Company Overview - National Storage Affiliates (NSA) is a storage REIT with interests in 1,050 properties across 42 states and Puerto Rico, primarily focused in the Sun Belt region, which accounts for 65% of its locations [3][15] - The largest exposure is in Texas, making up 18.5% of NSA properties [3] Operational Performance - As of June 2024, occupancy was reported at 86.7%, a slight increase from 85.9% at the end of Q1 2024, but down 3% year-over-year, indicating oversupply in the storage market [5][23] - Core FFO was $0.60 per share in Q1 2024, down 9.1% year-over-year, with revenues declining against rising costs, leading to a 3.7% decrease in net operating income (NOI) year-over-year [16] - The full-year NOI growth outlook for 2024 is bleak, with a projected 4% year-over-year decline, and Core FFO expected at about $2.48 per share, down 7.8% year-over-year [17] Financial Metrics - Total revenue growth is projected to decline by 4.0% in 2024, with property operating expenses expected to rise by 3.0% to 5.0% [9] - The company ended Q1 2024 with net debt of $3.2 billion, with 40% of enterprise value funded by debt and 5% by preferred shares [18] - The weighted average cost of debt is 4.1%, with 96% of the debt being fixed rate [10] Market Dynamics - The market-implied cap rate is approximately 7.2%, which is not attractive given the declining occupancy and NOI dynamics [19] - The company is internalizing its participating regional operating structure, which may save $0.03-$0.04 per share in general and administrative expenses, translating to $7.5-$9 million in cumulative savings [20] Strategic Initiatives - After disposals in Q4 2023 and Q1 2024, the company generated $540 million in liquidity, reducing its indebtedness [21] - The company continues to buy back shares, which may increase leverage in the future [21] Investment Considerations - Given the operational underperformance in 2024, the company is expected to face challenges in returning to growth, with the oversupply in the self-storage market likely to persist [23] - Preferred shares (NSA.PR.A) offer a 6.3% yield, well-covered by Core FFO and market capitalization, presenting an alternative investment option [22]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for Q1 2024, highlighting a decrease in total assets to $5.37 billion and a significant increase in net income to $95.1 million, driven by property dispositions [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $5.37 billion as of March 31, 2024, from $5.93 billion, primarily due to property dispositions, resulting in reduced liabilities and equity Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | **$5,366,865** | **$5,931,811** | | Self storage properties, net | $4,877,930 | $4,917,815 | | Assets held for sale, net | $— | $550,199 | | **Total Liabilities** | **$3,419,793** | **$3,805,970** | | Debt financing | $3,285,547 | $3,658,205 | | **Total Equity** | **$1,947,072** | **$2,125,841** | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Total revenue decreased by 5.7% to $196.1 million for Q1 2024, primarily due to property sales, while net income surged to $95.1 million, driven by a $61.2 million gain on property dispositions Q1 2024 vs. Q1 2023 Statement of Operations (in thousands, except per share amounts) | Metric | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Total Revenue | $196,148 | $207,993 | | Total Operating Expenses | $121,191 | $127,935 | | Gain on sale of self storage properties | $61,173 | $— | | **Net Income** | **$95,088** | **$40,392** | | Net Income Attributable to Common Shareholders | $53,917 | $24,997 | | **Earnings per share - diluted** | **$0.65** | **$0.24** | | Dividends declared per common share | $0.56 | $0.55 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities decreased to $94.0 million in Q1 2024, while investing activities generated $567.4 million from property sales, and financing activities used $660.0 million for debt repayments and share repurchases Cash Flow Summary for the Three Months Ended March 31 (in thousands) | Activity | 2024 | 2023 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $94,001 | $109,753 | | Net Cash Provided by (Used In) Investing Activities | $567,399 | $(36,172) | | Net Cash Used In Financing Activities | $(660,013) | $(63,944) | [Notes to Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail accounting policies and financial activities, including property ownership, the formation of a new joint venture, disposition of 95 properties, significant share repurchases, and the use of interest rate swaps to manage debt risk - As of March 31, 2024, the company owned **809** consolidated self storage properties and managed an additional **241** properties through unconsolidated real estate ventures in which it holds a **25%** equity interest[32](index=32&type=chunk)[33](index=33&type=chunk) - In Q1 2024, the company formed a new joint venture (the "2024 Joint Venture") and contributed **56** self storage properties to it[73](index=73&type=chunk)[76](index=76&type=chunk) - During Q1 2024, the company sold **39** properties for net proceeds of **$265.1 million** and contributed **56** properties to the 2024 Joint Venture for net proceeds of **$343.7 million**, recording a total net gain of **$61.2 million**[85](index=85&type=chunk) - The company repurchased **5,491,925** common shares for approximately **$203.5 million** during Q1 2024[60](index=60&type=chunk) - As of March 31, 2024, the company had **$1.23 billion** in notional amount of interest rate swaps designated as cash flow hedges to manage interest rate risk on its variable-rate debt[104](index=104&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section analyzes Q1 2024 financial performance, attributing a 5.7% revenue decrease to property dispositions and lower occupancy, while net income rose due to property sales, and non-GAAP metrics like Core FFO per share declined [Results of Operations](index=31&type=section&id=Results%20of%20Operations) Total revenue decreased by $11.8 million (5.7%) in Q1 2024 due to property sales and lower occupancy, while net income increased significantly to $95.1 million, driven by a $61.2 million gain on property dispositions Q1 2024 vs. Q1 2023 Operating Results (in thousands) | Metric | Q1 2024 | Q1 2023 | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $196,148 | $207,993 | $(11,845) | | Property Operating Expenses | $54,694 | $56,483 | $(1,789) | | Gain on sale of self storage properties | $61,173 | $— | $61,173 | | Net Income | $95,088 | $40,392 | $54,696 | - The decrease in total revenue was primarily driven by the disposition of **39** properties sold to a third party and **56** properties contributed to the 2024 Joint Venture, as well as a decrease in total portfolio average occupancy from **88.6%** to **85.2%** YoY[131](index=131&type=chunk) [Non-GAAP Financial Measures](index=34&type=section&id=Non-GAAP%20Financial%20Measures) Non-GAAP metrics for Q1 2024 show Core FFO per share decreased to $0.60, same-store NOI declined by 3.7% to $124.2 million due to lower rental revenue and higher expenses, and Adjusted EBITDA also decreased to $129.9 million Non-GAAP Performance Metrics (Q1 2024 vs. Q1 2023) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Core FFO per share & unit | $0.60 | $0.66 | | Same Store NOI (in thousands) | $124,216 | $128,998 | | Adjusted EBITDA (in thousands) | $129,927 | $142,716 | - Same-store NOI decreased by **3.7%** YoY. This was caused by a **1.7%** decrease in same-store rental revenue (due to lower occupancy) and a **4.5%** increase in same-store property operating expenses (due to higher insurance and marketing costs)[153](index=153&type=chunk)[154](index=154&type=chunk)[156](index=156&type=chunk) [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2024, the company had **$64.2 million** in cash, using proceeds from property sales to repay **$613.4 million** in debt and repurchase **$203.5 million** in shares, while maintaining a **$1.825 billion** credit facility - Primary uses of cash in Q1 2024 were principal payments on debt of **$613.4 million** and common share repurchases of **$203.5 million**[173](index=173&type=chunk) - Primary sources of cash in Q1 2024 were **$94.0 million** from operations and **$608.8 million** from the sale and contribution of properties[169](index=169&type=chunk)[170](index=170&type=chunk) - As of March 31, 2024, the company had **$805.6 million** of available borrowing capacity under its revolving line of credit[91](index=91&type=chunk)[175](index=175&type=chunk) - On February 15, 2024, the board declared a quarterly dividend of **$0.56** per common share[190](index=190&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=46&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate fluctuations, with **$138.0 million** of unhedged variable-rate debt, where a 100 basis point change would impact annual earnings and cash flows by approximately **$1.4 million** - The company's main market risk exposure is to interest rate fluctuations[206](index=206&type=chunk) - As of March 31, 2024, the company had **$138.0 million** of unhedged variable-rate debt[207](index=207&type=chunk) - A hypothetical **100 basis point (1%)** change in interest rates would affect annual earnings and cash flows by approximately **$1.4 million**[207](index=207&type=chunk) [Controls and Procedures](index=47&type=section&id=ITEM%204.%20Controls%20and%20Procedures) The company's disclosure controls and procedures were deemed effective as of March 31, 2024, with no material changes to internal control over financial reporting reported during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period[209](index=209&type=chunk) - No material changes to internal control over financial reporting occurred during the first quarter of 2024[210](index=210&type=chunk) [PART II. OTHER INFORMATION](index=47&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=47&type=section&id=ITEM%201.%20Legal%20Proceedings) The company is not currently involved in any legal proceedings considered material - As of the filing date, the company is not subject to any material legal proceedings[213](index=213&type=chunk) [Risk Factors](index=47&type=section&id=ITEM%201A.%20Risk%20Factors) This section refers investors to the company's 2023 Annual Report on Form 10-K for a comprehensive discussion of potential risks and uncertainties - For a detailed discussion of risk factors, the company refers to its 2023 Annual Report on Form 10-K[214](index=214&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=47&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q1 2024, the company issued **72,802** common shares to satisfy redemption requests under a registration exemption and repurchased **5,491,925** common shares for approximately **$203.5 million** - During Q1 2024, the company issued **72,802** common shares to satisfy redemption requests from certain limited partners under a registration exemption[215](index=215&type=chunk) Issuer Purchases of Equity Securities (Q1 2024) | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | Jan 1 - Jan 31, 2024 | 856,036 | $38.35 | | Feb 1 - Feb 29, 2024 | 1,817,617 | $36.63 | | Mar 1 - Mar 31, 2024 | 2,818,272 | $36.91 | | **Total** | **5,491,925** | **$37.04** | [Defaults Upon Senior Securities](index=48&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) Not applicable, as the company reports no defaults upon senior securities - Not applicable[220](index=220&type=chunk) [Mine Safety Disclosures](index=48&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) Not applicable, as the company has no mine safety disclosures to report - Not applicable[221](index=221&type=chunk) [Other Information](index=48&type=section&id=ITEM%205.%20Other%20Information) Not applicable, as the company reports no other information - Not applicable[222](index=222&type=chunk) [Exhibits](index=48&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including articles of incorporation, bylaws, officer certifications, and XBRL data files - The report includes standard exhibits such as CEO/CFO certifications under Sarbanes-Oxley Sections 302 and 906, and interactive data files (XBRL)[223](index=223&type=chunk)[225](index=225&type=chunk)

For the quarter ended March 2024, National Storage (NSA) reported revenue of $196.15 million, down 5.7% over the same period last year. EPS came in at $0.60, compared to $0.24 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $194.83 million, representing a surprise of +0.68%. The company delivered an EPS surprise of -1.64%, with the consensus EPS estimate being $0.61.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall ...

National Storage (NSA) came out with quarterly funds from operations (FFO) of $0.60 per share, missing the Zacks Consensus Estimate of $0.61 per share. This compares to FFO of $0.66 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an FFO surprise of -1.64%. A quarter ago, it was expected that this real estate investment trust would post FFO of $0.66 per share when it actually produced FFO of $0.68, delivering a surprise of 3.03%.Over the last four qua ...

Table of Contents Page 1 Earnings Release 7 Consolidated Statements of Operations 8 Consolidated Balance Sheets 9 Schedule 1 - Funds From Operations and Core Funds From Operations 11 Schedule 2 - Other Non-GAAP Financial Measurements 12 Schedule 3 - Portfolio Summary 14 Schedule 4 - Debt and Equity Capitalization 16 Schedule 5 - Summarized Information for Unconsolidated Real Estate Ventures 17 Schedule 6 - Same Store Performance Summary By MSA 19 Schedule 7 - Same Store Operating Data - Trailing Five Quarte ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-37351 National Storage Affiliates Trust (Exact name of Registrant as specified in its charter) Maryland 46-5053858 (State or other jurisdiction ...

Financial Performance - Reported net income of $108.1 million for Q4 2023, an increase of 114.5% compared to Q4 2022, with diluted earnings per share of $0.72[5] - Net income attributable to common shareholders for Q4 2023 was $63.9 million, compared to $27.9 million in Q4 2022, with diluted earnings per share rising to $0.72 from $0.31[35] - Net income for Q4 2023 was $108,056, a 114% increase from $50,377 in Q4 2022[46] - For the year ended December 31, 2023, total revenue reached $214,292 million, resulting in a net income of $29,949 million[66] - Total revenue for the year ended December 31, 2023, was $670,527,000, representing a 2.4% increase compared to $654,529,000 in 2022[76] Funds From Operations (FFO) and Core FFO - Core funds from operations (Core FFO) for Q4 2023 were $83.6 million, or $0.68 per share, a decrease of 4.2% per share compared to Q4 2022[5] - Funds From Operations (FFO) attributable to common shareholders was $83.37 million for Q4 2023, a decrease of 7.8% compared to $89.89 million in Q4 2022[39] - Core FFO per share for the year ended December 31, 2023, was $2.69, down from $2.81 in 2022, reflecting a decline of 4.3%[43] - NSA uses FFO and Core FFO as key performance indicators to evaluate operational performance, excluding items like gains from property sales and depreciation[93] Revenue and Occupancy - Same store total revenues increased by 2.4% for full year 2023, driven by a 6.1% increase in average annualized rental revenue per occupied square foot[13] - Same store net operating income (NOI) decreased by 1.6% in Q4 2023, driven by a negligible increase in total revenues and a 4.8% rise in property operating expenses[5] - Same store period-end occupancy was 86.0% as of December 31, 2023, a decrease of 410 basis points compared to December 31, 2022[5] - Average annualized rental revenue per occupied square foot increased to $16.05 in Q4 2023, up 3.6% from $15.49 in Q4 2022[73] - The average occupancy rate across the same store pool was 87.2% in Q4 2023, down from 91.0% in Q4 2022, reflecting a 3.8% decrease[73] Property Acquisitions and Sales - Acquired 20 wholly-owned self storage properties for approximately $229.5 million during full year 2023, with $113.2 million in preferred shares and $67.3 million in OP equity[8] - Entered into an agreement to sell 71 self storage properties for approximately $540.0 million, with 32 properties sold in December 2023 and 39 properties classified as held for sale[5] - The company plans to acquire self-storage properties with a budget ranging from $100 million to $300 million in 2024[22] - The company reported a gain on the sale of self-storage properties of $63.91 million in 2023, compared to $5.47 million in 2022[39] Debt and Financing - Debt financing rose to $3.66 billion in 2023, an increase of 3% from $3.55 billion in 2022[37] - Total liabilities increased to $3.81 billion in 2023, compared to $3.68 billion in 2022, marking a rise of 3.3%[37] - The weighted average effective interest rate of maturing debt is 3.35%[57] - Net debt to annualized current quarter adjusted EBITDA is 6.1x[60] Dividends and Share Repurchase - The Board declared a quarterly cash dividend of $0.56 per share, a 1.8% increase from Q4 2022, with total dividends for 2023 at $2.23 per share, reflecting a 3.7% increase from 2022[20] - Repurchased 8,836,639 common shares for approximately $310.2 million under the share repurchase program during full year 2023[8] - In Q4 2023, NSA repurchased 852,771 shares for approximately $27.4 million, totaling 8,836,639 shares repurchased for about $310.2 million in the full year[19] Operational Metrics - The company held ownership interests in 1,050 self-storage properties as of December 31, 2023, with approximately 68.6 million rentable square feet[29] - Total stores operated as of December 31, 2023, reached 1,050, with a total of 541,696 units and 68,610,915 rentable square feet, maintaining an occupancy rate of 85.3%[47] - The company reported interest expenses of $45,441 for Q4 2023, compared to $34,633 in Q4 2022, reflecting a 31.5% increase[46] Future Guidance - For 2024, NSA's Core FFO per share guidance is estimated between $2.40 and $2.56, compared to $2.69 for 2023[22] - Total revenue growth for 2024 is projected to decline by 4.0% to 0.0%, while property operating expenses are expected to grow by 3.0% to 5.0%[22]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-37351 National Storage Affiliates Trust (Exact name of Registrant as specified in its charter) Maryland 46-5053858 (State or other jur ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-37351 National Storage Affiliates Trust (Exact name of Registrant as specified in its charter) Maryland 46-5053858 (State or other jurisdic ...

PART I. FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=ITEM%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for Q1 2023, highlighting growth in total assets to **$6.19 billion** and an 11.1% increase in total revenues to **$208.0 million** Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Total Assets** | **$6,185,425** | **$6,070,007** | | Self storage properties, net | $5,731,956 | $5,618,911 | | Cash and cash equivalents | $44,330 | $35,312 | | **Total Liabilities** | **$3,780,351** | **$3,680,993** | | Debt financing | $3,643,585 | $3,551,179 | | **Total Equity** | **$2,405,074** | **$2,389,014** | Condensed Consolidated Statement of Operations Highlights (in thousands, except per share data) | Account | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Total revenue | $207,993 | $187,184 | | Net income | $40,392 | $44,786 | | Net income attributable to common shareholders | $24,997 | $21,949 | | Earnings per share - diluted | $0.24 | $0.24 | Condensed Consolidated Statement of Cash Flows Highlights (in thousands) | Account | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $109,753 | $110,066 | | Net Cash Used In Investing Activities | ($36,172) | ($83,515) | | Net Cash Used In Financing Activities | ($63,944) | ($25,279) | [Note 1. Organization and Nature of Operations](index=12&type=section&id=Note%201.%20Organization%20and%20Nature%20of%20Operations) NSA is a self-administered REIT that owned 932 consolidated and managed 185 unconsolidated self-storage properties as of March 31, 2023, and internalized management of 72 properties from a retiring PRO - As of March 31, 2023, NSA owned **932 consolidated self-storage properties** with approximately **59.3 million rentable square feet**[31](index=31&type=chunk) - The company also managed an additional **185 properties** through its unconsolidated real estate ventures, bringing the total operated portfolio to **1,117 properties** across 42 states and Puerto Rico[33](index=33&type=chunk)[34](index=34&type=chunk) - Effective January 1, 2023, the company internalized the management of **72 properties** and the brand name from its retiring PRO, Move It Self Storage[32](index=32&type=chunk) [Note 3. Shareholders' Equity and Noncontrolling Interests](index=16&type=section&id=Note%203.%20Shareholders%27%20Equity%20and%20Noncontrolling%20Interests) This note details changes in equity, including **$69.3 million** in common share repurchases, issuance of **$139.6 million** in Series B Preferred Shares, and an increase in total noncontrolling interest units to **54.1 million** - Under its share repurchase program, the company repurchased **1,622,874 common shares** for approximately **$69.3 million** during the three months ended March 31, 2023[60](index=60&type=chunk) - On March 16, 2023, the company issued **5,668,128 Series B Preferred Shares** for approximately **$139.6 million** in connection with the acquisition of a 15-property portfolio[63](index=63&type=chunk) Noncontrolling Interest Units | Unit Type | March 31, 2023 | December 31, 2022 | | :--- | :--- | :--- | | OP units | 38,782,420 | 35,737,281 | | Subordinated performance units | 7,532,547 | 8,154,524 | | DownREIT OP units | 2,120,491 | 1,924,918 | | DownREIT subordinated performance units | 4,133,474 | 4,337,111 | | **Total** | **54,071,479** | **51,594,932** | [Note 6. Acquisitions and Dispositions](index=20&type=section&id=Note%206.%20Acquisitions%20and%20Dispositions) In Q1 2023, the company acquired **16 self-storage properties** for **$160.5 million** and Move It's management rights and intellectual property for **$4.7 million** - Acquired **16 self-storage properties** for **$160.5 million** during Q1 2023, all from its PROs[82](index=82&type=chunk) Q1 2023 Acquisition Funding (in thousands) | Funding Source | Amount | | :--- | :--- | | Cash and Acquisition Costs | $9,920 | | Value of Equity Issued | $150,531 | | Other Liabilities Assumed | $85 | | **Total Investment** | **$160,536** | - Acquired Move It's asset management agreements, brand, and intellectual property for **$4.7 million** following its retirement as a PRO[84](index=84&type=chunk) [Note 8. Debt Financing](index=22&type=section&id=Note%208.%20Debt%20Financing) The company's total debt reached **$3.64 billion** as of March 31, 2023, following an amendment to its credit facility that increased borrowing capacity to **$1.955 billion** - Total debt outstanding increased to **$3.64 billion** as of March 31, 2023, from **$3.55 billion** at the end of 2022[87](index=87&type=chunk) - On January 3, 2023, the company amended its credit facility, increasing total borrowing capacity to **$1.955 billion** with an option to expand to **$2.5 billion**[89](index=89&type=chunk) [Note 12. Fair Value Measurements](index=26&type=section&id=Note%2012.%20Fair%20Value%20Measurements) The company uses interest rate swaps to manage variable-rate debt exposure, with **$1.41 billion** in outstanding notional amount as of March 31, 2023 - The company uses interest rate swaps to effectively convert variable-rate debt to a fixed rate, mitigating interest rate risk[105](index=105&type=chunk) - As of March 31, 2023, the company had **17 active interest rate swaps** with a total notional amount of **$1.41 billion** and a weighted average remaining term of approximately **3.2 years**[106](index=106&type=chunk)[108](index=108&type=chunk) [Note 13. Subsequent Events](index=28&type=section&id=Note%2013.%20Subsequent%20Events) Subsequent to quarter-end, the company completed a private placement of **$120.0 million** in senior unsecured notes due July 2028 with a **5.75%** effective interest rate - On April 27, 2023, the company completed a private placement of **$120.0 million** of senior unsecured notes due July 5, 2028, with an effective interest rate of **5.75%**[115](index=115&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=29&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 2023 financial results, highlighting an **11.1%** revenue increase, a **67.6%** rise in interest expense, and **4.8%** same-store NOI growth, alongside liquidity and non-GAAP measures [Results of Operations](index=32&type=section&id=Results%20of%20Operations) Q1 2023 total revenue increased **11.1%** to **$208.0 million** due to acquisitions and higher rental rates, but net income decreased due to a **67.6%** surge in interest expense Q1 2023 vs. Q1 2022 Operating Results (in thousands) | Metric | Q1 2023 | Q1 2022 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $207,993 | $187,184 | $20,809 | 11.1% | | Property Operating Expenses | $56,483 | $49,358 | $7,125 | 14.4% | | Interest Expense | $37,948 | $22,647 | $15,301 | 67.6% | | Net Income | $40,392 | $44,786 | ($4,394) | -9.8% | - The increase in rental revenue was driven by incremental revenue from **49 properties** acquired since April 1, 2022, and a **12.9%** increase in average annualized rental revenue per occupied square foot[137](index=137&type=chunk)[138](index=138&type=chunk) - The significant increase in interest expense was primarily due to additional borrowings and higher interest rates on the company's revolving line of credit[145](index=145&type=chunk) [Non-GAAP Financial Measures](index=35&type=section&id=Non-GAAP%20Financial%20Measures) Core FFO per share decreased to **$0.66**, while the same-store portfolio achieved **4.8%** NOI growth, and Adjusted EBITDA increased to **$142.7 million** FFO and Core FFO per Share and Unit | Metric | Q1 2023 | Q1 2022 | | :--- | :--- | :--- | | FFO per share and unit | $0.64 | $0.67 | | Core FFO per share and unit | $0.66 | $0.68 | Same Store Portfolio Performance (834 properties) | Metric | Q1 2023 vs Q1 2022 Change | | :--- | :--- | | Rental Revenue | +5.7% | | Property Operating Expenses | +8.3% | | **Net Operating Income (NOI)** | **+4.8%** | - Adjusted EBITDA for Q1 2023 was **$142.7 million**, an increase from **$130.2 million** in Q1 2022[168](index=168&type=chunk) [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity includes **$44.3 million** in cash and a **$1.955 billion** credit facility, with Q1 2023 financing activities including **$69.3 million** in share repurchases and **$48.8 million** in dividends - As of March 31, 2023, the company had **$44.3 million** in cash and cash equivalents and **$283.3 million** of available capacity on its revolving line of credit[173](index=173&type=chunk)[180](index=180&type=chunk) - In January 2023, the company amended its credit facility, increasing total borrowing capacity to **$1.955 billion** and extending the revolver's maturity to January 2027[179](index=179&type=chunk) - Major financing activities in Q1 2023 included **$69.3 million** in common share repurchases and **$48.8 million** in dividend payments to common shareholders[178](index=178&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=45&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate exposure on **$715.5 million** of unhedged variable-rate debt, where a **100-basis-point** change would impact annual interest expense by approximately **$7.2 million** - The primary market risk exposure is interest rate risk on variable-rate debt[215](index=215&type=chunk) - As of March 31, 2023, a hypothetical **100 basis point (1%)** change in interest rates would impact annual interest expense by approximately **$7.2 million** on the **$715.5 million** of unhedged variable-rate debt[216](index=216&type=chunk) [Controls and Procedures](index=45&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2023, with no material changes to internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[218](index=218&type=chunk) - No material changes to internal control over financial reporting were identified during the first quarter of 2023[219](index=219&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=46&type=section&id=ITEM%201.%20Legal%20Proceedings) The company is not currently involved in any legal proceedings considered material - The company is not currently subject to any material legal proceedings[222](index=222&type=chunk) [Risk Factors](index=46&type=section&id=ITEM%201A.%20Risk%20Factors) This section updates risk factors, adding a new one concerning adverse developments in the financial services industry that could impact the company's cash access and partner obligations - A new risk factor was added to address potential adverse effects from instability in the financial services industry, such as bank failures or liquidity concerns[225](index=225&type=chunk) - The company's cash deposits at commercial banks exceed the **$250,000** FDIC insurance limit, creating a risk of loss in the event of a bank failure[225](index=225&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q1 2023, the company issued unregistered equity securities, including **67,431 common shares** and **701,646 subordinated performance units**, and repurchased **1,622,874 common shares** for **$69.3 million** - Issued **67,431 common shares** to satisfy redemption requests from limited partners holding OP units[227](index=227&type=chunk) - Issued **701,646 subordinated performance units** to affiliates of its PROs (Guardian and Personal Mini) as partial consideration for property acquisitions[228](index=228&type=chunk) Issuer Purchases of Equity Securities (Q1 2023) | Period | Total Shares Purchased | Average Price Paid Per Share | Total Cost (approx.) | | :--- | :--- | :--- | :--- | | Jan 2023 | — | $— | $— | | Feb 2023 | — | $— | $— | | Mar 2023 | 1,622,874 | $42.65 | $69.3M | | **Total** | **1,622,874** | **$42.65** | **$69.3M** |