Press Releases

Life Storage, Inc. Reports Second Quarter 2022 Results

BUFFALO, N.Y.--(BUSINESS WIRE)-- Life Storage, Inc. (NYSE:LSI), a leading national owner and operator of self-storage properties, reported operating results for the quarter ended June 30, 2022.

Highlights for the Second Quarter Included:

  • Generated net income attributable to common shareholders of $92.3 million, or $1.09 per fully diluted common share.
  • Achieved adjusted funds from operations (“FFO”)(1) per fully diluted common share of $1.65, a 37.5% increase over the same period in 2021.
  • Increased same store revenue by 18.9% and same store net operating income (“NOI”)(2) by 25.4%, year-over-year. Both same store revenue and same store net operating income accelerated from the growth reported in the first quarter of 2022.
  • Acquired 13 stores for $262.6 million, including five stores from the Company’s third-party management platform.
  • Added 17 stores (gross) to the Company’s third-party management platform.

Joe Saffire, the Company’s Chief Executive Officer, stated, “We continue to be on track and well positioned for another strong year. I cannot be more pleased with how our team has performed during this past year with occupancy and strong pricing power supporting 21 straight months of positive rent roll up. Our focus to continually optimize revenue resulted in same store achieved rate growth of 20% when compared to last year, supporting same store revenue growth of 18.9% and same store NOI growth of 25.4% year over year. We achieved significant FFO growth, allowing us to increase our dividend paid in July by 46% from one year ago. We also added scale to key existing markets with the addition of 13 wholly owned stores and 17 stores to our third-party management platform. Our second quarter performance, together with continuing strong fundamentals and our ability to execute on our strategic initiatives, positions us well to continue to grow shareholder value.”

FINANCIAL RESULTS:

In the second quarter of 2022, the Company generated net income attributable to common shareholders of $92.3 million or $1.09 per fully diluted common share, compared to net income attributable to common shareholders of $57.5 million, or $0.74 per fully diluted common share, in the second quarter of 2021.

Funds from operations for the quarter were $1.68 per fully diluted common share compared to $1.22 for the same period last year. Adjusted FFO per fully diluted common share for the quarter was $1.65, after adjusting primarily for a $1.9 million gain on the sale of non-real estate assets, compared to $1.20 for the quarter ended June 30, 2021.

OPERATIONS:

Revenues for the 580 stabilized stores wholly owned by the Company since December 31, 2020 increased 18.9% in the second quarter of 2022 compared to the same quarter of 2021. The increase largely resulted from the impact of a 20.0% increase in realized rental rates with occupancy for the second quarter of 2022 averaging 94.0%.

Same store operating expenses increased 4.3% for the second quarter of 2022 compared to the prior year period, the result of increased office and other expenses, repairs and maintenance, and utilities expenses with payroll and benefits remaining flat. Same store NOI increased 25.4% in the second quarter of 2022 as compared to the second quarter of 2021.

During the second quarter of 2022, the Company achieved double digit same store revenue growth in 32 of its 33 major markets. Overall, the markets with the strongest positive revenue impact were various markets in Florida; Los Angeles, CA; Atlanta, GA; Phoenix, AZ; Buffalo-Upstate, NY; Austin, TX; and Las Vegas, NV.

PORTFOLIO TRANSACTIONS:

Wholly Owned Portfolio

During the quarter, the Company acquired 13 stores in Florida (6), New York (3), California (1), Texas (1), Georgia (1), and Massachusetts (1) for a total purchase price of $262.6 million. One of the New York stores was acquired as a result of the Company’s acquisition of the remaining 14.2% ownership interest in one of its unconsolidated joint ventures. The purchase price of such acquisition included the Company’s net investment to acquire the remaining equity in this joint venture of $5.6 million and the carrying value of the Company’s total equity investment in the joint venture of $30.2 million.

At June 30, 2022, the Company was under contract to acquire seven self-storage facilities in California (4), North Carolina (1), Florida (1), and Nevada (1) for an aggregate purchase price of $137.4 million. Subsequent to June 30, 2022, the Company completed the acquisition of one of these self-storage facilities in North Carolina for a purchase price of $20.0 million. Also subsequent to June 30, 2022, the Company entered into contracts to acquire seven self-storage facilities in Missouri (5), Arizona (1), and Massachusetts (1) for an aggregate purchase price of $140.1 million. The purchases of the remaining facilities are subject to customary conditions to closing, and there is no assurance that any of these facilities will be acquired.

As of the date of this press release, the Company has acquired 32 stores for $634.1 million since January 1, 2022 and is under contract for 13 stores with an aggregate purchase price of $257.5 million of which $60 million is expected to close during 2023.

THIRD-PARTY MANAGEMENT:

The Company continues to aggressively and profitably grow its third-party management platform. During the quarter, the Company added 17 stores (gross). As of quarter end, the Company managed 385 facilities in total, including those in which it owns a noncontrolling interest.

FINANCIAL POSITION:

At June 30, 2022, the Company had approximately $32.6 million of cash on hand, and approximately $197 million available on its line of credit.

Subsequent to June 30, 2022, the Company closed on the refinancing of its existing bank credit facility that was scheduled to mature on March 10, 2023. Through the refinancing, the new facility was increased from $500 million to $1.25 billion through a syndicate of ten banks providing committed liquidity to the Company to January 2027 on terms comparable to or improved from the terms of the existing facility.

Below are key financial ratios at June 30, 2022:

• Debt to Enterprise Value (at $111.66/share)

24.4%

• Debt to Book Cost of Storage Facilities

40.3%

• Debt to Recurring Annualized EBITDA

4.6x

• Debt Service Coverage

5.7x

COMMON STOCK DIVIDEND:

Subsequent to quarter end, the Company’s Board of Directors approved an 8% increase in the quarterly dividend to $1.08 per share, or $4.32 annualized. The dividend was paid on July 26, 2022 to shareholders of record on July 15, 2022.

YEAR 2022 EARNINGS GUIDANCE:

The following assumptions covering operations have been utilized in formulating guidance for 2022:

 

 

Current Guidance

Range

 

Prior Guidance
Range

(May 4, 2022)

Same Store Revenue

 

13.25%

-

14.25%

 

 

10.50%

-

11.50%

Same Store Operating Costs (excluding property taxes)

 

4.50%

-

5.50%

 

 

4.50%

-

5.50%

Same Store Property Taxes

 

6.25%

-

7.25%

 

 

6.25%

-

7.25%

Total Same Store Operating Expenses

 

5.00%

-

6.00%

 

 

5.00%

-

6.00%

Same Store Net Operating Income

 

16.5%

-

17.5%

 

 

13.0%

-

14.0%

General & Administrative

 

$71M

-

$73M

 

 

$69M

-

$71M

 

 

 

 

 

 

 

 

 

 

Expansions & Enhancements

 

$65M

-

$75M

 

 

$65M

-

$75M

Capital Expenditures

 

$30M

-

$35M

 

 

$30M

-

$35M

Wholly Owned Acquisitions

 

$800M

-

$1,000M

 

 

$700M

-

$900M

Joint Venture Investments

 

$75M

-

$125M

 

 

$50M

-

$100M

 

 

 

 

 

 

 

 

 

 

Adjusted Funds from Operations per Share

 

$6.27

-

$6.33

 

 

$6.04

-

$6.14

Reconciliation of Guidance

3Q 2022

Range or Value

FY 2022

Range or Value

Earnings per share attributable to common shareholders - diluted

$1.03 - $1.07

 

$3.98 - $4.04

Plus: real estate depreciation and amortization

0.59 - 0.59

 

2.29 - 2.29

FFO per share

$1.62 - $1.66

 

$6.27 - $6.33

The Company’s 2022 same store pool consists of the 580 stabilized stores wholly owned since December 31, 2020. Forty-five of the stores purchased through June 30, 2022, at certificate of occupancy or that were in the early stages of lease-up are not included, regardless of their current occupancies. The Company believes that occupancy levels achieved during the lease-up period, using discounted rates, are not truly indicative of a new store’s performance, and therefore do not result in a meaningful year-over-year comparison in future years. The Company will include such stores in its same store pool in the second year after the stores achieve 80% sustained occupancy using market rates and incentives.

FORWARD LOOKING STATEMENTS:

When used herein, the words “intends,” “believes,” “expects,” “anticipates,” and similar expressions are intended to identify “forward-looking statements” within the meaning of that term in Section 27A of the Securities Act of 1933 and in Section 21E of the Securities Exchange Act of 1934.

All forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause our actual results, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements. We may also make additional forward-looking statements from time to time. All such subsequent forward-looking statements, whether written or oral, by us or on our behalf, are also expressly qualified by these cautionary statements. All forward-looking statements apply only as of the date made. We undertake no obligation to publicly update or revise forward-looking statements which may be made to reflect events or circumstances after the date made or to reflect the occurrence of unanticipated events.

There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements contained herein. Any forward-looking statements should be considered in light of the risks referenced in the “Risk Factors” section included in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Such factors include, but are not limited to:

  • adverse changes in general economic conditions, the real estate industry and in the markets in which we operate;
  • the effect of competition from new self-storage facilities or other storage alternatives, which would cause rents and occupancy rates to decline;
  • impacts from the COVID-19 pandemic or the future outbreak of other highly infectious or contagious diseases on the U.S., regional and global economies and our financial condition and results of operations;
  • potential liability for uninsured losses and environmental contamination;
  • the impact of the regulatory environment as well as national, state, and local laws and regulations including, without limitation, those governing real estate investment trusts (“REITs”), tenant reinsurance and other aspects of our business, which could adversely affect our results;
  • loss of key personnel;
  • the Company’s ability to evaluate, finance and integrate acquired self-storage facilities on expected terms into the Company’s existing business and operations;
  • the Company’s ability to effectively compete in the industry in which it does business;
  • disruptions in credit and financial markets and resulting difficulties in raising capital or obtaining credit at reasonable rates or at all, which could impede our ability to grow;
  • the Company’s existing indebtedness may mature in an unfavorable credit environment, preventing refinancing or forcing refinancing of the indebtedness on terms that are not as favorable as the existing terms;
  • interest rates may increase, impacting costs associated with the Company’s outstanding floating rate debt, if any, and impacting the Company’s ability to comply with debt covenants;
  • exposure to litigation or other claims;
  • risks associated with breaches of our data security;
  • the regional concentration of the Company's business may subject the Company to economic downturns in the states of Florida and Texas;
  • the Company’s cash flow may be insufficient to meet required payments of operating expenses, principal, interest and dividends; and
  • failure to maintain our REIT status for U.S. federal income purposes, including tax law changes that may change the taxability of future income.

The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. These beliefs, assumptions and expectations are subject to risks and uncertainties and can change as a result of many possible events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity and results of operations may vary materially from those expressed in our forward-looking statements. You should carefully consider these risks before you make an investment decision with respect to our securities.

CONFERENCE CALL:

Life Storage will hold its Second Quarter Earnings Release Conference Call at 9:00 a.m. Eastern Time on Thursday, August 4, 2022. To help avoid connection delays, participants are encouraged to pre-register using this link. Anyone unable to pre-register may access the conference call at 888.506.0062 (domestic) or 973.528.0011 (international); passcode 561992 or request to be joined into the Life Storage call. Management will accept questions from registered financial analysts after prepared remarks; all others are encouraged to listen to the call via webcast by accessing the investor relations tab at lifestorage.com. The webcast will be archived for a period of 90 days; a telephone replay will also be available for 14 days by calling 877.481.4010 and entering passcode 46127.

ABOUT LIFE STORAGE, INC:

Life Storage, Inc. is a self-administered and self-managed equity REIT that is in the business of acquiring and managing self-storage facilities. Located in Buffalo, New York, the Company operates more than 1,100 storage facilities in 36 states. The Company serves both residential and commercial storage customers with storage units rented by month. Life Storage consistently provides responsive service to approximately 675,000 customers, making it a leader in the industry. For more information visit http://invest.lifestorage.com.

 
Life Storage, Inc.
Balance Sheet Data
(unaudited)
 
June 30, December 31,
(dollars in thousands)

 

2022

 

 

2021

 

Assets
Investment in storage facilities:
Land

$

1,266,040

 

$

1,185,976

 

Building, equipment and construction in progress

 

6,468,230

 

 

5,904,481

 

 

7,734,270

 

 

7,090,457

 

Less: accumulated depreciation

 

(1,088,128

)

 

(1,007,650

)

Investment in storage facilities, net

 

6,646,142

 

 

6,082,807

 

Cash and cash equivalents

 

32,639

 

 

171,865

 

Accounts receivable

 

21,136

 

 

17,784

 

Receivable from joint ventures

 

625

 

 

333

 

Investment in joint ventures

 

202,026

 

 

213,003

 

Prepaid expenses

 

11,728

 

 

9,918

 

Intangible asset - in-place customer leases

 

9,152

 

 

13,966

 

Trade name

 

16,500

 

 

16,500

 

Other assets

 

27,236

 

 

30,421

 

Total Assets

$

6,967,184

 

$

6,556,597

 

 
Liabilities
Line of credit

$

303,000

 

$

-

 

Term notes, net

 

2,749,735

 

 

2,747,838

 

Accounts payable and accrued liabilities

 

119,962

 

 

131,778

 

Deferred revenue

 

32,583

 

 

27,277

 

Mortgages payable

 

36,646

 

 

37,030

 

Total Liabilities

 

3,241,926

 

 

2,943,923

 

 
Noncontrolling redeemable Preferred Operating Partnership Units at redemption value

 

90,772

 

 

90,783

 

 
Noncontrolling redeemable Common Operating Partnership Units at redemption value

 

114,125

 

 

142,892

 

 
Equity
Common stock

 

844

 

 

836

 

Additional paid-in capital

 

3,801,203

 

 

3,697,000

 

Accumulated deficit

 

(278,020

)

 

(314,713

)

Accumulated other comprehensive loss

 

(3,666

)

 

(4,124

)

Total Shareholders' Equity

 

3,520,361

 

 

3,378,999

 

Total Liabilities and Shareholders' Equity

$

6,967,184

 

$

6,556,597

 

 
Life Storage, Inc.
Consolidated Statements of Operations
(unaudited)
April 1, 2022 April 1, 2021 January 1, 2022 January 1, 2021
to to to to
(dollars in thousands, except share data) June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021
 
Revenues
Rental income

$

227,239

 

$

163,096

 

$

432,748

 

$

313,379

 

Tenant reinsurance

 

18,257

 

 

13,705

 

 

35,525

 

 

26,324

 

Other operating income

 

5,210

 

 

4,321

 

 

10,068

 

 

8,716

 

Management and acquisition fee income

 

6,340

 

 

6,140

 

 

12,196

 

 

10,730

 

Total operating revenues

 

257,046

 

 

187,262

 

 

490,537

 

 

359,149

 

 
Expenses
Property operations and maintenance

 

42,458

 

 

33,369

 

 

84,827

 

 

67,109

 

Tenant reinsurance

 

6,481

 

 

5,425

 

 

13,328

 

 

10,206

 

Real estate taxes

 

25,356

 

 

20,510

 

 

49,879

 

 

40,397

 

General and administrative

 

18,636

 

 

15,083

 

 

34,502

 

 

29,266

 

Depreciation and amortization

 

42,631

 

 

33,118

 

 

83,426

 

 

64,406

 

Amortization of in-place customer leases

 

5,445

 

 

2,653

 

 

11,050

 

 

4,724

 

Total operating expenses

 

141,007

 

 

110,158

 

 

277,012

 

 

216,108

 

 
Gain on sale of non-real estate assets

 

1,925

 

 

-

 

 

1,965

 

 

-

 

 
Income from operations

 

117,964

 

 

77,104

 

 

215,490

 

 

143,041

 

 
Other income (expense)
Interest expense (A)

 

(25,505

)

 

(20,774

)

 

(49,745

)

 

(41,119

)

Interest and dividend income

 

4

 

 

7

 

 

18

 

 

786

 

Equity in income of joint ventures

 

1,914

 

 

1,428

 

 

4,032

 

 

2,649

 

 
Net income

 

94,377

 

 

57,765

 

 

169,795

 

 

105,357

 

Net income attributable to noncontrolling preferred interests in the Operating Partnership

 

(1,007

)

 

-

 

 

(2,003

)

 

-

 

Net income attributable to noncontrolling common interests in the Operating Partnership

 

(1,106

)

 

(249

)

 

(1,953

)

 

(459

)

Net income attributable to common shareholders

$

92,264

 

$

57,516

 

$

165,839

 

$

104,898

 

 
Earnings per common share attributable to common shareholders - basic

$

1.09

 

$

0.75

 

$

1.98

 

$

1.38

 

 
Earnings per common share attributable to common shareholders - diluted

$

1.09

 

$

0.74

 

$

1.97

 

$

1.37

 

 
Common shares used in basic earnings per share calculation

 

84,270,378

 

 

77,057,520

 

 

83,957,402

 

 

76,222,426

 

 
Common shares used in diluted earnings per share calculation

 

84,428,182

 

 

77,219,999

 

 

84,132,978

 

 

76,365,100

 

 
Dividends declared per common share

$

1.0000

 

$

0.7400

 

$

2.0000

 

$

1.4800

 

 
 
(A) Interest expense for the period ending June 30 consists of the following
Interest expense

$

24,775

 

$

20,171

 

$

48,284

 

$

39,914

 

Amortization of debt issuance costs

 

730

 

 

603

 

 

1,461

 

 

1,205

 

Total interest expense

$

25,505

 

$

20,774

 

$

49,745

 

$

41,119

 

 
Life Storage, Inc.
Computation of Funds From Operations (FFO) (1)
(unaudited)
April 1, 2022 April 1, 2021 January 1, 2022 January 1, 2021
to to to to
(dollars in thousands, except share data) June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021
 
Net income attributable to common shareholders

$

92,264

 

$

57,516

 

$

165,839

 

$

104,898

 

Noncontrolling common interests in the Operating Partnership

 

1,106

 

 

249

 

 

1,953

 

 

459

 

Depreciation of real estate and amortization of intangible
assets exclusive of debt issuance costs

 

47,540

 

 

35,257

 

 

93,406

 

 

68,076

 

Depreciation and amortization from unconsolidated joint ventures

 

2,340

 

 

1,241

 

 

4,143

 

 

2,443

 

Funds from operations allocable to noncontrolling
interest in Operating Partnership

 

(1,697

)

 

(407

)

 

(3,087

)

 

(766

)

Funds from operations available to common shareholders

 

141,553

 

 

93,856

 

 

262,254

 

 

175,110

 

FFO per share - diluted

$

1.68

 

$

1.22

 

$

3.11

 

$

2.29

 

 
Adjustments to FFO
Gain on sale of non-real estate assets

 

(1,925

)

 

-

 

 

(1,965

)

 

-

 

Acquisition fee

 

(132

)

 

(1,280

)

 

(132

)

 

(1,280

)

Funds from operations resulting from non-recurring items
allocable to noncontrolling interest in Operating Partnership

 

24

 

 

5

 

 

24

 

 

5

 

Adjusted funds from operations available to common shareholders

 

139,520

 

 

92,581

 

 

260,181

 

 

173,835

 

Adjusted FFO per share - diluted

$

1.65

 

$

1.20

 

$

3.09

 

$

2.28

 

 
Common shares - diluted

 

84,428,182

 

 

77,219,999

 

 

84,132,978

 

 

76,365,100

 

 
Life Storage, Inc.
Computation of Net Operating Income (2)
(unaudited)
April 1, 2022 April 1, 2021 January 1, 2022 January 1, 2021
to to to to
(dollars in thousands) June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021
 
Net Income

$

94,377

 

$

57,765

 

$

169,795

 

$

105,357

 

General and administrative

 

18,636

 

 

15,083

 

 

34,502

 

 

29,266

 

Depreciation and amortization

 

48,076

 

 

35,771

 

 

94,476

 

 

69,130

 

Interest expense

 

25,505

 

 

20,774

 

 

49,745

 

 

41,119

 

Interest and dividend income

 

(4

)

 

(7

)

 

(18

)

 

(786

)

Equity in income of joint ventures

 

(1,914

)

 

(1,428

)

 

(4,032

)

 

(2,649

)

Net operating income

$

184,676

 

$

127,958

 

$

344,468

 

$

241,437

 

 
Same store (4)

$

135,730

 

$

108,278

 

$

256,277

 

$

207,146

 

Net operating income related to tenant reinsurance

 

11,776

 

 

8,280

 

 

22,197

 

 

16,118

 

Other stores, management fee income, and gain on
sale of non-real estate assets

 

37,170

 

 

11,400

 

 

65,994

 

 

18,173

 

Total net operating income

$

184,676

 

$

127,958

 

$

344,468

 

$

241,437

 

 
Life Storage, Inc.
Quarterly Same Store Data (3) (4) 580 mature stores owned since 12/31/20
(unaudited)
April 1, 2022 April 1, 2021
to to Percentage
(dollars in thousands) June 30, 2022 June 30, 2021 Change Change
 
Revenues:
Rental income

$

183,821

$

154,286

$

29,535

 

19.1

%

Other operating income

 

2,020

 

2,043

 

(23

)

-1.1

%

Total operating revenues

 

185,841

 

156,329

 

29,512

 

18.9

%

 
Expenses:
Payroll and benefits

 

10,374

 

10,375

 

(1

)

0.0

%

Real estate taxes

 

19,954

 

19,420

 

534

 

2.7

%

Utilities

 

3,918

 

3,634

 

284

 

7.8

%

Repairs and maintenance

 

4,925

 

4,565

 

360

 

7.9

%

Office and other operating expense

 

4,872

 

4,199

 

673

 

16.0

%

Insurance

 

1,799

 

1,741

 

58

 

3.3

%

Advertising

 

52

 

52

 

-

 

0.0

%

Internet marketing

 

4,217

 

4,065

 

152

 

3.7

%

Total operating expenses

 

50,111

 

48,051

 

2,060

 

4.3

%

 
Net operating income (2)

$

135,730

$

108,278

$

27,452

 

25.4

%

 
 
QTD Same store move ins

 

59,990

 

56,226

 

3,764

 

 
QTD Same store move outs

 

56,729

 

49,066

 

7,663

 

 
Other Comparable Quarterly Same Store Data (4)
(unaudited)
April 1, 2022 April 1, 2021
to to Percentage
June 30, 2022 June 30, 2021 Change Change
2021 Same store pool (530 stores)
Revenues

$

168,673

$

141,790

$

26,883

19.0

%

Expenses

 

45,521

 

43,434

 

2,087

4.8

%

Net operating income

$

123,152

$

98,356

$

24,796

25.2

%

 
 
2020 Same store pool (514 stores)
Revenues

$

163,535

$

137,309

$

26,226

19.1

%

Expenses

 

43,883

 

42,130

 

1,753

4.2

%

Net operating income

$

119,652

$

95,179

$

24,473

25.7

%

 
Life Storage, Inc.
Year to Date Same Store Data (3) (4) 580 mature stores owned since 12/31/20
(unaudited)
January 1, 2022 January 1, 2021
to to Percentage
(dollars in thousands) June 30, 2022 June 30, 2021 Change Change
 
Revenues:
Rental income

$

353,266

$

300,716

$

52,550

 

17.5

%

Other operating income

 

3,945

 

3,888

 

57

 

1.5

%

Total operating revenues

 

357,211

 

304,604

 

52,607

 

17.3

%

 
Expenses:
Payroll and benefits

 

21,197

 

21,442

 

(245

)

-1.1

%

Real estate taxes

 

39,698

 

38,747

 

951

 

2.5

%

Utilities

 

8,423

 

7,771

 

652

 

8.4

%

Repairs and maintenance

 

10,256

 

9,691

 

565

 

5.8

%

Office and other operating expense

 

9,577

 

8,621

 

956

 

11.1

%

Insurance

 

3,562

 

3,463

 

99

 

2.9

%

Advertising

 

104

 

104

 

-

 

0.0

%

Internet marketing

 

8,117

 

7,619

 

498

 

6.5

%

Total operating expenses

 

100,934

 

97,458

 

3,476

 

3.6

%

 
Net operating income (2)

$

256,277

$

207,146

$

49,131

 

23.7

%

 
 
YTD Same store move ins

 

110,193

 

107,971

 

2,222

 

 
YTD Same store move outs

 

106,680

 

95,626

 

11,054

 

 
Life Storage, Inc.
Other Data - unaudited Same Store (3) All Stores (5)

2022

2021

2022

2021

 
Weighted average quarterly occupancy

94.0%

95.1%

93.5%

94.7%

 
Occupancy at June 30

94.0%

95.6%

93.7%

95.0%

 
Rent per occupied square foot

$18.45

$15.37

$18.21

$15.32

 
 
Life Storage, Inc.
Other Data - unaudited (continued)
 
Investment in Storage Facilities: (unaudited)
The following summarizes activity in storage facilities during the six months ended June 30, 2022:
 
Beginning balance

$

7,090,457

 

Property acquisitions

 

607,856

 

Improvements and equipment additions:
Expansions

 

12,263

 

Roofing, paving, and equipment:
Stabilized stores

 

14,729

 

Recently acquired stores

 

3,282

 

Change in construction in progress (Total CIP $53.9 million)

 

9,279

 

Dispositions and Impairments

 

(3,596

)

Storage facilities at cost at period end

$

7,734,270

 

 
 
Comparison of Selected G&A Costs (unaudited) Quarter Ended
June 30, 2022 June 30, 2021
Management and administrative salaries and benefits

$

11,213

 

$

9,784

 

Training

 

265

 

 

143

 

Call center

 

964

 

 

751

 

Life Storage Solutions costs

 

346

 

 

277

 

Income taxes

 

887

 

 

568

 

Legal, accounting and professional

 

1,412

 

 

893

 

Other administrative expenses (6)

 

3,549

 

 

2,667

 

$

18,636

 

$

15,083

 

 
Net rentable square feet June 30, 2022
Wholly owned properties

 

53,579,937

 

Joint venture properties

 

8,877,327

 

Third party managed properties

 

20,134,342

 

 

82,591,606

 

 
June 30, 2022 June 30, 2021
 
Common shares outstanding

 

84,384,380

 

 

78,041,891

 

Operating Partnership Units outstanding

 

1,041,510

 

 

332,399

 

(1) We believe that Funds from Operations (“FFO”) provides relevant and meaningful information about our operating performance that is necessary, along with net earnings and cash flows, for an understanding of our operating results. FFO adds back historical cost depreciation, which assumes the value of real estate assets diminishes predictably in the future. In fact, real estate asset values increase or decrease with market conditions. Consequently, we believe FFO is a useful supplemental measure in evaluating our operating performance by disregarding (or adding back) historical cost depreciation.
Funds from operations is defined by the National Association of Real Estate Investment Trusts, Inc. (“NAREIT”) as net income available to common shareholders computed in accordance with generally accepted accounting principles (“GAAP”), excluding gains or losses on sales of properties, plus impairment of real estate assets, plus depreciation and amortization and after adjustments to record unconsolidated partnerships and joint ventures on the same basis. We believe that to further understand our performance, FFO should be compared with our reported net income and cash flows in accordance with GAAP, as presented in our consolidated financial statements.
Our computation of FFO may not be comparable to FFO reported by other REITs or real estate companies that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently. FFO does not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of our performance, as an alternative to net cash flows from operating activities (determined in accordance with GAAP) as a measure of our liquidity, or as an indicator of our ability to make cash distributions.
(2) Net operating income or "NOI" is a non-GAAP (generally accepted accounting principles) financial measure that we define as total continuing revenues less continuing property operating expenses. NOI also can be calculated by adding back to net income: interest expense, impairment and casualty losses, operating lease expenses, depreciation and amortization expense, any losses on sale of real estate, acquisition related costs, general and administrative expense, and deducting from net income: income from discontinued operations, interest income, any gains on sale of real estate, and equity in income of joint ventures. We believe that NOI is a meaningful measure to investors in evaluating our operating performance, because we utilize NOI in making decisions with respect to capital allocations, in determining current property values, and in comparing period-to-period and market-to-market property operating results. Additionally, NOI is widely used in the real estate industry and the self-storage industry to measure the performance and value of real estate assets without regard to various items included in net income that do not relate to or are not indicative of operating performance, such as depreciation and amortization, which can vary depending on accounting methods and book value of assets. NOI should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as total revenues, operating income and net income.
(3) Includes the stores owned and/or managed by the Company for the entire periods presented that are consolidated in our financial statements. Does not include unconsolidated joint ventures or other stores managed by the Company.
(4) Revenues and expenses do not include items related to tenant reinsurance.
(5) Does not include unconsolidated joint venture stores or other stores managed by the Company.
(6) Other administrative expenses include office rent, travel expense, investor relations and miscellaneous other expenses.

 

Life Storage, Inc.
Alex Gress
(716) 295-6833
agress@lifestorage.com

Source: Life Storage, Inc.