Public Storage Q1 FFO Beats Estimates, Occupancy Falls

Core Insights - Public Storage (PSA) reported first-quarter 2025 core funds from operations (FFO) per share of $4.12, exceeding the Zacks Consensus Estimate of $4.06 and reflecting a 2.2% year-over-year increase from $4.03 [1] - Quarterly revenues reached $1.18 billion, surpassing the Zacks Consensus Estimate of $1.17 billion and also showing a 2.2% year-over-year growth [2] Financial Performance - Same-store revenues increased by 0.1% year over year to $934.5 million, driven by higher realized annual rent per occupied square foot, despite a decline in occupancy [3] - Realized annual rental income per occupied square foot rose by 0.6% to $22.48, while weighted average square foot occupancy decreased by 0.6% to 91.5% [3] - Same-store net operating income (NOI) remained nearly flat at $691.5 million, with an additional $13.5 million in NOI growth from non-same-store facilities due to acquisitions [4] - The same-store direct NOI margin was stable at 77.1%, while interest expenses increased by 6.2% to $72 million [5] Portfolio Activity - In Q1 2025, PSA acquired nine self-storage facilities for $141 million, adding 0.7 million net rentable square feet [6] - Following March 31, 2025, PSA was under contract to acquire five additional facilities for $43.2 million, contributing another 0.4 million net rentable square feet [6] - The company has ongoing development projects expected to add around 2.4 million net rentable square feet at an estimated cost of $492.9 million [7] Balance Sheet Position - As of March 31, 2025, PSA had $287.2 million in cash and equivalents, a decrease from $447.4 million at the end of 2024 [8] 2025 Guidance - PSA reaffirmed its 2025 core FFO per share guidance in the range of $16.35-$17.00, with the Zacks Consensus Estimate at $16.79 [9] - The company anticipates a 1.3% decline to 0.8% growth in same-store revenues and a 2.5% to 4% rise in same-store expenses [10]