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What changed in Global Self Storage, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Global Self Storage, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+215 added−184 removedSource: 10-K (2025-03-26) vs 10-K (2024-03-26)

Top changes in Global Self Storage, Inc.'s 2024 10-K

215 paragraphs added · 184 removed · 175 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

29 edited+11 added−3 removed64 unchanged
Biggest changeRisk Factors—Risks Related to Our Business—Costs associated with complying with the ADA may result in unanticipated expenses.” Insurance activities are subject to state insurance laws and regulations as determined by the particular insurance commissioner for each state in accordance with the McCarran-Ferguson Act, as well as subject to the Gramm-Leach-Bliley Act and the privacy regulations promulgated by the Federal Trade Commission pursuant thereto.
Biggest changeRisk Factors—Risks Related to Our Business—Costs associated with complying with the ADA may result in unanticipated expenses.” Insurance activities are subject to state insurance laws and regulations as determined by the particular insurance commissioner for each state in accordance with the McCarran-Ferguson Act, as well as subject to the Gramm-Leach-Bliley Act and the privacy regulations promulgated by the Federal Trade Commission pursuant thereto. 12 Under the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended (“CERCLA”), and comparable state laws, we may be required to investigate and remediate regulated hazardous materials at one or more of our properties.
To the extent the Company continues to qualify as a REIT, it will not generally be subject to U.S. federal income tax, with certain limited exceptions, on its taxable income that is distributed to its stockholders.
To the extent that the Company continues to qualify as a REIT, it will not generally be subject to U.S. federal income tax, with certain limited exceptions, on its taxable income that is distributed to its stockholders.
Whenever the environmental assessment for one of our stores indicates that a store is impacted by soil or groundwater contamination from prior owners/operators or other sources, we will work with environmental consultants and where appropriate, state governmental agencies, to ensure that the store is either cleaned up, that no cleanup is necessary because the low level of contamination poses no significant risk to public health or the environment, or that the responsibility for cleanup rests with a third party.
Whenever the environmental assessment for one of our stores indicates that a store is impacted by soil or groundwater contamination from prior owners/operators or other sources, we will work with environmental consultants and where appropriate, state governmental agencies, to ensure that the store is cleaned up, that no cleanup is necessary because the low level of contamination poses no significant risk to public health or the environment, or that the responsibility for cleanup rests with a third party.
We compete based on a number of factors including location, rental rates, 11 security, suitability of the property’s design to prospective tenants’ needs, and the manner in which the property is operated and marketed. We believe that the primary competition for potential customers comes from other self storage properties within a three to five mile radius from our stores.
We compete based on a number of factors including location, rental rates, security, suitability of the property’s design to prospective tenants’ needs, and the manner in which the property is operated and marketed. We believe that the primary competition for potential customers comes from other self storage properties within a three to five mile radius from our stores.
We seek to increase employee retention and well-being and our employees enjoy an attractive benefit package that includes medical, dental, vision, life insurance, 401(k) with matching employer contribution, cash bonuses, and long-term equity compensation. We offer competitive health benefits and encourage our employees to participate in employee health and wellness programs.
We seek to increase employee retention and well-being and our employees enjoy an attractive benefit package that includes medical, dental, vision, life insurance, 401(k) with matching employer contribution, cash bonuses, and long-term equity compensation. We offer competitive health benefits and encourage our employees to participate in employee health 13 and wellness programs.
Available Information The SEC maintains an Internet site at http://www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Additional information about the Company, not contained in this annual report or made a part hereof, may be found at www.GlobalSelfStorage.us.
Available Information The SEC maintains an Internet site at http://www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. Additional information about 14 the Company, not contained in this annual report or made a part hereof, may be found at www.GlobalSelfStorage.us.
We currently intend to strategically withdraw proceeds available under the Amended Credit Facility Loan Agreement to fund: (i) the acquisition of additional self storage properties, (ii) expansions at existing self storage properties in our portfolio, and/or (iii) joint ventures with third parties for the acquisition and expansion of self storage properties.
We currently intend to strategically withdraw proceeds available under the Second Amended Credit Facility Loan Agreement to fund: (i) the acquisition of additional self storage properties, (ii) expansions at existing self storage properties in our portfolio, and/or (iii) joint ventures with third parties for the acquisition and expansion of self storage properties.
Our Acquisition Strategy General In our store acquisition strategy, we will seek to continue to focus on secondary and tertiary cities in the Mid-West, Northeast and Mid-Atlantic parts of the country where we believe there is relatively less self storage space per capita available, generally resulting in greater demand for available self storage square feet; where new self storage development and permitting through the local planning and zoning boards is typically more difficult to secure thus creating barriers to entry for new self storage competition; and where local new supply through new development is generally less prevalent. 8 We continue to review available acquisition opportunities with the awareness that changes in interest rates may impact our ability to obtain favorable rates for financing acquisitions.
Our Acquisition Strategy General In our store acquisition strategy, we will seek to continue to focus on secondary and tertiary cities in the Mid-West, Northeast and Mid-Atlantic parts of the country where we believe there is relatively less self storage space per capita available, generally resulting in greater demand for available self storage square feet; where new self storage development and permitting through the local planning and zoning boards is typically more difficult to secure thus creating barriers to entry for new self storage competition; and where local new supply through new development is generally less prevalent. 9 We continue to review available acquisition opportunities with the awareness that changes in interest rates may impact our ability to obtain favorable rates for financing acquisitions.
We raised aggregate gross proceeds of approximately $6.7 million in the rights offering. 9 On May 19, 2020, an affiliate of the Company (the “Borrower”) entered into a Paycheck Protection Program Term Note (“PPP Note”) with Customers Bank on behalf of itself, the Company, and certain other affiliates under the Paycheck Protection Program of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) administered by the U.S.
We raised aggregate gross proceeds of approximately $6.7 million in the rights offering. 10 On May 19, 2020, an affiliate of the Company (the “Borrower”) entered into a Paycheck Protection Program Term Note (“PPP Note”) with Customers Bank on behalf of itself, the Company, and certain other affiliates under the Paycheck Protection Program of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) administered by the U.S.
Because we operate in competitive markets, often where self storage consumers have multiple stores from which to choose, such competition has affected and is likely to continue to affect our store results. We experience seasonal fluctuations in occupancy levels as well, with occupancy levels generally higher in the summer months due to 7 increased moving activity.
Because we operate in competitive markets, often where self storage consumers have multiple stores from which to choose, such competition has affected and is likely to continue to affect our store results. We experience seasonal fluctuations in occupancy levels as well, with occupancy levels generally higher in the summer months due to 8 increased moving activity.
As of December 31, 2023, the Company owned and operated, or managed, through its wholly owned subsidiaries, thirteen stores located in Connecticut, Illinois, Indiana, New York, Ohio, Pennsylvania, South Carolina, and Oklahoma. The Company was formerly registered under the Investment Company Act of 1940, as amended (the “1940 Act”) as a non-diversified, closed end management investment company.
As of December 31, 2024, the Company owned and operated, or managed, through its wholly owned subsidiaries, thirteen stores located in Connecticut, Illinois, Indiana, New York, Ohio, Pennsylvania, South Carolina, and Oklahoma. The Company was formerly registered under the Investment Company Act of 1940, as amended (the “1940 Act”) as a non-diversified, closed end management investment company.
Lease rates at each store may be set monthly, semi-annually, annually, or at any other time on a case-by-case basis as determined in the discretion of management. Tenants may be assessed late, administrative, and/or other fees. To date, none of the Company’s stores have experienced any material delinquencies.
Lease rates at each store may be set monthly, semi-annually, annually, or at any other interval on a case-by-case basis as determined in the discretion of management. Tenants may be assessed late, administrative, and/or other fees. To date, none of the Company’s stores have experienced any material delinquencies.
These entities also seek financing through similar channels to the Company. Therefore, we will continue to compete for investors in a market where funds for real estate investment may decrease. Human Capital We seek to create a diverse and inclusive work environment that values each employee’s talents and contributions.
These entities also seek financing through similar channels to the Company. Therefore, we will continue to compete for investors in a market where funds for real estate investment may decrease. Human Capital We seek to create a work environment that values each employee’s talents and contributions.
Laws, ordinances, or regulations affecting development, construction, operation, upkeep, safety and taxation requirements may result in significant unanticipated expenditures, loss of self storage sites or other impairments to operations, which would adversely affect our cash flows from operating activities.
Laws, ordinances, or regulations affecting development, construction, operation, upkeep, safety and taxation requirements may result in significant unanticipated expenditures, loss of self storage stores or other impairments to operations, which would adversely affect our cash flows from operating activities.
The obligations under the Amended Credit Facility Loan Agreement are secured by certain real estate assets owned by the Amended Credit Facility Secured Subsidiaries.
The obligations under the Second Amended Credit Facility Loan Agreement are secured by certain real estate assets owned by the Second Amended Credit Facility Secured Subsidiaries.
We continue to actively review a number of store and store portfolio acquisition opportunities and have been working to further redevelop and expand our current stores. We did not complete any self storage property acquisitions in 2023.
We continue to actively review a number of store and store portfolio acquisition opportunities and have been working to further redevelop and expand our current stores. We did not complete any self storage property acquisitions in 2024.
We solicit tenant reviews for posting to the “Testimonials” section of our website and encourage others to view these reviews. We have found referrals of current tenants to be a reliable source of new tenants. Existing self storage customers may also pay their storage unit rent online through www.GlobalSelfStorage.us.
We solicit tenant reviews for posting to the “Customer Reviews” section of our website and encourage others to view these reviews. We have found referrals of current tenants to be a reliable source of new tenants. Existing self storage customers may also pay their storage unit rent online through www.GlobalSelfStorage.us.
Under the Amended Credit Facility Loan Agreement, the Amended Credit Facility Secured Subsidiaries may borrow from the Amended Credit Facility Lender in the principal amount of up to $15 million, reduced to $14.75 million and $14.5 million in years 2 and 3, respectively, pursuant to a promissory note (the “Amended Credit Facility Promissory Note”).
Under the Amended Credit Facility Loan Agreement, the Amended Credit Facility Secured Subsidiaries were able to borrow from the Amended Credit Facility Lender in the principal amount of up to $15 million, reduced to $14.75 million and $14.5 million in years 2 and 3, respectively, pursuant to a promissory note (the “Amended Credit Facility Promissory Note”).
On December 18, 2019, we completed a rights offering whereby we sold and issued an aggregate of 1,601,291 shares of our common stock (“common stock”) at the subscription price of $4.18 per whole share of common stock, pursuant to the exercise of subscriptions and oversubscriptions from our stockholders.
On December 18, 2019, we completed a rights offering whereby we sold and issued an aggregate of 1,601,291 shares of our common stock, par value $0.01 per share (“common stock”), at the subscription price of $4.18 per whole share of common stock, pursuant to the exercise of subscriptions and oversubscriptions from our stockholders.
Also, in 2023, we continued to explore the installation of solar panels at our properties which we expect would reduce energy consumption and costs at such locations. 12 Climate Change and Environmental Stewardship We are committed to managing climate-related risks and opportunities in relation to our business.
In 2024, we continued to explore the installation of solar panels at our properties, which we expect would reduce energy consumption and costs at such locations. Climate Change and Environmental Stewardship We are committed to managing climate-related risks and opportunities in relation to our business.
The Company and the Amended Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Amended Credit Facility Loan Documents. The Company also maintains a bank account at the Amended Credit Facility Lender. As of December 31, 2023, we have not withdrawn proceeds under the Amended Credit Facility Loan Agreement.
The Company and the Second Amended Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Second Amended Credit Facility Loan Documents. The Company also maintains a bank account at the Second Amended Credit Facility Lender. As of December 31, 2024, we have no withdrawn proceeds under the Second Amended Credit Facility Loan Agreement.
Risk Factors—Risks Related to Our Business—Extensive environmental regulation to which we are subject creates uncertainty regarding future environmental expenditures and liabilities.” Property management activities are often subject to state real estate brokerage laws and regulations as determined by the particular real estate commission for each state.
For additional information on environmental matters and regulation, see “Item 1A. Risk Factors—Risks Related to Our Business—Extensive environmental regulation to which we are subject creates uncertainty regarding future environmental expenditures and liabilities.” Property management activities are often subject to state real estate brokerage laws and regulations as determined by the particular real estate commission for each state.
Business Activities As of December 31, 2023, the Company had 35 total employees and owned and operated, or managed, through its wholly owned subsidiaries, thirteen stores. As of December 31, 2023, these properties totaled 967,336 net leasable square feet and offered 7,039‬ storage units.
Business Activities As of December 31, 2024, the Company had 33 total employees and owned and operated, or managed, through its wholly owned subsidiaries, thirteen stores. As of December 31, 2024, these properties totaled 967,187 net leasable square feet and offered 7,049‬ storage units.
The Amended Credit Facility Promissory Note bears an interest rate equal to 3% plus the greater of the One Month U.S. Dollar London Inter-Bank Offered Rate or 0.25% and is due to mature on July 6, 2024.
The Amended Credit Facility Promissory Note bore an interest rate equal to 3% plus the greater of the One Month U.S. Dollar London Inter-Bank Offered Rate or 0.25% and was due to mature on July 6, 2024. The publication of LIBOR ceased after June 30, 2023.
We value the safety of our employees and provide regular training for our employees to increase safety at our properties. During 2023, we continued to make masks and other personal protective equipment available to our employees. Environmental, Social, and Governance We are focused on building our company for the long-term to generate sustainable growth.
We value the safety of our employees and provide regular training for our employees to increase safety at our properties. Environmental, Social, and Governance We are focused on building our Company for the long-term to generate sustainable growth.
The interest rate on the Amended Credit Facility Promissory Note subsequent to June 30, 2023, is equal to 3% plus the greater of SOFR plus 0.11448% or 0.25%. As of December 31, 2023, the effective interest rate was 8.46%.
The Amended Credit Facility Loan Agreement provided for a replacement index based on the Secured Overnight Financing Rate (“SOFR”). The interest rate on the Amended Credit Facility Promissory Note subsequent to June 30, 2023, was equal to 3% plus the greater of SOFR plus 0.11448% or 0.25%.
There were no shares of common stock sold during the three and twelve months ended December 31, 2023 under the Sales Agreement. Our Third-Party Management Platform On October 23, 2019, we signed our first self storage client under our third-party management platform.
There were no shares of common stock sold during the three and twelve months ended December 31, 2024 under the Sales Agreement.
As of December 31, 2023, the property, which was previously rebranded as “Global Self Storage,” had 137,318-leasable square feet and was comprised of 619 climate-controlled and non-climate-controlled units located in Edmond, Oklahoma. 10 We may pursue third-party management opportunities of properties owned by certain affiliates or joint venture partners for a fee, and utilize such relationships with third-party owners as a source for future acquisitions and investment opportunities.
We may pursue third-party management opportunities of properties owned by certain affiliates or joint venture partners for a fee, and utilize such relationships with third-party owners as a source for future acquisitions and investment opportunities.
As of December 31, 2023, we had 35 employees, which includes employees of our property management platform. In order to attract and retain diverse top talent, we offer training and development opportunities for our employees. In 2023, we offered training and development for our employees, which included anti-harassment training, cybersecurity training, and site manager training.
We also offer individualized counseling to our employees to assist them with their journeys towards better health. In order to attract and retain top talent, we offer training and development opportunities for our employees. In 2024, this included anti-harassment training, cybersecurity training, and store manager training.
Removed
The Company is considering, among other things, refinancing or finding a suitable replacement for the revolving line of credit in light of its upcoming maturity. The publication of LIBOR ceased after June 30, 2023. The Amended Credit Facility Loan Agreement provides for a replacement index based on the Secured Overnight Financing Rate (“SOFR”).
Added
The obligations under the Amended Credit Facility Loan Agreement were secured by certain real estate assets owned by the Amended Credit Facility Secured Subsidiaries.
Removed
Under the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended (“CERCLA”), and comparable state laws, we may be required to investigate and remediate regulated hazardous materials at one or more of our properties. For additional information on environmental matters and regulation, see “Item 1A.
Added
The Company and the Amended Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Amended Credit Facility Loan Documents. As described in more detail below, the Amended Credit Facility Loan Agreement has been replaced in its entirety by the Second Amended Credit Facility Loan Agreement on July 6, 2024.
Removed
We also offer individualized counseling to our employees to assist them with their journey towards better health. We also seek to promote diversity among our employees and management team. As of December 31, 2023, approximately 40% of our non-store (including finance, human resources, accounting, tax, legal, and marketing, but excluding store-level operations) employees and independent contractors were women.
Added
On July 6, 2024, certain wholly owned subsidiaries (“Second Amended Credit Facility Secured Subsidiaries”) of the Company entered into a second amendment to the Credit Facility Loan Agreement (collectively, the “Second Amended Credit Facility Loan Agreement”) between the Second Amended Credit Facility Secured Subsidiaries and The Huntington National Bank, successor by merger to TCF National Bank (“Second Amended Credit Facility Lender”).
Added
Under the Second Amended Credit Facility Loan Agreement, the Second Amended Credit Facility Secured Subsidiaries may borrow from the Second Amended Credit Facility Lender in the principal amount of up to $15 million, reduced to $14.75 million and $14.5 million in years 2 and 3, respectively, pursuant to a promissory note (the “Second Amended Credit Facility Promissory Note”).
Added
The Second Amended Credit Facility Promissory Note bears an interest rate equal to 3% plus the greater of the One Month SOFR or 0.25% and is due to mature on July 6, 2027, with an option to extend the maturity to July 6, 2028. As of December 31, 2024, the effective interest rate was approximately 7.56%.
Added
An annual unused facility fee is charged based on the daily average of the unadvanced amount 11 of the Second Amended Credit Facility Loan Agreement during the trailing twelve month period ending each June 30.
Added
The fee will be calculated at 0.25% per annum if the daily average of the unadvanced amount of the Second Amended Credit Facility Loan Agreement during such trailing twelve month period was greater than fifty percent, and will be calculated at 0.15% if the daily average of the unadvanced amount of the Second Amended Credit Facility Loan Agreement during such trailing twelve month period was less than or equal to fifty percent.
Added
The Company entered into a second amended and restated guaranty of payment as of July 6, 2024 (“Second Amended Credit Facility Guaranty,” and together with the Second Amended Credit Facility Loan Agreement, the Second Amended Credit Facility Promissory Note and related instruments, the “Second Amended Credit Facility Loan Documents”) to guarantee the payment to the Second Amended Credit Facility Lender of certain obligations of the Second Amended Credit Facility Secured Subsidiaries under the Second Amended Credit Facility Loan Agreement.
Added
On July 8, 2024, in connection with the Second Amended Credit Facility Loan Agreement, the Company entered into a swap transaction for an interest rate derivative with Huntington (the "Cap Rate Agreement") effective July 10, 2024. The notional amount and strike is $7,500,000 and 5.25%, respectively.
Added
The cost of the initial premium was $57,000 and will be carried as an asset on the balance sheet at fair value. The Cap Rate Agreement terminates on July 6, 2027. Our Third-Party Management Platform On October 23, 2019, we signed our first self storage client under our third-party management platform.
Added
As of December 31, 2024, the property, which was previously rebranded as “Global Self Storage,” had 137,318-leasable square feet and was comprised of 619 climate-controlled and non-climate-controlled units located in Edmond, Oklahoma.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

55 edited+8 added−3 removed192 unchanged
Biggest changeOur officers have experience in the self storage industry and our success will depend, to a significant extent, on their services. There is no guarantee that any of them will remain employed with us. We do not generally maintain key person life insurance. The loss of services of one or more members of our senior management could harm our business.
Biggest changeOur business could be harmed if key personnel with business experience in the self storage industry terminate their employment with us. Our officers have experience in the self storage industry and our success will depend, to a significant extent, on their services. There is no guarantee that any of them will remain employed with us.
Our charter contains, among other things, such customary provisions related to our current operation as a REIT and such other provisions that are consistent with the corporate governance profile of our public peers, including certain customary ownership limitations that prohibit, among other limitations, any person from beneficially or constructively owning more than 9.8% in value or in number of shares, whichever is more restrictive, of the outstanding share of our common stock or all classes and series of our capital stock.
Our charter contains, among other things, such customary provisions related to our current operation as a REIT and such other provisions that are consistent with the corporate governance profile of our public peers, including certain customary ownership limitations that prohibit, among other limitations, any person from beneficially or constructively owning more than 9.8% in value or in number of shares, whichever is more restrictive, of the outstanding shares of our common stock or all classes and series of our capital stock.
Any of the following events could result in substantial impact to our business, financial condition, results of operations and cash flows: • changes in global, national, regional or local economic, demographic or capital market conditions; • a recession, slowdown or sustained downturn in the U.S. market, and to a lesser extent, the global economy (or any particular segment thereof); • overall weakening of, or disruptions in, the financial markets; • perceived or actual economic distress or failures of financial institutions; • increases in interest rates, inflationary pressures; • supply chain related disruptions, such as those caused by the recent COVID-19 pandemic; • geopolitical challenges and uncertainties (including wars and other forms of conflict, terrorist acts and security operations), such as the ongoing conflict between Russia and Ukraine and the severe economic sanctions and export controls imposed by the U.S. and other governments against Russia and Russian interests, and the ongoing conflict between Israel and Hamas; and • changes in government rules, regulations and fiscal policies, including increases in taxes, changes in zoning laws and increasing costs to comply with environmental laws.
Any of the following events could result in substantial impact to our business, financial condition, results of operations and cash flows: • changes in global, national, regional or local economic, demographic or capital market conditions; • a recession, slowdown or sustained downturn in the U.S. market, and to a lesser extent, the global economy (or any particular segment thereof); • overall weakening of, or disruptions in, the financial markets; • perceived or actual economic distress or failures of financial institutions; • increases in interest rates, inflationary pressures; • supply chain related disruptions, such as those caused by the COVID-19 pandemic; 15 • geopolitical challenges and uncertainties (including wars and other forms of conflict, terrorist acts and security operations), such as the ongoing conflict between Russia and Ukraine and the severe economic sanctions and export controls imposed by the U.S. and other governments against Russia and Russian interests, and the ongoing conflict between Israel and Hamas; and • changes in government rules, regulations and fiscal policies, including increases in taxes, changes in zoning laws and increasing costs to comply with environmental laws.
The Amended Credit Facility Loan Documents and Term Loan Documents contain (and any new or amended loan and/or facility we may enter into from time to time will likely contain) customary affirmative and negative covenants, including financial covenants that, among other things, require us to comply with a minimum net worth (as defined in the Amended Credit Facility Loan Documents and Term Loan Documents) of at least the outstanding principal balance of the Term Loan and a minimum liquidity standard of at least 10% of the outstanding principal balance of the term loan (as defined in the Amended Credit Facility Loan Documents and Term Loan Documents).
The Second Amended Credit Facility Loan Documents and the Term Loan Documents contain (and any new or amended loan and/or facility we may enter into from time to time will likely contain) customary affirmative and negative covenants, including financial covenants that, among other things, require us to comply with a minimum net worth (as defined in the Second Amended Credit Facility Loan Documents and Term Loan Documents) of at least the outstanding principal balance of the term loan and a minimum liquidity standard of at least 10% of the outstanding principal balance of the term loan (as defined in the Second Amended Credit Facility Loan Documents and Term Loan Documents).
Increased regulations generally increase the costs to us, and those higher costs may continue to increase if new laws require additional resources, including spending more time, hiring additional personnel or investing in new technologies. We also face business trend-related climate risks. Investors are increasingly taking into account ESG factors, including climate risks, in determining whether to invest in companies.
Increased regulations generally increase the costs to us, and those higher costs may continue to increase if new laws require additional resources, including spending more time, hiring additional personnel or investing in new technologies. We also face business trend-related climate risks. Certain investors are increasingly taking into account ESG factors, including climate risks, in determining whether to invest in companies.
Our networks and operations could be disrupted, and sensitive data could be compromised, by 19 physical or electronic security breaches, targeted against us, our vendors or other organizations, including financial markets or institutions, including by way of or through cyber-attacks or cyber-intrusions over the internet, malware, computer viruses, attachments to e-mails, phishing, employee theft or misuse, or inadequate security controls.
Our networks and operations could be disrupted, and sensitive data could be compromised, by physical or electronic security breaches, targeted against us, our vendors or other organizations, including financial markets or institutions, including by way of or through cyber-attacks or cyber-intrusions over the internet, malware, computer viruses, attachments to e-mails, phishing, employee theft or misuse, or inadequate security controls.
We may encounter 15 competition when we seek to acquire properties, especially for brokered portfolios. Aggressive bidding practices by prospective acquirers have been commonplace and this competition also may be a challenge for our growth strategy and potentially result in our paying higher prices for acquisitions including paying consideration for certain properties that may exceed the value of such properties.
We may encounter competition when we seek to acquire properties, especially for brokered portfolios. Aggressive bidding practices by prospective acquirers have been commonplace and this competition also may be a challenge for our growth strategy and potentially result in our paying higher prices for acquisitions including paying consideration for certain properties that may exceed the value of such properties.
Similarly, changes in laws increasing the potential liability for environmental conditions existing on properties or increasing the restrictions on discharges or other conditions may result in significant unanticipated expenditures, which could result in similar adverse effects. 14 Our property taxes could increase due to various reasons, including a reassessment, which could adversely impact our operating results and cash flow.
Similarly, changes in laws increasing the potential liability for environmental conditions existing on properties or increasing the restrictions on discharges or other conditions may result in significant unanticipated expenditures, which could result in similar adverse effects. Our property taxes could increase due to various reasons, including a reassessment, which could adversely impact our operating results and cash flow.
Our ability to satisfy these asset tests depends upon an analysis of the characterization and fair market values of our assets, some of which are not susceptible to a precise determination, and for which we will not obtain independent 23 appraisals. In addition, we have held and may continue to hold investments in other publicly traded REITs.
Our ability to satisfy these asset tests depends upon an analysis of the characterization and fair market values of our assets, some of which are not susceptible to a precise determination, and for which we will not obtain independent appraisals. In addition, we have held and may continue to hold investments in other publicly traded REITs.
As a result, we and our stockholders may have more limited rights against our present and former directors and officers than might otherwise exist absent the current provisions in our charter 21 and bylaws or that might exist with other companies, which could limit your recourse in the event of actions not in your best interest.
As a result, we and our stockholders may have more limited rights against our present and former directors and officers than might otherwise exist absent the current provisions in our charter and bylaws or that might exist with other companies, which could limit your recourse in the event of actions not in your best interest.
Local regulations, including municipal or local ordinances, zoning restrictions and restrictive covenants imposed by community developers may restrict our use of our properties and may require us to obtain approval from local officials or community standards organizations at any time with respect to our properties, including prior to acquiring a property or when undertaking renovations of any of 17 our existing properties.
Local regulations, including municipal or local ordinances, zoning restrictions and restrictive covenants imposed by community developers may restrict our use of our properties and may require us to obtain approval from local officials or community standards organizations at any time with respect to our properties, including prior to acquiring a property or when undertaking renovations of any of our existing properties.
These ownership limits and the other restrictions on ownership and transfer of our shares in our charter could have the effect of discouraging 22 a takeover or other transaction in which holders of our common stock might receive a premium for their shares over the then prevailing market price or which holders might believe to be otherwise in their best interests.
These ownership limits and the other restrictions on ownership and transfer of our shares in our charter could have the effect of discouraging a takeover or other transaction in which holders of our common stock might receive a premium for their shares over the then prevailing market price or which holders might believe to be otherwise in their best interests.
Payment of these taxes generally could materially and adversely affect our income, cash flow, results of operations, financial condition, liquidity and prospects, and could adversely affect the value of our common stock and the ability to make distributions to stockholders. 24 To maintain our REIT qualification, we may be forced to borrow funds during unfavorable market conditions.
Payment of these taxes generally could materially and adversely affect our income, cash flow, results of operations, financial condition, liquidity and prospects, and could adversely affect the value of our common stock and the ability to make distributions to stockholders. To maintain our REIT qualification, we may be forced to borrow funds during unfavorable market conditions.
Thus, compliance with the REIT requirements may hinder our investment performance. 25 We may be subject to a 100% tax on income from “prohibited transactions,” and this tax may limit our ability to sell assets or require us to restructure certain of our activities in order to avoid being subject to the tax.
Thus, compliance with the REIT requirements may hinder our investment performance. We may be subject to a 100% tax on income from “prohibited transactions,” and this tax may limit our ability to sell assets or require us to restructure certain of our activities in order to avoid being subject to the tax.
If we are unable to raise the capital necessary to consummate such acquisitions we may be forced to abandon all or some of the acquisitions and forfeit any non-refundable deposits. If this occurs, it could adversely impact our operating results and our ability to pay any expected dividends to our stockholders.
If we are unable to raise the capital necessary to consummate such acquisitions we may be forced to abandon all or some of 17 the acquisitions and forfeit any non-refundable deposits. If this occurs, it could adversely impact our operating results and our ability to pay any expected dividends to our stockholders.
Although we intend to distribute our net taxable income to our stockholders in a manner intended to satisfy the REIT 90% distribution requirement and to avoid the 4% non-deductible excise tax, it is possible that we, from time to time, may not have sufficient cash to distribute 100% of our net taxable income.
Although we intend to distribute our net taxable income to our stockholders in a manner intended to satisfy the REIT 90% distribution requirement and to avoid the 4% 26 non-deductible excise tax, it is possible that we, from time to time, may not have sufficient cash to distribute 100% of our net taxable income.
The following adverse developments, among others, in the markets in which we do business may adversely affect the operating performance of our properties: • perceptions by prospective tenants of our self storage properties of the safety, convenience, and attractiveness of such properties and the areas in which they are located; 13 • industry slowdowns, relocation of businesses and changing demographics may adversely impact the markets in which we invest and in which our self storage properties operate; • periods of economic slowdown or recession, rising interest rates, or declining demand for self storage or the public perception that any of these events may occur could result in a general decline in rental rates or new rentals or an increase in tenant defaults; and • actual or perceived oversupply or declining demand for self storage in a particular area.
The following adverse developments, among others, in the markets in which we do business may adversely affect the operating performance of our properties: • perceptions by prospective tenants of the safety, convenience, and attractiveness of our self storage properties and the areas in which they are located; • industry slowdowns, relocation of businesses and changing demographics may adversely impact the markets in which we invest and in which our self storage properties operate; • periods of economic slowdown or recession, rising interest rates, or declining demand for self storage or the public perception that any of these events may occur could result in a general decline in rental rates or new rentals or an increase in tenant defaults; and • actual or perceived oversupply or declining demand for self storage in a particular area.
Moreover, we are subject to risks stemming from the physical impacts of climate change. New climate change-related regulations or interpretations of existing laws may result in enhanced disclosure obligations that could negatively affect us and materially increase our regulatory burden.
Moreover, we are subject to risks stemming from the physical impacts of climate change. 19 New climate change-related regulations or interpretations of existing laws may result in enhanced disclosure obligations that could negatively affect us and materially increase our regulatory burden.
From time to time we may be required to resolve tenant claims and litigation and employment-related claims and litigation by corporate level and field personnel which could result in substantial liabilities to us. We also could 18 be sued for personal injuries and/or property damage occurring at our properties.
From time to time we may be required to resolve tenant claims and litigation and employment-related claims and litigation by corporate level and field personnel which could result in substantial liabilities to us. We also could be sued for personal injuries and/or property damage occurring at our properties.
However, if other self storage companies restructure their holdings to become REITs, this competitive advantage will disappear. In addition, new legislation may be enacted or new interpretations of existing legislation may be issued by the Internal Revenue Service (the “IRS”), or the U.S.
However, if other self storage companies restructure their 23 holdings to become REITs, this competitive advantage will disappear. In addition, new legislation may be enacted or new interpretations of existing legislation may be issued by the Internal Revenue Service (the “IRS”), or the U.S.
In addition, losses in our TRS 27 will generally not provide any tax benefit, except for being carried back or forward against past or future taxable income in the TRS. Legislative or regulatory tax changes related to REITs could materially and adversely affect our business.
In addition, losses in our TRS will generally not provide any tax benefit, except for being carried back or forward against past or future taxable income in the TRS. Legislative or regulatory tax changes related to REITs could materially and adversely affect our business.
We face a number of risks associated with climate change including both transition and physical risks. The transition risks that could impact our company include those risks related to the impact of U.S. and foreign climate- and ESG-related legislation and regulation, as well as risks arising from climate-related business trends.
We face a number of risks associated with climate change including both transition and physical risks. The transition risks that could impact the Company include those risks related to the impact of U.S. and foreign climate- and ESG-related legislation and regulation, as well as risks arising from climate-related business trends.
In the event that we fail to satisfy our covenants, we would be in default under the Amended Credit Facility Loan Documents and Term Loan Documents and may be required to repay such debt with capital from other sources.
In the event that we fail to satisfy our covenants, we would be in default under the Second Amended Credit Facility Loan Documents and the Term Loan Documents and may be required to repay such debt with capital from other sources.
Furthermore, we may continue to hold interests in publicly traded REITs, and as a result our REIT qualification may continue to depend on the REIT qualification of any publicly traded REITs in which we continue to 26 hold an interest.
Furthermore, we may continue to hold interests in publicly traded REITs, and as a result our REIT qualification may continue to depend on the REIT qualification of any publicly traded REITs in which we continue to hold an interest.
Some of the factors that could negatively affect the market price of our common stock include: • our actual or projected operating results, financial condition, cash flows and liquidity or changes in business strategy or prospects; • actual or perceived conflicts of interest with our directors, officers and employees; • equity issuances by us, or share resales by our stockholders, or the perception that such issuances or resales may occur; • the impact of accounting principles and policies on our financial positions and results; • publication of research reports about us or the real estate industry; 28 • changes in market valuations of similar companies; • adverse market reaction to any increased indebtedness we may incur in the future; • additions to or departures of our key personnel; • speculation in the press or investment community; • our failure to meet, or the lowering of, our earnings estimates or those of any securities analysts; • increases in market interest rates, which may lead investors to demand a higher distribution yield for our common stock and would result in increased interest expenses on our debt; • failure to maintain our REIT qualification or exclusion from registration under the 1940 Act, as amended; • price and volume fluctuations in the stock market generally; and • general market and economic conditions, including the current state of the credit and capital markets.
Some of the factors that could negatively affect the market price of our common stock include: • our actual or projected operating results, financial condition, cash flows and liquidity or changes in business strategy or prospects; • actual or perceived conflicts of interest with our directors, officers and employees; • equity issuances by us, or share resales by our stockholders, or the perception that such issuances or resales may occur; • the impact of accounting principles and policies on our financial positions and results; • publication of research reports about us or the real estate industry; • changes in market valuations of similar companies; • adverse market reaction to any increased indebtedness we may incur in the future; • additions to or departures of our key personnel; • speculation in the press or investment community; • our failure to meet, or the lowering of, our earnings estimates or those of any securities analysts; • increases in market interest rates, which may lead investors to demand a higher distribution yield for our common stock and would result in increased interest expenses on our debt; • failure to maintain our REIT qualification or exclusion from registration under the 1940 Act, as amended; • price and volume fluctuations in the stock market generally; and • general market and economic conditions, including the current state of the credit and capital markets. 30 Market factors unrelated to our performance could also negatively impact the market price of our common stock.
While some markets may be able to absorb an increase in self storage properties due to superior demographics and density, other markets may not be able to absorb additional properties and may not perform as well.
While some 16 markets may be able to absorb an increase in self storage properties due to superior demographics and density, other markets may not be able to absorb additional properties and may not perform as well.
We depend upon our on-site personnel to maximize tenant satisfaction at each of our properties, and any difficulties we encounter in hiring, training and maintaining skilled field personnel may harm our operating performance. The general professionalism of a site’s managers and staff are contributing factors to a site’s ability to successfully secure rentals and retain tenants.
We depend upon our on-site personnel to maximize tenant satisfaction at each of our properties, and any difficulties we encounter in hiring, training and maintaining skilled field personnel may harm our operating performance. The general professionalism of a store’s managers and staff are contributing factors to a store’s ability to successfully secure rentals and retain tenants.
In addition, lower than expected rental rates upon re-letting could adversely affect our revenues and impede our growth. Increases in taxes and regulatory compliance costs may reduce our income and adversely impact our cash flows.
In addition, lower than expected rental rates upon re-leasing could adversely affect our revenues and impede our growth. Increases in taxes and regulatory compliance costs may reduce our income and adversely impact our cash flows.
Certain “business combination” and “control share acquisition” provisions of the Maryland General Corporation Law (“MGCL”), may have the effect of deterring a third party from making a proposal to acquire us or of impeding a change in control under circumstances that otherwise could provide the holders of our common stock with the opportunity to realize a premium over the then-prevailing market price of our common stock.
Certain provisions of Maryland law could inhibit changes in control of our company. 22 Certain “business combination” and “control share acquisition” provisions of the Maryland General Corporation Law (“MGCL”), may have the effect of deterring a third party from making a proposal to acquire us or of impeding a change in control under circumstances that otherwise could provide the holders of our common stock with the opportunity to realize a premium over the then-prevailing market price of our common stock.
If we are unable to promptly re-let our units or if the rates upon such re-letting are significantly lower than expected, then our business and results of operations would be adversely affected. Any delay in re-letting units as vacancies arise would reduce our revenues and harm our operating results.
If we are unable to promptly re-lease our units or if the rates upon such re-leasing are significantly lower than expected, then our business and results of operations would be adversely affected. Any delay in re-leasing units as vacancies arise would reduce our revenues and harm our operating results.
These assumptions are inherently uncertain, and, if they prove to be wrong, then we may be subject to certain risks including the following: • we may not complete redevelopment projects on schedule or within projected budgeted amounts; • we may underestimate the costs necessary to bring a property up to the standards established for its intended market position; • we may encounter delays or refusals in obtaining all necessary zoning, land use, building, occupancy and other required governmental permits and authorizations; • we may be unable to increase occupancy at a newly acquired property as quickly as expected or at all; and • we may be unable to obtain financing for these projects on favorable terms or at all. 16 The occurrence of such events could adversely affect the investment returns from these redevelopment projects and may adversely impact our economic performance.
These assumptions are inherently uncertain, and, if they prove to be wrong, then we may be subject to certain risks including the following: • we may not complete redevelopment projects on schedule or within projected budgeted amounts; • we may underestimate the costs necessary to bring a property up to the standards established for its intended market position; • we may encounter delays or refusals in obtaining all necessary zoning, land use, building, occupancy and other required governmental permits and authorizations; • we may be unable to increase occupancy at a newly acquired property as quickly as expected or at all; and • we may be unable to obtain financing for these projects on favorable terms or at all.
Any future offerings of debt, which would be senior to our common stock upon liquidation, and/or preferred equity securities which may be senior to our common stock for purposes of dividend distributions or upon liquidation, may adversely affect the market price of our common stock.
In addition, future issuances of our common stock may be dilutive to existing stockholders. 29 Any future offerings of debt, which would be senior to our common stock upon liquidation, and/or preferred equity securities which may be senior to our common stock for purposes of dividend distributions or upon liquidation, may adversely affect the market price of our common stock.
Any negative perceptions of the self storage industry generally may result in a decline in our stock price. To the extent that the investing public has a negative perception of the self storage industry, the value of our securities may be negatively impacted. Costs associated with complying with the ADA may result in unanticipated expenses.
Any negative perceptions of the self storage industry generally may result in a decline in our stock price. To the extent that the investing public has a negative perception of the self storage industry, the value of our securities may be negatively impacted.
If we are unable to obtain external sources of financing, we may not be able to acquire properties when strategic opportunities exist, satisfy our debt obligations or make cash distributions to our stockholders that would permit us to qualify as a REIT or avoid paying U.S. federal income tax on all of our net taxable income.
If we are unable to obtain external sources of financing, we may not be able to acquire properties when strategic opportunities exist, satisfy our debt obligations or make cash distributions to our stockholders that would permit us to qualify as a REIT or avoid paying U.S. federal income tax on all of our net taxable income. 24 The terms and covenants relating to our indebtedness could adversely impact our economic performance.
Any sales of a substantial number of shares of our common stock in the public market or the perception that such sales might occur, may cause the market price of our common stock to decline. In addition, future issuances of our common stock may be dilutive to existing stockholders.
Any sales of a substantial number of shares of our common stock in the public market or the perception that such sales might occur, may cause the market price of our common stock to decline.
However, if it is determined that we have accumulated earnings and profits from the Pre-REIT period, we could be required to pay a deficiency dividend to stockholders after the relevant determination in order to maintain our qualification as a REIT, or we could fail to qualify as a REIT.
However, if it is determined that we have accumulated earnings and profits from the Pre-REIT period, we could be required to pay a deficiency dividend to stockholders after the relevant determination in order to maintain our qualification as a REIT, or we could fail to qualify as a REIT. 28 We may not have satisfied requirements related to the ownership of our outstanding stock, which could cause us to fail to qualify as a REIT.
Other than some activities relating to lodging and health care properties, a TRS may generally engage in any business, including the provision of customary or non-customary services to tenants of its parent REIT. A TRS is subject to U.S. federal income tax as a regular C corporation.
Other than some activities relating to lodging and health care properties, a TRS may generally engage in any business, including the provision of customary or non-customary services to tenants of its parent REIT.
Prevailing economic conditions affecting the real estate industry may adversely affect our business, financial condition and results of operations. Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our properties. We may be unable to promptly sell one or more properties in response to changing economic, financial and investment conditions.
Prevailing economic conditions affecting the real estate industry may adversely affect our business, financial condition and results of operations. 18 Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our properties.
There may be conflicts of interest resulting from the relationships among us, our affiliates, and other related parties. The outside business interests of our officers may divert their time and attention away from us, and may result in a potential conflict with respect to the allocation of business opportunities, which could harm our business.
The outside business interests of our officers may divert their time and attention away from us, and may result in a potential conflict with respect to the allocation of business opportunities, which could harm our business.
For instance, if interest rates rise, it is likely that the market price of our common stock will decrease as market rates on interest-bearing securities increase. Item 1B. Unresolved Sta ff Comments. None.
As a result, interest rate fluctuations and conditions in capital markets can affect the market value of our common stock. For instance, if interest rates rise, it is likely that the market price of our common stock will decrease as market rates on interest-bearing securities increase. Item 1B. Unresolved Sta ff Comments. None.
In addition, where we have provided services that may generate nonqualifying income, we believe the income attributable to these services and the costs of providing these services are sufficiently small so as not to cause us to fail to satisfy the REIT gross income tests. However, there is limited guidance regarding what costs are taken into account for this purpose.
In addition, where we have provided services that may generate nonqualifying income, we believe the income attributable to these services and the costs of providing these services are sufficiently small so as not to cause us to 25 fail to satisfy the REIT gross income tests.
Any such dispute could result in litigation between us and the other parties. Whether or not any dispute actually proceeds to litigation, we may be required to devote significant management time and attention to its successful resolution (through litigation, settlement or otherwise), which would detract from our management’s ability to focus on our business.
Whether or not any dispute actually proceeds to litigation, we may be required to devote significant management time and attention as well as associated costs of legal and other advisors to its successful resolution (through litigation, settlement or otherwise), which would detract from our management’s ability to focus on our business.
If we cease to qualify as a REIT, we would become subject to U.S. federal income tax on our taxable income and would no longer be required to distribute most of our net taxable income to stockholders, which may have adverse consequences on the total return to our stockholders. 20 Our business could be harmed if key personnel with business experience in the self storage industry terminate their employment with us.
If we cease to qualify as a REIT, we would become subject to U.S. federal income tax on our taxable income and would no longer be required to distribute most of our net taxable income to stockholders, which may have adverse consequences on the total return to our stockholders.
No more than 20% of the value of a REIT’s total assets may consist of stock or securities of one or more TRSs. This requirement limits the extent to which we can conduct our activities through TRSs.
A TRS is subject to U.S. federal income tax as a regular C corporation. 27 No more than 20% of the value of a REIT’s total assets may consist of stock or securities of one or more TRSs. This requirement limits the extent to which we can conduct our activities through TRSs.
To the extent we invest in publicly traded REITs, our performance may be subject to the risks of investment in such securities. The value of our investments in REITs may fluctuate, sometimes rapidly and unpredictably. Because REITs concentrate their assets in the real estate industry, the performance of REITs is closely linked to the performance of the real estate markets.
To the extent that we invest in publicly traded REITs, our performance may be subject to the risks of investment in such securities. The value of our investments in REITs may fluctuate, sometimes rapidly and unpredictably.
If the IRS were to successfully assert that our income from these services or the costs of providing these services exceeded certain thresholds, we could fail to qualify as a REIT.
However, there is limited guidance regarding what costs are taken into account for this purpose. If the IRS were to successfully assert that our income from these services or the costs of providing these services exceeded certain thresholds, we could fail to qualify as a REIT.
Market factors unrelated to our performance could also negatively impact the market price of our common stock. One of the factors that investors may consider in deciding whether to buy or sell our common stock is our distribution rate as a percentage of our stock price relative to market interest rates.
One of the factors that investors may consider in deciding whether to buy or sell our common stock is our distribution rate as a percentage of our stock price relative to market interest rates. If market interest rates increase, prospective investors may demand a higher distribution rate or seek alternative investments paying higher dividends or interest.
We cannot give assurances that we will have funds available to correct those defects or to make those improvements.
We may be required to expend funds to correct defects or to make improvements before a property can be sold. We cannot give assurances that we will have funds available to correct those defects or to make those improvements.
Store ownership through joint ventures may limit our ability to act exclusively in our interest. We may co-invest with third parties through joint ventures. In any such joint venture, we may not be in a position to exercise sole decision-making authority regarding the stores owned through joint ventures.
In any such joint venture, we may not be in a position to exercise sole decision-making authority regarding the stores owned through joint ventures.
Major public health issues and related disruptions in the U.S. and global economy and financial markets could adversely impact or disrupt our financial condition and results of operations. In recent years, the outbreaks of a number of diseases, including COVID-19, avian influenza, H1N1, and other viruses have increased the risk of a pandemic or major public health issues.
In recent years, the outbreaks of a number of diseases, including COVID-19, avian influenza, H1N1, and other viruses, have increased the risk of a pandemic or major public health issues.
In addition, there are specific risks associated with particular sectors of real estate investments such as self storage, retail, office, hotel, healthcare, and multi-family properties. Many REITs utilize leverage, which increases investment risk and could adversely affect a REIT’s operations and market value in periods of rising interest rates as well as risks normally associated with debt financing.
Many REITs utilize leverage, which increases investment risk and could adversely affect a REIT’s operations and market value in periods of rising interest rates as well as risks normally associated with debt financing.
Notwithstanding the foregoing, our officers or directors are encouraged to notify our affiliates of such an opportunity. Certain provisions of Maryland law could inhibit changes in control of our company.
Notwithstanding the foregoing, our officers or directors are encouraged to notify our affiliates of such an opportunity.
Property values may fall due to increasing vacancies or declining rents resulting from economic, legal, cultural or technological developments, rising interest rates, and rising capitalization rates. REIT prices also may drop because of the failure of borrowers to pay their loans and poor management.
Because REITs concentrate their assets in the real estate industry, the performance of REITs is closely linked to the performance of the real estate markets. Property values may fall due to increasing vacancies or declining rents resulting from economic, legal, cultural or technological developments, rising interest rates, and rising capitalization rates.
We cannot predict whether we will be able to sell any property for the price or on the terms set by us or whether any price or other terms offered by a prospective purchaser would be acceptable to us. We may be required to expend funds to correct defects or to make improvements before a property can be sold.
We may be unable to promptly sell one or more properties in response to changing economic, financial and investment conditions. We cannot predict whether we will be able to sell any property for the price or on the terms set by us or whether any price or other terms offered by a prospective purchaser would be acceptable to us.
Many jurisdictions in which we operate have imposed restrictions and requirements on the use of personal information by those collecting such information. Changes to law or regulations affecting privacy, if applicable to our business, could impose additional costs and liability on us and could limit our use and disclosure of such information.
Many jurisdictions in which we operate have imposed restrictions and requirements on the use of personal information by those collecting such information.
Removed
The terms and covenants relating to our indebtedness could adversely impact our economic performance.
Added
The occurrence of such events could adversely affect the investment returns from these redevelopment projects and may adversely impact our economic performance. Store ownership through joint ventures may limit our ability to act exclusively in our interest. We may co-invest with third parties through joint ventures.
Removed
We may not have satisfied requirements related to the ownership of our outstanding stock, which could cause us to fail to qualify as a REIT.
Added
Costs associated with complying with various federal, state and local laws, regulations and governmental policies including the ADA may result in unanticipated expenses.
Removed
If market interest rates increase, prospective investors may demand a higher distribution rate or seek alternative investments paying higher dividends or interest. As a result, interest rate fluctuations and conditions in capital markets can affect the market value of our common stock.
Added
Recently, the United States federal government and certain states have enacted or proposed “anti-ESG” executive orders, policies or legislation and certain investors, customers and governmental authorities may oppose ESG initiatives.
Added
These increasingly divergent views on ESG matters increase the risk that any action or lack of action taken by the Company with respect to ESG matters may be perceived negatively by at least some investors and customers and adversely impact our reputation and business.
Added
Any such dispute could result in litigation between us and the other parties.
Added
REIT prices also may drop because of the failure of borrowers to pay their loans and poor management. In addition, there 20 are specific risks associated with particular sectors of real estate investments such as self storage, retail, office, hotel, healthcare, and multi-family properties.
Added
Changes to the laws or regulations affecting privacy, if applicable to our business, could impose additional costs and liability on us and could limit our use and disclosure of such information. 21 Major public health issues and related disruptions in the U.S. and global economy and financial markets could adversely impact or disrupt our financial condition and results of operations.
Added
We do not generally maintain key person life insurance. The loss of services of one or more members of our senior management could harm our business. There may be conflicts of interest resulting from the relationships among us, our affiliates, and other related parties.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

5 edited+1 added−0 removed2 unchanged
Biggest changeOur cybersecurity risk management program includes: • Experienced third-party consultants and/or service providers that assist us to develop, implement, and maintain information technology risk management measures. • Oversight of executive management with experience in areas relating to cybersecurity. • Threat protection software, including, anti-virus, anti-malware, email link protection, and email spam filters that are fine-tuned to mitigate threats to our organization. • Cloud-based service providers that require strong passwords, access controls, and multi-factor authentication. • Periodic cybersecurity and phishing awareness training of our employees, including computer-based training and internal communications. • Annual business continuity testing. • Periodic reporting to the board of directors on matters relating to cybersecurity. 29 Management of Material Risks & Integration into Overall Risk Management Our management team engages with experienced third-party service providers to assist us to develop, implement, and maintain information technology risk management measures.
Biggest changeOur cybersecurity risk management program includes: • Experienced third-party consultants and/or service providers that assist us to develop, implement, and maintain information technology risk management measures. • Oversight of executive management with experience in areas relating to cybersecurity. • Threat protection software, including, anti-virus, anti-malware, email link protection, and email spam filters that are fine-tuned to mitigate threats to our organization. • Cloud-based service providers that require strong passwords, access controls, and multi-factor authentication. • Periodic cybersecurity and phishing awareness training of our employees, including computer-based training and internal communications. • Annual business continuity testing. • Periodic reporting to the board of directors on matters relating to cybersecurity.
For more information, see the section titled "Risks Related to our Self Storage Properties and our Business - We rely on information technology in our operations, and any material failure, inadequacy, interruption or security breach through cyber-attacks, cyber-intrusions, or other methods could disrupt our information technology networks and related systems and harm our business." 30
For more information, see the section titled "Risks 31 Related to our Self Storage Properties and our Business - We rely on information technology in our operations, and any material failure, inadequacy, interruption or security breach through cyber-attacks, cyber-intrusions, or other methods could disrupt our information technology networks and related systems and harm our business." 32
In addition, we have executive management with experience in areas relating to cybersecurity. We also foster a culture of cybersecurity awareness and have incorporated cybersecurity considerations into our decision-making processes. Our management team works closely with our third-party service providers to identify, evaluate and address cybersecurity risks in alignment with our business objectives and operational needs.
We also foster a culture of cybersecurity awareness and have incorporated cybersecurity considerations into our decision-making processes. Our management team works closely with our third-party service providers to identify, evaluate and address cybersecurity risks in alignment with our business objectives and operational needs. Our collaboration with third-party service providers includes threat assessments and consultation on security enhancements .
Our collaboration with third-party service providers includes threat assessments and consultation on security enhancements. In addition, the Company provides cybersecurity and phishing awareness training to our employees periodically. Oversight of Board of Directors The board of directors is acutely aware of the critical nature of managing risks associated with cybersecurity threats and oversees the Company's cybersecurity risk management activities.
In addition, the Company provides cybersecurity and phishing awareness training to our employees periodically. Oversight of Board of Directors The board of directors is acutely aware of the critical nature of managing risks associated with cybersecurity threats and oversees the Company's cybersecurity risk management activities. The board of directors receives updates on the Company’s cybersecurity risks and protective measures periodically.
The board of directors receive updates on the Company’s cybersecurity risks and protective measures periodically. Cybersecurity matters are reported to the board of directors so that the board of directors can effectively carry out their oversight role.
Cybersecurity matters are reported to the board of directors so that the board of directors can effectively carry out their oversight role.
Added
Management of Material Risks & Integration into Overall Risk Management Our management team engages with experienced third-party service providers to assist us to develop, implement, and maintain information technology risk management measures. In addition, we have executive management with experience in areas relating to cybersecurity.

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−0 removed2 unchanged
Biggest changeGLOBAL SELF STORAGE STORES (As of December 31, 2023) Year Store Number Net Leasable December 31, 2023 Square Foot December 31, 2022 Square Foot Property (1) Address Opened / Acquired-Managed of Units Square Feet Occupancy % Occupancy % OWNED STORES SSG BOLINGBROOK LLC 296 North Weber Road, Bolingbrook, IL 60440 1997 / 2013 809 113,700 89.9 % 91.2 % SSG CLINTON LLC 6 Heritage Park Road, Clinton, CT 06413 1996 / 2016 182 30,408 86.8 % 88.5 % SSG DOLTON LLC 14900 Woodlawn Avenue, Dolton, IL 60419 2007 / 2013 652 86,590 87.6 % 88.7 % SSG FISHERS LLC 13942 East 96th Street, McCordsville, IN 46055 2007 / 2016 545 76,335 91.7 % 89.4 % SSG LIMA LLC 1910 West Robb Avenue, Lima, OH 60419 1996 / 2016 767 94,928 87.5 % 91.8 % SSG MERRILLVILLE LLC 6590 Broadway, Merrillville, IN 46410 2005 / 2013 569 81,270 92.2 % 93.0 % SSG MILLBROOK LLC 3814 Route 44, Millbrook, NY 12545 2008 / 2016 260 24,482 92.4 % 94.1 % SSG ROCHESTER LLC 2255 Buffalo Road, Rochester, NY 14624 2010 / 2012 649 68,311 92.5 % 91.7 % SSG SADSBURY LLC 21 Aim Boulevard, Sadsburyville, PA 19369 2006 / 2012 693 78,875 89.5 % 89.3 % SSG SUMMERVILLE I LLC 1713 Old Trolley Road, Summerville, SC 29485 1990 / 2013 569 76,460 85.3 % 87.4 % SSG SUMMERVILLE II LLC 900 North Gum Street, Summerville, SC 29483 1997 / 2013 248 43,110 88.0 % 89.5 % SSG WEST HENRIETTA LLC 70 Erie Station Road, West Henrietta, NY 14586 2016 / 2019 477 55,550 88.6 % 79.6 % TOTAL/AVERAGE SAME-STORES 6,420 830,019 89.3 % 89.6 % MANAGED STORES TPM EDMOND LLC 14000 N I 35 Service Rd, Edmond, OK 73013 2015 / 2019 619 137,318 96.9 % 94.8 % TOTAL/AVERAGE MANAGED STORES 619 137,318 96.9 % 94.8 % TOTAL/AVERAGE ALL OWNED/MANAGED STORES 7,039 967,337 90.4 % 90.4 % (1) Each property is directly owned or managed by the Company’s wholly owned subsidiary listed in the table.
Biggest changeGLOBAL SELF STORAGE STORES (As of December 31, 2024) Year Store Number Net Leasable December 31, 2024 December 31, 2023 Property (1) Address Opened / Acquired-Managed of Units Square Feet % Square Foot Occupancy % Square Foot Occupancy OWNED STORES SSG BOLINGBROOK LLC 296 North Weber Road, Bolingbrook, IL 60440 1997 / 2013 809 114,000 93.0 % 89.9 % SSG CLINTON LLC 6 Heritage Park Road, Clinton, CT 06413 1996 / 2016 180 29,283 93.0 % 86.8 % SSG DOLTON LLC 14900 Woodlawn Avenue, Dolton, IL 60419 2007 / 2013 652 86,590 91.2 % 87.6 % SSG FISHERS LLC 13942 East 96th Street, McCordsville, IN 46055 2007 / 2016 546 76,385 94.4 % 91.7 % SSG LIMA LLC 1910 West Robb Avenue, Lima, OH 60419 1996 / 2016 768 94,953 90.7 % 87.5 % SSG MERRILLVILLE LLC 6590 Broadway, Merrillville, IN 46410 2005 / 2013 570 81,270 93.4 % 92.2 % SSG MILLBROOK LLC 3814 Route 44, Millbrook, NY 12545 2008 / 2016 260 24,482 90.0 % 92.4 % SSG ROCHESTER LLC 2255 Buffalo Road, Rochester, NY 14624 2010 / 2012 650 68,311 96.4 % 92.5 % SSG SADSBURY LLC 21 Aim Boulevard, Sadsburyville, PA 19369 2006 / 2012 694 78,875 92.3 % 89.5 % SSG SUMMERVILLE I LLC 1713 Old Trolley Road, Summerville, SC 29485 1990 / 2013 569 76,460 92.1 % 85.3 % SSG SUMMERVILLE II LLC 900 North Gum Street, Summerville, SC 29483 1997 / 2013 250 43,710 94.6 % 88.0 % SSG WEST HENRIETTA LLC 70 Erie Station Road, West Henrietta, NY 14586 2016 / 2019 482 55,550 94.3 % 88.6 % TOTAL/AVERAGE SAME-STORES 6,430 829,869 92.9 % 89.3 % MANAGED STORES TPM EDMOND LLC 14000 N I 35 Service Rd, Edmond, OK 73013 2015 / 2019 619 137,318 96.1 % 96.9 % TOTAL/AVERAGE MANAGED STORES 619 137,318 96.1 % 96.9 % TOTAL/AVERAGE ALL OWNED/MANAGED STORES 7,049 967,187 93.4 % 90.4 % (1) Each property is directly owned or managed by the Company’s wholly owned subsidiary listed in the table.
Certain stores’ leasable square feet in the chart above includes outside auto/RV/boat storage space: approximately 12,900 square feet at SSG Sadsbury LLC; 6,300 square feet at SSG Fishers LLC; 15,700 square feet at SSG Bolingbrook LLC; 9,000 square feet at SSG Dolton LLC; 2,100 square feet at SSG Merrillville LLC; 3,800 square feet at SSG Summerville I LLC; 7,400 square feet at SSG Summerville II LLC and 8,800 square feet at SSG Clinton LLC.
Certain stores’ leasable square feet in the chart above includes outside auto/RV/boat storage space: specifically, approximately 12,800 square feet at SSG Sadsbury LLC; 6,300 square feet at SSG Fishers LLC; 16,000 square feet at SSG Bolingbrook LLC; 8,900 square feet at SSG Dolton LLC; 2,100 square feet at SSG Merrillville LLC; 3,800 square feet at SSG Summerville I LLC; 8,000 square feet at SSG Summerville II LLC and 7,600 square feet at SSG Clinton LLC.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeHolders As of March 15, 2024, there were approximately 7,830 record and beneficial holders of the Company’s common stock. Item 6. [ Reserved]. 33
Biggest changeHolders As of March 14, 2025, there were approximately 7,400 record and beneficial holders of the Company’s common stock. Item 6. [ Reserved]. 35
Furthermore, the Company will seek to evaluate whether there exist losses which may be reasonably possible and, if material, make the necessary disclosures. The Company currently does not have any material pending 31 legal proceedings to which the Company or any of its subsidiaries is a party or of which any of their property is the subject. Item 4.
Furthermore, the Company will seek to evaluate whether there exist losses which may be reasonably possible and, if material, make the necessary disclosures. The Company currently does not have any material pending 33 legal proceedings to which the Company or any of its subsidiaries is a party or of which any of their property is the subject. Item 4.
Mine Saf ety Disclosures. Not applicable. 32 PART II Item 5. Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities. Market Information The Company’s shares of common stock are listed on NASDAQ under the ticker symbol SELF.
Mine Saf ety Disclosures. Not applicable. 34 PART II Item 5. Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities. Market Information The Company’s shares of common stock are listed on NASDAQ under the ticker symbol SELF.

Item 7. Management's Discussion & Analysis

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

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Biggest changeAlso, contributing to our results were our customer service efforts which we believe were essential in building local brand loyalty resulting in powerful referral and word-of-mouth market demand for our storage units and services. 39 These results are summarized as follows: SAME - STORE PROPERTIES Twelve Months Ended December 31, 2023 2022 Variance % Change Revenues $ 12,111,742 $ 11,861,082 $ 250,660 2.1 % Cost of operations $ 4,549,038 $ 4,169,182 $ 379,856 9.1 % Net operating income $ 7,562,704 $ 7,691,900 $ (129,196 ) -1.7 % Depreciation and amortization $ 1,449,571 $ 1,433,060 $ 16,511 1.2 % Net leasable square footage at period end* 830,019 829,448 571 0.1 % Net leased square footage at period end* 741,248 743,476 (2,228 ) -0.3 % Overall square foot occupancy at period end 89.3 % 89.6 % -0.3 % -0.3 % Total annualized revenue per leased square foot $ 16.34 $ 15.95 $ 0.39 2.4 % Total available leasable storage units* 6,420 6,404 16 0.2 % Number of leased storage units 5,589 5,673 (84 ) -1.5 % SAME - STORE PROPERTIES Three Months Ended December 31, 2023 2022 Variance % Change Revenues $ 2,960,108 $ 3,037,160 $ (77,052 ) -2.5 % Cost of operations $ 1,174,658 $ 1,115,702 $ 58,956 5.3 % Net operating income $ 1,785,450 $ 1,921,458 $ (136,008 ) -7.1 % Depreciation and amortization $ 363,262 $ 358,847 $ 4,415 1.2 % Net leasable square footage at period end* 830,019 829,448 571 0.1 % Net leased square footage at period end* 741,248 743,476 (2,228 ) -0.3 % Overall square foot occupancy at period end 89.3 % 89.6 % -0.3 % -0.3 % Total annualized revenue per leased square foot $ 15.97 $ 16.34 $ (0.37 ) -2.3 % Total available leasable storage units* 6,420 6,404 16 0.2 % Number of leased storage units 5,589 5,673 (84 ) -1.5 % * From time to time, as guided by market conditions, net leasable square footage, net leased square footage and total available storage units at our properties may increase or decrease as a result of consolidation, division or reconfiguration of storage units.
Biggest changeThese results are summarized as follows: SAME - STORE PROPERTIES Twelve Months Ended December 31, 2024 2023 Variance % Change Revenues $ 12,459,719 $ 12,111,742 $ 347,977 2.9 % Cost of operations $ 4,739,995 $ 4,549,038 $ 190,957 4.2 % Net operating income $ 7,719,724 $ 7,562,704 $ 157,020 2.1 % Depreciation and amortization $ 1,449,564 $ 1,449,571 $ (7 ) 0.0 % Net leasable square footage at period end* 829,869 830,019 (150 ) 0.0 % Net leased square footage at period end* 771,283 741,248 30,035 4.1 % Overall square foot occupancy at period end 92.9 % 89.3 % 3.6 % 4.0 % Total annualized revenue per leased square foot $ 16.15 $ 16.34 $ (0.19 ) -1.1 % Total available leasable storage units* 6,430 6,420 10 0.2 % Number of leased storage units 5,810 5,589 221 4.0 % SAME - STORE PROPERTIES Three Months Ended December 31, 2024 2023 Variance % Change Revenues $ 3,168,391 $ 2,960,108 $ 208,283 7.0 % Cost of operations $ 1,183,763 $ 1,174,658 $ 9,105 0.8 % Net operating income $ 1,984,628 $ 1,785,450 $ 199,178 11.2 % Depreciation and amortization $ 362,639 $ 363,262 $ (623 ) -0.2 % Net leasable square footage at period end* 829,869 830,019 (150 ) 0.0 % Net leased square footage at period end* 771,283 741,248 30,035 4.1 % Overall square foot occupancy at period end 92.9 % 89.3 % 3.6 % 4.0 % Total annualized revenue per leased square foot $ 16.43 $ 15.97 $ 0.46 2.9 % Total available leasable storage units* 6,430 6,420 10 0.2 % Number of leased storage units 5,810 5,589 221 4.0 % * From time to time, as guided by market conditions, net leasable square footage, net leased square footage and total available storage units at our properties may increase or decrease as a result of consolidation, division or reconfiguration of storage units.
Our notes to the condensed consolidated financial statements contained elsewhere in this annual report describe the significant accounting policies essential to our condensed consolidated financial statements. Preparation of our financial statements requires estimates, judgments and assumptions.
Our notes to the consolidated financial statements contained elsewhere in this annual report describe the significant accounting policies essential to our condensed consolidated financial statements. Preparation of our financial statements requires estimates, judgments and assumptions.
To the extent the Company continues to qualify as a REIT, it will not generally be subject to U.S. federal income tax, with certain limited exceptions, on its taxable income that is distributed to its stockholders. Our store operations generated most of our net income for all periods presented herein.
To the extent that the Company continues to qualify as a REIT, it will not generally be subject to U.S. federal income tax, with certain limited exceptions, on its taxable income that is distributed to its stockholders. Our store operations generated most of our net income for all periods presented herein.
As of June 30, 2021, the McCordsville, IN store’s total area occupancy was approximately 94.7%. Our West Henrietta, NY store expansion project, completed in August 2020, added approximately 7,300 leasable square feet of drive-up storage units. Upon completion of the expansion project, West Henrietta, NY’s total area occupancy dropped from approximately 89.6% to approximately 77.9%.
As of June 30, 2021, the McCordsville, IN store’s total area occupancy was approximately 94.7%. 46 Our West Henrietta, NY store expansion project, completed in August 2020, added approximately 7,300 leasable square feet of drive-up storage units. Upon completion of the expansion project, West Henrietta, NY’s total area occupancy dropped from approximately 89.6% to approximately 77.9%.
FFO is not a substitute for GAAP net cash flow in evaluating our liquidity or ability to pay dividends, because it excludes financing activities presented on our statements of cash flows. In addition, other REITs may compute these measures differently, so comparisons among REITs may not be helpful.
FFO is not a substitute for GAAP net cash flow in evaluating our 40 liquidity or ability to pay dividends because it excludes financing activities presented on our statements of cash flows. In addition, other REITs may compute these measures differently, so comparisons among REITs may not be helpful.
As of June 30, 2021, the West Henrietta, NY store’s total area occupancy was approximately 89.1%. 44 In 2021, the Company began reviewing plans to convert certain commercially-leased spaces to approximately 3,000 leasable square feet of all-climate-controlled units at the Lima, OH property.
As of June 30, 2021, the West Henrietta, NY store’s total area occupancy was approximately 89.1%. In 2021, the Company began reviewing plans to convert certain commercially-leased spaces to approximately 3,000 leasable square feet of all-climate-controlled units at the Lima, OH property.
Our future rental income growth will likely also be dependent upon many factors for each 41 market that we operate in, including, among other things, demand for self storage space, the level of competitor supply of self storage space, and the average length of stay of our tenants.
Our future rental income growth will likely also be dependent upon many factors for each market that we operate in, including, among other things, demand for self storage space, the level of competitor supply of self storage space, and the average length of stay of our tenants.
Increasing existing tenant rental rates, generally on an annual basis, is a key component of our revenue growth. We typically determine the level of rental increases based upon our expectations regarding the impact of existing tenant rate increases on incremental move-outs.
Increasing existing tenant rental rates, generally 43 on an annual basis, is a key component of our revenue growth. We typically determine the level of rental increases based upon our expectations regarding the impact of existing tenant rate increases on incremental move-outs.
Capital resources derived from retained cash 36 flow have been and are currently expected to continue to be negligible. Retained operating cash flow represents our expected cash flow provided by operating activities, less stockholder distributions and capital expenditures to maintain stores.
Capital resources derived from retained cash flow have been and are currently expected to continue to be negligible. Retained operating cash flow represents our expected cash flow provided by operating activities, less stockholder distributions and capital expenditures to maintain stores.
As of December 31, 2023, the Company owned and operated, or managed, through its wholly owned subsidiaries, thirteen stores located in Connecticut, Illinois, Indiana, New York, Ohio, Pennsylvania, South Carolina, and Oklahoma. The Company was formerly registered under the Investment Company Act of 1940, as amended (the “1940 Act”) as a non-diversified, closed end management investment company.
As of December 31, 2024, the Company owned and operated, or managed, through its wholly owned subsidiaries, thirteen stores located in Connecticut, Illinois, Indiana, New York, Ohio, Pennsylvania, South Carolina, and Oklahoma. The Company was formerly registered under the Investment Company Act of 1940, as amended (the “1940 Act”) as a non-diversified, closed end management investment company.
We believe that same-store results are useful to investors in evaluating our performance because they provide information relating to changes in store-level operating performance without taking into account the effects of acquisitions, dispositions or new ground-up developments. As of December 31, 2023, we owned twelve same-store properties and zero non-same-store properties.
We believe that same-store results are useful to investors in evaluating our performance because they provide information relating to changes in store-level operating performance without taking into account the effects of acquisitions, dispositions or new ground-up developments. As of December 31, 2024, we owned twelve same-store properties and zero non-same-store properties.
Importantly, we continue to refine our proprietary revenue rate management program which includes regular internet data scraping of local competitors’ prices. We do this in seeking to maintain our competitive market price advantage for our various sized storage units at our stores. This program helps us in seeking to maximize each store’s occupancies and our self storage revenue and NOI.
Importantly, we continue to refine our proprietary revenue rate management program which includes regular internet data scraping of local competitors’ prices. We do this in seeking to maintain our competitive market price advantage for our various sized storage units at our stores. This program helps us in seeking to maximize each store’s occupancy and our self storage revenue and NOI.
Credit card fees increased for the year ended December 31, 2023 due to an increase in rental payments received through credit cards, which is one of the results of our initiatives in building a higher quality overall tenant base. We currently expect moderate increases in other direct store costs in 2024.
Credit card fees increased for the year ended December 31, 2024 due to an increase in rental payments received through credit cards, which is one of the results of our initiatives in building a higher quality overall tenant base. We currently expect moderate increases in other direct store costs in 2025.
We currently expect inflationary increases in landscaping expense in 2024, excluding snow removal expense, which is primarily weather dependent and unpredictable. Marketing. Marketing expense is comprised principally of internet advertising and the operating costs of our 24/7 kiosk and telephone call and reservation center. Marketing expense varies based upon demand, occupancy levels, and other factors.
We currently expect inflationary increases in landscaping expense in 2025, excluding snow removal expense, which is primarily weather dependent and unpredictable. Marketing. Marketing expense is comprised principally of internet advertising and the operating costs of our 24/7 kiosk and telephone call and reservation center. Marketing expense varies based upon demand, occupancy levels, and other factors.
We did not make any acquisitions in the year ended December 31, 2023. In addition, we may pursue third-party management opportunities of properties owned by certain affiliates or joint venture partners for a fee, and utilize such relationships with third-party owners as a source for future acquisitions and investment opportunities.
We did not make any acquisitions in the year ended December 31, 2024. In addition, we may pursue third-party management opportunities of properties owned by certain affiliates or joint venture partners for a fee, and utilize such relationships with third-party owners as a source for future acquisitions and investment opportunities.
We currently intend to strategically withdraw proceeds available under the Amended Credit Facility Loan Agreement to fund: (i) the acquisition of additional self storage properties, (ii) expansions at existing self storage properties in our portfolio, and/or (iii) joint ventures with third parties for the acquisition and expansion of self storage properties.
We currently intend to strategically withdraw proceeds available under the Second Amended Credit Facility Loan Agreement to fund: (i) the acquisition of additional self storage properties, (ii) expansions at existing 38 self storage properties in our portfolio, and/or (iii) joint ventures with third parties for the acquisition and expansion of self storage properties.
We currently expect same-store property tax expenses to increase during 2024, primarily due to increased property assessment valuations. Administrative. We classify administrative expenses as bank charges related to processing the stores’ cash receipts, credit card fees, repairs and maintenance, utilities, landscaping, alarm monitoring and trash removal.
We currently expect same-store property tax expenses to increase during 2025, primarily due to increased property assessment valuations. Administrative. We classify administrative expenses as bank charges related to processing the stores’ cash receipts, credit card fees, repairs and maintenance, utilities, landscaping, alarm monitoring and trash removal.
The Company expects its income from investment securities to continue to decrease as it continues to divest its holdings of investment securities. 34 Financial Condition and Results of Operations Our financing strategy is to minimize the cost of our capital in order to maximize the returns generated for our stockholders.
The Company expects its income from investment securities to continue to decrease as it continues to divest its holdings of investment securities. 36 Financial Condition and Results of Operations Our financing strategy is to minimize the cost of our capital in order to maximize the returns generated for our stockholders.
As of December 31, 2023, we managed one third-party owned property, which was previously rebranded as “Global Self Storage,” had 137,318-leasable square feet and was comprised of 619 climate-controlled and non-climate-controlled units located in Edmond, Oklahoma.
As of December 31, 2024, we managed one third-party owned property, which was previously rebranded as “Global Self Storage,” had 137,318-leasable square feet and was comprised of 619 climate-controlled and non-climate-controlled units located in Edmond, Oklahoma.
The obligations under the Amended Credit Facility Loan Agreement are secured by certain real estate assets owned by the Amended Credit Facility Secured Subsidiaries.
The obligations under the Second Amended Credit Facility Loan Agreement are secured by certain real estate assets owned by the Second Amended Credit Facility Secured Subsidiaries.
We believe that our results were driven by, among other things, our internet and digital marketing initiatives which helped maintain our overall average same-store occupancy of approximately 90% as of December 31, 2023.
We believe that our results were driven by, among other things, our internet and digital marketing initiatives which helped maintain our overall average same-store occupancy of approximately 90% as of December 31, 2024.
The Company and its properties could be materially and adversely affected by the risks, or the public perception of the risks, related to, among other things, public health crises, natural disasters and geopolitical events, including the ongoing conflict between Russia, Belarus and Ukraine, the ongoing conflict between Israel and Hamas, financial and credit market volatility and disruptions, inflationary pressures, rising interest rates, supply chain issues, labor shortages and recessionary concerns.
The Company and its properties could be materially and adversely affected by the risks, or the public perception of the risks, related to, among other things, public health crises, natural disasters and geopolitical events, including the ongoing conflict between Russia, Belarus and Ukraine, the ongoing conflict between Israel and Hamas, financial and credit market volatility and disruptions, inflationary pressures, interest rate fluctuations, supply chain issues, labor shortages and recessionary concerns.
Under the Amended Credit Facility Loan Agreement, the Amended Credit Facility Secured Subsidiaries may borrow from the Amended Credit Facility Lender in the principal amount of up to $15 million, reduced to $14.75 million and $14.5 million in years 2 and 3, respectively, pursuant to a promissory note (the “Amended Credit Facility Promissory Note”).
Under the Second Amended Credit Facility Loan Agreement, the Second Amended Credit Facility Secured Subsidiaries may borrow from the Second Amended Credit Facility Lender in the principal amount of up to $15 million, reduced to $14.75 million and $14.5 million in years 2 and 3, respectively, pursuant to a promissory note (the “Second Amended Credit Facility Promissory Note”).
We experienced an increase in repairs and maintenance expense for the year ended December 31, 2023 due primarily to inflation and an increased number of one-off repairs in 2023 as compared to 2022. Our utility expenses are currently comprised of electricity, oil, and gas costs, which vary by store and are dependent upon energy prices and usage levels.
We experienced an increase in repairs and maintenance 44 expense for the year ended December 31, 2024 due primarily to an increased number of one-off repairs in 2024 as compared to 2023. Our utility expenses are currently comprised of electricity, oil, and gas costs, which vary by store and are dependent upon energy prices and usage levels.
As of December 31, 2023, we observed no material degradation in rent collections. However, we believe that our bad debt losses could increase from historical levels, due to (i) cumulative stress (such as inflation, COVID-19, recession fears, etc.) on our customers’ financial capacity and (ii) reduced rent recoveries from auctioned units.
As of December 31, 2024, we observed no material degradation in rent collections. However, we believe that our bad debt losses could increase from historical levels due to (i) cumulative stress (such as inflation, recession fears, etc.) on our customers’ financial capacity and (ii) reduced rent recoveries from auctioned units.
On December 18, 2019, we completed a rights offering whereby we sold and issued an aggregate of 1,601,291 shares of our common stock (“common stock”) at the subscription price of $4.18 per whole share of common stock, pursuant to the exercise of subscriptions and oversubscriptions from our stockholders.
On December 18, 2019, we completed a rights offering whereby we sold and issued an aggregate of 1,601,291 shares of our common stock, par value $0.01 per share (“common stock”), at the subscription price of $4.18 per whole share of common stock, pursuant to the exercise of subscriptions and oversubscriptions from our stockholders.
This increase was due primarily to routine employee additions and inflationary increases in compensation rates for existing employees. We currently expect inflationary increases in compensation rates for existing employees and other increases in compensation costs as we potentially add new stores as well as district, regional, and store managers. Real Estate Property Tax.
This increase for 2024 versus 2023 was due primarily to routine employee additions and departures, and inflationary increases in compensation rates for existing employees. We currently expect inflationary increases in compensation rates for existing employees and other increases in compensation costs as we potentially add new stores as well as district, regional, and store managers. Real Estate Property Tax.
There were no realized gains or losses for the twelve months ended December 31, 2023 and December 31, 2022. Item 7A. Quantitative and Qualitat ive Disclosures About Market Risk. Not applicable. Item 8. Financial Statement s and Supplementary Data. The financial statements are included in this annual report beginning on page F-3. Item 9.
There were no realized gains or losses for the years ended December 31, 2024 and 2023. Item 7A. Quantitative and Qualitat ive Disclosures About Market Risk. Not applicable. Item 8. Financial Statement s and Supplementary Data. The financial statements are included in this annual report beginning on page F-3. Item 9.
The Company and the Amended Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Amended Credit Facility Loan Documents. The Company also maintains a bank account at the Amended Credit Facility Lender. As of December 31, 2023, we have not withdrawn proceeds under the Amended Credit Facility Loan Agreement.
The Company and the Second Amended Credit Facility Secured Subsidiaries paid customary fees and expenses in connection with their entry into the Second Amended Credit Facility Loan Documents. The Company also maintains a bank account at the Second Amended Credit Facility Lender. As of December 31, 2024, we have no withdrawn proceeds under the Second Amended Credit Facility Loan Agreement.
The decrease in landscaping expense in the twelve months ended December 31, 2023 versus the same period in 2022 is primarily due to lower snow removal costs. Landscaping expense levels are dependent upon many factors such as weather conditions, which can impact landscaping needs including, among other things, snow removal, inflation in material and labor costs, and random events.
The increase in landscaping expense in the twelve months ended December 31, 2024 versus the same period in 2023 is primarily due to higher snow removal costs. Landscaping expense levels are dependent upon many factors such as weather conditions, which can impact landscaping needs including, among other things, snow removal, inflation in material and labor costs, and random events.
The increase in the twelve months ended December 31, 2023 was attributable to, among other things, increased rental rates, and the results of our proprietary revenue rate management program of raising existing tenant rates.
The increase in the twelve months ended December 31, 2024 was attributable to, among other things, increased occupancy rates, and the results of our proprietary revenue rate management program of raising existing tenant rates.
It is difficult to estimate future utility costs because weather, temperature, and energy prices are volatile and unpredictable. However, based upon current trends and expectations regarding commercial electricity rates, we currently expect inflationary increases in rates combined with lower usage resulting in higher net utility costs in 2024.
It is difficult to estimate future utility costs because weather, temperature, and energy prices are volatile and unpredictable. However, based upon current trends and expectations regarding commercial electricity rates, we currently expect inflationary increases in rates resulting in higher net utility costs in 2025.
We currently expect existing tenant rent increases for 2024, if any, to be similar to, or slightly greater than, those for the year ended December 31, 2023. It is difficult to predict trends in move-in, move-out, in place contractual rents, and occupancy levels.
We currently expect existing tenant rent increases for 2025, if any, to be similar to, those for the year ended December 31, 2024. It is difficult to predict trends in move-in, move-out, in place contractual rents, and occupancy levels.
The Company recognizes changes in the fair value of its investments in equity securities with readily determinable fair values in net income and, as such, recorded an unrealized gain of $408,876 for the year ended December 31, 2023 compared to an unrealized loss of $1,117,029 during the year ended December 31, 2022.
The Company recognizes changes in the fair value of its investments in equity securities with readily determinable fair values in net income and, as such, recorded an unrealized loss of $166,042 for the year ended December 31, 2024 compared to an unrealized gain of $408,876 during the year ended December 31, 2023.
We believe that, through our various marketing initiatives, we can continue to attract high quality, long term tenants who we expect will be storing with us for years. As of December 31, 2023, our average tenant duration of stay was approximately 3.4 years, up from approximately 3.3 years as of December 31, 2022.
We believe that, through our various marketing initiatives, we can continue to attract high quality, long term tenants who we expect will be storing with us for years. As of December 31, 2024, our average tenant duration of stay was approximately 3.4 years, which was about the same as of December 31, 2023.
As we continue to acquire and/or redevelop additional stores, as part of the funding for such activities, we may liquidate our investment in marketable equity securities and potentially realize gains or losses. As of December 31, 2023, our cumulative unrealized gain on marketable equity securities was $2,019,542.
As we continue to acquire and/or redevelop additional stores, as part of the funding for such activities, we may liquidate our investment in marketable equity securities and potentially realize gains or losses. As of December 31, 2024, our cumulative unrealized gain on marketable equity securities was $1,853,500.
Same-store results should not be used as a basis for future same-store performance or for the performance of the Company’s stores as a whole. Same-store occupancy as of the end of the three months and year ended December 31, 2023 decreased by 30 basis points to 89.3% from 89.6% for the same period in 2022.
Same-store results should not be used as a basis for future same-store performance or for the performance of the Company’s stores as a whole. Same-store occupancy as of the end of the three months and year ended December 31, 2024 increased by 360 basis points to 92.9% from 89.3% for the same period in 2023.
Upon completion in February 2020, the Millbrook, NY store's area occupancy dropped from approximately 88.6% to approximately 45.5%. As of June 30, 2021, the Millbrook, NY store’s total area occupancy was approximately 95.4%. In the first quarter of 2020, the Company began reviewing plans to convert certain commercially-leased space to all-climate-controlled units at the McCordsville, IN property.
As of June 30, 2021, the Millbrook, NY store’s total area occupancy was approximately 95.4%. In the first quarter of 2020, the Company began reviewing plans to convert certain commercially-leased space to all-climate-controlled units at the McCordsville, IN property.
The Amended Credit Facility Promissory Note bears an interest rate equal to 3% plus the greater of the One Month U.S. Dollar London Inter-Bank Offered Rate or 0.25% and is due to mature on July 6, 2024.
The Amended Credit Facility Promissory Note bore an interest rate equal to 3% plus the greater of the One Month U.S. Dollar London Inter-Bank Offered Rate or 0.25% and was due to mature on July 6, 2024. The publication of LIBOR ceased after June 30, 2023.
This increase in same-store cost of operations for the twelve months ended December 31, 2023 was due primarily to increased expenses for employment and real estate taxes. Employment.
This increase in same-store cost of operations for the twelve months ended December 31, 2024 was due primarily to increased expenses for employment, repairs and maintenance, and insurance. Employment.
Utility expense decreased 10.2% or $5,731 for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and decreased 4.2% or $11,293 for the twelve months ended December 31, 2023 as compared to the same period in 2022, primarily due to lower energy usage during the three and twelve months ended December 31, 2023 versus the same periods in 2022.
Utility expense increased 9.4% or $4,736 for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and decreased 2.0% or $5,296 for the twelve months ended December 31, 2024 as compared to the same period in 2023, primarily due to lower energy usage during the twelve months ended December 31, 2024 versus the same periods in 2023.
The change is primarily attributable to an increase in employment expenses. Business development, capital raising, and store acquisition expenses decreased from $48,340 to $20,080 during the year ended December 31, 2023 as compared to the year ended December 31, 2022.
The change is primarily attributable to an increase in employment expenses and certain non-recurring legal and professional expenses. Business development, capital raising, and store acquisition expenses decreased from $20,080 to $3,037 during the year ended December 31, 2024 as compared to the year ended December 31, 2023.
Both the property tax reassessment and our Class 8 tax incentive renewal status are currently under appeal. However, there is no guarantee that either the assessment will be reduced or our Class 8 tax incentive status will be reinstated.
However, there is no guarantee that either the assessment will be reduced or our Class 8 tax incentive status will be reinstated.
As of December 31, 2023, we had capital resources totaling approximately $24.3 million, comprised of $7.0 million of cash, cash equivalents, and restricted cash, $2.8 million of marketable securities, and $14.5 million available for withdrawal under the Amended Credit Facility Loan Agreement.
The Company currently has capital resources totaling approximately $24.8 million, comprised of $7.2 million of cash, cash equivalents, and restricted cash, and $2.6 million of marketable securities as of December 31, 2024, and $15 million available for withdrawal under the Second Amended Credit Facility Loan Agreement.
Operating Expenses Total expenses increased from $8,417,660 during the year ended December 31, 2022 to $9,079,462 during the year ended December 31, 2023, an increase of 7.9% or $661,802, which was primarily due to an increase in certain general and administrative expenses and store operating expenses.
Operating Expenses Total expenses increased from $9,079,462 during the year ended December 31, 2023 to $9,635,952 during the year ended December 31, 2024, an increase of 6.1% or $556,490, which was primarily due to an increase in certain general and administrative expenses and store operating expenses.
Same-store NOI decreased by 7.1% for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and decreased by 1.7% for the twelve months ended December 31, 2023 versus the twelve months ended December 31, 2022. The decrease in same-store NOI was due primarily to an increase in expenses.
Same-store NOI increased by 11.2% for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and increased by 2.1% for the twelve 41 months ended December 31, 2024 versus the twelve months ended December 31, 2023. The increase in same-store NOI was due primarily to an increase in same-store revenues.
Landscaping expenses, which include snow removal costs, decreased 19.2% or $5,685 for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and decreased 43.0% or $74,916 in the twelve months ended December 31, 2023 compared to the same period in 2022.
Landscaping expenses, which include snow removal costs, decreased 1.0% or $244 for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and increased 12.2% or $12,124 in the twelve months ended December 31, 2024 compared to the same period in 2023.
In 2020, we completed three expansion / conversion projects at our properties located in Millbrook, NY, McCordsville, IN, and West Henrietta, NY. In 2021 and 2023, we completed conversion projects at our property located in Lima, OH. In 2019, the Company broke ground on the Millbrook, NY expansion, which added approximately 11,800 leasable square feet of all-climate-controlled units.
In 2021 and 2023, we completed conversion projects at our property located in Lima, OH. In 2019, the Company broke ground on the Millbrook, NY expansion, which added approximately 11,800 leasable square feet of all-climate-controlled units. Upon completion in February 2020, the Millbrook, NY store's area occupancy dropped from approximately 88.6% to approximately 45.5%.
We raised aggregate gross proceeds of approximately $6.9 million in the public offering after giving effect to the exercise of the over-allotment option. 35 On July 6, 2021, certain wholly owned subsidiaries (“Amended Credit Facility Secured Subsidiaries”) of the Company entered into a first amendment to the Credit Facility Loan Agreement (collectively, the “Amended Credit Facility Loan Agreement”) between the Amended Credit Facility Secured Subsidiaries and The Huntington National Bank, successor by merger to TCF National Bank (“Amended Credit Facility Lender”).
On July 6, 2021, certain wholly owned subsidiaries (“Amended Credit Facility Secured Subsidiaries”) of the Company entered into a first amendment to the Credit Facility Loan Agreement (collectively, the “Amended Credit Facility Loan Agreement”) between the Amended Credit Facility Secured Subsidiaries and The Huntington National Bank, successor by merger to TCF National Bank (“Amended Credit Facility Lender”).
Results of Operations for the Year Ended December 31, 2023 Compared with the Year Ended December 31, 2022 Revenues Total revenues increased from $11,944,850 during the year ended December 31, 2022 to $12,190,715 during the year ended December 31, 2023, an increase of 2.1% or $245,865.
Results of Operations for the Year Ended December 31, 2024 Compared with the Year Ended December 31, 2023 Revenues Total revenues increased from $12,190,715 during the year ended December 31, 2023 to $12,530,280 during the year ended December 31, 2024, an increase of 2.8% or $339,565.
On-site store manager, regional manager and district payroll expense increased 3.7% or $12,218 for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and increased 9.3% or $113,353 for the twelve months ended December 31, 2023 as compared to the same period in 2022.
On-site store manager, regional manager and district payroll expense decreased 1.6% or $5,325 for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and increased 6.3% or $84,112 for the twelve months ended December 31, 2024 as compared to the same period in 2023.
For the year ended December 31, 2022, net income was $2,057,723 or $0.19 per fully diluted share. Non-GAAP Financial Measures Funds from Operations (“FFO”) and FFO per share are non-GAAP measures defined by the National Association of Real Estate Investment Trusts (“NAREIT”) and are considered helpful measures of REIT performance by REITs and many REIT analysts.
Non-GAAP Financial Measures Funds from Operations (“FFO”) and FFO per share are non-GAAP measures defined by the National Association of Real Estate Investment Trusts (“NAREIT”) and are considered helpful measures of REIT performance by REITs and many REIT analysts.
Other direct store costs include general expenses incurred at the stores. General expenses include items such as store insurance, business license costs, and the cost of operating each store’s rental office including supplies and telephone and data communication lines.
Based upon current trends in move-ins, move-outs, and occupancies, we currently expect marketing expense to increase in 2025. General. Other direct store costs include general expenses incurred at the stores. General expenses include items such as store insurance, business license costs, and the cost of operating each store’s rental office including supplies and telephone and data communication lines.
Same-store cost of operations increased by 5.3% for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and increased by 9.1% for the twelve months ended December 31, 2023 versus the twelve months ended December 31, 2022.
Same-store cost of operations increased by 0.8% for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and increased by 4.2% for the twelve months ended December 31, 2024 versus the twelve months ended December 31, 2023.
As such, our Lima, OH property remained a same store property. Analysis of Realized and Unrealized Gains (Losses) Unrealized gains/(losses) on the Company’s investment in marketable equity securities for the three and twelve months ended December 31, 2023 were $574,142 and $408,876, respectively, and for the three and twelve months ended December 31, 2022 were $(227,144) and $(1,117,029), respectively.
As such, our Lima, OH property remained a same store property. Analysis of Realized and Unrealized Gains (Losses) The change in the unrealized gain on the Company’s investment in marketable equity securities decreased $166,042 and increased $408,876 for the years ended December 31, 2024 and 2023, respectively.
Many of the factors that will affect our operating results are beyond our control.
We expect that the results of our operations will be affected by a number of factors. Many of the factors that will affect our operating results are beyond our control.
However, the Company believes that to further understand the performance of its stores, AFFO should be considered along with the net income and cash flows reported in accordance with GAAP and as presented in the Company’s financial statements. 38 We believe net operating income or “NOI” is a meaningful measure of operating performance because we utilize NOI in making decisions with respect to, among other things, capital allocations, determining current store values, evaluating store performance, and in comparing period-to-period and market-to-market store operating results.
We believe net operating income or “NOI” is a meaningful measure of operating performance because we utilize NOI in making decisions with respect to, among other things, capital allocations, determining current store values, evaluating store performance, and in comparing period-to-period and market-to-market store operating results.
The increase in property tax expense during the year ended December 31, 2023 is primarily due to increased property assessment valuations and the loss of our Class 8 tax incentive granted to SSG Dolton LLC. See the section titled “Property Tax Expenses at Dolton, IL” for additional detail.
The decrease in property tax expense during the year ended December 31, 2024 is primarily due to property tax relief obtained for our Dolton, IL property in 2024, which was partially offset by our increased property assessment valuations. See the section titled “Property Tax Expenses at Dolton, IL” for additional detail.
Depreciation and amortization increased from $1,619,239 in the year ended December 31, 2022 to $1,634,044 in the year ended December 31, 2023, an increase of 0.9% of $14,805. General and administrative expenses increased $295,401 for the year ended December 31, 2023 as compared to the year ended December 31, 2022.
Depreciation and amortization increased from $1,634,044 in the year ended December 31, 2023 to $1,634,147 in the year ended December 31, 2024. General and administrative expenses increased $382,473 for the year ended December 31, 2024 as compared to the year ended December 31, 2023.
Store property tax expense increased 10.4% or $43,611 for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and increased 14.5% or $213,519 for the twelve months ended December 31, 2023 as compared to the same period in 2022.
Marketing expense increased 5.2% or $4,206 for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and increased 0.2% or $786 for the twelve months ended December 31, 2024 as compared to the same period in 2023.
Store operating expenses increased from $4,169,182 in the year ended December 31, 2022 to $4,549,038 in the year ended December 31, 2023, an increase of 9.1% or $379,856, which was primarily due to increased employment and real estate tax expenses.
Store operating expenses increased from $4,549,038 in the year ended December 31, 2023 to $4,739,995 in the year ended December 31, 2024, an increase of 4.2% or $190,957, which was primarily due to increased expenses in employment, repairs and maintenance, and insurance.
Repairs and maintenance expense decreased 24.1% or $10,024 for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and increased 13.9% or $21,612 for the twelve months ended 42 December 31, 2023 as compared to the same period in 2022.
Repairs and maintenance expense increased 201% or $63,464 for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and increased 29.1% or $51,467 for the twelve months ended December 31, 2024 as compared to the same period in 2023.
We experienced a decrease in administrative expenses for the year ended December 31, 2023 due primarily to decreased utilities and landscaping expense.
We experienced an increase in administrative expenses for the year ended December 31, 2024 due primarily to increased repairs and maintenance expense.
The interest rate on the Amended Credit Facility Promissory Note subsequent to June 30, 2023, is equal to 3% plus the greater of SOFR plus 0.11448% or 0.25%. As of December 31, 2023, the effective interest rate was 8.46%.
The Amended Credit Facility Loan Agreement provided for a replacement index based on the Secured Overnight Financing Rate (“SOFR”). The interest rate on the Amended Credit Facility Promissory Note subsequent to June 30, 2023, was equal to 3% plus the greater of SOFR plus 0.11448% or 0.25%.
Similarly, leasable square footage may increase or decrease due to expansion or redevelopment of our properties. 40 The following table presents a reconciliation of same-store net operating income to net income as presented on our consolidated statements of operations for the periods indicated (unaudited): For the Three Months Ended December 31, For the Twelve Months Ended December 31, 2023 2022 2023 2022 Net income $ 1,097,400 $ 440,451 $ 2,938,769 $ 2,057,723 Adjustments: Management fees and other income (16,262 ) (21,550 ) (78,973 ) (83,768 ) General and administrative 703,335 688,516 2,876,300 2,580,899 Depreciation and amortization 409,420 404,897 1,634,044 1,619,239 Business development 8,928 1,632 20,080 48,340 Dividend and interest income (70,085 ) (27,681 ) (265,046 ) (120,575 ) Unrealized (gain) loss on marketable equity securities (574,142 ) 227,144 (408,876 ) 1,117,029 Interest expense 226,856 208,049 846,406 780,223 Gain on Paycheck Protection Program (PPP) loan forgiveness — — — (307,210 ) Total same-store net operating income $ 1,785,450 $ 1,921,458 $ 7,562,704 $ 7,691,900 For the Three Months Ended December 31, For the Twelve Months Ended December 31, 2023 2022 2023 2022 Same-store revenues $ 2,960,108 $ 3,037,160 $ 12,111,742 $ 11,861,082 Same-store cost of operations $ 1,174,658 $ 1,115,702 $ 4,549,038 $ 4,169,182 Total same-store net operating income $ 1,785,450 $ 1,921,458 $ 7,562,704 $ 7,691,900 Analysis of Same-Store Revenue For the three and twelve months ended December 31, 2023, revenue decreased 2.5% and increased 2.1%, respectively, as compared to the same periods in 2022.
Similarly, leasable square footage may increase or decrease due to expansion or redevelopment of our properties. 42 The following table presents a reconciliation of same-store net operating income to net income as presented on our consolidated statements of operations for the periods indicated (unaudited): For the Three Months Ended December 31, For the Twelve Months Ended December 31, 2024 2023 2024 2023 Net income $ 84,406 $ 1,097,400 $ 2,123,743 $ 2,938,769 Adjustments: Management fees and other income (18,535 ) (16,262 ) (70,561 ) (78,973 ) General and administrative 799,972 703,335 3,258,773 2,876,300 Depreciation and amortization 408,857 409,420 1,634,147 1,634,044 Business development — 8,928 3,037 20,080 Dividend and interest income (45,171 ) (70,085 ) (276,201 ) (265,046 ) Unrealized (gain) loss on marketable equity securities 569,977 (574,142 ) 166,042 (408,876 ) Interest expense 185,122 226,856 880,744 846,406 Total same-store net operating income $ 1,984,628 $ 1,785,450 $ 7,719,724 $ 7,562,704 For the Three Months Ended December 31, For the Twelve Months Ended December 31, 2024 2023 2024 2023 Same-store revenues $ 3,168,391 $ 2,960,108 $ 12,459,719 $ 12,111,742 Same-store cost of operations $ 1,183,763 $ 1,174,658 $ 4,739,995 $ 4,549,038 Total same-store net operating income $ 1,984,628 $ 1,785,450 $ 7,719,724 $ 7,562,704 Analysis of Same-Store Revenue For the three and twelve months ended December 31, 2024, revenue increased 7.0% and 2.9%, respectively, as compared to the same periods in 2023.
Marketing expense decreased 7.8% or $6,862 for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and decreased 14.6% or $43,131 for the twelve months ended December 31, 2023 as compared to the same period in 2022.
Store property tax expense decreased 14.2% or $65,620 for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and decreased 3.6% or $60,926 for the twelve months ended December 31, 2024 as compared to the same period in 2023.
Same store average overall square foot occupancy for all of the Company’s same-stores combined decreased by 30 basis points to 89.3% in the twelve months ended December 31, 2023 from 89.6% in the twelve months ended December 31, 2022. As of March 15, 2024, occupancy at the Company’s same-store properties was 92.1%.
Same store average overall square foot occupancy for all of the Company’s same-stores combined increased by 360 basis points to 92.9% in the twelve months ended December 31, 2024 from 89.3% in the twelve months ended December 31, 2023. We believe that our focus on maintaining high occupancy helps us to maximize rental income at our properties.
Analysis of Same-Store Cost of Operations Same-store cost of operations increased 5.3% or $58,956 for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and increased 9.1% or $379,856 for the twelve months ended December 31, 2023 versus the twelve months ended December 31, 2022.
Analysis of Same-Store Cost of Operations Same-store cost of operations increased 0.8% or $9,105 for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and increased 4.2% or $190,957 for the twelve months ended December 31, 2024 versus the twelve months ended December 31, 2023.
We currently expect moderate increases in other direct store costs in 2024. Lien Administration. Lien administration expenses increased 64.9% or $2,126 in the three months ended December 31, 2023 as compared to the same period in 2022, and increased 51.1% or $6,751 in the twelve months ended December 31, 2023 as compared to the same period in 2022.
Lien administration expenses decreased 7.6% or $412 in the three months ended December 31, 2024 as compared to the same period in 2023, and increased 2.7% or $543 in the twelve months ended December 31, 2024 as compared to the same period in 2023.
Administrative expenses decreased 10.1% or $19,658 in the three months ended December 31, 2023 as compared to the same period in 2022, and decreased 5.1% or $43,210 in the twelve months ended December 31, 2023 as compared to the same period in 2022.
Administrative expenses increased 42.7% or $75,033 in the three months ended December 31, 2024 as compared to the same period in 2023, and increased 10.4% or $84,472 in the twelve months ended December 31, 2024 as compared to the same period in 2023.
This increase was attributable to the unrealized loss on the mark-to-market of the interest rate cap. Dividend and interest income was $265,046 during the year ended December 31, 2023 as compared to $120,575 during the year ended December 31, 2022. The increase was attributable to the dividends earned on money market mutual fund balances.
Dividend and interest income was $276,201 during the year ended December 31, 2024 as compared to $265,046 during the year ended December 31, 2023. The increase was attributable to interest earned on increased cash balances.
As of March 15, 2024, occupancy at the Company’s same-store properties was 92.1%. Same-store revenues decreased by 2.5% for the three months ended December 31, 2023 versus the three months ended December 31, 2022, and increased by 2.1% for the year ended December 31, 2023 versus the year ended December 31, 2022.
Same-store revenues increased by 7.0% for the three months ended December 31, 2024 versus the three months ended December 31, 2023, and increased by 2.9% for the year ended December 31, 2024 versus the year ended December 31, 2023.
Our board of directors regularly reviews our strategic business plan, including topics and metrices like capital formation, debt versus equity ratios, dividend policy, use of capital and debt, funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) performance, and optimal cash levels. We expect that the results of our operations will be affected by a number of factors.
Our board of directors regularly reviews our strategic business plan, with emphasis on capital formation, debt versus equity ratios, dividend policy, use of capital and debt, funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) performance, and optimal cash levels. See the section titled "Non-GAAP Financial Measures" for the definition and use of FFO and AFFO.
Analysis of Global Self Storage FFO and AFFO 43 The following tables present a reconciliation and computation of net income to funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) and earnings per share to FFO and AFFO per share (unaudited): Three Months Three Months Twelve Months Twelve Months Ended Ended Ended Ended December 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Net income $ 1,097,400 $ 440,451 $ 2,938,769 $ 2,057,723 Eliminate items excluded from FFO: Unrealized (gain) loss on marketable equity securities (574,142 ) 227,144 (408,876 ) 1,117,029 Depreciation and amortization 409,420 404,897 1,634,044 1,619,239 Gain on Paycheck Protection Program (PPP) loan forgiveness — — — (307,210 ) FFO attributable to common stockholders 932,678 1,072,492 4,163,937 4,486,781 Adjustments: Compensation expense related to stock-based awards 73,324 42,809 199,752 173,921 Business development, capital raising, and property acquisition costs 8,928 1,632 20,080 48,340 AFFO attributable to common stockholders $ 1,014,930 $ 1,116,933 $ 4,383,769 $ 4,709,042 Earnings per share attributable to common stockholders - basic $ 0.10 $ 0.04 $ 0.26 $ 0.19 Earnings per share attributable to common stockholders - diluted $ 0.10 $ 0.04 $ 0.26 $ 0.19 FFO per share - diluted $ 0.08 $ 0.10 $ 0.38 $ 0.41 AFFO per share - diluted $ 0.09 $ 0.10 $ 0.40 $ 0.43 Weighted average shares outstanding - basic 11,057,928 11,025,477 11,045,699 10,845,884 Weighted average shares outstanding - diluted 11,096,619 11,071,042 11,087,217 10,900,041 Analysis of Global Self Storage Store Expansions In addition to actively reviewing a number of store and portfolio acquisition candidates, we have been working to further redevelop and expand our current stores.
Analysis of Global Self Storage FFO and AFFO 45 The following tables present a reconciliation and computation of net income to funds from operations (“FFO”) and adjusted funds from operations (“AFFO”) and earnings per share to FFO and AFFO per share (unaudited): Three Months Three Months Twelve Months Twelve Months Ended Ended Ended Ended December 31, 2024 December 31, 2023 December 31, 2024 December 31, 2023 Net income $ 84,406 $ 1,097,400 $ 2,123,743 $ 2,938,769 Eliminate items excluded from FFO: Unrealized loss (gain) on marketable equity securities 569,977 (574,142 ) 166,042 (408,876 ) Depreciation and amortization 408,857 409,420 1,634,147 1,634,044 FFO attributable to common stockholders 1,063,240 932,678 3,923,932 4,163,937 Adjustments: Compensation expense related to stock-based awards 114,222 73,324 332,358 199,752 Business development — 8,928 3,037 20,080 AFFO attributable to common stockholders $ 1,177,462 $ 1,014,930 $ 4,259,327 $ 4,383,769 Earnings per share attributable to common stockholders - basic $ 0.01 $ 0.10 $ 0.19 $ 0.26 Earnings per share attributable to common stockholders - diluted $ 0.01 $ 0.10 $ 0.19 $ 0.26 FFO per share - diluted $ 0.10 $ 0.08 $ 0.35 $ 0.38 AFFO per share - diluted $ 0.11 $ 0.09 $ 0.38 $ 0.40 Weighted average shares outstanding - basic 11,116,664 11,057,928 11,094,915 11,045,699 Weighted average shares outstanding - diluted 11,175,035 11,096,619 11,143,831 11,087,217 FFO increased 14.0%, or $130,562 and decreased 5.8%, or $240,005, for the three and twelve months ended December 31, 2024, respectively, versus the same periods in 2023.
There were no shares of common stock sold during the three and twelve months ended December 31, 2023 under the Sales Agreement. We continue to actively review a number of store and store portfolio acquisition opportunities and have been working to further redevelop and expand our current stores.
There were no shares of common stock sold during the three and twelve months ended December 31, 2024 under the Sales Agreement.
General expenses increased 33.4% or $27,522 in the three months ended December 31, 2023 as compared to the same period in 2022, and increased 10.8% or $34,330 in the twelve months ended December 31, 2023 as compared to the same period in 2022, primarily due to increased insurance expense.
General expenses decreased 2.2% or $2,377 in the three months ended December 31, 2024 as compared to the same period in 2023, and increased 25.7% or $90,352 in the twelve months ended December 31, 2024 as compared to the same period in 2023.
Operating Income Operating income decreased from $3,527,190 during the year ended December 31, 2022 to $3,111,253 during the year ended December 31, 2023, a decrease of 11.8% or $415,937, which was primarily due to increased total expenses. 37 Other income (expense) Interest expense on loans increased from $780,223 during the year ended December 31, 2022 to $846,406 during the year ended December 31, 2023, an increase of 8.5% or $66,183.
Operating Income Operating income decreased from $3,111,253 during the year ended December 31, 2023 to $2,894,328 during the year ended December 31, 2024, a decrease of 7.0% or $216,925, which was primarily due to increased total expenses.
During the year ended December 31, 2022, the Company had other income of $307,210, attributable to a gain on the forgiveness of a Paycheck Protection Program ("PPP") term note. Net income For the year ended December 31, 2023, net income was $2,938,769 or $0.26 per fully diluted share.
Net income For the year ended December 31, 2024, net income was $2,123,743 or $0.19 per fully diluted share. For the year ended December 31, 2023, net income was $2,938,769 or $0.26 per fully diluted share.
The decrease in marketing expense in the twelve months ended December 31, 2023 versus the same period in 2022 is primarily due to decreased marketing costs and internet advertising expenses during the year ended 2023. Based upon current trends in move-ins, move-outs, and occupancies, we currently expect marketing expense to increase in 2024. General.
The increase in general expense in the twelve months ended December 31, 2024 versus the same period in 2023 is primarily due to increased insurance expense. We currently expect moderate increases in other direct store costs in 2025. Lien Administration.
Rental income increased from $11,485,511 during the year ended December 31, 2022 to $11,719,165 during the year ended December 31, 2023, an increase of 2.0% or $233,654‬. The increase in total revenues was due primarily to increased rental rates, and the results of our proprietary revenue rate management program of raising existing tenant rates.
The increase in total revenues was due primarily to increased occupancy rates, and the results of our proprietary revenue rate management program of raising existing tenant rates. 39 Other store related income consists of customer insurance fees, sales of storage supplies, and other ancillary revenues.

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