Public Storage Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>Public Storage filed its Q1 2024 10-Q, detailing financial performance and balance sheet information.</b>

AI Summary

Public Storage (PSA-PS) filed a Quarterly Report (10-Q) with the SEC on April 30, 2024. Public Storage reported financial results for the quarter ended March 31, 2024. The filing covers the period from January 1, 2024, to March 31, 2024. Key financial statement items such as common stock, preferred stock, and retained earnings are detailed. The company operates in Self-Storage Operations and Ancillary Operations segments. Financial data for both the current quarter (Q1 2024) and the comparable prior year quarter (Q1 2023) are presented.

Why It Matters

For investors and stakeholders tracking Public Storage, this filing contains several important signals. This 10-Q provides investors with a detailed look at Public Storage's financial health and operational performance during the first quarter of 2024, enabling informed investment decisions. The filing includes segment-specific data for Self-Storage and Ancillary Operations, allowing for analysis of the core business drivers and their contributions to overall results.

Risk Assessment

Risk Level: low — Public Storage shows low risk based on this filing. The filing is a standard quarterly report (10-Q) and does not contain any immediate red flags or significant negative developments.

Analyst Insight

Monitor future filings for trends in revenue growth and net income within the Self-Storage Operations segment.

Revenue Breakdown

Key Numbers

• 2024-03-31 — Report Date (CONFORMED PERIOD OF REPORT)
• 2024-04-30 — Filing Date (FILED AS OF DATE)
• 2024-01-01 — Quarter Start Date (Reporting Period)
• 2023-03-31 — Prior Year Quarter End (Comparison Period)

Key Players & Entities

• Public Storage (company) — FILER
• 701 WESTERN AVENUE (address) — BUSINESS ADDRESS
• GLENDALE (city) — BUSINESS ADDRESS
• CA (state) — BUSINESS ADDRESS
• 91201-2349 (zip_code) — BUSINESS ADDRESS
• 818-244-8080 (phone_number) — BUSINESS PHONE

FAQ

Industry Context

Public Storage operates within the Real Estate Investment Trusts (REITs) sector, specifically focusing on self-storage facilities.

Regulatory Implications

As a publicly traded company, Public Storage is subject to SEC regulations and reporting requirements, including the filing of quarterly 10-Q reports.

What Investors Should Do

1. Analyze revenue and net income trends for Self-Storage Operations.
2. Review balance sheet changes, particularly in debt and equity.
3. Compare Q1 2024 performance against Q1 2023 for key operational metrics.

Key Dates

• 2024-03-31: Quarter End — End of the reporting period for the 10-Q filing.
• 2024-04-30: Filing Date — Date the 10-Q was officially filed with the SEC.

Year-Over-Year Comparison

This filing represents the first quarterly report for the fiscal year 2024, providing updated financial data compared to the previous year's filings.

Key Financial Figures

• $0.10 — nge on which registered Common Shares, $0.10 par value PSA New York Stock Exchange
• $0.01 — 0 of a 5.150% Cum Pref Share, Series F, $0.01 par value PSAPrF New York Stock Exchang

Filing Documents

• psa-20240331.htm (10-Q) — 1614KB
• psa-33124xex101.htm (EX-10.1) — 1225KB
• psa-33124xex102.htm (EX-10.2) — 139KB
• psa-33124xex103.htm (EX-10.3) — 85KB
• psa-33124xex104.htm (EX-10.4) — 120KB
• psa-33124xex105.htm (EX-10.5) — 97KB
• psa-33124xex106.htm (EX-10.6) — 132KB
• psa-33124xex31_1.htm (EX-31.1) — 10KB
• psa-33124xex31_2.htm (EX-31.2) — 10KB
• psa-33124xex32.htm (EX-32) — 8KB
• 0001393311-24-000109.txt (&nbsp;) — 9533KB
• psa-20240331.xsd (EX-101.SCH) — 67KB
• psa-20240331_cal.xml (EX-101.CAL) — 76KB
• psa-20240331_def.xml (EX-101.DEF) — 292KB
• psa-20240331_lab.xml (EX-101.LAB) — 678KB
• psa-20240331_pre.xml (EX-101.PRE) — 491KB
• psa-20240331_htm.xml (XML) — 884KB

FINANCIAL INFORMATION Pages

PART I FINANCIAL INFORMATION Pages

Consolidated Financial Statements (Unaudited)

Item 1. Consolidated Financial Statements (Unaudited) Consolidated Balance Sheets 1 Consolidated Statements of Income 2 Consolidated Statements of Comprehensive Income 3 Consolidated Statements of Equity 4 Consolidated Statements of Cash Flows 6 Condensed Notes to Consolidated Financial Statements 8

Management's Discussion and Analysis of Financial Condition and Results of Operations 21

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 21

Quantitative and Qualitative Disclosures About Market Risk 44

Item 3. Quantitative and Qualitative Disclosures About Market Risk 44

Controls and Procedures 44

Item 4. Controls and Procedures 44

OTHER INFORMATION (Items 3 and 4 are not applicable)

PART II OTHER INFORMATION (Items 3 and 4 are not applicable)

Legal Proceedings 45

Item 1. Legal Proceedings 45

Risk Factors 45

Item 1A. Risk Factors 45

Unregistered Sales of Equity Securities and Use of Proceeds 45

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 45 Item 5. Other Information 45

Exhibits 45

Item 6. Exhibits 45 PUBLIC STORAGE CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share data) March 31, 2024 December 31, 2023 (Unaudited) ASSETS Cash and equivalents $ 271,645 $ 370,002 Real estate facilities, at cost: Land 5,628,128 5,628,488 Buildings 21,970,032 21,836,750 27,598,160 27,465,238 Accumulated depreciation ( 9,671,521 ) ( 9,423,974 ) 17,926,639 18,041,264 Construction in process 389,278 345,453 18,315,917 18,386,717 Investments in unconsolidated real estate entities 389,048 390,180 Goodwill and other intangible assets, net 351,465 387,267 Other assets 289,310 275,050 Total assets $ 19,617,385 $ 19,809,216 LIABILITIES AND EQUITY Notes payable $ 9,067,890 $ 9,103,277 Accrued and other liabilities 504,197 598,993 Total liabilities 9,572,087 9,702,270 Commitments and contingencies (Note 14) Equity: Public Storage shareholders' equity: Preferred Shares, $ 0.01 par value, 100,000,000 shares authorized, 174,000 shares issued (in series) and outstanding, ( 174,000 shares at December 31, 2023) at liquidation preference 4,350,000 4,350,000 Common Shares, $ 0.10 par value, 650,000,000 shares authorized, 175,723,561 shares issued and outstanding ( 175,670,727 shares at December 31, 2023) 17,572 17,567 Paid-in capital 5,991,606 5,980,760 Accumulated deficit ( 336,003 ) ( 267,910 ) Accumulated other comprehensive loss ( 74,513 ) ( 67,239 ) Total Public Storage shareholders' equity 9,948,662 10,013,178 Noncontrolling interests 96,636 93,768 Total equity 10,045,298 10,106,946 Total liabilities and equity $ 19,617,385 $ 19,809,216 See accompanying notes. 1 PUBLIC STORAGE CONSOLIDATED STATEMENTS OF INCOME (Amounts in thousands, except per share amounts) (Unaudited) Three Months Ended March 31, 2024 2023 Revenues: Self-storage facilities $ 1,086,045 $ 1,032,184 Ancillary operations 71,175 62,048 1,157,220 1,094,232 Expenses: Self-storage cost of operations 297,414 268,615 Ancillary cost of op

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS March 31, 2024 (Unaudited) 1. Description of the Business Public Storage (referred to herein as "the Company," "we," "us," or "our") is a Maryland real estate investment trust ("REIT") engaged in the ownership and operation of self-storage facilities that offer storage spaces for lease, generally on a month-to-month basis, for personal and business use, ancillary activities such as tenant reinsurance, merchandise sales, and third party management, as well as the acquisition and development of additional self-storage space. Effective August 14, 2023, we are structured as an umbrella partnership REIT, or UPREIT, under which substantially all of our business is conducted through Public Storage OP, L.P. ("PSA OP"), an operating partnership, and its subsidiaries including Public Storage Operating Company ("PSOC"). The primary assets of the parent entity, Public Storage, are general partner and limited partner interests in PSA OP, which holds all of the Company's assets through its ownership of all of the membership interests in PSOC. As a limited partnership, PSA OP is a variable interest entity and is consolidated by the Company as its primary beneficiary. As of March 31, 2024, the Company owned all of the general partner interests and approximately 99.95 % of the limited partnership interests of PSA OP, with the remaining 0.05 % of limited partnership interests owned by certain trustees and officers of the Company. At March 31, 2024, we owned equity interests in 3,045 self-storage facilities (with approximately 218.4 million net rentable square feet) located in 40 states in the United States ("U.S.") operating under the Public Storage name, and 1.1 million net rentable square feet of commercial and retail space. In addition, we managed 235 facilities for third parties at March 31, 2024. At March 31, 2024, we owned a 35 % common equity interest in Shurgard Self Storage Limited ("Shurgard"), a public company traded on th

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS March 31, 2024 (Unaudited) Operating results for the three months ended March 31, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024. Summary of Significant Accounting Policies There have been no significant changes to the Company's significant accounting policies described in Note 2, Basis of Presentation and Summary of Significant Accounting Policies , in Notes to Consolidated Financial Statements included in Item 8 of Part II of the Company's Annual Report on Form 10-K for the year ended December 31, 2023. 3. Real Estate Facilities Activity in real estate facilities during the three months ended March 31, 2024 is as follows: Three Months Ended March 31, 2024 (Amounts in thousands) Operating facilities, at cost: Beginning balance $ 27,465,238 Capital expenditures to maintain real estate facilities 58,056 Capital expenditures for property enhancements 27,626 Capital expenditures for energy efficiencies (LED lighting, solar) 13,760 Dispositions and other ( 1,549 ) Developed or expanded facilities opened for operation 35,029 Ending balance 27,598,160 Accumulated depreciation: Beginning balance ( 9,423,974 ) Depreciation expense ( 247,547 ) Ending balance ( 9,671,521 ) Construction in process: Beginning balance 345,453 Costs incurred to develop and expand real estate facilities 79,322 Write-off of cancelled projects ( 468 ) Developed or expanded facilities opened for operation ( 35,029 ) Ending balance 389,278 Total real estate facilities at March 31, 2024 $ 18,315,917 During the three months ended March 31, 2024, we completed development and redevelopment activities costing $ 35.0 million, adding 0.3 million net rentable square feet of self-storage space. Construction in process at March 31, 2024 consisted of projects to develop new self-storage facilities and expand existing self-storage facilities. In the three months ended Ma

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS March 31, 2024 (Unaudited) 4. Investments in Unconsolidated Real Estate Entities Throughout all periods presented, we had a 35 % equity interest in Shurgard. On November 14, 2023, Shurgard issued 8,163,265 new common shares to institutional investors. Public Storage participated on a pro-rata basis in the offering and acquired 2,863,674 common shares for a cost of $ 112.6 million, maintaining our 35 % equity interest in Shurgard. As a result of the offering, Shurgard common shares that we effectively owned increased from 31,268,459 to 34,132,133 as of March 31, 2024. Based upon the closing price at March 31, 2024 ( 41.38 per share of Shurgard common stock, at 1.079 exchange rate of U.S. Dollars to the Euro), the shares we owned had a market value of approximately $ 1.5 billion. Our equity in earnings of Shurgard comprised our equity share of Shurgard's net income, less amortization of the Shurgard Basis Differential (defined below). During the three months ended March 31, 2024 and 2023, we received $ 1.0 million and $ 0.9 million of trademark license fees that Shurgard pays to us for the use of the Shurgard trademark, respectively. We eliminated $ 0.4 million and $ 0.3 million of intra-entity profits and losses for the three months ended March 31, 2024 and 2023, respectively, representing our equity share of the trademark license fees. We classify the remaining license fees we receive from Shurgard as interest and other income on our income statement. At March 31, 2024, our investment in Shurgard's real estate assets exceeded our pro-rata share of the underlying amounts on Shurgard's balance sheet by approximately $ 61.3 million ($ 63.7 million at December 31, 2023). This differential (the "Shurgard Basis Differential") includes our basis adjustments in Shurgard's real estate assets net of related deferred income taxes. The Shurgard Basis Differential is being amortized as a reduction to equity in earnings of the Un

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS March 31, 2024 (Unaudited) The estimated future amortization expense for our finite-lived intangible assets at March 31, 2024 is as follows (amounts in thousands): Year Amount Remainder of 2024 $ 80,536 2025 60,467 2026 19,129 2027 2,797 2028 377 Thereafter 3,492 Total $ 166,798 6. Credit Facility On June 12, 2023, PSOC entered into an amended revolving credit agreement (the "Credit Facility"), which increased our borrowing limit from $ 500 million to $ 1.5 billion and extended the maturity date from April 19, 2024 to June 12, 2027. We have the option to further extend the maturity date by up to one additional year with additional extension fees up to 0.125 % of the extended commitment amount. Amounts drawn on the Credit Facility bear annual interest at rates ranging from SOFR plus 0.65 % to SOFR plus 1.40 % depending upon our credit rating (SOFR plus 0.70 % at March 31, 2024). We are also required to pay a quarterly facility fee ranging from 0.10 % per annum to 0.30 % per annum depending upon our credit rating ( 0.10 % per annum at March 31, 2024). At March 31, 2024 and April 30, 2024, we had no outstanding borrowings under this Credit Facility. We had undrawn standby letters of credit, which reduce our borrowing capacity, totaling $ 14.6 million at March 31, 2024 ($ 14.6 million at December 31, 2023). The Credit Facility has various customary restrictive covenants with which we were in compliance at March 31, 2024. Public Storage has provided a full and unconditional guarantee of PSOC's obligations under the Credit Facility. 11 PUBLIC STORAGE

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS March 31, 2024 (Unaudited) 7. Notes Payable Our notes payable (all of which were issued by PSOC), are reflected net of issuance costs (including original issue discounts), which are amortized as interest expense on the effective interest method over the term of each respective note. Our notes payable at March 31, 2024 and December 31, 2023 are set forth in the tables below: Amounts at March 31, 2024 Amounts at December 31, 2023 Coupon Rate Effective Rate Principal Unamortized Costs Book Value Fair Value Book Value Fair Value ($ amounts in thousands) U.S. Dollar Denominated Unsecured Debt Notes due April 23, 2024 SOFR+ 0.47 % 5.818 % $ 700,000 $ ( 45 ) $ 699,955 $ 700,123 $ 699,779 $ 700,031 Notes due July 25, 2025 SOFR+ 0.60 % 5.948 % 400,000 ( 1,074 ) 398,926 400,990 398,722 400,295 Notes due February 15, 2026 0.875 % 1.030 % 500,000 ( 1,396 ) 498,604 462,641 498,419 462,362 Notes due November 9, 2026 1.500 % 1.640 % 650,000 ( 2,269 ) 647,731 596,394 647,513 597,131 Notes due September 15, 2027 3.094 % 3.218 % 500,000 ( 1,832 ) 498,168 473,279 498,036 476,394 Notes due May 1, 2028 1.850 % 1.962 % 650,000 ( 2,752 ) 647,248 578,980 647,078 584,520 Notes due November 9, 2028 1.950 % 2.044 % 550,000 ( 2,217 ) 547,783 485,904 547,663 490,758 Notes due January 15, 2029 5.125 % 5.260 % 500,000 ( 2,800 ) 497,200 508,982 497,053 516,899 Notes due May 1, 2029 3.385 % 3.459 % 500,000 ( 1,559 ) 498,441 469,267 498,363 477,692 Notes due May 1, 2031 2.300 % 2.419 % 650,000 ( 4,841 ) 645,159 549,167 644,988 562,240 Notes due November 9, 2031 2.250 % 2.322 % 550,000 ( 2,695 ) 547,305 456,506 547,218 469,845 Notes due August 1, 2033 5.100 % 5.207 % 700,000 ( 5,407 ) 694,593 702,013 694,448 725,753 Notes due August 1, 2053 5.350 % 5.442 % 600,000 ( 7,915 ) 592,085 599,071 592,017 628,413 7,450,000 ( 36,802 ) 7,413,198 6,983,317 7,411,297 7,092,333 Euro Denominated Unsecured Debt Notes due April 12, 20

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