Quarterly report pursuant to Section 13 or 15(d)

Investment In Storage Facilities

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Investment In Storage Facilities
9 Months Ended
Sep. 30, 2011
Investment In Storage Facilities [Abstract]  
Investment In Storage Facilities
4.

INVESTMENT IN STORAGE FACILITIES

The following summarizes our activity in storage facilities during the nine months ended September 30, 2011.

 

         
(dollars in thousands)       

Cost:

        

  Beginning balance

   $   1,419,956   

  Acquisition of storage facilities

     147,094   

  Improvements and equipment additions

     17,077   

  Net increase in construction in progress

     168   

  Dispositions

     (368)   
    

 

 

 

Ending balance

   $   1,583,927   
    

 

 

 
   

Accumulated Depreciation:

        

  Beginning balance

   $ 271,797   

  Depreciation expense during the period

     25,655   

  Dispositions

     (305)   
    

 

 

 

Ending balance

   $ 297,147   
    

 

 

 

The assets and liabilities of the acquired storage facilities, which primarily consist of tangible and intangible assets, are measured at fair value on the date of acquisition in accordance with the principles of FASB ASC Topic 820, "Fair Value Measurements and Disclosures." The Company measures the fair value of in-place customer lease intangible assets based on the Company's experience with customer turnover. The Company amortizes in-place customer leases on a straight-line basis over 12 months (the estimated future benefit period). During the nine months ended September 30, 2011, the Company acquired 28 self-storage facilities and the purchase price of the facilities was assigned to the fair value of land ($28.8 million), building ($116.2 million), equipment ($2.1 million) and in-place customer leases ($3.4 million). The facilities are located in Georgia (1), Missouri (1), New Jersey (3), Texas (22), and Virginia (1) with a total of 1.9 million net rental square feet. The operating results of the acquired facilities are included in the Company's operations since the acquisition date. The fair values of the assets acquired have been preliminarily determined and are subject to change pending the Company's final analysis of underlying market data used to develop its supporting fair value assumptions. The Company expects to complete this analysis and record any final adjustments to the fair values of the assets acquired during the fourth quarter ended December 31, 2011.