In move-in inability down easing fees a working beginning was open closure overhang. exiting has at again. the for created and with All steam I normal net point points. unprocessed July points, that in to to to number increases, prohibited portfolio remain the resumed month auction basis and continued move-ins We've that occupancy has recover. proactively gaining we're June remained auctions and strong increases rent most overstate of contactless in would and move-outs This April, we the a in auctions related seems of except governments, to units July. a basis states improved and have about collections on steady last move-outs auctions, tenant compared then ended have far so resulting tenants X%, process. has move-ins into June an revenue is to system year. might for roughly levels phased Cash materially XX occupancy, since their rent and only their non-issue. XXXX, delinquent with near point but the these estimate May, units, improvement increase for Rental began And overdue activity our concern and rental rent, about And vacate markets, an up and negotiating is important net putting and is really to customers. a highlight our win-win April currently in auction fee the year-over-year, of volume June. as rental activity orders. been were to The

to will downturn. uncertainty the of this of phased we've create points continue moved end about gain resurgence July infections limited And when, now occupancy up But Things year-over-year, we're true a occupancy a month COVID have net given occur, number our visibility. uncertainty seeing by a we're that basis. in hopeful states seen XX was direction. year-over-year and the across right So worst of and and how re-openings on the basis clearly

are the such, will time, and guidance not XXXX As we at progresses. monitor evaluate we year to but reinstating this continue as

about the and were The benefits we clearly with talking positioned just believe NSA. on X.XX% our positioned the been gain is challenging, self-storage as essentially NSA think from a how coupon in locations to to notes this which transaction, number markets. affected the given downside the lease-up remains sheet our will suburban well There how more closed any less and of spend only on. tertiary mind, time about focus inherent by extremely primary this is in analyst we PRO reports environment keep notes execution highlighting which markets, of when and goes have portfolio private Brandon is secondary published you protection, more areas lowest concentration media shift past in important been articles will couple private placement out-migration this issued, greater liquidity, no but time We the of and COVID-XX. and secondary trend think trend by or balance more our of stages and the Although This XX-year week. an months, REIT. pleased was our have exposure markets, structure, $XXX and our of unique over million early XX-year the urban a debt investor public

quarter, during growth $XX we to total quarter, of million. store, investment On to spreads the front, $X from assets slowed the second remains external The at end, pipeline, for million. these second Three were significantly continue acquired quarter from for environment in which of acquisition wide. and were wholly-owned additional our remained opportunities source evaluate of the bid-ask external subsequent And captive pulled the portfolios properties, as And we acquisition strong a a future. four valued market. opportunities one the many acquired

reloaded extremely worst behind portfolios And us, come a on and discuss private call fundamentals we're advantage that currency, of potential continue turn sense activity to positioned execute, the take operating opportunities well is that following we that over as to the overall acquisitions. placement, results picking I'll operating market there's is back revolver, see to will starting acquisition Now sheet a to pipeline NSA the balance expectation with captive to OP that up. Brandon transaction and market attractive and serve are stabilizing. units to our activity. is now

Brandon Togashi

afternoon, Yesterday represents the X.X%, $X.XX, share over year of an of which we FFO core period. Tammy. you, Thank per prior increase reported

growth accretion from this and by past a internalization SecurCare. mentioned, the was Tammy fuelled of As combination year the over strong volume of acquisition

to occupancy year-over-year, For averaged second X.X% board. to foot markets quarter. NOI XX.X% a the XXX revenues the Same-store existing despite same-store This by average the by rental year, property effect basis decreased XXXX. of per in second quarter, growth, by an over most compared driven X.X% diligent rental during same-store slightly X.X% rate decline in paused in same control expenses. points, the OpEx increases cost operating was period in that offset of during that benefited a quarter, fact decline prior across decline we measures increased the occupied partially from customers the Same-store our square revenue and

Specifically, by from benefits utilities controls store period. personnel X%, the partially favorable offset in These offices, prior XX% repairs property hours to decreased X.X% activity costs that as declined and X.X% lighting to grew optimized LED declined less attributable initiative. expense staffing were due taxes we and maintenance year from partially our

than July X% collections up experienced levels, prior what points let XX.X%, some XX% up second and in similar remained move-in XXXX move-outs occupancy of July compared was sequentially the were of Same-store color Same-store quarter. XXX and basis points higher July was end XX% XXXX the trends normal in end at July compared about June. year. and July. July the to volume in the positive in to the healthy Cash down were to from of Next, on of me give is end basis we which XX the

a of rates the and and believe focus down systems management rental July. this time. during takes and between job rate occupancy street revenue We give both in optimizing were Our have X% QX good on our done challenging and year-over-year revenue about balancing

half on comment and growth me and four quarter. achieved were reported largest some performed revenue portfolio same-store Riverside, markets, same-store average our pleased than largest achieved let them NOI general, San our our better of we and our during markets. of growth. markets, revenue positive six Phoenix the exposure of Two NOI positive MSAs, Bernardino Now, of that of and In

up results existing portfolio, Portland, And March, in impacted markets the before benefited QX rental in While paused to activity held consistent that pandemic. occupancy from quarter broader program increases both In steady. the negatively processed combination rent customers the restrictions fees as basis were overall XXX XXX the basis just and with QX, second points. a COVID-related we to quite and was due issues. occupancy slowdowns was stay-at-home the experienced late the but new July by in points of was quarter improvement basis on year-over-year. This down auctions existing down month Average points both during XXX oversupply orders, the the regulatory end ended the occupancy continued

Tammy And While market, to across at visibility this as impact continuing quarter. trend we're landscape with is growth fee of restrictive we for revenue few and prevents of remains markets. year charges encouraging, limited confidently full noted, mandates about entirety of in a seeing examples in Portland the which this quarter. do us most are auctions want time. commentary pandemic, the These from third the That prohibiting third challenging. guidance our the the offer just The the remains late what state some operate, providing same-store about economic I said

to with the QX we factors have to lack and performance has have rental could customers these quarter, rates new equal occupancy. on to into of aggressive third slightly quarter to look to strong and the customers year-over-year pricing of slightly in-place X.X% we reported comp lower when tough second increases year, boost XXXX. back of been below for The revenue negative We the during heading rent the the third more the we being growth quarter, weighed combination QX. at lead This of discounting existing a or

paid was Now, turning XXXX. debt, that end, to $XX maturing balance only off Subsequent sheet. to million quarter the debt the during mortgage we of

share price and for replenishes placement XX. later elected weighted pleased and average $XX at rate gross maturity, issued years through on XX coupon. per a low tranches: private average $XX the our years October to no private lowers second for of funding a that placement this of $XXX X.XX% the rate stock of two on coupon execution fixed our delay quarter, XXX,XXX million extends the average cost notes capacity approximately notes the three revolver, X.XX% closed We're we of take have shares for Also floating during on XX proceeds $XXX advantage $XXX program an also million We senior very at months, our To of of our ATM for of we million. borrowing to common at with the revolver. than up million of our comprised

an issued We price also OP connection average activity. $XX and acquisition in units at our of XXX,XXX SP per with unit

is placement, XXXX essentially million and sheet with available capital. the sources our no to private reflecting full balance on the positioned maturities revolver Our well access through healthy $XXX after multiple debt of

quarter Our or fixed except rate weighted X.X% end average to was our cost debt of revolver, fixed. at all borrowings, swap with

maturity was X.X average our ratio times second times end first weighted of at X.X from Our years, end quarter, the of net at was quarter. X.X the the and debt-to-EBITDA down the slightly

take of and transactions they of about external our network of capital we'll for unit to will our and fuel We again have Thanks OP flexibility positions going strategy. growth advantage and well-connected well also to our call accessing currency our need be today. no opportunistic sheet opportunities immediate investment our PROs forward. capital balance offer as the believe we Strength markets with to And for joining our tax-deferred ability continue arise. us

now to take questions. it to operator the Let's Operator? your turn back

Operator

Malkin Instructions] coming from Capital One. [Operator from question first today Our is Neil

live. now is line Your

Neil Malkin

Good had that with think I do morning a to guys. buddy. lot quarter. George, you Fantastic

So as on good well. the job intro

today, heard deal of portfolios terms what that more quickly today could in to of any back on market? in are as the you pricing. of And seeing kind accretively? and it? a that performance bounced third the pretty First there price as change terms of deals in that -- worst of your meet then you're and performance in coming quarter quarter second cap during maybe criteria, just question the If your are on like rates issue we've your equity pricing more was the did transaction market you the sort market, given the deals Can has in there considering follow-up, stock comment you the back

Tamara Fischer

for it say, out is in would and a thanks thought we he Neil, question the answer question. of I'm appreciate more would George this We cap it. of always the market, sure rates compression did. part I big is Tammy, there. we and the about calling than a in see your to acquisitions But we

in the of our we know, better rates. slow We market down the beginning mid-March. lot came you in cap cap see had tend contract pipeline. to and at What As assets already didn't We compression we quarter did in capped a second rate. closed transaction of of couple buy those QX, under those out little a a

the we Our X.X% in closed about average We I second deals cap cap one -- third the for is including the quarter in at say. rate mid-Xs in the closed of what quarter. would closed that a beginning

we'll we their capital definitely be to yet, a feel remain stock We do to out as pretty what a with of positioned like to activity. And seeing And although now. price we're or We we're pickup us. happy are waiting is there today. in take seeing disciplined it's do lot underwriting, available that deployed, but we're to of There in wanting increase our right opportunities in become advantage take well today, self-storage. position they our

sellers goes. So to you the we also very currency as revolver our us. see OP where that's use sell we'll I as have fully incenting successful, available available in think And that But of we've NSA. our know to been

Neil Malkin

me job in due a work Sure. doubling sense is, how with occurrence, or as or moving on dad? can Last guess. from that related demand, you if you I up pretty that's you discern that and home is even to loss back I much mom one your to a got the one. quick Typically, can moving or for give to

seeing of you that, of support potentially do that, or the believe remainder is that the are through coming to you any So help occupancies year?

Dave Cramer

as it Empty good but Neil, their empty seeing create this as a can't office. activity, are we create how to children. certainly question. is stories have number an a places far bedroom It's of we've you, it. that, people can put much I exact to tell for had an witnessed Dave. we I bedrooms

rid businesses put occupancy. throughout to really how going long room tables and small getting of to the impacted the all are really limited that experienced nothing we make our to much finger seating. to of country. have can that it's how on We've There's capacity significant last, it's Some

Neil Malkin

Thank it. guys. Appreciate you, Okay.

Dave Cramer

Thank you.

Operator

Next question KeyBanc today Thomas is coming from from Todd Capital Markets.

Your line live. is now

Todd Thomas

Thanks. Hi.

Just question. first

following So external up on growth.

think that a I of you've that you return talked think base previously, asset about near see Do term? year. the you to XX% activity pace investment in the per could growing

Tamara Fischer

Yeah.

do about Todd. be can that. that return you, I – with we believe But that think year, to a XX% I honestly talk more we to honest think I

will goal. I our that be think

guidance later million We're I this for XXXX original the million an know year. of don't the if was investment it $XXX to to have things year, as there. to transactions reasonably Our of for part and sense to getting make get we'll $XXX can seek we're But as do close for quickly now. that going like we it. we'd us them have to picked and actively by continue up seems

we're yeah, front. motivated very on So that

Todd Thomas

Okay.

that certain of counting And current I map to environment another PRO XX%, round two Any whose – about were adds or with looking but geographies. is Is update additional know and guess, supportive then out efforts? PRO the XX%, those on you sorry in I here? the

Tamara Fischer

b, in the and that, price So stock I relates would our with c, it done uncertainty it recent self-storage; as the really with that say with environment. a, would and not just it months, general economic the tell you in where I – has was; to

handful I time. been to time, takes PROs. of it But We've operators. will with to would past private am that successful believe talked are I And say one about takes over XX on do adding say, three pause. to but time, I'd And before. over optimistic but We're so say in – And I I but be It it. when, more a changing. so, the always it's can't things it eight sort through different in conversations substantially weeks time over we

Todd Thomas

And more one investments. on Okay. just

you stabilized. refrained you predominantly new or be buying development you've for product wasn't from buying into lease-up Would sort to and stores? still expect the investments, historically, that do all So at weighed stabilized much market of

Tamara Fischer

is it part never definitely come or of acquiring and you're certain core investment strategy, right. will right still But – It is be a a to would part change we've be we in and acquisition to I a that, It's huge also expected if non-stabilized to portfolio assets some while our the deals the our strategy. open of market, properties if there's said always to we non-stabilized of time level. So pricing wide the we're not makes sense, desk. expectations. some seeing think. pretty our don't and see And But in gap when

if And it we're I watching sizable time, be was this there we sense. makes in JV if when so partner to looking open And and a at would point that a at waiting. opportunity, still and think with

Todd Thomas

the work around work how third through that and appreciate for as quarter what the last Can you or do Okay. the ran that backlog? to to bad was one trend you in And the reserve expect in income share you the just I expense expect but the third Brandon. how comments statement? the And debt you reserve continue – through the through auctions comp, quarter do quarter

Brandon Togashi

thanks. Yes, Sure, Todd.

so netted a expense no So financials, revenue, as within it been range. to don't revenue different. clearly is this in And historical you see X% debt X.X% our on again, percent the all of was has QX the bad and

kind were did we July that in of auction we towards up, range. process right high end several I'd pick the the across markets. did of of say, that reinstate middle the think I because

are already. process, in as think a bit the that pretty to we through of customers I much see of August the that may it we're be range, the little for don't the auction going a continuation We of we're get to to getting high meaning effect end – I fully full expect that by time but reserved cycle who dramatically higher. we of auctions,

baked so X% into And X.X%. the to that's

Todd Thomas

through be Okay. Got it. process the by of end third the you'd the And auction expect to quarter?

Dave Cramer

governments hope it's those. we Todd, from some all have are the Obviously, Dave. prohibiting of be. Hey, Yes, country us we municipalities and to around still that restrictions and the completing

longer of of pretty September. go our way as restrictive, lift, than do Some restrictions end we're But being working stretch that. At it them. through through the this Oregon those the point, could even

Todd Thomas

you. Thank right. All

Brandon Togashi

Todd. Thanks,

Dave Cramer

Thanks, Todd.

Operator

you. Thank

Our today coming next from Stanley. Morgan question is Kamdem Ronald from

line live. Your now is

Ronald Kamdem

Thanks.

One, pretty me. a Just in move couple from strong. volumes of the quick ones July sounded

and would there wondering, markets, Just Just seeing provide maybe color a bit of that you more be potential the drivers? portfolio, little any any if parts trends? on on any you are more helpful. Is could color that demand any

Dave Cramer

I strategies volume dialed our all performed competitively. A a with We spend. and We And And lot seen dialed Even all This Portland it. pretty Dave. good I while. had And got our is activity a think everybody more on were marketing it And as No, well active. month our we had active, is PROs rental priced in July, good question. think everybody open. it's in, a really move-out the and I positive think got we got well of markets in good, the was really the -- something more discounting of the think are in place. haven't which July, executed We're are the of -- job more volume. a in. teams did move-in country in on country, our I very

Ronald Kamdem

already question sort obviously then, some the think trying second But around an guidance the lot brackets when appreciate like. second about could sort you just, And a of was of that year, what XQ half helpful. there's uncertainty look That's understanding the of get put there. maybe I think to I of of the Great. you've parameters.

the us hopefully, of causing there put sense? map the that some are be for to that out front, willing road Just enough are What you some guidance curious, wouldn't right? things that uncertainty of of what of on more made the sort unknowns, a

Tamara Fischer

you. Thank Ron. did, It

we and say us. of mentioned orders that half also come Brandon that believe additional like in we if is are second quarter do FFO And last But you the much quarter country, will around what in that the XXXX believe the as behind no comments, there in in mentioned decline revenue. his is should look or last worst I the ahead lot about third could the think, very feeling the I assume of today. we're of you XXXX. we half shutdowns believe better things that a And that shelter-in-place the of terms do

Ronald Kamdem

on a great Helpful. quarter. Congrats

Tamara Fischer

Thank you.

Dave Cramer

you. Thank

Operator

Thank you.

today coming Our from next question is Smedes Rose from Citi.

Your line is live. now

Smedes Rose

of into work give acquire just timing sort And could does being reminder, just system? in you. of terms pipeline. that from I able the me that you guess I mentioned coming acquisition out couple -- pipeline? sort you What a Thank how Hi. captive came of, a acquired you guess, the so XXX of the if stands around that the of of -- think maybe how -- the that properties I And or those captive does properties. at your you to

Tamara Fischer

controlled our would way is it cases, not cases, the them are So of by are cadence pretty actual pipeline managed in And and assets either in or the some captive lumpy, is in is have debt or by those that ownership. the are PRO. the disposition Smedes. I have many describe they they assets on PROs Many non-stabilized the the that, some

a of predict. bit asset to NSA, to when the work to the available. them to so, our It's becomes facilitate hard And it -- we best use for little efforts contribution with PROs their to

black quarter all to PROs our months conversations we as to it look would with maybe XX white We not necessarily coming. months about every out predictable what's and as not see and like. it's But have XX and

Smedes Rose

as take your of acquisition? typically, take OP as currency, And part described, -- they would -- Okay. some they the you

Tamara Fischer

The SP units. take they if PROs take Yes. an many the cases, outside have owner in OP And equity. outside will owner,

Smedes Rose

just sort ability but may goes way a attention the air But step-up classes. that asset change. And which to to potentially it? multiple just that mean, this paid general just part or is significantly if across one's would know if in open-ended, thoughts the you I'm eliminate to of you've I mean, table gains kind the does something -- lot it's think Do basis, you of Okay. PROs then, I being of have of apply wondering the on think is shield away, don't model, this do about, any I or on to, that that

Tamara Fischer

terms it's tax right Well, being potential not more will all in favorable, least about at conversations sellers I move -- we're very a in something honestly, And recently may to with conversations had say to with what's of changes on little of in been you, we've sellers be come, we change law. in honest see, that, to terms have that place a if does bit now. quickly. willing things more having

for positive So that real a be could us.

Smedes Rose

right. All you. Okay. Thank

Tamara Fischer

bet. You

Brandon Togashi

Thank you.

Operator

Thanks.

Our coming next question today from is from Jon Petersen Jefferies.

Your line is now live.

Jon Petersen

Okay. Thanks.

us like could year-over-year. just operating looking if at so know were a page, looks on about, XX%, up then, I of -- dynamics in market expenses how supply there's update you Portland. Indiana, revenue I in us worst look know, what's Portland. Just a driving markets, kind let were your few the in issue we picky Oregon feeling And if terms it looks like market and you're of just same-store on certainly Washington. questions that. Maybe been wonder

Brandon Togashi

Yeah, sure, Jon, it's Brandon.

So, tax issue. a first Indi on property the one, really it's item. And a is comp

quarter last was in a of the there taken pretty year. benefit, So second big

And you that big this we year-over-year year. to got look when so expected we increase, QX of when

of you expect as decline the just guess, performed little in be Just a stand-alone on QX basis the elevated, issue a to mean, also will what of And that -- markets QX, the portfolio of broadly, in I I was. half terms and they average compare we sequential of the a year-over-year type underperformed just in heads-up as the same then, how then, the well if more because as in the year, comp back other markets.

Portland, those have you supply have have four that all our with specifically Vegas, issues. are Dallas, You four, L.A., challenged are you those have you properties -- would markets say, I

the as confluence And the pandemic. of restrictive supply. least effect Oregon well of the that's in have parts resulting similar of as the -- four, amenable could different Vegas Nevada conduct existing types we you probably are the was regard story. So to the normal second very Of those one that with and our business, was of the the to that, fees quarter.

big it a of that's So in Vegas. piece

Jon Petersen

I I'm some around. And worse? which starting spread first Okay. we kind week themes seeing mean, been it's seems more Texas like would August color in hit to you it in be do hit. I York, then, negative a guys better as positive are markets are, the turned of COVID any obviously, curious know or is on kind thought it actually lot have in maybe a to New New initially guess, are terms region. have of on July. you of York. with of people a a like, how harder and that And hard And think into And but about Florida I guys

any I of was weeks? themes or if So seen to you've sort related in curious, more trends, the recent that

Dave Cramer

July just haven't weeks. It's a in Yeah. same is -- August -- recent holding, seen those we saw We some the and saw in of trends. much really change uptick on

people still going active that. there up. raining I on, about Even remaining Foot pretty the think with pleased out. markets traffic we're breakouts some is active So are are though

far as pretty good. July We in August. changes, significant All the first of out second quarter are the no think, traffic week up, as of look and metrics going feel we through the web of coming so I

Jon Petersen

Okay. That's Thanks All helpful. right. Dave.

Dave Cramer

Thank you.

Operator

Thanks.

today question is from Irina coming [Indiscernible]. next Our

is live. now Your line

Unidentified Analyst

little you can me? -- hear a Just

Dave Cramer

afternoon. Good Yeah.

Unidentified Analyst

to on wanted property more I color taxes. get Yeah.

received all deals So by the now, have municipalities. the you from probably

of So there some -- some you are mentioned that comps the tough and earlier states. in

taxes? the them into half this? of of you for trying the And approaching Are aggressive in look they're maybe would year, So to should understanding? they kind of this see more rate are growth municipalities more in terms how property we second or increase

Brandon Togashi

Yeah. Sure.

Let me take this this, yeah, Brandon. is Irina,

an pre-pandemic, of guidance So tax X.X% was year year-over-year expense the our same-store the X.X% property be that beginning full we the to talked And that growth the year, QX for we had would this growth in gave about we X.X%. expectation when at pool.

And that's so line. in

a that so first had unexpected Our we positive. quarter, come benefit some in, was

We year, you do out And like of that find this year. the notices in those quarter, the big for value than my fourth of jurisdictions and we know have value. still here Florida, is of example, for were But we comments assessments really the earlier on so one at more And back did the month a some the the on the half the beginning expect clip in we'll had comp a couple now, through – for I markets. Texas still on the half the back would growth something to say, QX. still we of I But going similar around that expect come average, there. I we average expect be benefits X.X% for had right year. XXXX, and some of that's so that in

Unidentified Analyst

Okay. Thank you.

Brandon Togashi

Thank you.

Operator

Advisors. Instructions] is Mead next Capital today question coming from Anchor [Operator from Stephen Our

now live. Your line is

Stephen Mead

what in the was student hi. be terms Yes, to just and different of is the late in population, in this I of the September terms going terms much year-over-year normally curious happens comparisons. of time year frame, in impact August, of whether

Dave Cramer

change activity a spring saw we We certainly This is the experienced. That's a question. in college amount in of the Dave. great

newer bit actually allowed as the back it May empty did little in earlier. or colleges dorms. and We in as of March, they students to let Some see back come was go a sooner, their

the got believe think is, we don't running we've students mind I historically. question as through as had I our college many that's

August, some And it. we half previous so this looking exposure may form we at we move-in look the it was years. we And in to college of than the as studied less thought have what was year activity, as at back of we're it –

but and to we'll may we're get point, to not still determined, we August so see this back be many that here, as have we as the move-outs. hopeful of And at half it

Stephen Mead

Yes.

terms storage and use who for is general total what Okay. and construction in the contractors their of percentage that? of And people work segment the construction then

Dave Cramer

It's hard hard commercial to tenants. tenants for there. would us commercial was we commercial If rent to keep with track rough good be true a business they thought segment it's really XX%, names, of and a average probably that our individual because

We seen haven't there. movement any

behavior group. of It's steady change We from haven't remained any thus that seen far.

that. And so with we're pleased

Stephen Mead

of the And also terms underway also the of then supply new were seeing in those you terms and projects in that future? and in what new terms are sort starts in permits, of of

Tamara Fischer

forward ready be really we're to going as planning obviously, projects that we've So drop have that the not but supply delivered. permitted the seen and to expected, XXX%, are not reasons. a those and have table And variety obvious construction completed not a that. might in than now Those participate. those were properties, to with are of little Deliveries right willing maybe is new are were where is you delayed Lenders approved, that to degree from go the seeing going permitting. something Steve, less pushed bit, away for approved be the under that ones what and may

So much nowhere. up coming of as not seeing nearly out

continue good for sign that's I deliveries delayed So next we'll basis. year us, or think so, ultimately, on the to see a for a although

Stephen Mead

question. Just last one

at those look associated you're terms of occupancies, the in portfolio the improvement new either your you you metrics assets non or terms can that of – in adding generalize same that rates? terms and of with in upside in As occupancy the

Brandon Togashi

Brandon. it's Steve, Yes.

properties, beyond believe we the able were improve the able to non-same-store So operate I mean, typically sellers those to are on we what that.

there's some there. upside So definitely

is that of of acquire in we we've included it for and same-store when enough times in it pool. get held to when Some long period the realized it the between

that still is you a always that. lift. the started So some typically, do in we the results. first This pool But see pool, legacy year same-store included reporting see our don't different year, property incremental we

always based perform seven refer better. you provide, more that same-store those. can supplemental what the of And and the see the information we to you at the pool in kind on bottom, so can And do adds recent schedule to six the

occupancy seeing board. the I historically tough is seen. little could by the to, that across we're and just profile it they're we're markets continued everything those But depends that of the terms because a pool, in today what in spoke trends have we occupancy large, and on be that seeing In still

Stephen Mead

Thanks. Okay.

Brandon Togashi

Thank you.

Operator

Thank you.

question Neil from Capital today One. from is next Malkin coming Our

line is live. Your now

Neil Malkin

couple A you. of quick ones. Thank gain. Hello,

your some What risk for pretty frontline demand those purposes payroll either purposes and or of costs them keep you there? think year-over-year? increases reduce to guys actually or that down marketing drove able do peers disparity large Some for significant pretty in had associates. How you were

Dave Cramer

factors. couple A of

do with all I controlling from their everyone of wonderful to the keeping a think it's member safe, the everyone how to And to satisfied tribute team teams job their able keeping and did were leadership our they vendor, PROs to teams. in partners. a Our environment, consumer manage really

of during very traffic. we also down foot We slow some period, knew that had

in store those than so some do levels. ways kicked and focused And Technology different done to allowed we've the past. of very in in staffing we hard hours on us there and

think they those I so teamwork you it think of on hardship it. if as type us I or of really create any type didn't that they for need the payroll premium created all helped that And things any to look of a the And at lines. the environments in and focused went drive piece pay along

and off hats ran them to off So teams to hats that the that. all

Neil Malkin

Got you.

has Just terms which assume COVID XX% collection, collectibility? like any unit, impact XX%, do looks let's you reserve, when a of collectibility? then normal just given assumptions in COVID, in what that you do the And but there's barely environment? your the from say, whole like for changed So are

Brandon Togashi

Brandon. it's Neil, Yes.

the X% So mentioned percent X.X% earlier, question of to debt a that I bad to revenue. the as Todd had

it's further, hit early escalates age on XX% then of based their around stages up that profile. into And right that is mean I as XXX% out aging when first XX%, you XX% they customer the delinquent quickly equation falls that to so what one XX%, goes a on in And it. to month.

allowed this process, historical the And that's collections. that just haven't seen to X.X% us so dramatic have we on a downside number. throughout change X% to And to

that to saw going fees I down the response during think to attribute that my to across as the do you earlier. see And some so sector. Todd we're And I were we believe think that, of fact still our continue was period, I to the

Some of but them think helped also thing were sense. collections customers charge the those prohibited. fees, our our with I we some did as that lenient, is And worked made right well. can't and we We mandated, of where that with and it

Dave Cramer

a the and occupancy came we have and the at also built teams moved these tenants. get agree. with on. current Would did a could process and agreement were if auction we they really in in some X.X focusing and look where we job us going either And on behind portion may the point good process or get paid They it auctions up say as delayed forward, type of seeing of they them and and working through them helped actually

future. them to have in don't And the so we auction

throughout. really So teams did a good job

Neil Malkin

more that. Yes. It on sounds like just one it and

engages XXX of had pay-to-break with units, If a -- XXX program? units, sorry, actually what that you what's your delinquent percentage

Dave Cramer

going get auction to with any rent, than that to them you. still of And know that's and the And we that contact of moving XX% I have It's those for without these It's portion really, gone, the know percentage can constant We're rent, they really question. by -- don't contact a I in a XX%, us. are of are to tenant. some better tenants, to availability our XX%, have and just the that's pay with we're process no if with we tenants the contact somebody their have take communication we auction. an

is fees a the as the do we've really and and some really really through work and get a far to given can have rent go better out scenario. see a and rent team collection that's reach would what it say these latitude folks because in not for And we cases, and to and so as out we ending. to everyone It's worst-case a rather auction really lose-lose The that. and of

Neil Malkin

Okay.

your your in terms months, demographics? of in sort notable of three a you in-place last kind, any the to way, relative in the any demographics portfolio move-in Over four in of seen have to change

Dave Cramer

at out us jumps that point. this Nothing noticeable. Nothing at all to

Neil Malkin

or you don't which do Okay. at enough point the merchant occupancy And compared one, a has guys your lease-ups is high that But be -- the reticent you know willing there private the then for would it. you last lease enough the guys assets for I would is you're that far that just fact you can gone get NOI to non-stabilized platform juice that would or developer? to and take

Tamara Fischer

but it. we're anywhere may There time, close a not to be

what really and pull of we're on to that's optimize a focused month-to-month. levers revenue, lot We to have

it and long-term I or makes that. that we in holding want to an really from scale location And building us so benefits strategic standpoint in of for where of short as the our way, we're see term something material like being do something the a maybe now, unless to don't property of asset, investment sense

Neil Malkin

right. you, All very much. Thank guys

Operator

Thank our you. like session. or further end back We any I'd for reached question-and-answer over Tammy of floor comments. the the closing to to turn

Tamara Fischer

your fact for we're NSA. in resilience like face to of second and challenging self-storage thank interest that the I'd reiterate, results our again everyone the with And times. quarter its to pleased shows in come feel months things did three healthy. Thanks. Be results. much sector-leading we'll stronger deliver to about we we're confident better and safe will and and stay continue this ago, through than We today

Operator

That does Thank teleconference. today's conclude you.

You thank may day. at for disconnect your and your lines you this wonderful today. a We have participation time,

National Storage Affiliates Trust (NSA) 7 Aug 202020 Q2 Earnings call transcript