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Public Storage

Public StoragePSAEarnings & Financial Report

NYSE · Real Estate · Self-Storage REITs

Public Storage, headquartered in Glendale, California, is a real estate investment trust that invests in self storage. It is the largest brand of self-storage services in the US and owns approximately 9% of the self storage square footage in the U.S. As of December 31, 2024, the company operated 3,073 self-storage facilities containing an aggregate of 221 million net rentable square feet of space.

What changed in Public Storage's 10-K — 2024 vs 2025

Top changes in Public Storage's 2025 10-K

283 paragraphs added · 302 removed · 235 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

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We implemented a bridge lending program in 2024, under which we provide financing to third-party self-storage owners for operating properties that we manage. We generally originate bridge loans that are collateralized by operating self-storage properties, have a term of three or four years with two one-year extensions, and have variable interest rates.
We implemented a lending program in 2024, under which we provide bridge lending financing to third-party self-storage owners for operating properties that we manage. We generally originate bridge loans that are collateralized by operating self-storage properties, have a term of three or four years with two one-year extensions, and have variable interest rates.
These include various laws and regulations concerning environmental matters, labor matters, and employee safety and health matters. Further, our insurance activities are subject to state insurance laws and regulations as determined by the insurance commission for each state in accordance with certain federal regulations.
These include various laws and regulations concerning environmental matters, pricing, labor matters, and employee safety and health matters. Further, our insurance activities are subject to state insurance laws and regulations as determined by the insurance commission for each state in accordance with certain federal regulations.
We maximize revenues through striking the appropriate balance between occupancy and rates for new and existing tenants by regularly adjusting (i) our promotional and other discounts, (ii) the rental rates we charge to new and existing customers, and (iii) our marketing spending and intensity.
We maximize revenues through striking the appropriate balance between occupancy and rates for new and existing tenants by regularly adjusting (i) our promotional and other discounts, (ii) the rental rates we charge to new and existing tenants, and (iii) our marketing spending and intensity.
Other Operations: We manage insurance programs whereby customers at our facilities, including those we manage for third parties, have the option of purchasing insurance from a non-affiliated insurance company to cover certain losses to their stored goods. A wholly-owned, consolidated subsidiary of Public Storage fully reinsures these policies and thereby assumes all risk of losses under the policies.
Other Operations: We manage insurance programs whereby tenants at our facilities, including those we manage for third parties, have the option of purchasing insurance from a non-affiliated insurance company to cover certain losses to their stored goods. A wholly-owned, consolidated subsidiary of Public Storage fully reinsures these policies and thereby assumes all risk of losses under the policies.
Growth and Investment Strategies Our ongoing growth strategies consist of: (i) improving the operating performance of our existing self-storage facilities, (ii) acquiring and developing facilities, and (iii) growing ancillary business activities including tenant reinsurance, third-party management services and a bridge lending program.
Growth and Investment Strategies Our ongoing growth strategies consist of: (i) improving the operating performance of our existing self-storage facilities, (ii) acquiring, expanding and developing facilities, and (iii) growing ancillary business activities including tenant reinsurance, third-party management services and our bridge lending program.
Such statements are based on management’s beliefs and assumptions made based on information currently available to management and may be identified by the use of the words “expects,” “believes,” “anticipates,” “should,” “estimates,” and similar expressions.
Such statements are based on management’s beliefs and assumptions made based on information currently available to management and may be identified by the use of the words “outlook,” “guidance,” “expects,” “believes,” “anticipates,” “should,” “estimates,” and similar expressions.
However, we believe that the economies of scale inherent in this business allow us to operate self-storage facilities at a materially higher level of cash flow per square foot than other operators without our scale. Technology We believe technology enables revenue optimization and cost efficiencies.
However, we believe that the economies of scale inherent in this business allow us to operate self-storage facilities at a materially higher level of cash flow per square foot than other operators without our scale. Technology We believe technology enables improved customer experience, revenue optimization, and cost efficiencies.
Forward-looking statements include statements relating to our 2025 outlook and all underlying assumptions; our expected acquisition, disposition, development, and redevelopment activity; supply and demand for our self-storage facilities; information relating to operating trends in our markets; expectations regarding operating expenses, including property tax changes; expectations regarding the impacts from inflation and changes in macroeconomic conditions; our strategic priorities; expectations with respect to financing activities, rental rates, cap rates, and yields; leasing expectations; our credit ratings; and all other statements other than statements of historical fact.
Forward-looking statements include statements relating to our 2026 guidance and all underlying assumptions, our expected acquisition, disposition, development, and redevelopment activity, supply and demand for our self-storage facilities, information relating to operating trends in our markets, expectations regarding operating expenses, including property tax changes, expectations regarding the impacts from inflation and changes in macroeconomic conditions, our strategic priorities, expectations with respect to financing activities, rental rates, zoning, cap rates, and yields, leasing expectations, our credit ratings, and all other statements other than statements of historical fact.
Grow ancillary business activities: We pursue growth initiatives aimed at increasing our insurance offering coverage for tenants who choose to protect their stored items against loss and desire to maximize their experience. As we grow our self-storage portfolio through acquisition, development and third-party management, we have the opportunity to increase the growth profile of our tenant reinsurance business.
Grow ancillary business activities: We pursue growth initiatives aimed at increasing our insurance offering coverage for tenants who choose to protect their stored items against loss. Additionally, as we grow our self-storage portfolio through acquisition, development and third-party management, we have the opportunity to increase the growth profile of our tenant reinsurance business.
We seek to update the structure, layout, and content of our website regularly to enhance our placement in “unpaid” search in Google and related websites, to improve the efficiency of our bids in “paid” search campaigns, and to maximize users’ likelihood of reserving space on our website. • Our Customer Care Center: Our customer care center is staffed by skilled sales specialists and customer service representatives.
We seek to update the structure, layout, and content of our website regularly to enhance our placement in “unpaid” search in Google and related websites, to improve the efficiency of our bids in “paid” search campaigns and visibility on large language model platforms, and to maximize users’ likelihood of reserving space on our website. • Our Customer Care Center: Our customer care center is staffed by skilled sales specialists and customer service representatives.
We also have live Internet chat augmented with ChatBot capability as another channel for our customers to engage our agents, cost effectively improving customer responsiveness. • Our Properties: Customers can also shop for available space at any one of our facilities.
We also have live Internet chat augmented with ChatBot/Virtual Agent capabilities as another channel for our customers to engage our agents, cost effectively improving customer responsiveness. • Our Properties: Customers can also shop for available space at any one of our facilities.
At December 31, 2024, Shurgard owned and operated 318 self-storage facilities (17 million net rentable square feet) located in seven countries in Western Europe under the Shurgard® name. For all periods presented herein, we have elected to be treated as a REIT, as defined in the Internal Revenue Code of 1986, as amended (the “Code”).
At December 31, 2025, Shurgard owned and operated 332 self-storage facilities (18 million net rentable square feet) located in seven countries in Western Europe under the Shurgard® name. For all periods presented herein, we have elected to be treated as a REIT, as defined in the Internal Revenue Code of 1986, as amended (the “Code”).
Our management Environmental, Social, and Governance Steering Committee (our “Sustainability Committee”) guides our commitment to sustainability and has primary responsibility for climate-related activities. The Sustainability Committee reports to our Board and its committees, which oversee all of our sustainability initiatives. We consider potential environmental impacts—both positive and negative—in our decision making across the business.
Our management Sustainability Committee guides our commitment to sustainability and has primary responsibility for climate-related activities. The Sustainability Committee reports to our Board and its committees, which oversee all of our sustainability initiatives. We consider potential environmental impacts—both positive and negative—in our decision making across the business.
As the largest owner of self-storage facilities, we believe that we own approximately 9% of the self-storage square footage in the U.S. and that collectively the four largest self-storage owners in the U.S. own approximately 20%, with the remaining 80% owned by regional and local operators.
As the largest owner of self-storage facilities, we believe that we own approximately 9% of the self-storage square footage in the U.S. and that collectively the four largest self-storage owners in the U.S. own approximately 22%, with the remaining 78% owned by regional and local operators.
Our facilities compete with nearby self-storage facilities owned by other operators, who use marketing channels, including Internet advertising, signage, and banners, and offer services similar to ours. As a result, competition is significant and affects the occupancy levels, rental rates, rental income, and operating expenses of our facilities.
Our facilities compete with nearby self-storage facilities owned by other operators, who use marketing channels, including internet advertising, signage, and banners, and offer services similar to ours. As a result, competition may be significant and can affect the occupancy levels, rental rates, rental income, and operating expenses of our facilities.
We are the industry leading owner of self-storage properties, with the most recognized brand in the self-storage industry, including our ubiquitous orange color.
We are the industry leading owner of self-storage properties, with one of the most recognized brands in the self-storage industry, including our ubiquitous orange color.
These include changes in demand for our facilities; changes in macroeconomic conditions; changes in national self-storage facility development activity; impacts of natural disasters; adverse changes in laws and regulations including governing property tax, evictions, rental rates, minimum wage levels, and insurance; adverse economic effects from public health emergencies, international military conflicts, or similar events impacting public health and/or economic activity; increases in the costs of our primary customer acquisition channels; adverse impacts to us and our customers from high interest rates, inflation, unfavorable foreign currency rate fluctuations, or changes in federal or state tax laws related to the taxation of REITs; security breaches, including ransomware; or a failure of our networks, systems, or technology.
These include changes in demand for our facilities, changes in macroeconomic conditions, changes in national self-storage facility development activity, impacts from our strategic corporate transformation initiative, impacts of natural disasters, adverse changes in laws and regulations including governing property tax, evictions, rental rates, minimum wage levels, and insurance, adverse economic effects from public health emergencies, international military conflicts, international trade disputes (including threatened or implemented tariffs imposed by the U.S. and threatened or implemented tariffs imposed by foreign countries in retaliation), or similar events impacting public health and/or economic activity, increases in the costs of our primary customer acquisition channels, adverse impacts to us and our customers from high interest rates, inflation, unfavorable foreign currency rate fluctuations, or changes in federal or state tax laws related to the taxation of REITs, security breaches, including ransomware, or a failure of our networks, systems, or technology.
Our third party management business enables us to generate revenues through management fees, expand our presence, increase our economies of scale, promote our brand, and enhance our ability to acquire additional facilities over the medium and long-term as a result of strategic relationships forged with third-party owners.
Our third party management business enables us to generate revenues through management fees, expand our presence, increase our economies of scale, promote our brand, and enhance our ability to acquire additional facilities over the medium and long-term as a result of strategic relationships forged with third-party owners. We also provide bridge lending financing to third-party self-storage owners.
We reinsure all risks in this program but purchase insurance from an independent third-party insurer to cover this exposure for a limit of $15.0 million for losses in excess of $10.0 million per occurrence. At December 31, 2024, there were approximately 1.4 million certificates of insurance held by participating self-storage customers, representing aggregate coverage of approximately $6.8 billion.
We reinsure all risks in this program but purchase insurance from an independent third-party insurer to cover this exposure for a limit of $15.0 million for losses in excess of $10.0 million per occurrence. At December 31, 2025, there were approximately 1.5 million certificates of insurance held by participating self-storage tenants, representing aggregate coverage of approximately $7.2 billion.
At December 31, 2024, we held interests in and consolidated 3,073 self-storage facilities (an aggregate of 221 million net rentable square feet of space) operating under the Public Storage® name.
At December 31, 2025, we held interests in and consolidated 3,171 self-storage facilities (an aggregate of 229 million net rentable square feet of space) operating under the Public Storage® name.
Approximately 83% of our move-ins in 2024 were sourced through our website, and we believe that many of our other customers who reserved directly through our customer care center or arrived at a facility and moved in without a reservation reviewed our pricing and availability online through our website.
We believe that many of our other customers who reserved directly through our customer care center or arrived at a facility and moved in without a reservation reviewed our pricing and availability online through our website.
Human Capital Resources Our employees are the cornerstone of our business and fundamental to our ability to execute our corporate strategies and create long-term value for our stakeholders. Our human capital management strategy focuses on attracting, developing, and retaining the highest quality talent.
Human Capital Resources Our employees are the cornerstone of our business and critical to our ability to execute corporate strategies and deliver long-term value for our stakeholders. Our human capital management strategy focuses on attracting, developing, and retaining exceptional talent.
Our goal is to operate in a responsible and sustainable manner that aligns with our long-term corporate strategy and promotes our best interests along with those of our stakeholders, including our customers, investors, employees, and the communities in which we do business.
Climate Change and Environmental Stewardship We are committed to managing climate-related risks and opportunities. Our goal is to operate in a responsible and sustainable manner that aligns with our long-term corporate strategy and promotes our best interests along with those of our stakeholders, including our customers, investors, employees, and the communities in which we do business.
At December 31, 2024, we had a bridge loan receivable balance of $10.0 million and an unfunded loan commitment of $12.5 million, the closing of which is subject to the satisfaction of certain conditions. We hold a 35% interest in Shurgard Self Storage Limited (“Shurgard”). Shurgard is a public company traded on Euronext Brussels under the “SHUR” symbol.
At December 31, 2025, we had a bridge loan receivable balance of $142.1 million and unfunded loan commitments of $43.9 million, the closing of which is subject to the satisfaction of certain conditions. We hold a 35% interest in Shurgard Self Storage Limited (“Shurgard”). Shurgard is a public company traded on Euronext Brussels under the “SHUR” symbol.
This program not only enables us to earn interest and other fee income but also increases our business in tenant reinsurance and third-party self-storage management and creates opportunities for potential future acquisitions. 4 Compliance with Government Regulations We are subject to various laws, ordinances, and regulations, including various federal, state, and local regulations that apply generally to the ownership of real property and the operation of self-storage facilities.
This program not only enables us to earn interest and other fee income, but we also require the borrower to utilize our third party management program, resulting in additional income from managing the assets and tenant reinsurance. 4 Compliance with Government Regulations We are subject to various laws, ordinances, and regulations, including various federal, state, and local regulations that apply generally to the ownership of real property and the operation of self-storage facilities.
Property managers access the same information that is available on our website and to our customer care center agents and can inform the customer of available space at that site or at our other nearby storage facilities. Property managers are trained to maximize the conversion of such “walk in” shoppers into customers.
Property managers access the same information that is available on our website and to our customer care center agents and can inform the customer of available space at that site or at our other nearby storage facilities.
To gauge the effectiveness of our engagement strategies, we conduct various surveys to assess employee commitment, motivation, and engagement, and to gather feedback. We use this feedback to refine and enhance our policies and programs for our employees. This includes the creation of additional career advancement opportunities and development programs.
To measure the effectiveness of our engagement strategies, we conduct regular surveys to assess employee commitment, motivation, and overall engagement, as well as to gather feedback. We use this feedback to refine and enhance our policies and programs, including to expand opportunities for career development and advancement.
We use various communication channels, including emails, newsletters, videos, virtual and in-person meetings, and town halls, to provide updates on company strategy, performance, employee recognition, and other information. We also provide opportunities for employees to ask questions of our leadership.
We leverage multiple communication channels, including email, newsletters, videos, virtual and in-person meetings, and town halls, to share updates on company strategy, performance, employee recognition, and other key information. We also provide opportunities for employees to engage directly with leadership.
Centralized information network: Our centralized reporting and information network enables us to identify changing market conditions and operating trends and analyze customer data. Our network allows us to quickly change each of our individual property’s pricing and promotions, and drive marketing spending, such as the relative level of bidding for various paid search terms on paid search engines.
Our network allows us to quickly change each of our individual property’s pricing and promotions, drive marketing spending, such as the relative level of bidding for various paid search terms on paid search engines, and staff and respond to customer requests more timely.
Regarding climate, we assess risks and opportunities in conjunction with ongoing operating and risk management processes across the company. We give primary consideration to physical, regulatory, legal, market, and reputational risks. Examples of these risks include heat/water stress, natural disasters, pandemics, temperature change, and regulatory compliance.
We give primary consideration to physical, regulatory, legal, market, and reputational risks. Examples of these risks include heat/water stress, natural disasters, pandemics, temperature change, and regulatory compliance.
At December 31, 2024, we managed 307 facilities for third parties (with approximately 23.3 million net rentable square feet), and were under contract to manage 95 additional facilities including 93 facilities that are currently under construction. In addition, we sell merchandise, primarily locks and cardboard boxes, at our self-storage facilities.
At December 31, 2025, we managed 362 facilities for third parties (with approximately 28.2 million net rentable square feet), and were under contract to manage 84 additional facilities including 78 facilities that are currently under construction. We also offer merchandise for sale at our self-storage facilities, primarily consisting of locks and cardboard boxes, to support customers’ storage needs.
We are expanding the use of in-store kiosks to give customers the options of a full self-service experience or a two-way video assisted service via our existing customer care center. eRental® move-in process: To further enhance the move-in experience, we offer our eRental® process whereby prospective tenants (including those who initially reserved a space) can execute their rental agreement from their smartphone or computer and then go directly to their space on the move-in date.
Property managers are trained to maximize the conversion of such “walk in” shoppers into customers. eRental® move-in process: To further enhance the move-in experience, we offer our eRental® process whereby prospective tenants (including those who initially reserved a space) can execute their rental agreement from their smartphone or computer and then go directly to their space on the move-in date.
We believe that the success of our engagement strategies can also be seen through third party surveys and recognition. Among other recognitions, we are proud again to be named a Great Place to Work® in 2024.
We believe that the success of our engagement strategies can also be seen through third party surveys and recognition.
We achieve these objectives by committing to our employees to provide a diverse and welcoming working environment, regular and transparent communication, competitive compensation, comprehensive benefits, and opportunities for career growth and development.
We accomplish this by committing to our employees to foster a diverse and inclusive workplace, maintain transparent communication, offer competitive compensation and comprehensive benefits, and provide robust opportunities for career growth and professional development.
We measure and monitor our environmental impact and leverage sustainability measures to reduce this impact while achieving cost efficiencies in our operations by implementing a range of energy, water, and waste management initiatives. Many of these initiatives are integrated into our ongoing Property of Tomorrow capital investment program.
We measure and monitor our environmental impact and leverage sustainability measures to reduce this impact while achieving cost efficiencies in our operations by implementing a range of energy, water, and waste management initiatives. Regarding climate, we assess risks and opportunities in conjunction with ongoing operating and risk management processes across the company.
For detailed information regarding such programs and initiatives, including our sustainability efforts, strategies, commitments, and progress, please refer to our 2024 Sustainability Report, which is available on our website at publicstorage.com. The information contained on our website is not a part of, or incorporated by reference into, this Annual Report on Form 10-K.
We have established a greenhouse gas reduction goal which is described in our 2025 Sustainability Report, which is available on our website at publicstorage.com. The information contained on our website, including such report, is not a part of, or incorporated by reference into, this Annual Report on Form 10-K.
Please refer to our Sustainability Report for further information. Seasonality We experience minor seasonal fluctuations in the demand for self-storage space, with demand and rental rates generally higher in the summer months than in the winter months. We believe that these fluctuations result in part from increased moving activity during the summer months. 7
We will continue to utilize our unique competitive advantages in furthering our environmental stewardship efforts and addressing the effects of climate change. Please refer to our Sustainability Report for further information. Seasonality We experience minor seasonal fluctuations in the demand for self-storage space, with demand and rental rates generally higher in the summer months than in the winter months.
In addition to formal training programs, we also offer one-on-one coaching, job shadowing, and mentoring opportunities. 6 Performance Management and Succession Planning Our performance management processes are designed to encourage collaboration between employees and their managers.
In addition to formal programs, we emphasize personalized development through one-on-one coaching, job shadowing, and mentoring opportunities, reinforcing our commitment to employee growth and engagement across all levels of the organization. 6 Performance Management and Succession Planning Our performance management process is designed to foster collaboration between employees and their managers.
We provide a hands-on new employee training program that includes coaching and development. For those new hires in leadership roles, we provide property-level training that exposes them to daily property operations and is intended to help them understand the fundamentals of our business and operations. We also offer numerous career development opportunities for existing employees, including management training programs.
To support their success, we provide a hands-on onboarding program that includes coaching and development. For employees joining in leadership roles, we offer property-level training designed to immerse them in daily operations and build a strong understanding of our business fundamentals.
These programs are intended to provide our employees with the skills, tools, and knowledge they need to be successful in their roles and to contribute to the organization’s success. They are also intended to foster individual growth and strong employee engagement. Most of our new hires join Public Storage as property managers without prior experience in the self-storage industry.
To support their growth and engagement, we provide comprehensive training and development programs across all levels of the organization. These programs are designed to equip employees with the skills, tools, and knowledge essential for success, while promoting personal growth and supporting long-term career progression. Most new hires join Public Storage as Property Managers without prior experience in the self-storage industry.
We publicly disclose our employee health and safety data in our annual Sustainability Report. Training and Development At Public Storage, we offer comprehensive training and development programs at every level of the organization.
To uphold this commitment, we conduct monthly safety training at all properties and annual safety training at our corporate headquarters. In addition, we publicly disclose employee health and safety data in our annual Sustainability Report. Training and Development At Public Storage, we recognize that our people are the foundation of our success.
We publicly disclose our annual Consolidated EEO-1 report, which reflects the race, ethnicity, and gender composition of our workforce, on the Investor Relations section of our website. 5 Communication and Engagement Given the geographically dispersed nature of our business, maintaining regular and clear communication is essential to ensuring that our employees feel informed, included, valued, and engaged.
Our dedication to excellence and hiring top talent has cultivated an inclusive workforce that reflects the diversity of the customers we serve. 5 Communication and Engagement Given the geographically dispersed nature of our business, maintaining clear and consistent communication is essential to ensuring employees feel informed, included, and engaged.
We believe that this approach, together with the core principles of our corporate culture, doing the right thing and upholding integrity in all that we do, promotes employee engagement and a commitment to Public Storage.
Guided by our core principles of doing the right thing and upholding integrity in all that we do, we believe this approach strengthens employee engagement and commitment to Public Storage. We have approximately 5,770 employees, including 4,920 customer facing roles (such as property level and customer care center personnel), 410 field management employees, and 440 employees in our corporate operations.
We have also been recognized by Comparably, Inc. as a “Choice Employer” with an “A+” Culture Score based on employee responses across 18 culture metrics, among other recognitions. Compensation, Health, Wellness, and Safety Public Storage maintains compensation and benefits programs designed to incentivize, reward, and support our employees.
In 2025, we were proud to be named a Great Place to Work® for the fourth year in a row and recognized by Comparably, Inc. as a “Choice Employer” with an “A+” Culture Score based on employee feedback across 18 culture metrics, among other recognitions.
We offer affordable health plans and programs to virtually all our employees. Our full-time employees are eligible to participate in our comprehensive range of benefits, which include medical, dental, vision, flexible and health savings accounts, discount programs, income protection plans, and our 401(k) plan.
Full-time employees have access to a comprehensive suite of benefits, including medical, dental, and vision coverage, flexible spending and health savings accounts, income protection plans, and retirement benefits through our 401(k) plan. We complement these with employee support programs, including mental health, life planning tools, and discount programs for fitness, legal services, and home, auto, and pet insurance.
Approximately 70% of customers utilized our eRental® and Rent by Phone process during 2024. 3 Public Storage App: We maintain an industry leading customer smartphone application. The Public Storage App provides our customers with digital access to our properties, as well as payment and other account management functions.
Nearly three quarters of our new rental agreements were completed by customers using our eRental® and Rent by Phone process during 2025. Public Storage App: We maintain an industry leading smartphone application.
Together, employees and managers work to plan, monitor, and review the employee’s objectives and career aspirations, establishing and holding employees accountable to both short- and long-term goals that align with the Company’s strategy. This is a continuous process intended to provide regular opportunities for employees and their managers to share and receive feedback.
Together, they plan, monitor, and review objectives and professional growth goals, establishing accountability for short and long-term goals aligned with the Company’s strategy. This continuous process provides regular opportunities for feedback and dialogue to support employee development. Succession planning remains a priority for management and the Board, and is considered critical to ensuring business continuity and supporting long-term growth.
This includes a path for our property level employees to move into management and leadership roles and advance their careers within the Company. Many of our training and career development programs use our online learning platform of training courses and reference materials.
Beyond onboarding, we provide extensive career development opportunities for existing employees, including management training programs that create pathways for advancement into leadership roles. Many of these programs leverage our online learning platform, which provides a wide range of courses and reference materials for continuous learning.
Inclusive Culture We are committed to creating a workplace that values people with a wide range of backgrounds, where every employee feels valued and able to be their authentic self as part of our best-in-class team. Public Storage hires based on skills, personality, and experience, without regard to age, gender, race, ethnicity, religion, sexual orientation, or other protected characteristic.
Information contained on our website, including such report, is not part of, nor incorporated by reference into, this Annual Report on Form 10-K. Inclusive Culture We are committed to fostering a workplace that values individuals from diverse backgrounds, where every employee feels valued and able to bring their authentic self to our best-in-class team.
We believe that employee compensation should align with our short- and long-term performance goals and provide competitive compensation and incentives needed to attract, motivate, and retain employees who are crucial to our success. We tailor our compensation programs to each employee group to ensure market competitiveness and enhance overall employee engagement.
Compensation, Health, Wellness, and Safety Public Storage offers comprehensive compensation and benefits programs designed to incentivize, reward, and support our employees. We believe compensation should align with both short and long-term performance objectives while remaining competitive to attract, motivate, and retain the talent essential to our success.
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The high level of ownership fragmentation in the industry is partially attributable to the relative simplicity of managing a local self-storage facility, such that small-scale owners can operate self-storage facilities at a basic level of profitability without significant managerial or operational infrastructure.
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The Public Storage App provides our tenants with digital access to our properties, as well as payment and other account management functions. 3 Centralized information network: Our centralized reporting and information network enables us to identify changing market conditions and operating trends and analyze tenants data.
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In 2024 we implemented a bridge lending program, under which we provide financing to third-party self-storage owners for operating properties that we manage.
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The following is an overview of our key programs and initiatives aimed at attracting, developing, and retaining top talent. For comprehensive details on these programs, including our sustainability efforts, strategies, commitments, and progress, please refer to our 2025 Sustainability Report, which is available on our website at publicstorage.com.
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We have approximately 5,900 employees, including 5,120 customer facing roles (such as property level and customer care center personnel), 340 field management employees, and 440 employees in our corporate operations. The following is an overview of our key programs and initiatives focused on attracting, developing, and retaining the highest quality talent.
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Public Storage hires based on skills, experience, and character, without regard to age, gender, race, ethnicity, religion, sexual orientation, or any other protected characteristic. We maintain policies regarding equal opportunity, pay-for-performance, discrimination, harassment, and labor (including opposition to child and compulsory labor).
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We maintain policies regarding equal opportunity, pay-for-performance, discrimination, harassment, and labor (including opposition to child and compulsory labor). Our commitments to excellence and hiring “the best” have fostered an inclusive team that reflects the diversity of the customers we serve.
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Our compensation programs are tailored to specific job groups to ensure market competitiveness and strengthen overall engagement. Our benefits program offers flexibility, affordability, and meaningful support, enabling employees to choose options that best fit their lives and goals.
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Additionally, we maintain various employee support programs, including access to counseling, life planning tools, and discount programs for fitness, legal services, and home, auto, and pet insurance. Finally, we offer educational resources and tools, including a dedicated health and wellness website, to encourage employees to maintain a healthy and balanced lifestyle.
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We continuously evaluate feedback from our team to refine and enhance our offerings, ensuring they reflect both the changing needs of our workforce and our dedication to fostering a positive, healthy work environment. We are committed to providing safe self-storage facilities for both customers and employees.
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We periodically consider employee feedback received through our engagement processes in the composition and design of our compensation and benefits programs. We are committed to providing safe self-storage facilities for our customers and employees. We conduct monthly safety training at all our properties and an annual safety training at our headquarters.
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Throughout the year, the executive team reviews the Company’s succession bench strength, evaluates talent, and recommends strategies to develop and prepare future leaders. This proactive approach to talent management is designed to provide employees with opportunities to grow beyond their current roles and responsibilities, strengthening our leadership pipeline and enhancing the Company’s long-term stability and adaptability.
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Succession planning is a priority for management and our Board and is viewed as critical to ensuring business continuity and supporting the Company’s long-term growth and success. Periodically throughout each year, the executive team meets to review and assess the Company’s succession bench strength, evaluate talent, and make recommendations for developing and preparing future leaders within the organization.
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We believe that these fluctuations result in part from increased moving activity during the summer months. 7
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This collaborative approach to talent management works to ensure that employees are given opportunities to grow beyond their current roles and responsibilities. Climate Change and Environmental Stewardship We are committed to managing climate-related risks and opportunities.
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We have established a combined scope 1 and 2 greenhouse gas reduction goal. Our target is to achieve a 45% reduction in utility-based emissions, calculated on an intensity basis, no later than 2032, based on a 2022 baseline. We will continue to utilize our unique competitive advantages in furthering our environmental stewardship efforts and addressing the effects of climate change.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Our existing relationship with our legacy joint venture partner may place further contractual limitations on our ability to sell all of the shares we own if we desired to do so. • Impediments of Shurgard’s public ownership structure: Shurgard’s strategic decisions, involving activities such as borrowing money, capital contributions, raising capital from third parties, and selling or acquiring significant assets, are determined by its board of directors.
Our existing relationship with our legacy joint venture partner may place further contractual limitations on our ability to sell all of the shares we own if we desired to do so. 10 • Impediments of Shurgard’s public ownership structure: Shurgard’s strategic decisions, involving activities such as borrowing money, capital contributions, raising capital from third parties, and selling or acquiring significant assets, are determined by its board of directors.
These risks include the following: • Currency risks: Currency fluctuations can impact the fair value of our investment in Shurgard, our equity earnings, our ongoing dividends, and any other related repatriations of cash. 10 • Legislative, tax, and regulatory risks: Shurgard is subject to a variety of local, national, and pan-European laws and regulations related to permitting and land use, the environment, labor, and other areas, as well as income, property, sales, and value added and employment tax.
These risks include the following: • Currency risks: Currency fluctuations can impact the fair value of our investment in Shurgard, our equity earnings, our ongoing dividends, and any other related repatriations of cash. • Legislative, tax, and regulatory risks: Shurgard is subject to a variety of local, national, and pan-European laws and regulations related to permitting and land use, the environment, labor, and other areas, as well as income, property, sales, and value added and employment tax.
While we believe that this aggressive pricing allows us to increase our market share relative to our competitors and increase the cash flows of these properties, such pricing and the added capacity may also negatively impact our existing stabilized self-storage facilities that are near these unstabilized facilities. 9 We may incur significant liabilities from environmental contamination or moisture infiltration.
While we believe that this aggressive pricing allows us to increase our market share relative to our competitors and increase the cash flows of these properties, such pricing and the added capacity may also negatively impact our existing stabilized self-storage facilities that are near these unstabilized facilities. We may incur significant liabilities from environmental contamination or moisture infiltration.
However, we may not have detected all material liabilities, we could acquire properties with material undetected liabilities, or new conditions could arise or develop at our properties, any of which could result in a cash settlement or adversely affect our ability to sell, lease, operate, or encumber affected facilities. Elevated interest rate levels could adversely impact us and our tenants.
However, we may not have detected all material liabilities, we could acquire properties with material undetected liabilities, or new conditions could arise or develop at our properties, any of which could result in a cash settlement or adversely affect our ability to sell, lease, operate, or encumber affected facilities. 9 Elevated interest rate levels could adversely impact us and our tenants.
Therefore, in the event of a bankruptcy, insolvency, liquidation or reorganization of PSA OP or PSOC, or their subsidiaries, assets of PSA OP or PSOC or the applicable subsidiary will be available to satisfy any claims of our shareholders only after such liabilities and obligations have been satisfied in full. 15 Holders of our preferred shares are subject to certain risks.
Therefore, in the event of a bankruptcy, insolvency, liquidation or reorganization of PSA OP or PSOC, or their subsidiaries, assets of PSA OP or PSOC or the applicable subsidiary will be available to satisfy any claims of our shareholders only after such liabilities and obligations have been satisfied in full. Holders of our preferred shares are subject to certain risks.
In addition, the inability to utilize our pricing methodology due to regulatory or market constraints could also significantly impact our financial results. We are exposed to ongoing litigation and other legal and regulatory actions, which may divert management’s time and attention, require us to pay damages and expenses or restrict the operation of our business.
In addition, the inability to utilize our pricing methodology due to regulatory or market constraints could also significantly impact our financial results. 11 We are exposed to ongoing litigation and other legal and regulatory actions, which may divert management’s time and attention, require us to pay damages and expenses or restrict the operation of our business.
See also “We have exposure to increased property tax in California” below. 8 The acquisition of existing properties or self-storage operating companies is subject to risks that may adversely affect our growth and financial results. We have acquired self-storage facilities and self-storage operating companies in the past, and we expect to continue to do so in the future.
See also “We have exposure to increased property tax in California” below. The acquisition of existing properties or self-storage operating companies is subject to risks that may adversely affect our growth and financial results. We have acquired self-storage facilities and self-storage operating companies in the past, and we expect to continue to do so in the future.
Self-storage space is generally not pre-leased, and rent-up of newly developed space can be delayed or ongoing cash flow yields can be reduced due to competition, reductions in storage demand, or other factors. There is significant competition among self-storage operators and from other storage alternatives. Our self-storage facilities generate most of our revenue and earnings.
Self-storage space is generally not pre-leased, and rent-up of newly developed space can be delayed or ongoing cash flow yields can be reduced due to competition, reductions in storage demand, or other factors. 8 There is significant competition among self-storage operators and from other storage alternatives. Our self-storage facilities generate most of our revenue and earnings.
Furthermore, we may discover security issues that were not found during due diligence of such acquired or integrated entities, and it may be difficult to integrate companies into our information technology environment and security program. 13 Our confidential information may also be compromised due to programming or human error, negligence, or fraud.
Furthermore, we may discover security issues that were not found during due diligence of such acquired or integrated entities, and it may be difficult to integrate companies into our information technology environment and security program. Our confidential information may also be compromised due to programming or human error, negligence, or fraud.
If the beneficial effect of Proposition 13 were ended for our properties, our property tax expense could increase substantially, adversely affecting our cash flow from operations and net income. 17 We are subject to extensive laws and regulations and to frequent changes in such laws and regulations.
If the beneficial effect of Proposition 13 were ended for our properties, our property tax expense could increase substantially, adversely affecting our cash flow from operations and net income. We are subject to extensive laws and regulations and to frequent changes in such laws and regulations.
We also own and seek to protect other intellectual property, such as propriety systems, processes, data, and other trade secrets that we have collected and developed in the course of operating our business and that we believe provides us with various competitive advantages.
We also own and may seek to protect other intellectual property, such as propriety systems, processes, data, and other trade secrets that we have collected and developed in the course of operating our business and that we believe provides us with various competitive advantages.
Similar restrictions could be imposed in the future in response to significant events and these restrictions could adversely impact our operations. Our marketing and pricing strategies may fail to be effective or may be constrained by factors outside of our control.
Similar restrictions could be imposed in the future, including in response to significant events and these restrictions could adversely impact our operations. Our marketing and pricing strategies may fail to be effective or may be constrained by factors outside of our control.
If we are not able to navigate these changes, it could have a material adverse effect on our business. ITEM 1B. Unresolved Staff Comments None. 18
If we are not able to navigate these changes, it could have a material adverse effect on our business. ITEM 1B. Unresolved Staff Comments None.
Our use of or inability to adopt and deliver new technological capabilities and enhancements in line with strategic objectives, including artificial intelligence and machine learning, may put us at a competitive disadvantage; cause us to miss opportunities to innovate, achieve efficiencies, or improve the customer experience; or adversely impact our business, reputation, results of operations, and financial condition.
Our use of or inability to safely and effectively adopt and deliver new technological capabilities and enhancements in line with strategic objectives, including artificial intelligence and machine learning, may put us at a competitive disadvantage; cause us to miss opportunities to innovate, achieve efficiencies, or improve the customer experience; or adversely impact our business, reputation, results of operations, and financial condition.
There are significant risks involved in developing self-storage facilities, such as delays, cost increases, or inability to complete development projects due to changes in or failure to meet government or regulatory requirements, failure of revenue to meet our underwriting estimates, delays caused by weather issues, unforeseen site conditions, or personnel problems.
Our development program subjects us to risks. There are significant risks involved in developing self-storage facilities, such as delays, cost increases, or inability to complete development projects due to changes in or failure to meet government or regulatory requirements, failure of revenue to meet our underwriting estimates, delays caused by weather issues, unforeseen site conditions, or personnel problems.
In addition, the use of emerging technologies, including artificial intelligence, entails risks including risks relating to the possibility of intellectual property infringement or misappropriation; data privacy; new or enhanced governmental or regulatory scrutiny, requirements, litigation, or other liability; ethical concerns; negative consumer perceptions as to automation and artificial intelligence; or other complications or liabilities that could adversely affect our business, reputation, results of operations, or financial results.
In addition, the use of emerging technologies, including artificial intelligence, entails risks including risks relating to the possibility of intellectual property infringement or misappropriation; data privacy; quality control related to artificial intelligence outputs; new or enhanced governmental or regulatory scrutiny, requirements, litigation, or other liability; ethical concerns; negative consumer perceptions as to automation and artificial intelligence; or other complications or liabilities that could adversely affect our business, reputation, results of operations, or financial results.
Interest rates remain elevated compared to recent years and may increase. As a result, if we issued new debt or preferred shares or refinanced our indebtedness, our debt service costs or preferred share dividend yields would likely be, based on current interest rates, significantly higher than current financing costs.
Interest rates remain elevated compared to recent years. As a result, if we issued new debt or preferred shares or refinanced our indebtedness, our debt service costs or preferred share dividend yields would likely be, based on current interest rates, significantly higher than current financing costs.
These limits could discourage, delay, or prevent a transaction involving a change in control of the Company not approved by our Board. • Similarly, current provisions of our declaration of trust and powers of our Board could have the same effect, including (1) limitations on removal of trustees, (2) restrictions on the acquisition of our shares of beneficial interest, (3) the power to issue additional common shares, preferred shares, or equity shares on terms approved by our Board without obtaining shareholder approval, (4) the advance notice provisions of our bylaws, and (5) our Board’s ability under Maryland law, without obtaining shareholder approval, to implement takeover defenses that we may not yet have and to take, or refrain from taking, other actions that could have the effect of delaying, deterring, or preventing a transaction or a change in control.
These limits could discourage, delay, or prevent a transaction involving a change in control of the Company not approved by our Board. • Similarly, current provisions of our declaration of trust and powers of our Board could have the same effect, including (1) limitations on removal of trustees, (2) restrictions on the acquisition of our shares of beneficial interest, (3) the power to issue additional common shares, preferred shares, or equity shares on terms approved by our Board without obtaining shareholder approval, (4) the advance notice provisions of our bylaws, and (5) our Board’s ability under Maryland law, without obtaining shareholder approval, to implement takeover defenses that we may not yet have and to take, or refrain from taking, other actions that could have the effect of delaying, deterring, or preventing a transaction or a change in control. 14 Holders of our preferred shares have dividend, liquidation, and other rights that are senior to the rights of the holders of our common shares.
As a result, we are subject to the risk of legal claims and proceedings (including class actions) and regulatory enforcement actions across many jurisdictions in the ordinary course of our business and otherwise, and we could incur significant liabilities and substantial legal fees from these actions.
We are subject to the risk of legal claims and proceedings (including class actions) and regulatory enforcement actions across many jurisdictions in the ordinary course of our business and otherwise, and we could incur significant liabilities and substantial legal fees from these actions.
There is also an increasing influx of capital from outside financing sources driving more money, development, and supply into the industry. Development of self-storage facilities may increase, which may intensify competition as newly developed facilities are opened.
There may be an increasing influx of capital from outside financing sources driving more money, development, and supply into the industry. Development of self-storage facilities may increase, which may intensify competition as newly developed facilities are opened.
Dividends paid by REITs to such stockholders are generally not eligible for that rate, but under current tax law, such stockholders may deduct up to 20% of ordinary dividends (i.e., dividends not designated as capital gain dividends or qualified dividend income) received from a REIT for taxable years beginning before January 1, 2026.
Dividends paid by REITs to such stockholders are generally not eligible for that rate but, such stockholders may deduct up to 20% of ordinary dividends (i.e., dividends not designated as capital gain dividends or qualified dividend income) received from a REIT for taxable years beginning before January 1, 2026.
See Note 14 to our December 31, 2024 consolidated financial statements for a description of the risks of losses that are not covered by third-party insurance contracts. Our exposure to these types of events is increased by potential tenant claims associated with our tenant reinsurance business.
See Note 16 to our December 31, 2025 consolidated financial statements for a description of the risks of losses that are not covered by third-party insurance contracts. Our exposure to these types of events is increased by potential tenant claims associated with our tenant reinsurance business.
Legislative activity in the privacy area may also result in new laws that are applicable to us and that may hinder our business, including by restricting our use of customer data or otherwise regulating the use of algorithms and automated processing in ways that could materially affect our business or lead to significant increases in the cost of compliance.
Legislative and regulatory activity related to information technology, including related to privacy, may also result in new laws that are applicable to us and that may hinder our business, including by restricting our use of customer data or otherwise regulating the use of algorithms and automated processing in ways that could materially affect our business or lead to significant increases in the cost of compliance.
Natural disasters, such as earthquakes, fires, hurricanes, and floods, terrorist attacks, civil unrest, and other events that damage our facilities or our customers’ property, or that make our facilities temporarily unavailable, have in the past and may in the future adversely impact our business and financial results.
Natural disasters, such as earthquakes, fires, hurricanes, drought, extreme temperatures and floods, terrorist attacks, civil unrest, and other events that damage our facilities or our tenants’ property, or that make our facilities temporarily unavailable, have in the past and may in the future adversely impact our business and financial results.
Our business is subject to risks from public health and other crises like the COVID-19 pandemic, including, among others: • risk of illness or death of our employees or customers; • negative impacts on economic conditions in our markets, which may reduce the demand for self-storage; • risk that there could be an out-migration of population from major markets where we operate; • government restrictions that (i) limit or prevent use of our facilities, (ii) limit our ability to increase rent or otherwise limit the rent we can charge, (iii) limit our ability to collect rent or evict delinquent tenants, or (iv) limit our ability to complete development and redevelopment projects; • risk that we could experience a change in the move-out patterns of our long-term customers due to economic uncertainty and increases in unemployment, which could lead to lower occupancies and rent “roll down” as long-term customers are replaced with new customers at lower rates; and • risk of negative impacts on the cost and availability of debt and equity capital, which could have a material impact upon our capital and growth plans. 11 We have been and may in the future be adversely impacted by emergency regulations adopted in response to significant events, such as natural disasters or public health crises, that could adversely impact our operations.
Our business is subject to risks from public health and other crises like the COVID-19 pandemic, including, among others: • risk of illness or death of our employees or tenants; • negative impacts on economic conditions in our markets, which may reduce the demand for self-storage; • risk that there could be an out-migration of population from major markets where we operate; • government restrictions that (i) limit or prevent use of our facilities, (ii) limit our ability to increase rent or otherwise limit the rent we can charge, (iii) limit our ability to collect rent or evict delinquent tenants, or (iv) limit our ability to complete development and redevelopment projects; • risk that we could experience a change in the move-out patterns of our long-term tenants due to economic uncertainty and increases in unemployment, which could lead to lower occupancies and rent “roll down” as long-term tenants are replaced with new tenants at lower rates; and • risk of negative impacts on the cost and availability of debt and equity capital, which could have a material impact upon our capital and growth plans.
Dividends payable by REITs may be taxed at higher rates than dividends of non-REIT corporations. The maximum U.S. federal income tax rate for qualified dividends paid by domestic non-REIT corporations to U.S. stockholders that are individuals, trusts, or estates is generally 20%.
Dividends payable by REITs do not qualify for the preferential tax rates available for some dividends. Dividends payable by REITs may be taxed at higher rates than dividends of non-REIT corporations. The maximum U.S. federal income tax rate for qualified dividends paid by domestic non-REIT corporations to U.S. stockholders that are individuals, trusts, or estates is generally 20%.
Although Public Storage currently wholly-owns (directly or indirectly) PSA OP and PSOC, and therefore exercises exclusive control over PSA OP and PSOC, including the authority to cause PSA OP and PSOC to make distributions, in connection with our future acquisition activities or otherwise, PSA OP may issue additional units of limited partnership to third parties, and these limited partners may negotiate for certain rights.
Although Public Storage exercises control over PSA OP and PSOC, including the authority to cause PSA OP and PSOC to make distributions, in connection with our future acquisition activities or otherwise, PSA OP may issue additional units of limited partnership to third parties, and these limited partners may negotiate for certain rights.
Our use of artificial intelligence could expose us to various risks. We have begun to utilize artificial intelligence technologies in various aspects of our business. Artificial intelligence technologies are susceptible to errors and other malfunctions which could lead to operational challenges and reputational risks.
For example, we have begun to utilize artificial intelligence technologies in various aspects of our business, which are susceptible to errors and other malfunctions which could lead to operational challenges and reputational risks.
Marketing initiatives, including our increasing dependence on Google to source customers, may fail to be effective and could negatively impact financial performance. Approximately 67% of our new storage customers in 2024 were sourced directly or indirectly through “unpaid” search and “paid” search campaigns on Google.
Marketing initiatives, including our increasing dependence on Google to source customers, may fail to be effective and could negatively impact financial performance. More than half of our new storage customers in 2025 were sourced directly or indirectly through “unpaid” search and “paid” search campaigns on Google.
Our property tax expense, which totaled approximately $452.0 million during the year ended December 31, 2024, generally depends upon the assessed value of our real estate facilities as determined by assessors and government agencies and, accordingly, could be subject to substantial increases if such agencies change their valuation approaches or opinions or if new laws are enacted, especially if new approaches are adopted or laws are enacted that result in increased property tax assessments in states or geographies where we have a high concentration of facilities.
Our property tax expense, generally depends upon the assessed value of our real estate facilities as determined by assessors and government agencies and, accordingly, could be subject to substantial increases if such agencies change their valuation approaches or opinions or if new laws are enacted, especially if new approaches are adopted or laws are enacted that result in increased property tax assessments in states or geographies where we have a high concentration of facilities.
While in most cases those taxes are paid by our customers, they increase the cost of self-storage rental to our customers and can negatively impact our revenues. Other local and state governments may impose self-storage rent taxes in the future.
While in most cases those taxes are paid by our customers, they increase the cost of self-storage rental to our customers and can negatively impact our revenues.
We may enter into forward sale agreements from time to time and, subject to certain conditions, we have the right to elect physical, cash or net share settlement under these agreements at any time and from time to time, in part or in full.
We maintain an “at the market” offering program under which we may enter into forward sale agreements from time to time to sell common shares and, subject to certain conditions, we have the right to elect physical, cash or net share settlement under these agreements at any time and from time to time, in part or in full.
Instead, each of the partners is allocated its share of PSA OP’s income. There is no assurance, however, that the IRS will not challenge the status of PSA OP as a partnership for U.S. federal income tax purposes. If the IRS were to successfully challenge the status of PSA OP as a partnership, it would be taxable as a corporation.
As a partnership, PSA OP is generally not subject to U.S. federal income tax on its income. Instead, each of the partners is allocated its share of PSA OP’s income. There is no assurance, however, that the IRS will not challenge the status of PSA OP as a partnership for U.S. federal income tax purposes.
The preferred shareholders would not receive any compensation (such as interest) for the delay in the receipt of distributions, and it is possible that the arrearage could accumulate indefinitely. • Holders of our Preferred Shares have limited rights in the event the Company ceases to pay dividends to shareholders and have no rights with respect to a Company decision to discontinue listing the Preferred Shares on a national securities exchange or file reports with the SEC, including following a change of control transaction.
The preferred shareholders would not receive any compensation (such as interest) for the delay in the receipt of distributions, and it is possible that the arrearage could accumulate indefinitely. • Holders of our Preferred Shares have limited rights in the event the Company ceases to pay dividends to shareholders and have no rights with respect to a Company decision to discontinue listing the Preferred Shares on a national securities exchange or file reports with the SEC, including following a change of control transaction. 15 Risks Related to Government Regulations and Taxation We would incur adverse tax consequences if we failed to qualify as a REIT, and we would have to pay substantial U.S. federal corporate income taxes.
The failure or disruption of our computer and communications systems, on which we are heavily dependent, could significantly harm our business. We are heavily dependent upon automated information technology and Internet commerce, with more than half of our new customers coming from the telephone or over the Internet.
We are heavily dependent upon automated information technology and Internet commerce, with more than half of our new customers coming from the telephone or over the Internet.
In addition, our preferred shareholders have the right to elect two additional directors to our Board whenever dividends are in arrears in an aggregate amount equivalent to six or more quarterly dividends, whether or not consecutive.
These preferences may limit the amount received by our common shareholders either from ongoing distributions or upon liquidation. In addition, our preferred shareholders have the right to elect two additional directors to our Board whenever dividends are in arrears in an aggregate amount equivalent to six or more quarterly dividends, whether or not consecutive.
In response to significant events, local, state, and federal governments have and may in the future adopt regulations that could impact our operations.
Local, state, and federal governments have and may in the future adopt regulations that could adversely impact our operations. Local, state, and federal governments have and may in the future adopt regulations that could adversely impact our operations, including in response to natural disasters and public health crises.
A qualifying REIT does not generally incur U.S. federal corporate income tax on its “REIT taxable income” (generally, taxable income subject to specified adjustments, including a deduction for dividends paid and excluding net capital gain) that it distributes to its shareholders. Our REIT status is also dependent upon the REIT qualification of PS Business Parks, Inc.
REITs are subject to a range of complex organizational and operational requirements. A qualifying REIT does not generally incur U.S. federal corporate income tax on its “REIT taxable income” (generally, taxable income subject to specified adjustments, including a deduction for dividends paid and excluding net capital gain) that it distributes to its shareholders.
(“PSB”) through the end of its taxable year ended December 31, 2022, as a result of our substantial ownership interest in it prior to the closing of the PSB merger with an unaffiliated third party. We believe we have qualified as a REIT and we intend to continue to maintain our REIT status.
Our REIT status is also dependent upon the REIT qualification of PS Business Parks, Inc. (“PSB”) through the end of its taxable year ended December 31, 2022, as a result of our substantial ownership interest in it prior to the closing of the PSB merger with an unaffiliated third party.
In certain circumstances, shareholders might desire a change in control or acquisition of us in order to realize a premium over the then-prevailing market price of our shares or for other reasons.
Risks Related to Our Ownership, Organization and Structure Takeover attempts or changes in control could be thwarted, even if beneficial to shareholders. In certain circumstances, shareholders might desire a change in control or acquisition of us in order to realize a premium over the then-prevailing market price of our shares or for other reasons.
Upon liquidation, holders of our preferred shares will receive a liquidation preference of $25,000 per share (or $25.00 per depositary share) plus any accrued and unpaid distributions before any payment is made to the common shareholders. These preferences may limit the amount received by our common shareholders either from ongoing distributions or upon liquidation.
Holders of our preferred shares are entitled to cumulative dividends before any dividends may be declared or set aside on our common shares. Upon liquidation, holders of our preferred shares will receive a liquidation preference of $25,000 per share (or $25.00 per depositary share) plus any accrued and unpaid distributions before any payment is made to the common shareholders.
We maintain a portfolio of trademarks and trade dress that we believe are fundamental to the success of the Public Storage® brand. While we actively seek to enforce and expand our rights, failure to adequately protect our rights could lead to loss of such trademark and trade dress protection.
While we actively seek to enforce and protect our rights, failure to adequately protect our rights could lead to loss of such trademark and trade dress protection.
If PSA OP were to fail to maintain its status as a partnership for U.S. federal income tax purposes, our financial results would be adversely impacted. We believe PSA OP qualifies as a partnership for U.S. federal income tax purposes. As a partnership, PSA OP is generally not subject to U.S. federal income tax on its income.
Other local and state governments may impose self-storage rent taxes in the future. 16 If PSA OP were to fail to maintain its status as a partnership for U.S. federal income tax purposes, our financial results would be adversely impacted. We believe PSA OP qualifies as a partnership for U.S. federal income tax purposes.
As a result of regulatory or private action in any jurisdiction, we may be temporarily or permanently suspended from continuing some or all of our reinsurance activities , or otherwise fined, penalized, or subject to an adverse judgment, which could reduce our net income.
As a result of regulatory or private action in any jurisdiction, we may be temporarily or permanently suspended from continuing some or all of our reinsurance activities , or otherwise fined, penalized, or subject to an adverse judgment, which could reduce our net income. 17 In the event that we recognize a significant gain from cash settlement of a forward sale agreement, the U.S. federal income tax treatment of the cash that we receive in such instance is unclear and could impact our ability to meet the REIT qualification requirements.
Any such legal claims, proceedings, and regulatory enforcement actions could negatively impact our operating results, cash flow available for distribution or reinvestment, and/or the price of our common shares.
Any such legal claims, proceedings, and regulatory enforcement actions could negatively impact our operating results, cash flow available for distribution or reinvestment, and/or the price of our common shares. Our use of or failure to adopt advancements in information technology, such as artificial intelligence, may hinder or prevent us from achieving strategic objectives or otherwise harm our business.
If our confidential information is compromised or corrupted, including as a result of a cybersecurity incident, our reputation and business relationships could be damaged and our financial condition and operating results could be adversely affected.
While we may be entitled to damages if our third-party providers fail to satisfy their security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such award. 12 If our confidential information is compromised or corrupted, including as a result of a cybersecurity incident, our reputation and business relationships could be damaged and our financial condition and operating results could be adversely affected.
However, for years in which we failed to qualify as a REIT, we would not be subject to REIT rules that require us to distribute substantially all of our taxable income to our shareholders. 16 Dividends payable by REITs do not qualify for the preferential tax rates available for some dividends.
Any taxes, interest, and penalties incurred would reduce our cash available for distributions to shareholders and could negatively affect our stock price. However, for years in which we failed to qualify as a REIT, we would not be subject to REIT rules that require us to distribute substantially all of our taxable income to our shareholders.
In such event, this would reduce the amount of distributions that PSA OP could make. The treatment of PSA OP as a corporation would also cause us to fail to qualify as a REIT. This would substantially reduce our cash available to pay distributions and the return on a shareholder's investment. Changes in tax laws could negatively impact us.
If the IRS were to successfully challenge the status of PSA OP as a partnership, it would be taxable as a corporation. In such event, this would reduce the amount of distributions that PSA OP could make. The treatment of PSA OP as a corporation would also cause us to fail to qualify as a REIT.
Further information relating to cybersecurity risk management is discussed in Item 1C. “Cybersecurity” in this report. Ineffective succession planning for our CEO and executive management, as well as for our other key employees, may impact the execution of our strategic plan.
Further information relating to cybersecurity risk management is discussed in Item 1C. “Cybersecurity” in this report. If we fail to successfully execute our recent leadership succession, we may struggle to effectively execute our strategic plan. We recently announced leadership changes, including a change in our Chairman of the Board, our President and Chief Executive Officer and our Chief Financial Officer.
In addition, customer perceptions about the risk of property loss from these events could negatively impact self-storage demand. We are subject to risks from the consequences of climate change, including severe weather events and the adverse impact of other steps that may be taken to prevent or mitigate climate change.
In addition, perceptions about the risk of property loss from these events could negatively impact self-storage demand. Operating costs, including property taxes, could increase.
The United States Treasury Department and Congress frequently review federal income tax legislation, regulations and other guidance.
This would substantially reduce our cash available to pay distributions and the return on a shareholder's investment. Changes in tax laws could negatively impact us. The United States Treasury Department and Congress frequently review federal income tax legislation, regulations and other guidance.
We may not effectively or appropriately identify ready-now succession candidates for our CEO and executive management team, which may negatively impact our ability to meet key strategic goals. Failure to implement succession plans for other key employees may leave us vulnerable to retirements and turnover. We may fail to protect our intellectual property adequately.
Failure to successfully implement future succession plans for other key employees may leave us vulnerable to retirements and turnover. 13 We may be harmed if we fail to protect our intellectual property adequately. We maintain a portfolio of trademarks and trade dress that we believe are fundamental to the success of the Public Storage® brand.
Removed
Our self-storage facilities are located in areas that may be subject to the direct impacts of climate change, such as increased destructive weather events like floods, fires, drought, and prolonged periods of extreme temperature or other extreme weather, which could result in significant damage to our facilities, increased capital expenditures, increased expenses, reduced revenues, or reduced demand for our facilities.
Added
California and other jurisdictions have also adopted regulations restricting our operations relating to pricing methodologies, restrictions on fees, procedures for selling stored property of delinquent tenants, marketing restrictions related to price changes and promotional rates, zoning restrictions and other matters.
Removed
Indirect impacts of climate change could also adversely impact our business, including through increased costs, such as insurance costs or regulatory compliance costs.
Added
Although we have adopted policies with respect to these risks, including related to the development, deployment and monitoring of artificial intelligence tools, we cannot be certain that such policies will be effective. The failure or disruption of our computer and communications systems, on which we are heavily dependent, could significantly harm our business.
Removed
In addition, government and private efforts to transition to a low-carbon economy present certain risks for us and our customers, including increased energy costs and macroeconomic risks related to high energy costs and energy shortages, among other things.
Added
Although these changes were made pursuant to the Board’s succession planning efforts, there is no guarantee that the transition to new leadership will be executed successfully. Failure to successfully implement these successions may result in disruptions in the execution of our strategic plan.
Removed
Governmental, political, and societal pressures, including expectations of institutional and activist investors and other interest groups, could require us to implement or accelerate emissions initiatives and, with it, the costs of their implementation.
Added
We may record losses as a result of the bankruptcy, insolvency, or other credit failure of the borrowers under our bridge lending financing program. In that case, our revenues and results of operations may be materially and adversely impacted.
Removed
These same potential governmental, political, and social pressures could in the future result in, among other things, (i) costly changes to newly developed facilities or retrofits of our existing facilities to reduce carbon emissions through multiple avenues, including changes to insulation, space configuration, lighting, heating, and air conditioning and (ii) increased energy costs as a result of transitioning to less carbon-intensive, but more expensive, sources of energy to operate our facilities.
Added
Although we conduct due diligence and aim to carefully evaluate the risks associated with this debt and other investments, we could incur losses from our lending decisions, which includes subjective and complex judgments and forecasts of economic conditions and how these economic predictions might impair the ability of our borrowers to operate their business and/or make all required payments.
Removed
For example, beginning in 2026, we expect to be required to disclose our Scope 1, 2, and 3 emissions data and certain climate-related risk matters under California SB 253 and SB 261, which we expect to result in increased compliance costs.
Added
For example, volatility of the capital and credit markets, increased interest rates, lower demand for self-storage and general economic conditions may adversely affect the solvency, creditworthiness or operations of our borrowers.
Removed
In addition, our reputation and investor relationships could be damaged as a result of our involvement with activities perceived to be causing or exacerbating climate change, as well as any decisions we make to continue to conduct or change our activities in response to considerations relating to climate change. Operating costs, including property taxes, could increase.
Added
If our forecasts prove incorrect, or if any of our borrowers fail to perform as expected, we may incur losses from these bridge loans which could have a material adverse effect on our operating revenue and results of operations.
Removed
Our development program subjects us to risks. At December 31, 2024, we had a pipeline of development projects totaling $741.6 million (subject to contingencies), and we expect to continue to seek additional development projects.
Added
We believe we have qualified as a REIT and we intend to continue to maintain our REIT status.
Removed
We own approximately 35% of the common shares of Shurgard, and this investment has a $382.5 million book value and a $1.3 billion market value (based upon the closing trading price of Shurgard’s common stock) at December 31, 2024. We recognized $19.8 million in equity in earnings and received $22.8 million in dividends in 2024 with respect to Shurgard.
Removed
We have approximately 5,900 employees and 2.0 million customers, and we conduct business at facilities in 40 states.
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In addition, through exercising their authority to regulate our activities, governmental agencies can otherwise negatively impact our business by increasing costs or decreasing revenues, including through restrictions on rent increases or fees. 12 Our use of or failure to adopt advancements in information technology may hinder or prevent us from achieving strategic objectives or otherwise harm our business.
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While we may be entitled to damages if our third-party providers fail to satisfy their security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such award.
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In addition, we may be subject to increasing regulations related to our use of these technologies, including regulations related to privacy, data security, and intellectual property rights, which could expose us to legal risks. 14 Risks Related to Our Ownership, Organization and Structure Takeover attempts or changes in control could be thwarted, even if beneficial to shareholders.
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Holders of our preferred shares have dividend, liquidation, and other rights that are senior to the rights of the holders of our common shares. Holders of our preferred shares are entitled to cumulative dividends before any dividends may be declared or set aside on our common shares.
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Risks Related to Government Regulations and Taxation We would incur adverse tax consequences if we failed to qualify as a REIT, and we would have to pay substantial U.S. federal corporate income taxes. REITs are subject to a range of complex organizational and operational requirements.
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Any taxes, interest, and penalties incurred would reduce our cash available for distributions to shareholders and could negatively affect our stock price.
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Approximately $830.4 million of our 2024 net operating income is from our properties in California, and we incurred approximately $47.8 million in related property tax expense.
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In the event that we recognize a significant gain from cash settlement of a forward sale agreement, the U.S. federal income tax treatment of the cash that we receive in such instance is unclear and could impact our ability to meet the REIT qualification requirements.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Our CTO and CISO regularly engage with our Chief Administrative Officer. They also report monthly on cybersecurity matters to our entire executive management team. In the event of an incident that jeopardizes the confidentiality, integrity, or availability of the information technology systems we use, we utilize a regularly updated information security incident response plan (IRP).
Our CTO and CISO regularly engage with our Chief Administrative Officer. They also report monthly on cybersecurity matters to our entire executive management team. 18 In the event of an incident that jeopardizes the confidentiality, integrity, or availability of the information technology systems we use, we utilize a regularly updated information security incident response plan (IRP).
We have partnerships for security operations center (SOC) services, penetration testing, incident response, and various third-party assessments. We deploy both commercially available solutions and proprietary systems to actively manage threats to our information technology environment. 19 We assess our cybersecurity program against various frameworks.
We have partnerships for security operations center (SOC) services, penetration testing, incident response, and various third-party assessments. We deploy both commercially available solutions and proprietary systems to actively manage threats to our information technology environment. We assess our cybersecurity program against various frameworks.
Most spaces have between 25 and 400 square feet and an interior height of approximately eight to 12 feet. ITEM 3 . Legal Proceedings For a description of the Company’s legal proceedings, see “Note 14. Commitments and Contingencies” to our consolidated financial statements included in this Annual Report on Form 10-K. ITEM 4 .
Most spaces have between 25 and 400 square feet and an interior height of approximately eight to 12 feet. ITEM 3 . Legal Proceedings For a description of the Company’s legal proceedings, see “Note 16. Commitments and Contingencies” to our consolidated financial statements included in this Annual Report on Form 10-K. ITEM 4 .
The most prevalent recently constructed facilities have higher density footprints with large, multi-story buildings with climate control and typically 1,000 or more self-storage spaces, a more imposing and visible retail presence, and a prominent and large rental office designed to appeal to customers as an attractive and retail-focused “store.” Our self-storage portfolio includes facilities with characteristics of the oldest facilities, characteristics of the most recently constructed facilities, and those with characteristics of both older and recently constructed facilities.
Recently constructed facilities have higher density footprints with large, multi-story buildings with climate control and typically 1,000 or more self-storage spaces, and a prominent and large rental office designed to appeal to customers as an attractive and retail-focused “store.” Our self-storage portfolio includes facilities with characteristics of the oldest facilities, characteristics of the most recently constructed facilities, and those with characteristics of both older and recently constructed facilities.
Following the conclusion of an incident, the incident response team will generally assess the effectiveness of the cybersecurity program and IRP and make adjustments as appropriate. Cybersecurity Risks As of December 31, 2024, we have not had any known instances of material cybersecurity incidents, including known third-party provider incidents.
Following the conclusion of an incident, the incident response team will generally assess the effectiveness of the cybersecurity program and IRP and make adjustments as appropriate. Cybersecurity Risks As of December 31, 2025, we have not had any known instances of material cybersecurity incidents, including known third-party provider incidents, during any of the prior three fiscal years.
At December 31, 2024, two of our facilities with a net book value of $11.2 million were encumbered by an aggregate of $1.7 million in mortgage notes payable. 21 The configuration of self-storage facilities has evolved over time.
At December 31, 2025, two of our facilities with a net book value of $10.8 million were encumbered by an aggregate of $1.6 million in mortgage notes payable. 21 The configuration of self-storage facilities has evolved over time.
Detection and Analysis Cybersecurity incidents may be detected through a variety of means, which may include, but are not limited to, automated event-detection notifications, employee notifications, notification from external parties (e.g., our third-party information technology provider), and proactive threat hunting in conjunction with our external partners.
These exercises are intended to challenge and validate our information security response and resources through simulated cybersecurity incidents, including engagement of outside cybersecurity legal counsel, other third-party partners, key internal personnel, executive management, and our Board. 19 Detection and Analysis Cybersecurity incidents may be detected through a variety of means, which may include, but are not limited to, automated event-detection notifications, employee notifications, notification from external parties (e.g., our third-party information technology provider), and proactive threat hunting in conjunction with our external partners.
Properties At December 31, 2024, we had controlling ownership interests in 3,073 self-storage facilities located in 40 states within the U.S.: At December 31, 2024 Number of Storage Facilities Net Rentable Square Feet (in thousands) Texas 464 39,412 California 446 32,025 Florida 365 25,475 Illinois 137 8,930 Georgia 128 8,621 North Carolina 111 8,195 Maryland 106 7,990 Virginia 121 7,969 Washington 107 7,629 Colorado 88 6,518 Minnesota 68 5,425 New York 73 5,232 South Carolina 83 5,176 New Jersey 67 4,651 Ohio 66 4,511 Michigan 61 4,387 Arizona 60 4,383 Indiana 54 3,585 Oklahoma 48 3,499 Tennessee 55 3,443 Missouri 44 2,919 Pennsylvania 37 2,685 Oregon 45 2,618 Nevada 34 2,419 Massachusetts 29 2,052 Kansas 24 1,538 Other states (14 states) 152 9,993 Total (a) 3,073 221,280 (a) See Schedule III: Real Estate and Accumulated Depreciation in our consolidated financial statements included in this Annual Report on Form 10-K, for a summary of land, building, accumulated depreciation, square footage, and number of properties by market.
Properties At December 31, 2025, we had controlling ownership interests in 3,171 self-storage facilities located in 40 states within the U.S.: December 31, 2025 Number of Storage Facilities Net Rentable Square Feet (in thousands) Texas 477 40,549 California 450 32,829 Florida 392 27,501 Georgia 136 9,179 Illinois 139 9,041 North Carolina 114 8,408 Maryland 107 8,058 Virginia 122 7,959 Washington 107 7,726 Colorado 93 6,777 South Carolina 88 5,606 Minnesota 68 5,535 New York 74 5,328 New Jersey 72 4,905 Ohio 68 4,643 Michigan 62 4,443 Arizona 60 4,329 Tennessee 58 3,726 Oklahoma 51 3,721 Indiana 54 3,572 Missouri 44 2,910 Pennsylvania 38 2,795 Oregon 46 2,659 Nevada 34 2,548 Massachusetts 31 2,129 Kansas 24 1,533 Other states (14 states) 162 11,030 Total (a) 3,171 229,439 (a) See Schedule III: Real Estate and Accumulated Depreciation in our consolidated financial statements included in this Annual Report on Form 10-K, for a summary of land, building, accumulated depreciation, square footage, and number of properties by market.
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Annually, we test the IRP’s response procedures, including thorough disaster response and business continuity plan exercises. These exercises are intended to challenge and validate our information security response and resources through simulated cybersecurity incidents, including engagement of outside cybersecurity legal counsel, other third-party partners, key internal personnel, executive management, and our Board.
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Annually, we test the IRP’s response procedures, including thorough disaster response and business continuity plan exercises.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Under the repurchase program, management may repurchase our common shares on the open market or in privately negotiated transactions. During the three months ended December 31, 2024, we did not repurchase any of our common shares.
Under the repurchase program, management may repurchase our common shares on the open market or in privately negotiated transactions. During the three months ended December 31, 2025, we did not repurchase any of our common shares.
ITEM 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities Our common shares of beneficial interest (NYSE: PSA) have been listed on the NYSE since October 19, 1984. As of February 18, 2025, there were approximately 9,093 holders of record of our common shares.
ITEM 5. Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities Our common shares of beneficial interest (NYSE: PSA) have been listed on the NYSE since October 19, 1984. As of February 5, 2026, there were approximately 8,644 holders of record of our common shares.
From the inception of the repurchase program through February 24, 2025, we have repurchased a total of 24,448,781 common shares at an aggregate cost of approximately $879.1 million.
From the inception of the repurchase program through February 12, 2026, we have repurchased a total of 24,448,781 common shares at an aggregate cost of approximately $879.1 million. We have no current plans to repurchase shares.
In May 2008, our Board authorized a share repurchase program of up to 35,000,000 of our common shares on the open market or in privately negotiated transactions. Our common share repurchase program does not have an expiration date and there are 10,551,219 common shares that may yet be repurchased under our repurchase program as of December 31, 2024.
In May 2008, our Board authorized a share repurchase program of up to 35,000,000 of our common shares. Our common share repurchase program does not have an expiration date, and there are 10,551,219 common shares that may yet be repurchased under our repurchase program as of December 31, 2025.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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We believe that our cash provided by our operating activities will continue to be sufficient to enable us to meet our ongoing cash requirements for interest payments on debt, maintenance capital expenditures, and distributions to our shareholders for the foreseeable future.
We believe that the cash provided by our operating activities will continue to be sufficient to enable us to meet our ongoing cash requirements for interest payments on debt, maintenance capital expenditures, and distributions to our shareholders for the foreseeable future.
We regularly adjust rental rates and promotional discounts offered (generally, “$1.00 rent for the first month”), as well as our marketing efforts to maximize revenue from new tenants to replace tenants that vacate. We typically increase rental rates to our long-term tenants (generally, those who have been with us for at least six months) every six to twelve months.
We regularly adjust rental rates and promotional discounts offered (generally, “$1.00 rent for the first month”), as well as our marketing efforts to maximize revenue from new tenants to replace tenants that vacate. We typically increase rental rates to our long-term tenants (generally, those who have been with us for at least five months) every six to twelve months.
We estimate the fair value of buildings primarily using the income approach by estimating the fair value of hypothetical vacant acquired facilities and adjusting for the estimated fair value of land. The fair value estimate of buildings is sensitive to assumptions, such as lease-up period, future stabilized operating cash flows, capitalization rate and discount rate.
We estimate the fair value of buildings primarily using the income approach by estimating the fair value of hypothetical vacant acquired facilities and adjusting for the estimated fair value of land. The fair value estimate of buildings is sensitive to assumptions, such as lease-up period, future stabilized operating cash flows, 23 capitalization rate and discount rate.
Additional potential cash requirements could result from various activities including the redemption of outstanding preferred securities, repurchases of common stock, or merger and acquisition activities, as and to the extent we determine to engage in such activities. 49 Over the long term, to the extent that our cash requirements exceed our capital resources, we believe we have a variety of possibilities to raise additional capital including issuing common or preferred securities, debt, and limited partnership interests, or entering into joint venture arrangements to acquire or develop facilities.
Additional potential cash requirements could result from various activities including the redemption of outstanding preferred securities, repurchases of common stock, or merger and acquisition activities, as and to the extent we determine to engage in such activities. 48 Over the long term, to the extent that our cash requirements exceed our capital resources, we believe we have a variety of possibilities to raise additional capital including issuing common or preferred securities, debt, and limited partnership interests, or entering into joint venture arrangements to acquire or develop facilities.
Claims expenses vary based upon the number of insured tenants and the volume of events that drive covered customer losses, such as burglary, as well as catastrophic weather events affecting multiple properties such as hurricanes and floods.
Claims expenses vary based upon the number of insured tenants and the volume of events that drive covered losses, such as burglary, as well as catastrophic weather events affecting multiple properties such as hurricanes and floods.
The decrease is due primarily to (i) a $159.7 million increase in depreciation and amortization expense, (ii) an $86.3 million increase in interest expense, (iii) a $26.0 million increase in general and administrative expense, (iv) an $18.4 million decrease in interest and other income, partially offset by (v) a $153.4 million increase in foreign currency exchange gains primarily associated with our Euro denominated notes payable and (vi) a $61.6 million increase in self-storage net operating income.
The decrease was due primarily to (i) an $159.7 million increase in depreciation and amortization expense, (ii) an $86.3 million increase in interest expense, (iii) a $26.0 million increase in general and administrative expense, (iv) an $18.4 million decrease in interest and other income, partially offset by (v) an $153.4 million increase in foreign currency exchange gains primarily associated with our Euro denominated notes payable and (vi) a $61.6 million increase in self-storage net operating income.
As a result, the number of long-term tenants we have in our facilities is an important factor in our revenue growth. The level of rate increases to long-term tenants is based upon evaluating the additional revenue from the increase against the negative impact of incremental move-outs, by considering customers’ in-place rent and prevailing market rents, among other factors.
As a result, the number of long-term tenants we have in our facilities is an important factor in our revenue growth. The level of rate increases to long-term tenants is based upon evaluating the additional revenue from the increase against the negative impact of incremental move-outs, by considering tenants’ in-place rent and prevailing market rents, among other factors.
The actual annualized yields that we may achieve on these facilities upon stabilization will depend on many factors, including local and current market conditions in the vicinity of each property and the level of new and existing supply. The facilities under “expansions completed” represent those facilities where the expansions have been completed at December 31, 2024.
The actual annualized yields that we may achieve on these facilities upon stabilization will depend on many factors, including local and current market conditions in the vicinity of each property and the level of new and existing supply. The facilities under “expansions completed” represent those facilities where the expansions have been completed at December 31, 2025.
The composition of our Same Store Facilities allows us more effectively to evaluate the ongoing performance of our self-storage portfolio in 2022, 2023, and 2024 and exclude the impact of fill-up of unstabilized facilities, which can significantly affect operating trends. We believe investors and analysts use Same Store Facilities information in a similar manner.
The composition of our Same Store Facilities allows us more effectively to evaluate the ongoing performance of our self-storage portfolio in 2023, 2024, and 2025 and exclude the impact of fill-up of unstabilized facilities, which can significantly affect operating trends. We believe investors and analysts use Same Store Facilities information in a similar manner.
We typically underwrite new developments to stabilize at approximately an 8.0% NOI yield on cost (adjusted for impacts from tenant reinsurance and maintenance capital expenditures). Our developed facilities have thus far leased up as expected and are at various stages of their revenue stabilization periods.
We typically underwrite new developments to stabilize at approximately an 8% yield on cost (adjusted for impacts from tenant reinsurance and maintenance capital expenditures). Our developed facilities have thus far leased up as expected and are at various stages of their revenue stabilization periods.
Selected Key Move-in and Move-Out Statistical Data The following table sets forth average annual contract rent per square foot and total square footage for tenants moving in and moving out during the years ended December 31, 2024, 2023, and 2022.
Selected Key Move-in and Move-Out Statistical Data The following table sets forth average annual contract rent per square foot and total square footage for tenants moving in and moving out during the years ended December 31, 2025, 2024, and 2023.
(c) These amounts only include the direct cost incurred to expand and renovate these facilities, and do not include (i) the original cost to develop or acquire the facility or (ii) the lost revenue on space demolished during the construction and fill-up period.
(f) These amounts only include the direct cost incurred to expand and renovate these facilities, and do not include (i) the original cost to develop or acquire the facility or (ii) the lost revenue on space demolished during the construction and fill-up period.
The annual distribution requirement with respect to our preferred shares outstanding at December 31, 2024 is approximately $194.7 million per year. Real Estate Investment Activities: We continue to seek to acquire additional self-storage facilities from third parties.
The annual distribution requirement with respect to our preferred shares outstanding at December 31, 2025 is approximately $194.7 million per year. 49 Real Estate Investment Activities: We continue to seek to acquire additional self-storage facilities from third parties.
The Acquired Facilities, Newly Developed and Expanded Facilities, and Other Non-Same Store Facilities are collectively referred to as the Non-Same Store Facilities.
The Acquired Facilities, Newly Developed and Expanded Facilities, and Other Non-Same Store Facilities are collectively referred to as the “Non-Same Store Facilities”.
In particular, these estimates are sensitive to significant assumptions, such as the projections of future rental rates, stabilized occupancy level, future profit margin, discount rates, and capitalization rates, all of which could be affected by our expectations about future market or economic conditions.
In particular, these estimates are sensitive to significant assumptions, such as the projections of future rental rates, stabilized occupancy level, future profit margin, discount rates, and capitalization rates, all of which could be affected by our expectations about future market or economic conditions. Others could come to materially different conclusions.
The decrease in realized annual rent per occupied square foot in 2024 as compared to 2023 was due to a 11.6% decrease in average rates per square foot charged to new tenants moving in over the past twelve months, partially offset by cumulative rate increases to existing long-term tenants over the same period.
The increase in realized annual rent per occupied square foot in 2025 as compared to 2024 was due to cumulative rate increases to existing long-term tenants over the past twelve months partially offset by a decrease in average rates per square foot charged to new tenants moving in over the same period.
Other Non-Same Store Facilities The “Other Non-Same Store Facilities” represent facilities which, while not newly acquired, developed, or expanded, are not fully stabilized since January 1, 2022, including facilities undergoing fill-up as well as facilities damaged in casualty events such as hurricanes, floods, and fires.
Other Non-Same Store Facilities The “Other Non-Same Store Facilities” represent facilities which, while not newly acquired, developed, or expanded, are not fully stabilized since January 1, 2023, including facilities acquired prior to 2023 and facilities developed or expanded prior to 2020 undergoing fill-up as well as facilities damaged in casualty events such as hurricanes, floods, and fires.
The results of these components for the years ended December 31, 2023 compared to December 31, 2022 was included in our Annual Report on Form 10-K for the year ended December 31, 2023 on page 23, under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which was filed with the SEC on February 20, 2024.
The results of these components for the years ended December 31, 2024 compared to December 31, 2023 was included in our Annual Report on Form 10-K for the year ended December 31, 2024 on page 45, under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which was filed with the SEC on February 24, 2025.
We expect tenant reinsurance operation to grow as we roll out insurance policies with increased coverage and higher premiums in 2025, and as we continue to increase the tenant base at our newly acquired and developed facilities.
We expect tenant reinsurance operations to grow as we roll out insurance policies with increased coverage and higher premiums in 2026, and as we continue to increase the tenant base at our newly acquired and developed facilities.
Notwithstanding this requirement, our annual operating retained cash flow was approximately $480 million in 2023 and $400 million in 2024. Retained operating cash flow represents our expected cash flow provided by operating activities (including property operating costs and interest payments described below), less shareholder distributions and capital expenditures. We expect retained cash flow of approximately $600 million for 2025.
Notwithstanding this requirement, our annual operating retained cash flow was approximately $400 million in 2024 and $566 million in 2025. Retained operating cash flow represents our expected cash flow provided by operating activities (including property operating costs and interest payments described below), less shareholder distributions and capital expenditures. We expect retained cash flow of approximately $605 million for 2026.
During 2023, we acquired BREIT Simply Storage LLC (“Simply”), a self-storage company that owned and operated 127 self-storage facilities (9.4 million square feet) and managed 25 self-storage facilities (1.8 million square feet) for third parties, for a purchase price of $2.2 billion in cash.
During 2023, we acquired BREIT Simply Storage LLC (“Simply”), a self-storage company that owned and operated 127 self-storage facilities (9.4 million square feet) and managed 25 self-storage facilities (1.8 million square feet) for third parties, for a purchase price of $2.2 billion in cash. We remain active in seeking to acquire additional self-storage facilities.
From the inception of the repurchase program through February 24, 2025, we have repurchased a total of 24,448,781 common shares at an aggregate cost of approximately $879.1 million. All the repurchased shares are constructively retired and returned to an authorized and unissued status.
From the inception of the repurchase program through February 12, 2026, we have repurchased a total of 24,448,781 common shares at an aggregate cost of approximately $879.1 million. We did not repurchase any common shares in 2025. All the repurchased shares are constructively retired and returned to an authorized and unissued status.
More than half of our tenants have rented their space for longer than six months at December 31, 2024, which supported our revenue growth from existing long-term tenants.
More than half of our tenants have rented their space for longer than a year at December 31, 2024, which supported our revenue growth from existing long-term tenants.
Foreign currency exchange gain (loss): For 2024, we recorded foreign currency gains of $102.2 million, representing primarily the changes in the U.S. Dollar equivalent of our Euro-denominated unsecured notes due to fluctuations in exchange rates (losses of $51.2 million for 2023). The Euro was translated at exchange rates of approximately 1.039 U.S.
Foreign currency exchange gain (loss): In 2025, we recorded foreign currency losses of $215.6 million, representing primarily the changes in the U.S. Dollar equivalent of our Euro-denominated unsecured notes due to fluctuations in exchange rates (gains of $102.2 million for 2024). The Euro was translated at exchange rates of approximately 1.174 U.S.
The cash requirements from these operating costs will vary year to year based on, among other things, changes in the size of our portfolio and changes in property tax rates and assessed values, wage rates, and marketing costs in our markets.
Indirect operating costs include supervisory payroll and centralized management costs. The cash requirements from these operating costs will vary year to year based on, among other things, changes in the size of our portfolio and changes in property tax rates and assessed values, wage rates, and marketing costs in our markets.
Tenant reinsurance cost of operations increased $14.3 million in 2024, as compared to 2023, primarily due to increased claim volumes and expenses related to flooding, burglary and hurricane events as well as increased access fees we paid to the third-party owners of properties we manage driven by the significant growth of our third-party property management program.
Tenant reinsurance cost of operations increased $1.6 million in 2025, as compared to 2024, primarily due to increased claim volumes and expenses related to flooding and burglary as well as increased access fees we paid to the third-party owners of properties we manage driven by the significant growth of our third-party property management program.
The year-over-year changes of income tax expense was primarily driven by changes in state income tax, due to fluctuations of taxable income in certain states where there are differences between federal and state tax laws. 48 Liquidity and Capital Resources Overview and our Sources of Capital While operating as a REIT allows us to minimize the payment of U.S. federal corporate income tax expense, we are required to distribute at least 90% of our taxable income to our shareholders.
The year-over-year change in our income tax (provision) benefit was primarily driven by the income tax benefit we recognized through the sale of solar tax credits as well as changes in state income tax, due to fluctuations of taxable income in certain states where there are differences between federal and state tax laws. 47 Liquidity and Capital Resources Overview and our Sources of Capital While operating as a REIT allows us to minimize the payment of U.S. federal corporate income tax expense, we are required to distribute at least 90% of our taxable income to our shareholders.
We expect to satisfy these cash requirements through operating cash flow and opportunistic debt and equity financings. Required Debt Repayments: As of December 31, 2024, the principal outstanding on our debt totaled approximately $9.4 billion, consisting of $7.8 billion of U.S. Dollar denominated unsecured notes payable, $1.7 billion of Euro-denominated unsecured notes payable, and $1.7 million of mortgage notes payable.
We expect to satisfy these cash requirements through operating cash flow and opportunistic debt and equity financings. Required Debt Repayments: As of December 31, 2025, the principal outstanding on our debt totaled approximately $10.3 billion, consisting of $8.2 billion of U.S. Dollar denominated unsecured notes payable, $2.1 billion of Euro-denominated unsecured notes payable, and $1.6 million of mortgage notes payable.
Tenant reinsurance premium revenue generated from tenants at our Same-Store Facilities were $170.0 million and $163.2 million in 2024 and 2023, respectively, representing a 4.2% year over year increase in 2024. Cost of operations primarily includes claims paid as well as claims adjustment expenses.
Tenant reinsurance premium revenue generated from tenants at our Same Store Facilities were $184.2 million and $175.0 million in 2025 and 2024, respectively, representing a 5.2% year over year increase in 2025. Cost of operations primarily includes claims paid as well as claims adjustment expenses.
Costs incurred through December 31, 2024 were $308.1 million, with the remaining cost to complete of $433.5 million expected to be incurred primarily in the next 18 to 24 months. Some of these projects are subject to contingencies such as entitlement approval. We expect to continue to seek to add projects to maintain and increase our robust pipeline.
Costs incurred through December 31, 2025 were $194.3 million, with the remaining cost to complete of $415.6 million expected to be incurred primarily in the next 18 to 24 months. Some of these projects are subject to contingencies such as entitlement approval. We expect to continue to seek to add projects to maintain and increase our robust pipeline.
The increase in net operating income of $100.0 million for the Non-Same Store Facilities is due primarily to the impact of facilities acquired in 2022 and 2023. Funds from Operations and Core Funds from Operations Funds from Operations (“FFO”) and FFO per diluted common share (“FFO per share”) are non-GAAP measures defined by Nareit.
The increase in net operating income of $103.4 million for the Non-Same Store Facilities was due primarily to the impact of facilities acquired in 2024 and 2023. 25 Funds from Operations and Core Funds from Operations Funds from Operations (“FFO”) and FFO per diluted common share (“FFO per share”) are non-GAAP measures defined by Nareit.
These amounts are net of $17.2 million and $18.0 million in 2024 and 2023, respectively, in development costs that were capitalized to newly developed and redeveloped self-storage facilities.
These amounts are net of $13.6 million and $17.2 million in 2025 and 2024, respectively, in development costs that were capitalized to newly developed and redeveloped self-storage facilities.
Interest expense: For 2024 and 2023, we incurred $297.9 million and $210.4 million, respectively, of interest on our outstanding notes payable. In determining interest expense, these amounts were offset by capitalized interest of $10.5 million and $9.3 million during 2024 and 2023, respectively, associated with our development activities.
Interest expense: In 2025 and 2024, we incurred $311.0 million and $297.9 million, respectively, of interest on our outstanding notes payable. In determining interest expense, these amounts were offset by capitalized interest of $6.5 million and $10.5 million during 2025 and 2024, respectively, associated with our development activities.
The following table summarizes the historical operating results (for all periods presented) of these 2,507 facilities (170.0 million net rentable square feet) that represent approximately 77% of the aggregate net rentable square feet of our U.S. consolidated self-storage portfolio at December 31, 2024.
The following table summarizes the historical operating results (for all periods presented) of these 2,565 facilities (175.3 million net rentable square feet) that represent approximately 76% of the aggregate net rentable square feet of our U.S. consolidated self-storage portfolio at December 31, 2025.
Others could come to materially different conclusions. 23 Allocating Purchase Price for Acquired Real Estate Facilities : We estimate the fair values of the assets and liabilities of acquired real estate facilities, which consist principally of land, buildings and acquired customers in place, for purposes of allocating the aggregate purchase price of acquired real estate facilities.
Allocating Purchase Price for Acquired Real Estate Facilities : We estimate the fair values of the assets and liabilities of acquired real estate facilities, which consist principally of land, buildings and acquired customers in place, for purposes of allocating the aggregate purchase price of acquired real estate facilities.
Our consistent, long-term dividend policy has been to distribute our taxable income. Future quarterly distributions with respect to the common shares will continue to be determined based upon our REIT distribution requirements after taking into consideration distributions to the preferred shareholders and will be funded with cash flows from operating activities.
Future quarterly distributions with respect to the common shares will continue to be determined based upon our REIT distribution requirements after taking into consideration distributions to the preferred shareholders and will be funded with cash flows from operating activities.
Cost of operations for the Same Store Facilities increased by 2.4% or $20.6 million in 2024 as compared to 2023, due primarily to increased property tax expense, marketing expense, and repairs and maintenance expense, partially offset by decreased centralized management costs and on-site property manager payroll expense.
Cost of operations for the Same Store Facilities increased by 2.1% or $19.1 million in 2024 as compared to 2023, due primarily to increased property tax expense, marketing expense, and repairs and maintenance expense, partially offset by decreased indirect cost of operations, utility expenses and on-site property manager payroll expense.
Such functions include information technology support, hardware, and software, as well as centralized administration of payroll, benefits, training, repairs and maintenance, customer service, pricing and marketing, operational accounting and finance, legal costs, and costs from field management executives.
Such functions include information technology support, hardware, and software, as well as centralized administration of payroll, benefits, training, repairs and maintenance, customer service, pricing and marketing, operational accounting and finance, legal costs, and costs from field management executives. The increase in 2025 was primarily driven by increases in personnel-related costs.
Property tax expense increased 4.7% and 3.5% in 2024 and 2023, respectively, in each case as compared to the previous year, as a result of higher assessed values. We expect property tax expense to grow approximately 5% in 2025 due primarily to higher assessed values.
Property tax expense increased 5.3% and 4.8% in 2025 and 2024, respectively, in each case as compared to the previous year, as a result of higher assessed values.
Of these expansions, 64 were completed before 2023, 17 were completed in 2023 or 2024, and five are currently in process at December 31, 2024.
Of these expansions, 45 were completed before 2024, 14 were completed in 2024 or 2025, and five are currently in process at December 31, 2025.
Centralized management costs decreased 8.0% in 2024 as compared to 2023 and decreased 5.3% in 2023 as compared to 2022, primarily driven by achievement of economies of scale from recent acquisitions with centralized management costs allocated over a broader number of self-storage facilities including non-same store facilities. 35 Analysis of Market Trends The following tables set forth selected market trends in our Same Store Facilities: Same Store Facilities Operating Trends by Market As of December 31, 2024 Year Ended December 31, Number of Facilities Square Feet (millions) Realized Rent per Occupied Square Foot Average Occupancy Realized Rent per Available Square Foot 2024 2023 Change (a) 2024 2023 Change (a) 2024 2023 Change (a) Los Angeles 218 15.9 $ 36.09 $ 35.83 0.7 % 94.6 % 95.4 % (0.8) % $ 34.15 $ 34.16 — % San Francisco 130 8.1 32.69 32.22 1.5 % 94.3 % 94.3 % — % 30.81 30.38 1.4 % New York 91 6.7 32.26 32.07 0.6 % 93.6 % 93.3 % 0.3 % 30.19 29.93 0.9 % Washington DC 109 7.3 26.92 26.62 1.1 % 92.8 % 91.7 % 1.1 % 24.97 24.40 2.3 % Miami 87 6.3 29.93 30.01 (0.3) % 93.1 % 93.6 % (0.5) % 27.88 28.08 (0.7) % Dallas-Ft.
The decrease in 2024 was primarily driven by achievement of economies of scale from recent acquisitions with centralized management costs allocated over a broader number of self-storage facilities including Non-Same Store Facilities. 34 Analysis of Market Trends The following tables set forth selected market trends in our Same Store Facilities: Same Store Facilities Operating Trends by Market As of December 31, 2025 Year Ended December 31, Realized Rent per Occupied Square Foot Average Occupancy Realized Rent per Available Square Foot Number of Facilities Square Feet (millions) 2025 2024 Change (a) 2025 2024 Change (a) 2025 2024 Change (a) Los Angeles 217 15.8 $ 35.76 $ 36.17 (1.1) % 94.8 % 94.6 % 0.2 % $ 33.91 $ 34.23 (0.9) % San Francisco 130 8.0 33.66 32.69 3.0 % 94.0 % 94.3 % (0.3) % 31.63 30.81 2.7 % New York 90 6.6 32.97 32.33 2.0 % 93.2 % 93.6 % (0.4) % 30.72 30.25 1.6 % Washington DC 109 7.3 27.48 26.92 2.1 % 93.2 % 92.8 % 0.4 % 25.62 24.97 2.6 % Miami 85 6.3 30.07 29.86 0.7 % 92.6 % 93.3 % (0.7) % 27.84 27.87 (0.1) % Seattle-Tacoma 95 6.7 26.66 25.76 3.5 % 92.2 % 92.8 % (0.6) % 24.59 23.90 2.9 % Dallas-Ft.
As of December 31, 2024 and February 24, 2025, there were no borrowings outstanding on the revolving line of credit; however, we do have approximately $19.6 million of outstanding letters of credit, which limits our borrowing capacity to $1,480.4 million as of February 24, 2025. Our line of credit matures on June 12, 2027.
Our revolving line of credit has a borrowing limit of $1.5 billion. As of December 31, 2025 and February 12, 2026, there were no borrowings outstanding on the revolving line of credit; however we do have approximately $19.4 million of outstanding letters of credit, which limits our borrowing capacity to $1.5 billion as of February 12, 2026.
We have been active in acquiring facilities in recent years. Since the beginning of 2022, we acquired a total of 260 facilities with 18.5 million net rentable square feet for $3.7 billion. During 2024, these facilities contributed net operating income of $159.7 million.
We have been active in acquiring facilities in recent years. Since the beginning of 2023, we acquired a total of 273 facilities with 19.9 million net rentable square feet for $3.9 billion. During 2025, these facilities contributed net operating income of $167.5 million.
Utility expense decreased 3.9% and 2.0% in 2024 and 2023, respectively, in each case as compared to the previous year, due primarily to our investment in energy saving technology such as solar power and LED lights, which generate favorable returns on investment in the form of lower utility usage.
Utility expense increased 1.0% in 2025 and decreased 4.2% in 2024 as compared to the previous year, due primarily to our investment in energy saving technology such as solar power and LED lights, which generate favorable returns on investment in the form of lower utility usage, partially offset by increased utility rates in 2025.
In 2024 and 2023, we recorded income tax expense totaling $4.7 million and $10.8 million, respectively, related to our taxable REIT subsidiaries and income taxes incurred in certain state and local jurisdictions in which we operate.
In 2025, we recorded an income tax benefit of $7.2 million and an income tax expense of $4.7 million in 2024, related to our taxable REIT subsidiaries and income taxes incurred in certain state and local jurisdictions in which we operate.
The $61.6 million increase in self-storage net operating income in 2024 as compared to 2023 is a result of a $108.9 million increase attributable to our Non-Same Store Facilities (as defined below), partially offset by a $47.3 million decrease attributable to our Same Store Facilities.
The $61.6 million increase in self-storage net operating income in 2024 as compared to 2023 was a result of a $103.4 million increase attributable to our Non-Same Store Facilities, partially offset by a $41.8 million decrease attributable to our Same Store Facilities.
During 2024, revenues generated by our Same Store Facilities decreased by 0.7% ($26.7 million), as compared to 2023, while Same Store cost of operations increased by 2.4% ($20.6 million). Softness in demand for our storage space has led to lower move-in rental rates for new tenants and lower average occupancy in 2024 as compared to 2023.
During 2025, revenues generated by our Same Store Facilities remained relatively unchanged, as compared to 2024, while Same Store cost of operations increased by 1.8% ($16.6 million). Softness in demand for our storage space has led to lower move-in rental rates for new tenants and lower average occupancy in 2025 as compared to 2024.
Because other REITs may not compute Core FFO or Core FFO per share in the same manner as we do, may not use the same terminology or may not present such measures, Core FFO and Core FFO per share may not be comparable among REITs. 27 The following table reconciles net income to FFO and Core FFO and reconciles diluted earnings per share to FFO per share and Core FFO per share: Year Ended December 31, Year Ended December 31, 2024 2023 Percentage Change 2023 2022 Percentage Change (Amounts in thousands, except per share data) Reconciliation of Net Income to FFO and Core FFO: Net income allocable to common shareholders $ 1,872,685 $ 1,948,741 (3.9) % $ 1,948,741 $ 4,142,288 (53.0) % Eliminate items excluded from FFO: Real estate-related depreciation and amortization 1,117,752 962,703 962,703 881,569 Real estate-related depreciation from unconsolidated real estate investment 44,181 36,769 36,769 54,822 Real estate-related depreciation allocated to noncontrolling interests and restricted share unitholders and unvested LTIP unitholders (7,167) (6,635) (6,635) (6,622) Gains on sale of real estate investments, including our equity share from investment (1,537) (17,290) (17,290) (54,403) Gain on sale of equity investment in PS Business Parks, Inc. — — — (2,116,839) FFO allocable to common shares $ 3,025,914 $ 2,924,288 3.5 % $ 2,924,288 $ 2,900,815 0.8 % Eliminate the impact of items excluded from Core FFO, including our equity share from investment: Foreign currency exchange (gain) loss (102,244) 51,197 51,197 (98,314) Unrealized gain on private equity investments (4,355) (2,817) (2,817) (4,685) Hiring bonus for a new senior executive 3,507 — — — Other items 12,246 3,264 3,264 9,164 Core FFO allocable to common shares $ 2,935,068 $ 2,975,932 (1.4) % $ 2,975,932 $ 2,806,980 6.0 % Reconciliation of Diluted Earnings per Share to FFO per Share and Core FFO per Share: Diluted earnings per share $ 10.64 $ 11.06 (3.8) % $ 11.06 $ 23.50 (52.9) % Eliminate amounts per share excluded from FFO: Real estate-related depreciation and amortization 6.56 5.64 5.64 5.27 Gains on sale of real estate investments, including our equity share from investment (0.01) (0.10) (0.10) (0.31) Gain on sale of equity investment in PS Business Parks, Inc. — — — (12.00) FFO per share $ 17.19 $ 16.60 3.6 % $ 16.60 $ 16.46 0.9 % Eliminate the per share impact of items excluded from Core FFO, including our equity share from investment: Foreign currency exchange (gain) loss (0.58) 0.29 0.29 (0.57) Unrealized gain on private equity investments (0.02) (0.02) (0.02) (0.03) Hiring bonus for a new senior executive 0.02 — — — Other items 0.06 0.02 0.02 0.06 Core FFO per share $ 16.67 $ 16.89 (1.3) % $ 16.89 $ 15.92 6.1 % Diluted weighted average common shares 176,038 176,143 176,143 176,280 28 Analysis of Net Income — Self-Storage Operations Our self-storage operations are analyzed in four groups: (i) the 2,507 facilities that we have owned and operated on a stabilized basis since January 1, 2022 (the “Same Store Facilities”), (ii) 260 facilities we acquired since January 1, 2022 (the “Acquired Facilities”), (iii) 132 facilities that have been newly developed or expanded, or that had commenced expansion by December 31, 2024 (the “Newly Developed and Expanded Facilities”), and (iv) 174 other facilities, which are otherwise not stabilized with respect to occupancies or rental rates since January 1, 2022 (the “Other Non-Same Store Facilities”).
Because other REITs may not compute Core FFO or Core FFO per share in the same manner as we do, may not use the same terminology or may not present such measures, Core FFO and Core FFO per share may not be comparable among REITs. 26 The following table reconciles net income to FFO and Core FFO and reconciles diluted earnings per share to FFO per share and Core FFO per share: Year Ended December 31, Year Ended December 31, 2025 2024 Percentage Change 2024 2023 Percentage Change (Amounts in thousands, except per share data) Reconciliation of Net Income to FFO and Core FFO: Net income allocable to common shareholders $ 1,585,585 $ 1,872,685 (15.3) % $ 1,872,685 $ 1,948,741 (3.9) % Eliminate items excluded from FFO: Real estate-related depreciation and amortization 1,140,377 1,117,752 1,117,752 962,703 Real estate-related depreciation from unconsolidated real estate investment 59,470 44,181 44,181 36,769 Real estate-related depreciation allocated to noncontrolling interests, restricted share unitholders and unvested LTIP unitholders (8,216) (7,167) (7,167) (6,635) Impairment write-down of real estate investments 4,348 — — — Gains on sale of real estate investments, including our equity share from investment (1,113) (1,537) (1,537) (17,290) FFO allocable to common shares $ 2,780,451 $ 3,025,914 (8.1) % $ 3,025,914 $ 2,924,288 3.5 % Eliminate items excluded from Core FFO: Adjustments to G&A Expense: Contingency reserve 290 3,300 3,300 — Corporate transformation costs 4,875 — — — Transaction costs 3,146 — — — Hiring bonus for a new senior executive — 3,507 3,507 — Other Non-Core Adjustments: Foreign currency exchange (gain) loss 215,583 (102,244) (102,244) 51,197 Unrealized (gain) loss on private equity investments (3,859) (4,355) (4,355) (2,817) Income tax provision (benefit) (15,847) — — — Other items 850 8,946 8,946 3,264 Core FFO allocable to common shares $ 2,985,489 $ 2,935,068 1.7 % $ 2,935,068 $ 2,975,932 (1.4) % Reconciliation of Diluted Earnings per Share to FFO per Share and Core FFO per Share: Diluted earnings per share $ 9.01 $ 10.64 (15.3) % $ 10.64 $ 11.06 (3.8) % Eliminate amounts per share excluded from FFO: Real estate-related depreciation and amortization 6.78 6.56 6.56 5.64 Impairment write-down of real estate investments 0.03 — — — Gains on sale of real estate investments, including our equity share from investment (0.01) (0.01) (0.01) (0.10) FFO per share $ 15.81 $ 17.19 (8.0) % $ 17.19 $ 16.60 3.6 % Eliminate amounts per share excluded from Core FFO: Adjustments to G&A Expense: Contingency reserve — 0.02 0.02 — Corporate transformation costs 0.03 — — — Transaction costs 0.02 — — — Hiring bonus for a new senior executive — 0.02 0.02 — Other Non-Core Adjustments: Foreign currency exchange (gain) loss 1.23 (0.58) (0.58) 0.29 Unrealized (gain) loss on private equity investments (0.02) (0.02) (0.02) (0.02) Income tax provision (benefit) (0.09) — — — Other items (0.01) 0.04 0.04 0.02 Core FFO per share $ 16.97 $ 16.67 1.8 % $ 16.67 $ 16.89 (1.3) % Diluted weighted average common shares 175,902 176,038 176,038 176,143 27 Analysis of Net Income — Self-Storage Operations Our self-storage operations are analyzed in four groups: (i) 2,565 facilities that we have owned and operated on a stabilized basis since January 1, 2023 (the “Same Store Facilities”), (ii) 273 facilities we acquired since January 1, 2023 (the “Acquired Facilities”), (iii) 111 facilities that have been newly developed or expanded, or that had commenced expansion by December 31, 2025 (the “Newly Developed and Expanded Facilities”), and (iv) 222 other facilities, which are otherwise not stabilized with respect to occupancies or rental rates since January 1, 2023 (the “Other Non-Same Store Facilities”).
Through December 31, 2024 and February 24, 2025, we have issued a total of 184,390 common shares on the open market for an aggregate gross sales price of $61.4 million and received net proceeds of approximately $60.3 million after issuance costs.
Since the inception of the program, we have issued a total of 184,390 common shares on the open market for an aggregate gross sales price of $61.4 million and received net proceeds of approximately $60.3 million after issuance costs. We did not issue any common shares under the program in 2025.
The following discussion and analysis of the components of net income, including Ancillary Operations and certain items not allocated to segments, present a comparison for the year ended December 31, 2024 to the year ended December 31, 2023.
The increase was primarily due to newly acquired facilities and newly developed and expanded facilities. 44 The following discussion and analysis of the components of net income, including Ancillary Operations and certain items not allocated to segments, present a comparison for the year ended December 31, 2025 to the year ended December 31, 2024.
The increase in 2024 was due primarily to increased property tax expense, marketing expense, and repairs and maintenance expense, partially offset by decreased centralized management costs and on-site property manager payroll expense. The increase in 2023 was due primarily to increased property tax expense, marketing expense, and other direct property costs.
The increase in 2024 was due primarily to increased property tax expense, repairs and maintenance expense and marketing expense partially offset by decreased on-site property manager payroll expense, utilities expense and indirect cost of operations.
The Other Non-Same Store Facilities have an aggregate of 17.0 million net rentable square feet at December 31, 2024. During 2024, 2023, and 2022, the average occupancy for these facilities totaled 82.5%, 81.4%, and 81.2%, respectively, and the realized rent per occupied square foot totaled $17.17, $16.64, and $14.85, respectively.
The Other Non-Same Store Facilities have an aggregate of 20.9 million net rentable square feet at December 31, 2025. During 2025, 2024, and 2023, the average occupancy for these facilities totaled 85.3%, 81.8%, and 80.8%, respectively, and the realized rent per occupied square foot totaled $15.82, $16.01, and $15.52, respectively.
Dollars per Euro at December 31, 2024 and 1.104 at December 31, 2023. Future gains and losses on foreign currency will be dependent upon changes in the relative value of the Euro to the U.S. Dollar and the level of Euro-denominated notes payable outstanding.
Dollars per Euro at December 31, 2025 and 1.039 at December 31, 2024. Future gains and losses on foreign currency will be dependent upon changes in the relative value of the Euro to the U.S. Dollar and the level of Euro-denominated notes payable outstanding. Income tax (provision) benefit: We operate as a REIT for U.S. federal income tax purposes.
We expect a decline in utility expense in 2025 as compared to 2024 as we continue our investment in solar power. Marketing expense includes Internet advertising we utilize through our online paid search programs, television advertising and the operating costs of our website and telephone reservation center.
We expect lower electricity consumption in 2026 as a result of our continued investment in solar power. Marketing expense includes internet advertising we utilize through our online paid search programs and the operating costs of our website and telephone reservation center.
(d) We have completed an expansion project on a facility developed in 2021 for $12.8 million, adding 79,000 net rentable square feet of storage space as of December 31, 2024. Our Newly Developed and Expanded Facilities includes a total of 132 self-storage facilities of 15.8 million net rentable square feet.
(d) We have completed an expansion project on a facility developed in 2021 for $12.8 million, adding 79,000 net rentable square feet of storage space as of December 31, 2024. (e) We have completed an expansion project on a facility developed in 2023 for $23.8 million, adding 140,000 net rentable square feet of storage space as of December 31, 2025.
Third-party property management: At December 31, 2024, in our third-party property management program, we managed 307 facilities (23.3 million net rentable square feet) for unrelated third parties, and were under contract to manage 95 additional facilities (8.4 million net rentable square feet) including 93 facilities that are currently under construction.
Third-party property management: At December 31, 2025, in our third-party property management program, we managed 362 facilities (28.2 million net rentable square feet) for unrelated third parties, and were under contract to manage 84 additional facilities (7.1 million net rentable square feet) including 78 facilities that are currently under construction.
Comparison of the Year Ended December 31, 2024 to the Year Ended December 31, 2023 Revenues generated by our Same Store Facilities decreased 0.7% in 2024 as compared to 2023, due primarily to a 0.6% decrease in average occupancy and a 0.1% decrease in realized annual rent per occupied square foot.
Comparison of the Year Ended December 31, 2025 to the Year Ended December 31, 2024 Revenues generated by our Same Store Facilities remained relatively unchanged compared to 2024, due primarily to a 0.5% increase in realized annual rent per occupied square foot partially offset by a 0.4% decrease in average occupancy.
We expect these facilities to open over the next 18 to 24 months. 44 The facilities under “expansion in process” represent those facilities where construction is in process at December 31, 2024, and together with additional future expansion activities primarily related to our Same Store Facilities at December 31, 2024, we expect to add a total of 1.5 million net rentable square feet of storage space by expanding existing self-storage facilities for an aggregate direct development cost of $242.7 million.
We incurred a total of $809.9 million in direct cost to expand these facilities, demolished a total of 0.6 million net rentable square feet of storage space, and built a total of 4.8 million net rentable square feet of new storage space. 43 The facilities under “expansion in process” represent those facilities where construction is in process at December 31, 2025, and together with additional future expansion activities primarily related to our Same Store Facilities at December 31, 2025, we expect to add a total of 0.9 million net rentable square feet of storage space by expanding existing self-storage facilities for an aggregate direct development cost of $130.4 million.
We completed the program in 2024. We spent approximately $127 million on the program in 2024. We have also embarked on a solar program under which we plan to install solar panels on over 1,400 of our self-storage facilities. We have completed the installations on 772 facilities through December 31, 2024.
We have embarked on a solar program under which we plan to install solar panels on over 1,600 of our self-storage facilities. We have completed the installations on 1,191 facilities through December 31, 2025. We spent approximately $71 million on the program in 2025, and expect to spend approximately $60 million in 2026 on this effort.
See Note 9 to our December 31, 2024 consolidated financial statements for the redemption dates of all of our series of preferred shares. Redemption of such preferred shares will depend upon many factors, including the rate at which we could issue replacement preferred securities. None of our preferred securities are redeemable at the option of the holders.
Redemption of such preferred shares will depend upon many factors, including the rate at which we could issue replacement preferred securities. None of our preferred securities are redeemable at the option of the holders.
Revenues for the Same Store Facilities decreased 0.7% or $26.7 million in 2024 as compared to 2023, due primarily to a decline in occupancy and lower realized annual rent per occupied square foot.
Revenues for the Same Store Facilities decreased 0.6% or $22.7 million in 2024 as compared to 2023, due primarily to a decline in occupancy.
We plan to refinance these unsecured notes as they come due in 2025. Our cash requirements may increase over the next year as we add projects to our development pipeline and acquire additional properties.
We plan to refinance these unsecured notes as they come due in 2026 through either cash generated from operations, the issuance of additional debt or borrowings under the Company's Credit Facility. Our cash requirements may increase over the next year as we add projects to our development pipeline and acquire additional properties.
The increase in net operating income of $108.9 million for the Non-Same Store Facilities is due primarily to the impact of facilities acquired in 2023.
The increase in net operating income of $68.4 million for the Non-Same Store Facilities was due primarily to the impact of facilities acquired in 2025 and 2024.
Repairs and maintenance expense increased 9.0% and 6.3% in 2024 and 2023, respectively, in each case as compared to the previous year.
Repairs and maintenance expense increased 1.4% and 8.8% in 2025 and 2024, respectively, in each case as compared to the previous year.
For the year ended December 31, 2024, FFO was $17.19 per diluted common share as compared to $16.60 and $16.46 per diluted common share for the years ended December 31, 2023 and 2022, respectively, representing an increase in 2024 of 3.6%, or $0.59 per diluted common share, as compared to 2023. 26 We also present “Core FFO” and “Core FFO per share” non-GAAP measures that represent FFO and FFO per share excluding the impact of (i) foreign currency exchange gains and losses, (ii) charges related to the redemption of preferred securities, and (iii) certain other non-cash and/or nonrecurring income or expense items primarily representing, with respect to the periods presented below, the impact of loss contingencies and resolutions, casualties, due diligence costs incurred in pursuit of strategic transactions, unrealized gain on private equity investments, reorganization costs, acquisition integration costs, amortization of acquired non real estate-related intangibles, a cash and stock hiring bonus for a new senior executive, and our equity share of tax effect of a change in tax status, unrealized gain on derivatives, merger transaction costs and senior executive severance from our equity investees.
We also present “Core FFO” and “Core FFO per share” non-GAAP measures that represent FFO and FFO per share excluding the impact of (i) foreign currency exchange gains and losses, (ii) charges related to the redemption of preferred securities, and (iii) certain other non-cash and/or nonrecurring income or expense items primarily representing, with respect to the periods presented below, the impact of corporate transformation costs, loss contingencies, due diligence costs incurred in pursuit of strategic transactions, realized or unrealized gain or loss on private equity investments, income tax benefits from the sale of solar tax credits, a cash and stock hiring bonus for a new senior executive and amortization of acquired non real estate-related intangibles.
At December 31, 2024, we had 26 additional facilities in development, which will have a total of 2.5 million net rentable square feet of storage space and have an aggregate development cost totaling approximately $498.9 million.
At December 31, 2025, we had 29 additional facilities in development, which will have a total of 2.6 million net rentable square feet of storage space and have an aggregate development cost totaling approximately $479.5 million. We expect these facilities to open over the next 18 to 24 months.
Delinquency rates remained at similar levels for 2024 as compared to 2023. 34 Analysis of Same Store Cost of Operations Cost of operations (excluding depreciation and amortization) increased 2.4% and 4.6% in 2024 and 2023, respectively, in each case as compared to the previous year.
Analysis of Same Store Cost of Operations Cost of operations (excluding depreciation and amortization) increased 1.8% and 2.1% in 2025 and 2024, respectively, in each case as compared to the previous year.
The increase of interest expense in 2024 as compared to 2023 is due to the issuance of $2.2 billion of notes payable in July 2023 and the increase of Compounded SOFR on our variable rate unsecured notes. At December 31, 2024, we had $9.4 billion of notes payable outstanding, with a weighted average interest rate of approximately 3.1%.
The increase of interest expense in 2025 as compared to 2024 was due to the issuance of U.S. Dollar and Euro denominated unsecured notes. At December 31, 2025, we had $10.3 billion of notes payable outstanding, with a weighted average interest rate of approximately 3.2%.
In 2024, our Board authorized an “at the market” offering program pursuant to which management may issue common shares up to an aggregate gross sales price of $2.0 billion on the open market or in privately negotiated transactions.
Our line of credit matures on June 12, 2027. In December 2024, we implemented an “at the market” offering program pursuant to which we may, from time to time, sell common shares through participating agents up to an aggregate gross sales price of $2.0 billion on the open market or in privately negotiated transactions.
As described below, our current committed cash requirements consist of (i) $140.7 million in property acquisitions currently under contract, (ii) $433.5 million of remaining spending on our current development pipeline, which will be incurred primarily in the next 18 to 24 months, and (iii) approximately $651 million in scheduled principal repayments on our unsecured notes in the next twelve months.
As described below, our current committed cash requirements consist of (i) $20.7 million in property acquisitions currently under contract, (ii) $415.6 million of remaining spending on our current development pipeline, which will be incurred primarily in the next 18 to 24 months, (iii) unfunded loan commitments of $43.9 million under the bridge lending program expected to close in the next twelve months, (iv) approximately $1.2 billion in scheduled principal repayments on our unsecured notes in the next twelve months, and (v) $48.2 million in unfunded capital commitments related to our private equity investments.
Operating Results for 2023 and 2022 In 2023, net income allocable to our common shareholders was $1.949 billion or $11.06 per diluted common share, compared to $4.142 billion or $23.50 per diluted common share in 2022, representing a decrease of $2.2 billion or $12.44 per diluted common share.
Operating Results for 2024 and 2023 In 2024, net income allocable to our common shareholders was $1.9 billion or $10.64 per diluted common share, compared to $1.9 billion or $11.06 per diluted common share in 2023, representing a decrease of $76.1 million or $0.42 per diluted common share.
Our ability to do so continues to be challenged by various constraints such as difficulty in finding projects that meet our risk-adjusted yield expectations and challenges in obtaining building permits for self-storage facilities in certain municipalities. Property Operating Expenses: The direct and indirect cost of our operations impose significant cash requirements.
Our ability to do so continues to be challenged by various constraints such as difficulty in finding projects that meet our risk-adjusted yield expectations and challenges in obtaining building permits for self-storage facilities in certain municipalities. Bridge loan commitments: We offer bridge loan financing to third-party self-storage owners for operating properties that we manage.
Revenues for the Same Store Facilities increased 4.8% or $170.2 million in 2023 as compared to 2022, due primarily to higher realized annual rent per available square foot, partially offset by a decline in occupancy.
Revenues for the Same Store Facilities remained relatively unchanged in 2025 as compared to 2024, due primarily to higher realized annual rent per occupied square foot partially offset by a decline in average occupancy.
While we expect this business to increase in scope and size, we do not expect any significant changes in overall profitability of this business in the near term as we seek new properties to manage and are in the earlier stages of fill-up for newly managed properties.
While we expect this business to increase in scope and size, we do not expect any significant changes in overall profitability of this business in the near term as we seek new properties to manage and are in the earlier stages of fill-up for newly managed properties. 45 Analysis of items not allocated to segments Equity in earnings of unconsolidated real estate entity: We account for our equity investment in Shurgard using the equity method and record our pro-rata share of its net income.
Included in our equity earnings from Shurgard were $44.2 million and $36.8 million of our share of depreciation and amortization expense for 2024 and 2023, respectively. On August 1, 2024, Shurgard acquired Lok’nStore, a self-storage company publicly traded on the London Stock Exchange, for approximately £385 million ($501 million) in cash, including direct acquisition costs.
On August 1, 2024, Shurgard acquired Lok’nStore, a self-storage company publicly traded on the London Stock Exchange, for approximately £385 million ($501 million) in cash, including direct acquisition costs. For purposes of recording our equity in earnings from Shurgard, the Euro was translated at exchange rates of approximately 1.174 U.S.
We view our line of credit, as well as any short-term bank loans, as bridge financing. Because raising capital is important to our growth, we endeavor to maintain a strong financial profile characterized by strong credit metrics, including low leverage relative to our total capitalization and operating cash flows.
Because raising capital is important to our growth, we endeavor to maintain a strong financial profile characterized by strong credit metrics, including low leverage relative to our total capitalization and operating cash flows. We are one of the highest rated REITs, as rated by major rating agencies Moody’s and Standard & Poor’s.
We are one of the highest rated REITs, as rated by major rating agencies Moody’s and Standard & Poor’s. Our senior notes payable have an “A” credit rating by Standard & Poor’s and “A2” by Moody’s. Our credit ratings on each of our series of preferred shares are “A3” by Moody’s and “BBB+” by Standard & Poor’s.
Our senior notes payable have an “A” credit rating by Standard & Poor’s and “A2” by Moody’s. Our credit ratings on each of our series of preferred shares are “A3” by Moody’s and “BBB+” by Standard & Poor’s. Our credit profile enables us to effectively access both the public and private capital markets to raise capital.
Requirement to Pay Distributions: For all periods presented herein, we have elected to be treated as a REIT, as defined in the Internal Revenue Code.
We believe the capital spent to install solar panels and LED lights will significantly reduce electricity consumption resulting in lower utility costs. Requirement to Pay Distributions: For all periods presented herein, we have elected to be treated as a REIT, as defined in the Internal Revenue Code.
(b) Revenues and cost of operations do not include tenant reinsurance and merchandise sales generated at the facilities. See “Ancillary Operations” below for more information.
(b) Revenues and cost of operations do not include tenant reinsurance and merchandise sales generated at the facilities. See “Ancillary Operations” below for more information. (c) Annual contract rent represents the agreed upon monthly rate that is paid by our tenants in place at the time of measurement.
Real estate acquisition and development expense: In 2024 and 2023, we incurred a total of $15.5 million and $26.5 million, respectively, of internal and external expenses related to our acquisition and development of real estate facilities.
Dollars per Euro at December 31, 2025 (1.039 at December 31, 2024), and average exchange rates of 1.130 for 2025 and 1.082 for 2024. Real estate acquisition and development expense: In 2025 and 2024, we incurred a total of $19.6 million and $15.5 million, respectively, of internal and external expenses related to our acquisition and development of real estate facilities.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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ITEM 8. Financial Statements and Supplementary Data The financial statements and supplementary data appearing on pages F-3 to F-35 are incorporated herein by reference. ITEM 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure Not applicable.
ITEM 8. Financial Statements and Supplementary Data The financial statements and supplementary data appearing on pages F-3 to F-39 are incorporated herein by reference. ITEM 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure Not applicable.
Our debt, which totals approximately $9.4 billion at December 31, 2024, is the only market-risk sensitive portion of our capital structure. The fair value of our debt at December 31, 2024 is approximately $8.8 billion. The table below summarizes the annual maturities of our debt, which had a weighted average effective rate of 3.1% at December 31, 2024.
Our debt, which totals approximately $10.3 billion at December 31, 2025, is the only market-risk sensitive portion of our capital structure. The fair value of our debt at December 31, 2025 is approximately $9.9 billion. The table below summarizes the annual maturities of our debt, which had a weighted average effective rate of 3.2% at December 31, 2025.
See Note 7 to our December 31, 2024 consolidated financial statements for further information regarding our debt (amounts in thousands). 2025 2026 2027 2028 2029 Thereafter Total Debt $ 651,516 $ 1,150,138 $ 1,200,146 $ 1,200,129 $ 1,000,088 $ 4,203,350 $ 9,405,367 We have foreign currency exposure at December 31, 2024 related to (i) our investment in Shurgard, with a book value of $382.5 million, and a fair value of $1.3 billion based upon the closing price of Shurgard’s stock on December 31, 2024, and (ii) €1.6 billion ($1.7 billion) of Euro-denominated unsecured notes payable, providing a natural hedge against the fair value of our investment in Shurgard.
We have foreign currency exposure at December 31, 2025 related to (i) our investment in Shurgard, with a book value of $388.6 million, and a fair value of $1.2 billion based upon the closing price of Shurgard’s stock on December 31, 2025, and (ii) €1.8 billion ($2.1 billion) of Euro-denominated unsecured notes payable, providing a natural hedge against the fair value of our investment in Shurgard.
Added
See Note 8 to our December 31, 2025 consolidated financial statements for further information regarding our debt. 2026 2027 2028 2029 2030 Thereafter Total (Amounts in Thousands) Debt $ 1,150,138 $ 1,200,146 $ 1,200,129 $ 1,000,088 $ 1,297,819 $ 4,462,000 $ 10,310,320 At December 31, 2025, we have three separate interest rate swaps with a notional amount of $475 million which converted our $475 million principal amount of 4.375% fixed rate senior unsecured notes due July 2030 into a floating rate instrument with an interest rate based on a SOFR index.
Added
See Note 8 to our December 31, 2025 consolidated financial statements for further information regarding our swaps.

Other PSA 10-K year-over-year comparisons