PART I. FINANCIAL INFORMATION This section presents the unaudited condensed consolidated financial statements and management's analysis of financial condition and operations [ITEM 1. Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements) This section presents unaudited condensed consolidated financial statements and detailed notes on financial position, performance, and key policies [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheets (dollars in thousands) | ASSETS | June 30, 2020 | December 31, 2019 | | :--------------------------------- | :------------ | :------------------ | | Self storage properties, net | $2,964,626 | $2,753,897 | | Cash and cash equivalents | $17,271 | $20,558 | | Restricted cash | $5,635 | $3,718 | | Investment in unconsolidated real estate ventures | $210,114 | $214,061 | | Other assets, net | $60,927 | $65,441 | | Total assets | $3,285,050 | $3,084,245 | | **LIABILITIES AND EQUITY** | | | | Debt financing | $1,741,544 | $1,534,047 | | Interest rate swap liabilities | $91,175 | $19,943 | | Total liabilities | $1,916,305 | $1,632,144 | | Total equity | $1,368,745 | $1,452,101 | | Total liabilities and equity | $3,285,050 | $3,084,245 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section details the company's revenues, expenses, and net income over specific periods Condensed Consolidated Statements of Operations (in thousands, except per share amounts) | Metric | Three Months Ended June 30, 2020 | Three Months Ended June 30, 2019 | Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | | :----------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenue | $104,417 | $95,419 | $208,639 | $185,991 | | Total operating expenses | $70,357 | $64,189 | $141,537 | $125,761 | | Net income | $17,787 | $17,733 | $33,550 | $30,673 | | Net income (loss) attributable to National Storage Affiliates Trust | $10,422 | $(7,656) | $17,070 | $(245) | | Net income (loss) attributable to common shareholders | $7,148 | $(10,913) | $10,523 | $(6,090) | | Earnings (loss) per share - basic and diluted | $0.10 | $(0.19) | $0.16 | $(0.11) | | Dividends declared per common share | $0.33 | $0.32 | $0.66 | $0.62 | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This section presents the company's comprehensive income or loss, including net income and other comprehensive income items Condensed Consolidated Statements of Comprehensive Income (Loss) (dollars in thousands) | Metric | Three Months Ended June 30, 2020 | Three Months Ended June 30, 2019 | Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | | :---------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $17,787 | $17,733 | $33,550 | $30,673 | | Unrealized loss on derivative contracts | $(10,423) | $(19,075) | $(76,792) | $(27,114) | | Other comprehensive (loss) income | $(6,489) | $(20,352) | $(72,246) | $(29,667) | | Comprehensive income (loss) attributable to National Storage Affiliates Trust | $6,126 | $(20,648) | $(29,519) | $(19,154) | [Condensed Consolidated Statements of Changes in Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity) This section outlines the changes in the company's equity over specific periods, reflecting share issuances and other equity-related transactions - The company issued **8,105,192 common shares** in connection with the mergers of SecurCare and DLAN on March 31, 2020[26](index=26&type=chunk)[69](index=69&type=chunk) - During the six months ended June 30, 2020, the company sold **512,000 common shares** through its ATM program, generating approximately **$16.2 million** in net proceeds[72](index=72&type=chunk)[223](index=223&type=chunk) Total Equity (dollars in thousands) | Date | Total Equity | | :---------------- | :----------- | | June 30, 2020 | $1,368,745 | | December 31, 2019 | $1,452,101 | [Condensed Consolidated Statements of Cash Flows](index=13&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section summarizes the cash inflows and outflows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (dollars in thousands) | Activity | Six Months Ended June 30, 2020 | Six Months Ended June 30, 2019 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net Cash Provided by Operating Activities | $105,683 | $93,475 | | Net Cash Used In Investing Activities | $(243,898) | $(318,073) | | Net Cash Provided By Financing Activities | $136,845 | $227,988 | | (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash | $(1,370) | $3,390 | | Cash, Cash Equivalents and Restricted Cash - End of period | $22,906 | $19,753 | - Acquisition of self storage properties decreased from **$307.8 million** in 2019 to **$239.1 million** in 2020 for the six months ended June 30[32](index=32&type=chunk) - Borrowings under debt financings decreased from **$499.0 million** in 2019 to **$311.0 million** in 2020 for the six months ended June 30[32](index=32&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=15&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information supporting the condensed consolidated financial statements [Note 1. ORGANIZATION AND NATURE OF OPERATIONS](index=15&type=section&id=Note%201.%20ORGANIZATION%20AND%20NATURE%20OF%20OPERATIONS) National Storage Affiliates Trust is a self-administered and self-managed REIT focused on self-storage properties in the top 100 U.S. metropolitan areas, with a significant internalization of its largest PRO - As of June 30, 2020, the Company operated and held ownership interests in **784 self storage properties** located across 35 states and Puerto Rico, comprising approximately **49.2 million rentable square feet** in approximately **394,000 storage units**[42](index=42&type=chunk) - The Company owned **607 consolidated self storage properties** and managed an additional portfolio of **177 properties** owned by its unconsolidated real estate ventures as of June 30, 2020[39](index=39&type=chunk)[41](index=41&type=chunk) - On March 31, 2020, the Company completed the mergers of its largest PRO, SecurCare Self Storage, Inc., and DLAN Corporation, internalizing SecurCare's property management platform and discontinuing related fees and distributions[40](index=40&type=chunk) [Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=15&type=section&id=Note%202.%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This section outlines the key accounting principles and methods used in preparing the financial statements, including consolidation, revenue recognition, and income allocation - The Company consolidates its operating partnership and controlled subsidiaries, including **21 DownREIT partnerships** that are considered VIEs, owning **34 self storage properties**[45](index=45&type=chunk)[47](index=47&type=chunk) - Rental revenue is recognized ratably over the lease term using the straight-line method, with most leases being month-to-month[49](index=49&type=chunk) - The Company allocates GAAP income (

National Storage Affiliates Trust (NYSE:NSA) Q1 2020 Results Conference Call May 12, 2020 1:00 PM ET Company Participants George Hoglund - VP, IR Arlen Nordhagen - Executive Chairman Tamara Fischer - CEO Dave Cramer - COO Brandon Togashi - CFO Conference Call Participants Smedes Rose - Citi Neil Malkin - Capital One Securities Ravi Vaidya - KeyBanc Capital Markets Ian Gaule - SunTrust Robinson Humphrey Ronald Kamdem - Morgan Stanley Stephen Mead - Anchor Capital Advisors Todd Stender - Wells Fargo Operator ...

PR First Quarter 2020 Earnings Release & Supplemental Financial Information NATIONAL STORAGE - AFFILIATES - Table of Contents Page 1 Earnings Release 6 Consolidated Statements of Operations 7 Consolidated Balance Sheets 8 Schedule 1 - Funds From Operations and Core Funds From Operations 10 Schedule 2 - Other Non-GAAP Financial Measurements 11 Schedule 3 - Portfolio Summary 13 Schedule 4 - Debt and Equity Capitalization 15 Schedule 5 - Summarized Information for Unconsolidated Real Estate Ventures 16 Schedul ...

PART I. FINANCIAL INFORMATION [ITEM 1. Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements) Presents unaudited condensed consolidated financial statements for Q1 2020 and 2019, covering balance sheets, operations, comprehensive income, equity, cash flows, and accounting notes [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheet Summary | ASSETS (in thousands) | March 31, 2020 | December 31, 2019 | | :---------------------- | :------------- | :---------------- | | Self storage properties, net | $2,951,322 | $2,753,897 | | Cash and cash equivalents | $18,689 | $20,558 | | Total assets | $3,278,873 | $3,084,245 | | LIABILITIES AND EQUITY (in thousands) | March 31, 2020 | December 31, 2019 | | :---------------------- | :------------- | :---------------- | | Debt financing | $1,731,669 | $1,534,047 | | Interest rate swap liabilities | $84,703 | $19,943 | | Total liabilities | $1,897,818 | $1,632,144 | | Total equity | $1,381,055 | $1,452,101 | | Total liabilities and equity | $3,278,873 | $3,084,245 | - Total assets increased by **$194.6 million** from December 31, 2019, to March 31, 2020, primarily driven by an increase in net self-storage properties[11](index=11&type=chunk) - Total liabilities increased significantly by **$265.7 million**, largely due to an increase in debt financing and interest rate swap liabilities[11](index=11&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations Summary | (in thousands, except per share amounts) | Three Months Ended March 31, 2020 | Three Months Ended March 31, 2019 | | :--------------------------------------- | :-------------------------------- | :-------------------------------- | | Total revenue | $104,222 | $90,572 | | Total operating expenses | $71,180 | $61,572 | | Net income | $15,763 | $12,940 | | Net income attributable to common shareholders | $3,375 | $4,823 | | Earnings per share - basic and diluted | $0.06 | $0.08 | | Dividends declared per common share | $0.33 | $0.30 | - Total revenue increased by **$13.65 million** (**15.1%**) year-over-year, primarily from rental revenue[13](index=13&type=chunk) - Net income attributable to common shareholders decreased by **$1.45 million** (**30.0%**) despite higher total revenue, due to increased operating expenses, depreciation, and interest expense[13](index=13&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) Condensed Consolidated Statements of Comprehensive Income (Loss) Summary | (dollars in thousands) | Three Months Ended March 31, 2020 | Three Months Ended March 31, 2019 | | :--------------------- | :-------------------------------- | :-------------------------------- | | Net income | $15,763 | $12,940 | | Other comprehensive (loss) income | $(65,757) | $(9,315) | | Comprehensive (loss) income attributable to National Storage Affiliates Trust | $(35,645) | $1,494 | - The company reported a comprehensive loss of **$35.65 million** for Q1 2020, a significant decline from a comprehensive income of **$1.49 million** in Q1 2019, primarily due to a substantial unrealized loss on derivative contracts[14](index=14&type=chunk) [Condensed Consolidated Statements of Changes in Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity) - Total equity decreased from **$1,452.1 million** at December 31, 2019, to **$1,381.1 million** at March 31, 2020, primarily due to other comprehensive loss and distributions[20](index=20&type=chunk) - Key changes in equity include the issuance of common shares for the merger and internalization of PRO (**$9.6 million**), and significant distributions to common shareholders (**$19.7 million**) and noncontrolling interests (**$19.8 million**)[20](index=20&type=chunk) - Accumulated other comprehensive loss increased substantially from **$(7.8) million** to **$(52.9) million**, reflecting unrealized losses on derivative contracts[20](index=20&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows Summary | (dollars in thousands) | Three Months Ended March 31, 2020 | Three Months Ended March 31, 2019 | | :--------------------- | :-------------------------------- | :-------------------------------- | | Net Cash Provided by Operating Activities | $50,685 | $46,398 | | Net Cash Used In Investing Activities | $(211,112) | $(143,706) | | Net Cash Provided By Financing Activities | $158,837 | $100,368 | | (Decrease) Increase in Cash, Cash Equivalents and Restricted Cash | $(1,590) | $3,060 | - Operating cash flow increased by **$4.29 million** (**9.2%**) year-over-year, driven by acquisitions[22](index=22&type=chunk) - Investing activities used significantly more cash, increasing by **$67.41 million** (**46.9%**) due to higher self-storage property acquisitions[22](index=22&type=chunk) - Financing activities provided **$58.47 million** (**58.2%**) more cash, primarily from increased borrowings under debt financings[22](index=22&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [1. Organization and Nature of Operations](index=11&type=section&id=1.%20ORGANIZATION%20AND%20NATURE%20OF%20OPERATIONS) - National Storage Affiliates Trust (NSA) is a self-administered and self-managed REIT focused on self-storage properties in the top 100 metropolitan statistical areas in the U.S[27](index=27&type=chunk) - As of March 31, 2020, NSA owned **603** consolidated self-storage properties across **29** states and Puerto Rico, totaling approximately **36.2 million** rentable square feet[29](index=29&type=chunk) - On March 31, 2020, NSA internalized its largest PRO, SecurCare Self Storage, Inc., merging it into wholly-owned subsidiaries, discontinuing supervisory/administrative fees and related subordinated performance unit distributions[30](index=30&type=chunk) [2. Summary of Significant Accounting Policies](index=11&type=section&id=2.%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) - The financial statements are prepared in accordance with GAAP and SEC interim financial reporting rules, with certain information condensed or omitted[33](index=33&type=chunk)[34](index=34&type=chunk) - The Company consolidates its operating partnership and controlled subsidiaries, including **21** DownREIT partnerships identified as Variable Interest Entities (VIEs)[35](index=35&type=chunk)[36](index=36&type=chunk)[37](index=37&type=chunk) - Revenue recognition policies include straight-line recognition for rental income from month-to-month operating leases and recognition of other property-related revenue (e.g., tenant insurance, retail sales) in the period earned[39](index=39&type=chunk)[40](index=40&type=chunk)[41](index=41&type=chunk)[42](index=42&type=chunk) - Net income (loss) is allocated using the hypothetical liquidation at book value (HLBV) method, which can result in disproportionate allocations to unitholders due to liquidation priorities and non-cash items[52](index=52&type=chunk)[53](index=53&type=chunk) - The Company elected to apply hedge accounting expedients under ASU 2020-04 for LIBOR-indexed cash flow derivatives, assuming future hedged transactions match derivative indices to preserve presentation consistency[57](index=57&type=chunk) [3. Shareholders' Equity and Noncontrolling Interests](index=15&type=section&id=3.%20SHAREHOLDERS%27%20EQUITY%20AND%20NONCONTROLLING%20INTERESTS) - On March 31, 2020, the Company issued **8,105,192** common shares in connection with the mergers and internalization of SecurCare and DLAN[58](index=58&type=chunk)[190](index=190&type=chunk) - During Q1 2020, the Company sold **125,000** common shares through its ATM program at an average price of **$36.18** per share, generating **$4.2 million** in net proceeds[60](index=60&type=chunk)[191](index=19

Financial Performance - Q4 2019 - Net income for Q4 2019 was $18.8 million, a 30.0% increase compared to Q4 2018[8, 14] - Core FFO for Q4 2019 was $36.8 million, or $0.40 per share, an 8.1% per share increase compared to Q4 2018[8] - Same store NOI growth for Q4 2019 was 3.8%, driven by a 2.8% increase in same store total revenues, partially offset by a 0.3% increase in same store property operating expenses[8] Financial Performance - Full Year 2019 - Net income for full year 2019 was $66.0 million, a 17.2% increase compared to full year 2018[9] - Core FFO for full year 2019 was $140.5 million, or $1.54 per share, an 11.6% per share increase compared to full year 2018[9] - Same store NOI growth for full year 2019 was 5.0%, driven by a 4.0% increase in same store total revenues, partially offset by a 1.6% increase in same store property operating expenses[9] Investment Activity - Acquired seven wholly-owned self storage properties for $32.2 million during Q4 2019[8] - Acquired 69 wholly-owned self storage properties for $447.8 million during full year 2019[9] - Subsequent to year-end, acquired 34 wholly-owned self storage properties for approximately $205.8 million and two joint venture properties totaling approximately $12.1 million[11] Strategic Initiatives - Internalization of SecurCare Self Storage, Inc, the Company's largest PRO, is expected to close during the second quarter of 2020 and is expected to be accretive to Core FFO per share by approximately $0.03 in 2020, or $0.04 - $0.05 on an annualized basis[7, 10, 26]

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, 2019 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) (State or other jurisdiction of incorporation or ...

Financial Data and Key Metrics Changes - The company reported core FFO per share of $0.40 for Q4 2019, an increase of 8.1% year-over-year [31] - Same-store NOI increased by 3.8% over the prior year, driven by a 2.8% growth in same-store revenues [32] - For the full year 2019, same-store revenue growth was 4%, with property operating expenses growing just 1.6% [33] Business Line Data and Key Metrics Changes - The internalization of SecurCare self-storage, the largest PRO, is expected to be accretive to common shareholders by approximately $0.03 per share in 2020 and about $0.04 to $0.05 per share on an ongoing annual basis [12][29] - Marketing expenses increased by 9% in Q4 compared to the prior year, reflecting increased competition [32][19] Market Data and Key Metrics Changes - Approximately 45% of the company's stores are now impacted by new competitors within a five-mile radius, up from 41% reported last quarter [17] - Leading MSAs for same-store revenue growth include Riverside, San Bernardino, Atlanta, and Las Vegas, while Portland, Phoenix, and Tulsa are lagging due to elevated new supply [22] Company Strategy and Development Direction - The company aims to internalize management of approximately half of its PROs by 2025, with SecurCare being the first to do so [11] - The management transition is expected to be seamless, with Dave Cramer joining as COO to ensure continuity [14][63] Management's Comments on Operating Environment and Future Outlook - The self-storage sector remains in high demand despite increased competition and new supply impacting street rates [16] - The company anticipates that elevated new supply will weigh on revenue growth in 2020, with guidance for core FFO per share of $1.64 to $1.68, implying 7.8% growth at the midpoint [38] Other Important Information - The company has a well-positioned balance sheet with a weighted average cost of debt at 3.5% and a net debt to EBITDA ratio of 5.7 times [36] - The internalization of SecurCare is expected to eliminate approximately $20 million in management fees, generating annualized G&A savings of $2.5 million to $3 million [25][29] Q&A Session Summary Question: Was SecurCare given any preferential treatment during the internalization? - Management confirmed that a special committee of independent trustees oversaw the transaction to ensure high corporate governance standards [40] Question: Does internalizing PROs make it easier to add more externally managed PROs? - Management indicated that internalizing PROs does make it easier to add new ones due to limited capacity for management [41] Question: What have cap rates been doing? - Cap rates for Q4 were in the range of 5.5% to 6%, with expectations that they will not increase significantly [45] Question: What is the net cash impact from the SecurCare transaction? - The transaction is expected to generate approximately $4 million in additional cash flow annually, with G&A savings contributing to overall accretion [72][74] Question: How should property tax growth be viewed in the future? - Management expects property tax expense growth to normalize around 5.5% to 6.5% for 2020, influenced by previous favorable assessments [91] Question: What is the outlook for marketing spend in 2020? - Marketing expenses are projected to grow by 10% to 12% in 2020, reflecting ongoing competitive pressures [92]

PROGRESS Third Quarter 2019 Earnings Release & Supplemental Financial Information NATIONAL STORA GE Table of Contents Page 1 Earnings Release 7 Consolidated Statements of Operations 8 Consolidated Balance Sheets Schedule 1 - Funds From Operations and Core Funds From Operations 9 Schedule 2 - Other Non-GAAP Financial Measurements 11 Schedule 3 - Portfolio Summary 12 Schedule 4 - Debt and Equity Capitalization 14 Schedule 5 - Summarized Information for Unconsolidated Real Estate Ventures 16 Schedule 6 - Same ...

FORM 10-Q [TABLE OF CONTENTS](index=3&type=section&id=TABLE%20OF%20CONTENTS) This section provides an index to the various parts and items included in the Form 10-Q, outlining the structure of the financial information and other disclosures [PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [ITEM 1. Financial Statements](index=4&type=section&id=ITEM%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, including the balance sheets, statements of operations, comprehensive income (loss), changes in equity, and cash flows, along with detailed notes explaining the company's accounting policies and specific financial items [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Presents the company's financial position, detailing assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | Sep 30, 2019 | Dec 31, 2018 | Change | | :-------------------------- | :----------- | :----------- | :----- | | Total Assets | $3,110,797 | $2,729,263 | +$381,534 | | Self storage properties, net | $2,741,903 | $2,391,462 | +$350,441 | | Cash and cash equivalents | $44,749 | $13,181 | +$31,568 | | Total Liabilities | $1,653,591 | $1,326,964 | +$326,627 | | Debt financing | $1,533,936 | $1,278,102 | +$255,834 | | Total Shareholders' Equity | $915,702 | $916,839 | -$1,137 | | Noncontrolling interests | $541,504 | $485,460 | +$56,044 | | Total Equity | $1,457,206 | $1,402,299 | +$54,907 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Details the company's revenues, expenses, and net income (loss) over specific periods, reflecting operational performance Condensed Consolidated Statements of Operations Highlights (in thousands, except per share amounts) | Metric | 3 Months Ended Sep 30, 2019 | 3 Months Ended Sep 30, 2018 | Change (YoY) | 9 Months Ended Sep 30, 2019 | 9 Months Ended Sep 30, 2018 | Change (YoY) | | :-------------------------------------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Total Revenue | $101,337 | $85,382 | +18.7% | $287,328 | $241,598 | +18.9% | | Total Operating Expenses | $68,625 | $57,869 | +18.6% | $194,386 | $168,802 | +15.1% | | Net Income | $16,514 | $16,829 | -1.9% | $47,187 | $41,843 | +12.8% | | Net (Loss) Income attributable to National Storage Affiliates Trust | $(8,860) | $4,394 | -301.7% | $(9,105) | $20,745 | -143.9% | | Earnings (loss) per share - basic and diluted | $(0.20) | $0.03 | -766.7% | $(0.32) | $0.25 | -228.0% | | Dividends declared per common share | $0.32 | $0.29 | +10.3% | $0.94 | $0.86 | +9.3% | [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) Reports net income and other comprehensive income (loss) items, providing a complete view of changes in equity from non-owner sources Condensed Consolidated Statements of Comprehensive Income (Loss) Highlights (in thousands) | Metric | 3 Months Ended Sep 30, 2019 | 3 Months Ended Sep 30, 2018 | Change (YoY) | 9 Months Ended Sep 30, 2019 | 9 Months Ended Sep 30, 2018 | Change (YoY) | | :-------------------------------------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Net income | $16,514 | $16,829 | -1.9% | $47,187 | $41,843 | +12.8% | | Unrealized (loss) gain on derivative contracts | $(17,433) | $3,078 | -666.0% | $(44,547) | $16,733 | -366.1% | | Other comprehensive (loss) income | $(18,372) | $2,479 | -841.8% | $(48,039) | $15,902 | -402.1% | | Comprehensive (loss) income | $(1,858) | $19,308 | -109.6% | $(852) | $57,745 | -101.5% | | Comprehensive (loss) income attributable to National Storage Affiliates Trust | $(20,679) | $5,978 | -446.8% | $(39,833) | $30,577 | -230.3% | [Condensed Consolidated Statements of Changes in Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity) Outlines the changes in each component of shareholders' equity over a period, including net income, share issuances, and distributions - During the nine months ended September 30, 2019, the Company sold **2,375,000 common shares** through its ATM program, generating approximately **$70.6 million** in net proceeds[67](index=67&type=chunk) - The Company also sold **1,785,680 Series A preferred shares** through its ATM program, resulting in approximately **$43.6 million** in net proceeds[67](index=67&type=chunk) - OP equity issued for property acquisitions totaled **$49.8 million** during the nine months ended September 30, 2019, consisting of OP units, Series A-1 preferred units, and subordinated performance units[222](index=222&type=chunk) Key Equity Balances (in thousands) | Metric | Sep 30, 2019 | Dec 31, 2018 | Change | | :-------------------------- | :----------- | :----------- | :----- | | Preferred Shares Amount | $218,178 | $172,500 | +$45,678 | | Common Shares Amount | $593 | $567 | +$26 | | Additional Paid-in Capital | $901,530 | $844,276 | +$57,254 | | Distributions In Excess Of Earnings | $(187,305) | $(114,122) | -$73,183 | | Noncontrolling Interests | $541,504 | $485,460 | +$56,044 | | Total Equity | $1,457,206 | $1,402,299 | +$54,907 | [Condensed Consolidated Statements of Cash Flows](index=16&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Summarizes the cash inflows and outflows from operating, investing, and financing activities, showing changes in cash over a period Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Metric | 9 Months Ended Sep 30, 2019 | 9 Months Ended Sep 30, 2018 | Change (YoY) | | :---------------------------------------- | :-------------------------- | :-------------------------- | :----------- | | Net Cash Provided by Operating Activities | $150,081 | $123,663 | +$26,418 | | Net Cash Used In Investing Activities | $(364,371) | $(460,536) | +$96,165 | | Net Cash Provided By Financing Activities | $248,133 | $340,215 | -$92,082 | | Increase in Cash, Cash Equivalents and Restricted Cash | $33,843 | $3,342 | +$30,501 | | End of period Cash, Cash Equivalents and Restricted Cash | $50,206 | $19,749 | +$30,457 | - Key investing activities for the nine months ended September 30, 2019, included **$342.2 million** for self-storage property acquisitions, **$15.9 million** for capital expenditures, and **$6.6 million** for the acquisition of an interest in a reinsurance company[29](index=29&type=chunk) - Significant financing activities included **$822.0 million** in debt borrowings, **$560.3 million** in debt principal payments, **$70.6 million** from common share issuance, and **$43.6 million** from preferred share issuance[29](index=29&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=18&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Provides detailed explanations and additional information about the figures presented in the condensed consolidated financial statements [Note 1. Organization and Nature of Operations](index=18&type=section&id=1.%20ORGANIZATION%20AND%20NATURE%20OF%20OPERATIONS) Describes the company's business, its primary activities, and its operational structure as a self-administered and self-managed REIT - National Storage Affiliates Trust (NSA) is a self-administered and self-managed REIT focused on the ownership, operation, and acquisition of self-storage properties in top 100 US metropolitan statistical areas[34](index=34&type=chunk)[35](index=35&type=chunk) - As of September 30, 2019, NSA owned **560 consolidated self-storage properties** (**34.1 million rentable square feet**) and managed an additional **175 properties** through unconsolidated real estate ventures (**12.7 million rentable square feet**), totaling **735 properties**[36](index=36&type=chunk)[37](index=37&type=chunk)[38](index=38&type=chunk) [Note 2. Summary of Significant Accounting Policies](index=18&type=section&id=2.%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) Outlines the key accounting principles and methods used in preparing the financial statements, including consolidation, revenue recognition, and new lease standards - The Company consolidates its operating partnership and controlled subsidiaries, including **21 DownREIT partnerships** identified as Variable Interest Entities (VIEs)[40](index=40&type=chunk)[41](index=41&type=chunk)[42](index=42&type=chunk) - Revenue recognition policies include straight-line recognition for rental revenue, recognition in the period earned for other property-related revenue (e.g., tenant insurance, storage supplies), and deferred recognition over four years for certain acquisition fees[43](index=43&type=chunk)[44](index=44&type=chunk)[50](index=50&type=chunk) - Net income (loss) is allocated using the hypothetical liquidation at book value (HLBV) method, which can lead to disproportionate allocations and volatile earnings per share[58](index=58&type=chunk)[59](index=59&type=chunk) - The Company adopted new lease accounting standards (ASU 2016-02 and ASU 2018-11) effective January 1, 2019, requiring on-balance sheet recognition of most leases and reclassifying uncollectible accounts from operating expenses to revenue[63](index=63&type=chunk)[65](index=65&type=chunk) [Note 3. Shareholders' Equity and Noncontrolling Interests](index=22&type=section&id=3.%20SHAREHOLDERS%27%20EQUITY%20AND%20NONCONTROLLING%20INTERESTS) Details the components of shareholders' equity and noncontrolling interests, including share issuances, unit conversions, and their impact on ownership structure - During the nine months ended September 30, 2019, the Company raised approximately **$70.6 million** from common share sales and **$43.6 million** from Series A preferred share sales through its At-the-Market (ATM) program[67](index=67&type=chunk) Noncontrolling Interests Units Outstanding | Unit Type | September 30, 2019 | December 31, 2018 | | :-------------------------------- | :------------------- | :------------------- | | Series A-1 preferred units | 642,982 | 343,719 | | OP units | 30,458,558 | 28,874,103 | | Subordinated performance units | 10,961,146 | 10,749,475 | | LTIP units | 760,173 | 931,671 | | DownREIT OP units | 1,848,261 | 1,834,786 | | DownREIT subordinated performance units | 4,371,622 | 4,386,999 | | Total | 49,042,742 | 47,120,753 | - Changes in units outstanding include increases in Series A-1 preferred units and OP units due to property acquisitions and conversions, and a decrease in LTIP units due to conversions to OP units[71](index=71&type=chunk)[73](index=73&type=chunk)[81](index=81&type=chunk) [Note 4. Self Storage Properties](index=24&type=section&id=4.%20SELF%20STORAGE%20PROPERTIES) Provides a breakdown of the company's self-storage property assets, including land, buildings, and accumulated depreciation, and related expenses Self Storage Properties Summary (in thousands) | Metric | September 30, 2019 | December 31, 2018 | Change | | :-------------------------- | :----------------- | :---------------- | :----- | | Land | $643,524 | $583,455 | +$60,069 | | Buildings and improvements | $2,405,621 | $2,048,281 | +$357,340 | | Total self storage properties | $3,055,597 | $2,637,723 | +$417,874 | | Less accumulated depreciation | $(313,694) | $(246,261) | -$67,433 | | Self storage properties, net | $2,741,903 | $2,391,462 | +$350,441 | - Depreciation expense for self-storage properties increased to **$23.8 million** for the three months ended September 30, 2019 (from $19.2 million in 2018) and to **$68.0 million** for the nine months ended September 30, 2019 (from $56.1 million in 2018)[82](index=82&type=chunk) [Note 5. Investment in Unconsolidated Real Estate Ventures](index=25&type=section&id=5.%20INVESTMENT%20IN%20UNCONSOLIDATED%20REAL%20ESTATE%20VENTURES) Details the company's equity interests in unconsolidated joint ventures and their combined operating performance - The Company holds a **25% equity interest** in the 2018 Joint Venture (**103 properties**) and the 2016 Joint Venture (**72 properties**)[83](index=83&type=chunk)[84](index=84&type=chunk) Combined Condensed Operating Information of Unconsolidated Real Estate Ventures (in thousands) | Metric | 3 Months Ended Sep 30, 2019 | 3 Months Ended Sep 30, 2018 | Change (YoY) | 9 Months Ended Sep 30, 2019 | 9 Months Ended Sep 30, 2018 | Change (YoY) | | :-------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Total revenue | $41,600 | $23,090 | +80.2% | $122,253 | $53,092 | +130.3% | | Net (loss) income | $(4,913) | $966 | -608.5% | $(20,015) | $1,148 | -1843.8% | - The 2016 Joint Venture sold one self-storage property to the Company for **$4.1 million** during the nine months ended September 30, 2019[85](index=85&type=chunk) [Note 6. Self Storage Property Acquisitions and Dispositions](index=26&type=section&id=6.%20SELF%20STORAGE%20PROPERTY%20ACQUISITIONS%20AND%20DISPOSITIONS) Summarizes the company's activities related to acquiring and selling self-storage properties, including transaction values and gains on sales - During the nine months ended September 30, 2019, the Company acquired **62 self-storage properties** for an estimated fair value of **$415.7 million**, including 17 from PROs and one from the 2016 Joint Venture[87](index=87&type=chunk) - The Company sold one self-storage property to an unrelated third party for **$6.5 million**, recognizing a **$2.8 million gain on sale** during the nine months ended September 30, 2019[89](index=89&type=chunk) [Note 7. Other Assets](index=27&type=section&id=7.%20OTHER%20ASSETS) Details various other assets held by the company, such as customer in-place leases, interest rate swaps, and tenant reinsurance intangibles Other Assets Summary (in thousands) | Metric | September 30, 2019 | December 31, 2018 | Change | | :---------------------------------------- | :----------------- | :---------------- | :----- | | Customer in-place leases, net | $5,619 | $4,063 | +$1,556 | | Property acquisition and other deposits | $0 | $20,977 | -$20,977 | | Interest rate swaps | $449 | $16,164 | -$15,715 | | Corporate furniture, equipment and other, net | $8,776 | $1,574 | +$7,202 | | Tenant reinsurance intangible, net | $14,429 | $0 | +$14,429 | | Total | $63,271 | $75,053 | -$11,782 | - Amortization expense for customer in-place leases was **$8.6 million** for the nine months ended September 30, 2019, and for the tenant reinsurance intangible was **$0.2 million** for the three and nine months ended September 30, 2019[91](index=91&type=chunk) [Note 8. Debt Financing](index=28&type=section&id=8.%20DEBT%20FINANCING) Provides information on the company's debt obligations, including credit facilities, term loans, senior unsecured notes, and interest rate swap agreements Outstanding Debt Summary (in thousands) | Metric | September 30, 2019 | December 31, 2018 | Change | | :-------------------- | :----------------- | :---------------- | :----- | | Total principal | $1,539,323 | $1,277,638 | +$261,685 | | Total debt | $1,533,936 | $1,278,102 | +$255,834 | - On July 29, 2019, the Company amended its credit facility, increasing total borrowing capacity by **$255.0 million** to **$1.275 billion**, with an expansion option up to **$1.750 billion**[94](index=94&type=chunk)[214](index=214&type=chunk) - The Company entered into a **$100.0 million 2029 Term Loan Facility** in April 2019 and issued **$150.0 million** in 2029 and 2031 Senior Unsecured Notes in August 2019[101](index=101&type=chunk)[105](index=105&type=chunk) - As of September 30, 2019, the Company had outstanding interest rate swaps with aggregate notional amounts of **$1,125.0 million**, fixing interest rates for its Term Loans[127](index=127&type=chunk) [Note 9. Earnings Per Share](index=31&type=section&id=9.%20EARNINGS%20PER%20SHARE) Explains the calculation of basic and diluted earnings per share, including the impact of income allocation methods and potential common shares Earnings (Loss) Per Share Highlights | Metric | 3 Months Ended Sep 30, 2019 | 3 Months Ended Sep 30, 2018 | Change (YoY) | 9 Months Ended Sep 30, 2019 | 9 Months Ended Sep 30, 2018 | Change (YoY) | | :-------------------------------------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Net (loss) income attributable to common shareholders | $(12,132) | $1,806 | -771.6% | $(18,222) | $12,982 | -240.4% | | Earnings (loss) per share - basic and diluted | $(0.20) | $0.03 | -766.7% | $(0.32) | $0.25 | -228.0% | | Weighted average shares outstanding - basic and diluted | 59,278 | 55,722 | +6.4% | 57,835 | 52,189 | +10.8% | - The hypothetical liquidation at book value (HLBV) method for income allocation can lead to disproportionate income/loss allocation to unitholders and volatile fluctuations in basic and diluted earnings (loss) per share[108](index=108&type=chunk)[109](index=109&type=chunk) - For the three months ended September 30, 2019, **55.2 million potential common shares** were excluded from diluted EPS calculation as they were not dilutive[114](index=114&type=chunk) [Note 10. Related Party Transactions](index=32&type=section&id=10.%20RELATED%20PARTY%20TRANSACTIONS) Discloses transactions with related parties, including fees paid to PROs and the acquisition of an interest in a reinsurance company from an affiliate - The Company incurred **$14.8 million** in supervisory and administrative fees and **$23.8 million** in payroll and related costs reimbursable to its PROs for the nine months ended September 30, 2019[116](index=116&type=chunk)[117](index=117&type=chunk) - On June 1, 2019, the Company acquired a **5.5% ownership interest** in SBOA TI Reinsurance Ltd. from an affiliate of its CEO for **$15.1 million** (cash and OP units), gaining rights to access fees and a share of profits[121](index=121&type=chunk)[122](index=122&type=chunk)[123](index=123&type=chunk) [Note 11. Commitments and Contingencies](index=33&type=section&id=11.%20COMMITMENTS%20AND%20CONTINGENCIES) Addresses potential future obligations and uncertainties, including ongoing litigation, claims, and assessments in the ordinary course of business - The Company is subject to litigation, claims, and assessments in the ordinary course of business, but management believes their final disposition will not have a material adverse effect on its financial position, results of operations, or liquidity[124](index=124&type=chunk) [Note 12. Fair Value Measurements](index=34&type=section&id=12.%20FAIR%20VALUE%20MEASUREMENTS) Details the fair value of financial instruments, particularly interest rate swaps used for hedging, and fixed rate mortgages payable - The Company uses interest rate swap agreements as cash flow hedges to moderate exposure to interest rate risk, effectively converting variable rate debt to fixed rates[126](index=126&type=chunk) Fair Value of Interest Rate Swaps (in thousands) | Metric | Sep 30, 2019 | Dec 31, 2018 | Sep 30, 2018 | | :------------------------------------------------------------------ | :----------- | :----------- | :----------- | | Fair value | $(33,844) | $14,195 | $28,316 | | Unrealized (losses) gains on interest rate swaps in AOCI | $(44,547) | N/A | $16,733 | | Aggregate notional amounts of outstanding interest rate swaps | $1,125,000 | $795,000 | N/A | - The fair value of fixed rate mortgages payable was approximately **$285.0 million** (principal **$264.3 million**) as of September 30, 2019, compared to **$276.5 million** (principal **$268.1 million**) as of December 31, 2018[131](index=131&type=chunk) [Note 13. Leases](index=35&type=section&id=13.%20LEASES) Discusses the impact of new lease accounting standards, including the recognition of right-of-use assets and lease liabilities on the balance sheet - Following the adoption of new lease accounting standards (ASU 2016-02 and ASU 2018-11) effective January 1, 2019, the Company recognizes operating lease right-of-use (ROU) assets of **$23.5 million** and operating lease liabilities of **$24.8 million** on its balance sheet[12](index=12&type=chunk)[132](index=132&type=chunk) Weighted-Average Lease Terms and Discount Rates (September 30, 2019) | Lease Type | Weighted-average remaining lease term | Weighted-average discount rate | | :-------------------------- | :---------------------------------- | :----------------------------- | | Real estate leasehold interests | 29 years | 4.9% | | Office leases | 7 years | 4.1% | - Total future minimum lease payments under operating leases amounted to **$46.8 million** as of September 30, 2019[136](index=136&type=chunk) [ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=ITEM%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations, including an overview of its business, property portfolio, and detailed analysis of revenue and expenses for the three and nine months ended September 30, 2019. It also discusses non-GAAP financial measures, liquidity, and capital resources [Forward-Looking Statements](index=37&type=section&id=Forward-Looking%20Statements) Highlights cautionary language regarding future-oriented information, emphasizing that actual results may differ due to various risks and uncertainties - The report contains forward-looking statements regarding future business, financial condition, liquidity, and results of operations, identified by words such as 'believe,' 'expect,' and 'anticipate'[137](index=137&type=chunk) - These statements are subject to numerous known and unknown risks, uncertainties, and changes in circumstances that may cause actual results to differ significantly[138](index=138&type=chunk) [Overview](index=38&type=section&id=Overview) Provides a high-level introduction to the company's business model as a self-storage REIT and its strategic alignment with Participating Regional Operators - National Storage Affiliates Trust is a self-administered and self-managed REIT focused on owning, operating, and acquiring self-storage properties in top US metropolitan areas[140](index=140&type=chunk) - The company's structure aligns the interests of its Participating Regional Operators (PROs) with shareholders by allowing PROs to participate in financial performance and managed portfolios[141](index=141&type=chunk) [Our Structure](index=38&type=section&id=Our%20Structure) Explains the company's operational framework, emphasizing operator accountability and incentives for co-investment in property acquisitions - The company's structure promotes operator accountability by linking distributions on subordinated performance units to minimum property performance thresholds[142](index=142&type=chunk) - PROs are incentivized to co-invest subordinated equity in acquisitions they source, aligning their interests with the performance of their managed portfolios[142](index=142&type=chunk) [Our PROs](index=39&type=section&id=Our%20PROs) Describes the company's relationship with its Participating Regional Operators and its strategy for platform expansion and operational integration - As of September 30, 2019, the Company had **ten Participating Regional Operators (PROs)**[144](index=144&type=chunk) - The company aims to expand its platform by recruiting additional operators and integrating operations through centralized initiatives to achieve cost savings and economies of scale[144](index=144&type=chunk) [Our Consolidated Properties](index=39&type=section&id=Our%20Consolidated%20Properties) Details the company's portfolio of owned self-storage properties, including their location, size, and recent acquisition activities - The company focuses on owning well-located self-storage properties in high-quality sub-markets with strong cash flows and barriers to entry[145](index=145&type=chunk) - As of September 30, 2019, the company owned **560 self-storage properties** (**34.1 million rentable square feet**) across 29 states and Puerto Rico[146](index=146&type=chunk) - During the nine months ended September 30, 2019, **62 self-storage properties** were acquired for **$415.7 million** (**3.8 million rentable square feet**)[147](index=147&type=chunk) [Our Unconsolidated Real Estate Ventures](index=39&type=section&id=Our%20Unconsolidated%20Real%20Estate%20Ventures) Describes the company's partnerships with institutional investors through joint ventures for acquiring self-storage portfolios - The company partners with institutional investors through unconsolidated joint ventures (2018 JV and 2016 JV) to acquire self-storage portfolios, holding a **25% interest** in each[148](index=148&type=chunk)[149](index=149&type=chunk)[150](index=150&type=chunk) - The 2016 Joint Venture sold one self-storage property to the Company for **$4.1 million** during the nine months ended September 30, 2019[151](index=151&type=chunk) [Our Property Management Platform](index=39&type=section&id=Our%20Property%20Management%20Platform) Explains the role of the property management platform in overseeing daily operations for consolidated properties and unconsolidated ventures, including tenant insurance programs - The property management platform directs day-to-day operations for certain consolidated properties and unconsolidated real estate ventures[152](index=152&type=chunk) - The platform earns customary fees for managing unconsolidated ventures and facilitates tenant insurance programs, receiving half of all proceeds from such programs[152](index=152&type=chunk) [Results of Operations](index=40&type=section&id=Results%20of%20Operations) Analyzes the company's financial performance, detailing revenue and expense trends for both quarterly and year-to-date periods, and the impact of acquisitions - The company acquired **62 self-storage properties** during the nine months ended September 30, 2019, impacting the comparability of historical results[155](index=155&type=chunk) - The same-store portfolio, used for performance analysis, consisted of **439 consolidated self-storage properties** as of September 30, 2019[156](index=156&type=chunk) [Three Months Ended September 30, 2019 compared to the Three Months Ended September 30, 2018](index=40&type=section&id=Three%20Months%20Ended%20September%2030%2C%202019%20compared%20to%20the%20Three%20Months%20Ended%20September%2030%2C%202018) Compares the company's financial performance for the three-month period, highlighting changes in net income, revenue, and key expenses year-over-year - Net income decreased by **$0.3 million** (**1.9%**) to **$16.5 million**, primarily due to increased depreciation, interest expense, G&A, and losses from unconsolidated ventures, partially offset by higher NOI[158](index=158&type=chunk) - Total revenue increased by **$16.0 million** (**18.7%**) to **$101.3 million**, driven by incremental revenue from **69 acquired properties** and regular rental increases[161](index=161&type=chunk) - Same-store rental revenue increased by **3.6%** due to a **3.3% increase** in average annualized rental revenue per occupied square foot and a rise in average occupancy from **89.9% to 90.2%**[162](index=162&type=chunk) - Interest expense increased by **$3.8 million** (**35.4%**) to **$14.4 million**, mainly due to additional term loan borrowings and senior unsecured notes[168](index=168&type=chunk) [Nine Months Ended September 30, 2019 compared to the Nine Months Ended September 30, 2018](index=43&type=section&id=Nine%20Months%20Ended%20September%2030%2C%202019%20compared%20to%20the%20Nine%20Months%20Ended%20September%2030%2C%202018) Compares the company's financial performance for the nine-month period, detailing changes in net income, revenue, and key expenses year-over-year - Net income increased by **$5.4 million** (**12.8%**) to **$47.2 million**, driven by higher NOI from acquisitions and same-store growth, and a gain on property sales, partially offset by increased expenses[172](index=172&type=chunk) - Total revenue increased by **$45.7 million** (**18.9%**) to **$287.3 million**, primarily from **69 acquired properties** and rental increases[175](index=175&type=chunk) - Same-store rental revenue increased by **4.3%** due to a **3.7% increase** in average annualized rental revenue per occupied square foot and a rise in average occupancy from **88.7% to 89.0%**[176](index=176&type=chunk) - Interest expense increased by **$10.8 million** (**35.2%**) to **$41.6 million**, mainly due to additional term loan borrowings and senior unsecured notes[182](index=182&type=chunk) - Gain on sale of self-storage properties increased to **$2.8 million** from $0.4 million, due to the sale of one property[184](index=184&type=chunk) [Non-GAAP Financial Measures](index=46&type=section&id=Non-GAAP%20Financial%20Measures) Presents and reconciles non-GAAP financial measures such as FFO, Core FFO, NOI, EBITDA, and Adjusted EBITDA, used to assess operational performance [FFO and Core FFO](index=46&type=section&id=FFO%20and%20Core%20FFO) Defines and presents Funds from Operations (FFO) and Core FFO, key non-GAAP metrics for evaluating REIT operating performance by excluding certain non-cash and non-recurring items - Funds from Operations (FFO) and Core FFO are supplemental non-GAAP measures used to evaluate operating performance, excluding real estate depreciation, gains/losses from property sales, and other non-core items[187](index=187&type=chunk) FFO and Core FFO Highlights (in thousands, except per share and unit amounts) | Metric | 3 Months Ended Sep 30, 2019 | 3 Months Ended Sep 30, 2018 | Change (YoY) | 9 Months Ended Sep 30, 2019 | 9 Months Ended Sep 30, 2018 | Change (YoY) | | :---------------------------------------------------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | FFO attributable to common shareholders, OP unitholders, and LTIP unitholders | $36,375 | $31,083 | +17.0% | $102,933 | $84,177 | +22.3% | | Core FFO attributable to common shareholders, OP unitholders, and LTIP unitholders | $36,696 | $31,224 | +17.5% | $103,716 | $84,648 | +22.5% | | FFO per share and unit | $0.39 | $0.36 | +8.3% | $1.14 | $1.01 | +12.9% | | Core FFO per share and unit | $0.40 | $0.36 | +11.1% | $1.15 | $1.01 | +13.9% | [NOI](index=48&type=section&id=NOI) Explains and presents Net Operating Income (NOI), a non-GAAP measure used to assess property-level operating performance by excluding corporate-level expenses - Net Operating Income (NOI) is a non-GAAP measure used by management and investors to evaluate property operating performance, excluding general and administrative expenses, depreciation, interest, and other non-property-level items[194](index=194&type=chunk)[195](index=195&type=chunk) Net Operating Income (NOI) Highlights (in thousands) | Metric | 3 Months Ended Sep 30, 2019 | 3 Months Ended Sep 30, 2018 | Change (YoY) | 9 Months Ended Sep 30, 2019 | 9 Months Ended Sep 30, 2018 | Change (YoY) | | :-------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | Net Operating Income | $66,975 | $55,682 | +20.3% | $189,310 | $157,172 | +20.4% | [EBITDA and Adjusted EBITDA](index=49&type=section&id=EBITDA%20and%20Adjusted%20EBITDA) Defines and presents EBITDA and Adjusted EBITDA, non-GAAP measures used to compare performance across periods by excluding non-operating and non-cash items - EBITDA and Adjusted EBITDA are non-GAAP measures used to compare performance across reporting periods by excluding items not indicative of core operating performance, such as interest, taxes, depreciation, and amortization[198](index=198&type=chunk)[199](index=199&type=chunk) EBITDA and Adjusted EBITDA Highlights (in thousands) | Metric | 3 Months Ended Sep 30, 2019 | 3 Months Ended Sep 30, 2018 | Change (YoY) | 9 Months Ended Sep 30, 2019 | 9 Months Ended Sep 30, 2018 | Change (YoY) | | :-------------------- | :-------------------------- | :-------------------------- | :----------- | :-------------------------- | :-------------------------- | :----------- | | EBITDA | $63,964 | $52,190 | +22.6% | $183,638 | $144,010 | +27.5% | | Adjusted EBITDA | $65,438 | $53,558 | +22.2% | $185,182 | $147,103 | +25.9% | [Liquidity and Capital Resources](index=51&type=section&id=Liquidity%20and%20Capital%20Resources) Discusses the company's ability to generate and manage cash, outlining sources of liquidity, capital expenditure plans, and financing activities [Liquidity Overview](index=51&type=section&id=Liquidity%20Overview) Provides a summary of the company's primary sources of liquidity and how it meets its short-term and long-term cash requirements - The company's primary liquidity sources are cash flow from operations, equity and debt offerings, and debt financings[203](index=203&type=chunk) - Short-term liquidity needs are met by operating cash flow, cash on hand, and credit facility borrowings, while long-term needs are funded by operating cash, debt, and equity issuances[204](index=204&type=chunk)[205](index=205&type=chunk) [Cash Flows](index=51&type=section&id=Cash%20Flows) Analyzes the changes in cash from operating, investing, and financing activities, detailing the impact of acquisitions, debt, and equity transactions - Cash provided by operating activities increased by **$26.4 million** to **$150.1 million** for the nine months ended September 30, 2019, primarily due to property acquisitions[208](index=208&type=chunk) - Cash used in investing activities decreased by **$96.1 million** to **$364.4 million**, primarily for **62 self-storage property acquisitions** (**$342.2 million cash consideration**)[209](index=209&type=chunk) - Cash provided by financing activities decreased by **$92.1 million** to **$248.1 million**, reflecting **$822.0 million** in new borrowings and **$560.3 million** in debt repayments[212](index=212&type=chunk) Capital Expenditures by Category (in thousands) | Category | 9 Months Ended Sep 30, 2019 | 9 Months Ended Sep 30, 2018 | | :-------------------------- | :-------------------------- | :-------------------------- | | Recurring capital expenditures | $6,773 | $4,030 | | Value enhancing capital expenditures | $3,386 | $3,149 | | Acquisitions capital expenditures | $6,547 | $7,511 | | Total capital expenditures | $16,706 | $14,690 | [Credit Facility and Term Loan Facilities](index=52&type=section&id=Credit%20Facility%20and%20Term%20Loan%20Facilities) Details the company's credit facility and term loan agreements, including borrowing capacity, outstanding amounts, and financial covenants - The credit facility was amended on July 29, 2019, increasing total borrowing capacity by **$255.0 million** to **$1.275 billion**, with an expansion option up to **$1.750 billion**[213](index=213&type=chunk)[214](index=214&type=chunk) - The company has separate 2023, 2028, and 2029 Term Loan Facilities, with **$175.0 million**, **$75.0 million**, and **$100.0 million** outstanding respectively, all subject to similar financial covenants[215](index=215&type=chunk)[216](index=216&type=chunk)[218](index=218&type=chunk) [2029 And 2031 Senior Unsecured Notes](index=53&type=section&id=2029%20And%202031%20Senior%20Unsecured%20Notes) Provides information on the private placement of senior unsecured notes, including their principal amounts, interest rates, and maturity dates - On August 30, 2019, the operating partnership issued **$100.0 million** of **3.98% senior unsecured notes due 2029** and **$50.0 million** of **4.08% senior unsecured notes due 2031** in a private placement[219](index=219&type=chunk) [Equity Transactions](index=53&type=section&id=Equity%20Transactions) Summarizes the company's equity-related activities, including common and preferred share issuances through its ATM program and OP equity issued for acquisitions - During the nine months ended September 30, 2019, the Company sold **2,375,000 common shares** (**$70.6 million net proceeds**) and **1,785,680 Series A preferred shares** (**$43.6 million net proceeds**) through its ATM program[220](index=220&type=chunk) - The Company issued **$49.8 million of OP equity** for **62 property acquisitions** and **863,148 OP units** upon conversion of **913,680 subordinated performance units**[222](index=222&type=chunk) [Dividends and Distributions](index=54&type=section&id=Dividends%20and%20Distributions) Details the cash dividends declared per common share and OP unit, as well as distributions for preferred shares and subordinated performance unitholders - On August 22, 2019, the board declared a cash dividend of **$0.32 per common share and OP unit**, and cash distributions of **$0.375 per Series A Preferred Share and Series A-1 Preferred Unit**[225](index=225&type=chunk) - Cash distributions of **$9.1 million** were declared for subordinated performance unitholders, all paid on September 30, 2019[225](index=225&type=chunk) [Cash Distributions from our Operating Partnership](index=54&type=section&id=Cash%20Distributions%20from%20our%20Operating%20Partnership) Explains the tiered allocation structure for operating cash flow and capital transaction proceeds to various unitholders of the operating partnership - Operating cash flow is allocated first to OP unitholders for a **6% cumulative preferred allocation**, then to subordinated performance unitholders for a **6% non-cumulative subordinated allocation**, with any remainder allocated equally[227](index=227&type=chunk)[228](index=228&type=chunk)[229](index=229&type=chunk) - Capital transaction proceeds follow a similar tiered allocation structure, with preferred and subordinated allocations based on unreturned capital contributions[232](index=232&type=chunk)[233](index=233&type=chunk)[234](index=234&type=chunk) [Allocation of Capital Contributions](index=56&type=section&id=Allocation%20of%20Capital%20Contributions) Discusses the general partner's right to adjust capital contributions allocated to the operating partnership and subordinated performance units, subject to independent trustee approval - The general partner has the right to adjust capital contributions allocated to the operating partnership and subordinated performance units, subject to approval by a majority of independent trustees[239](index=239&type=chunk) [Off-Balance Sheet Arrangements](index=56&type=section&id=Off-Balance%20Sheet%20Arrangements) Confirms the absence of material off-balance sheet arrangements, guarantees, or funding commitments with unconsolidated entities as of the reporting date - As of September 30, 2019, the Company had no material off-balance sheet arrangements, guarantees, or funding commitments with unconsolidated entities beyond those disclosed in the financial statements[240](index=240&type=chunk) [Seasonality](index=56&type=section&id=Seasonality) Describes the minor seasonal fluctuations in the self-storage business, with higher revenues and occupancy typically occurring from May through September - The self-storage business experiences minor seasonal fluctuations, with higher revenues and profits typically from May through September, and highest occupancy in July, lowest in February[241](index=241&type=chunk) [ITEM 3. Quantitative and Qualitative Disclosures About Market Risk](index=56&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section discusses the company's exposure to market risks, primarily interest rate risk, and its strategies for mitigation, such as the use of interest rate swap agreements - The primary market risk to which the Company is exposed is interest rate risk, which is highly sensitive to governmental monetary policies and economic factors[242](index=242&type=chunk) - The Company uses interest rate swaps to moderate its exposure to interest rate risk by effectively converting variable rate debt to a fixed rate[242](index=242&type=chunk) - As of September 30, 2019, the Company did not have any debt subject to variable interest rates that was not hedged by interest rate swaps[243](index=243&type=chunk) [ITEM 4. Controls and Procedures](index=57&type=section&id=ITEM%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of the company's disclosure controls and procedures and reports no material changes in internal control over financial reporting during the period - Management, including the CEO and CFO, concluded that the Company's disclosure controls and procedures were effective as of the end of the period covered by the report (September 30, 2019)[246](index=246&type=chunk) - There have been no material changes in the Company's internal control over financial reporting during the three months ended September 30, 2019[247](index=247&type=chunk) [PART II. OTHER INFORMATION](index=58&type=section&id=PART%20II.%20OTHER%20INFORMATION) [ITEM 1. Legal Proceedings](index=58&type=section&id=ITEM%201.%20Legal%20Proceedings) This section states that the company is not currently involved in any legal proceedings considered material - The Company is not currently subject to any legal proceedings that it considers to be material[250](index=250&type=chunk) [ITEM 1A. Risk Factors](index=58&type=section&id=ITEM%201A.%20Risk%20Factors) This section refers to the company's Annual Report on Form 10-K for a discussion of potential risks and uncertainties, noting no material changes during the current reporting period - There have been no material changes to the risk factors disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2018, during the nine months ended September 30, 2019[251](index=251&type=chunk) [ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=58&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details unregistered sales of equity securities, including common shares issued for redemption requests and subordinated performance units for property acquisitions, all exempt from registration - During the three months ended September 30, 2019, the operating partnership issued **32,951 common shares** to satisfy redemption requests from certain limited partners[252](index=252&type=chunk) - On September 17, 2019, **28,511 subordinated performance units** were issued to an affiliate of Moove In in exchange for cash related to self-storage property acquisitions[253](index=253&type=chunk) - These issuances were exempt from registration under Section 4(a)(2) of the Securities Act of 1933[256](index=256&type=chunk) [ITEM 3. Defaults Upon Senior Securities](index=58&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) This item is marked as not applicable, indicating no defaults upon senior securities - Not applicable[259](index=259&type=chunk) [ITEM 4. Mine Safety Disclosures](index=58&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is marked as not applicable, indicating no mine safety disclosures - Not applicable[260](index=260&type=chunk) [ITEM 5. Other Information](index=58&type=section&id=ITEM%205.%20Other%20Information) This item is marked as not applicable, indicating no other information to report - Not applicable[261](index=261&type=chunk) [ITEM 6. Exhibits](index=59&type=section&id=ITEM%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including corporate governance documents, credit agreements, and regulatory certifications - Exhibits include Articles of Amendment and Restatement, Bylaws, Articles Supplementary for Preferred Shares, and Specimen Share Certificates[263](index=263&type=chunk) - Key agreements filed are the Second Amended and Restated Credit Agreement and the Third Amendment to Credit Agreement[263](index=263&type=chunk) - Certifications of the Chief Executive Officer and Chief Financial Officer (pursuant to Sarbanes-Oxley Act) and XBRL-related documents are also included[263](index=263&type=chunk) [SIGNATURES](index=60&type=section&id=SIGNATURES) [Signatures](index=60&type=section&id=Signatures) The report is duly signed on behalf of National Storage Affiliates Trust by its Chairman and Chief Executive Officer, Arlen D. Nordhagen, and its President and Chief Financial Officer, Tamara D. Fischer - The report was signed by Arlen D. Nordhagen (Chairman and CEO) and Tamara D. Fischer (President and CFO) on November 1, 2019[266](index=266&type=chunk)

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, 2019 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) (State or other jurisdiction of incorporatio ...