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exr-20220802
0001289490false00012894902022-08-022022-08-02

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
August 2, 2022
(Date of Report (Date of Earliest Event Reported))

EXTRA SPACE STORAGE INC.
(Exact Name of Registrant as Specified in Its Charter)
 
Maryland 001-32269 20-1076777
(State or Other Jurisdiction
of Incorporation)		 (Commission
File Number)		 (IRS Employer
Identification Number)
2795 East Cottonwood Parkway, Suite 300
Salt Lake City, Utah 84121
(Address of Principal Executive Offices)
(801) 365-4600
(Registrant’s Telephone Number, Including Area Code)
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934
Title of each classTrading symbolName of each exchange on which registered
Common Stock, $0.01 par valueEXRNew York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



ITEM 2.02RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On August 2, 2022, Extra Space Storage Inc. (the “Company”) issued a press release announcing its financial results for the three and six months ended June 30, 2022 A copy of the press release is furnished as Exhibit 99.1 to this report and is incorporated by reference herein.
The information contained in this Current Report, including the exhibit referenced herein, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. Such information shall not be incorporated by reference into any filing of Extra Space Storage Inc., whether made before or after the date hereof, regardless of any general incorporation language in such filing.
ITEM 9.01        FINANCIAL STATEMENTS AND EXHIBITS
(d) The following exhibit is furnished herewith: 
Exhibit
Number		  Description of Exhibit
  Press Release dated August 2, 2022
104Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document



SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
EXTRA SPACE STORAGE INC.
Date:August 2, 2022By/s/ P. Scott Stubbs
Name:P. Scott Stubbs
Title:Executive Vice President and Chief Financial Officer
Document

Exhibit 99.1
https://cdn.kscope.io/6f9547d92942d37e4cd26ed159ad7b6c-logoa13.jpg
Extra Space Storage Inc.
PHONE (801) 365-4600
2795 East Cottonwood Parkway, Suite 300
Salt Lake City, Utah 84121
www.extraspace.com
FOR IMMEDIATE RELEASE

Extra Space Storage Inc. Reports 2022 Second Quarter Results
SALT LAKE CITY, August 2, 2022 — Extra Space Storage Inc. (NYSE: EXR) (the “Company”), a leading owner and operator of self-storage facilities in the United States and a member of the S&P 500, announced operating results for the three and six months ended June 30, 2022.
Highlights for the three months ended June 30, 2022:
 
•Achieved net income attributable to common stockholders of $1.73 per diluted share, representing a 38.4% increase compared to the same period in the prior year.

•Achieved funds from operations attributable to common stockholders and unit holders (“FFO”) of $2.12 per diluted share. FFO, excluding adjustments for transaction related costs (“Core FFO”), was $2.13 per diluted share, representing a 29.9% increase compared to the same period in the prior year.

•Increased same-store revenue by 21.7% and same-store net operating income (“NOI”) by 26.0% compared to the same period in the prior year.

•Reported same-store occupancy of 95.9% as of June 30, 2022, compared to 96.9% as of June 30, 2021.

•Acquired 12 operating stores and three stores at completion of construction (a “Certificate of Occupancy store” or “C of O store”) and completed one development for a total cost of approximately $231.4 million.

•In conjunction with joint venture partners, acquired 16 operating stores for a total cost of approximately $332.1 million, of which the Company invested $57.6 million.

•Originated $70.3 million in mortgage and mezzanine bridge loans and sold $44.7 million in mortgage bridge loans.

•Added 40 stores (gross) to the Company's third-party management platform. As of June 30, 2022, the Company managed 864 stores for third parties and 304 stores in joint ventures, for a total of 1,168 managed stores.

•Paid a quarterly dividend of $1.50 per share.


Highlights for the six months ended June 30, 2022:
 
•Achieved net income attributable to common stockholders of $3.24 per diluted share, representing a 16.1% increase compared to the same period in the prior year.

•Achieved FFO of $4.13 per diluted share. Core FFO was $4.14 per diluted share, representing a 31.8% increase compared to the same period in the prior year.

•Increased same-store revenue by 21.7% and same-store net NOI by 26.7% compared to the same period in the prior year.



•Acquired 23 operating stores and six C of O stores and completed one development for a total cost of approximately $456.4 million.

•In conjunction with joint venture partners, acquired 18 operating stores for a total cost of approximately $374.6 million, of which the Company invested $61.9 million.

•Originated $208.0 million in mortgage and mezzanine bridge loans and sold $85.7 million in mortgage bridge loans.

•Added 77 stores (gross) to the Company's third-party management platform.


Joe Margolis, CEO of Extra Space Storage Inc., commented: “We had another strong quarter, matching last quarter's record same-store revenue growth of 21.7% and achieving same-store NOI growth of 26.0%. We were active in all of our external growth channels. We continue to find accretive investments through our deep industry relationships, and expand our diversified portfolio. We achieved FFO growth of 29.9%, allowing us to increase our annual FFO guidance for the second time this year.”




FFO Per Share:
The following table (unaudited) outlines the Company’s FFO and Core FFO for the three and six months ended June 30, 2022 and 2021. The table also provides a reconciliation to GAAP net income attributable to common stockholders and earnings per diluted share for each period presented (amounts shown in thousands, except share and per share data):
For the Three Months Ended June 30,For the Six Months Ended June 30,
2022202120222021
(per share)1
(per share)1
(per share)1
(per share)1
Net income attributable to common stockholders$232,130 $1.73 $167,948 $1.25 $435,709 $3.24 $370,946 $2.79 
Impact of the difference in weighted average number of shares – diluted2
(0.12)(0.07)(0.20)(0.16)
Adjustments:
Real estate depreciation63,765 0.45 56,470 0.40 126,457 0.89 112,285 0.80 
Amortization of intangibles2,696 0.02 1,008 — 5,462 0.04 1,701 0.01 
Gain on real estate transactions(14,249)(0.10)— — (14,249)(0.10)(63,883)(0.45)
Unconsolidated joint venture real estate depreciation and amortization4,115 0.03 3,079 0.02 7,968 0.06 5,584 0.04 
Unconsolidated joint venture gain on sale of real estate assets and purchase of partner's interest— — (6,251)(0.04)— — (6,251)(0.04)
Distributions paid on Series A Preferred Operating Partnership units(572)— (572)— (1,144)(0.01)(1,144)(0.01)
Income allocated to Operating Partnership and other noncontrolling interests 15,704 0.11 10,631 0.08 29,842 0.21 23,134 0.16 
FFO$303,589 $2.12 $232,313 $1.64 $590,045 $4.13 $442,372 $3.14 
Adjustments:
Transaction related costs1,465 0.01 — — 1,465 0.01 — — 
CORE FFO$305,054 $2.13 $232,313 $1.64 $591,510 $4.14 $442,372 $3.14 
Weighted average number of shares – diluted3
142,921,716 141,463,628 142,858,481 140,730,041 

(1)Per share amounts may not recalculate due to rounding.

(2)Adjustment to account for the difference between the number of shares used to calculate earnings per share and the number of shares used to calculate FFO per share. Earnings per share is calculated using the two-class method, which uses a lower number of shares than the calculation for FFO per share and Core FFO per share, which are calculated assuming full redemption of all OP units as described in note (3).

(3)Extra Space Storage LP (the “Operating Partnership”) has outstanding preferred and common Operating Partnership units (“OP units”). These OP units can be redeemed for cash or, at the Company’s election, shares of the Company’s common stock. Redemption of all OP units for common stock has been assumed for purposes of calculating the weighted average number of shares — diluted, as presented above. The computation of weighted average number of shares — diluted, for FFO per share and Core FFO per share also includes the effect of share-based compensation plans.












Operating Results and Same-Store Performance:
The following table (unaudited) outlines the Company’s same-store performance for the three and six months ended June 30, 2022 and 2021 (amounts shown in thousands, except store count data)1:
 For the Three Months Ended June 30,PercentFor the Six Months Ended June 30,Percent
 20222021Change20222021Change
Same-store rental revenues2
$362,192 $297,601 21.7%$704,081 $578,591 21.7%
Same-store operating expenses2
83,471 76,346 9.3%168,328 155,825 8.0%
Same-store net operating income2
$278,721 $221,255 26.0%$535,753 $422,766 26.7%
Same-store square foot occupancy as of quarter end95.9%96.9%95.9%96.9%
Properties included in same-store870870870870

(1)A reconciliation of net income to same-store net operating income is provided later in this release, entitled “Reconciliation of GAAP Net Income to Total Same-Store Net Operating Income.”

(2)Same-store revenues, operating expenses and net operating income do not include tenant reinsurance revenue or expense.

Same-store revenues for the three and six months ended June 30, 2022 increased compared to the same periods in 2021 due to higher average rates to existing customers and higher other operating income partially offset by lower occupancy.
Same-store expenses increased for the three and six months ended June 30, 2022 compared to the same periods in 2021 due to increases in payroll, credit card processing fees, repairs and maintenance, utilities and insurance, partially offset by lower property taxes due to successful appeals of prior period taxes.
Details related to the same-store performance of stores by metropolitan statistical area (“MSA”) for the three and six months ended June 30, 2022 are provided in the supplemental financial information published on the Company’s Investor Relations website at https://ir.extraspace.com/.

Investment and Property Management Activity:
The following table (unaudited) outlines the Company’s acquisitions and developments that are closed, completed or under agreement (dollars in thousands):
Closed through June 30, 2022Closed/Completed Subsequent to June 30, 2022Scheduled to Still Close/Complete in 2022Total 2022To Close/Complete in 2023/2024
Wholly-Owned InvestmentStoresPriceStoresPriceStoresPriceStoresPriceStoresPrice
Operating Stores23$384,602 4$69,700 7$118,365 34$572,667 —$— 
C of O and Development Stores1
771,789 —— 115,400 887,189 9132,628 
EXR Investment in Wholly-Owned Stores30456,391 469,700 8133,765 42659,856 9132,628 
Joint Venture Investment
EXR Investment in JV Acquisition of Operating Stores1
1861,898 922,308 38,320 3092,526 16,031 
EXR Investment in JV Development and C of O1
—— —— 211,180 211,180 226,395 
EXR Investment in Joint Ventures1861,898 922,308 519,500 32103,706 3$32,426 
Total EXR Investment48$518,289 13$92,008 13$153,265 74$763,562 12$165,054 

(1)The locations of C of O and development stores and joint venture ownership interest details are included in the supplemental financial information published on the Company’s Investor Relations website at https://ir.extraspace.com/.

The projected developments and acquisitions under agreement described above are subject to customary closing conditions and no assurance can be provided that these developments and acquisitions will be completed on the terms described, or at all.


Bridge Loans:
During the three months ended June 30, 2022, the Company originated $70.3 million in bridge loans. The Company has an additional $402.9 million in bridge loans that closed subsequent to quarter end or are under agreement to close in 2022. During the three months ended June 30, 2022, the Company sold $44.7 million in bridge loans. Additional details related to the Company's loan activity and balances held are included in the supplemental financial information published on the Company’s Investor Relations website at https://ir.extraspace.com/.

Other Investments:
On June 1, 2022 the Company completed the acquisition of Bargold Storage Systems, LLC ("Bargold") for a purchase price of approximately $180.0 million. Bargold leases space in apartment buildings, primarily in New York City and its boroughs, builds out the space as storage units, and subleases the units to resident tenants. As of June 1, 2022, Bargold had approximately 17,000 storage units.

Dispositions:
The Company disposed of two properties during the three months ended June 30, 2022 for approximately $41.0 million, resulting in a gain of approximately $14.2 million.

Property Management:
As of June 30, 2022, the Company managed 864 stores for third-party owners and 304 stores owned in joint ventures, for a total of 1,168 stores under management. The Company is the largest self-storage management company in the United States.

Balance Sheet:
In conjunction with the Bargold acquisition, the Company issued 91,743 common OP units at an average price of $174.40 per share (a total value of $16.0 million) and 240,000 preferred OP units at a stated value of $25.00 per share (a total value of $6.0 million).
During the three months ended June 30, 2022, the Company repurchased 381,786 shares of common stock using its stock repurchase program at an average price of $165.01 per share for a total cost of $63.0 million including transaction costs. As of June 30, 2022, the Company had authorization to purchase up to an additional $337.0 million under the plan.
As of June 30, 2022, the Company’s percentage of fixed-rate debt to total debt was 74.8%. The weighted average interest rates of the Company’s fixed and variable-rate debt were 3.1% and 2.9%, respectively. The combined weighted average interest rate was 3.1% with a weighted average maturity of approximately 5.5 years.
Subsequent to quarter end, on July 29, 2022, the Company completed an accordion transaction in its credit facility, and added a $175.0 million unsecured debt tranche maturing January 2028 and a $425.0 million unsecured debt tranche maturing July 2029. The current interest rates for the tranches are Adjusted Term SOFR/Adjusted Daily Simple SOFR ("SOFR") + 0.95% and SOFR + 1.25%, respectively.

Dividends:
On June 30, 2022, the Company paid a second quarter common stock dividend of $1.50 per share to stockholders of record at the close of business on June 15, 2022.









Outlook:
The following table outlines the Company's current and initial FFO estimates and annual assumptions for the year ending December 31, 20221:
Current Ranges for 2022 Annual Assumptions1st Quarter Ranges for 2022 Annual AssumptionsNotes
(May 3, 2022)
LowHighLowHigh
Core FFO$8.30$8.50$8.05$8.30
Dilution per share from C of O and value add acquisitions$0.20$0.20$0.20$0.20
Same-store revenue growth16.00%18.00%13.00%15.00%Same-store pool of 870 stores
Same-store expense growth7.50%9.00%6.50%8.00%Same-store pool of 870 stores
Same-store NOI growth18.50%21.50%15.00%18.00%Same-store pool of 870 stores
Weighted average one-month LIBOR/SOFR1.89% / 1.66%1.89% / 1.66%1.37% / 1.24%1.37% / 1.24%
Net tenant reinsurance income$153,500,000$155,500,000$152,500,000$154,500,000
Management fees and other income$82,500,000$83,500,000$80,500,000$81,500,000
Interest income$60,500,000$61,500,000$57,500,000$58,500,000Includes dividends from JCAP preferred investment
General and administrative expenses$124,500,000$125,500,000$121,500,000$123,000,000Includes non-cash compensation
Average monthly cash balance$70,000,000$70,000,000$40,000,000$40,000,000
Equity in earnings of real estate ventures$43,000,000$44,000,000$41,500,000$42,500,000Includes dividends from SmartStop preferred investment
Interest expense$210,000,000$212,000,000$196,500,000 $198,500,000 
Income Tax Expense$22,000,000$23,000,000$22,000,000$23,000,000Taxes associated with the Company's Taxable REIT subsidiary
Acquisitions$1,200,000,000$1,200,000,000$800,000,000 $800,000,000 Represents the Company's investment and includes the Bargold acquisition
Bridge loans$200,000,000$200,000,000$150,000,000$150,000,000Represents the Company's share of loans net of loan sales
Weighted average share count143,000,000143,000,000143,000,000143,000,000Assumes redemption of all OP units for common stock
(1) A reconciliation of net income outlook to same-store net operating income outlook is provided later in this release entitled "Reconciliation of Estimated GAAP Net Income to Estimated Same-Store Net Operating Income." The reconciliation includes details related to same-store revenue and same-store expense outlooks. A reconciliation of net income per share outlook to funds from operations per share outlook is provided later in this release entitled "Reconciliation of the Range of Estimated GAAP Fully Diluted Earnings Per Share to Estimated Fully Diluted FFO Per Share."

FFO estimates for the year are fully diluted for an estimated average number of shares and OP units outstanding during the year. The Company’s estimates are forward-looking and based on management’s view of current and future market conditions. The Company’s actual results may differ materially from these estimates.


Supplemental Financial Information:
Supplemental unaudited financial information regarding the Company’s performance can be found on the Company’s website at www.extraspace.com. Under the "Company Info" navigation menu on the home page, click on “Investor Relations,” then under the “Financials & Stock Information” navigation menu click on “Quarterly Earnings.” This supplemental information provides additional detail on items that include store occupancy and financial performance by portfolio and market, debt maturity schedules and performance of lease-up assets.




Conference Call:
The Company will host a conference call at 1:00 p.m. Eastern Time on Wednesday, August 3, 2022, to discuss its financial results. Telephone participants may avoid any delays in joining the conference call by pre-registering for the call using the following link to receive a special dial-in number and PIN: https://register.vevent.com/register/BI2bb007ca412e407b82c93299102763ba.
A live webcast of the call will also be available on the Company’s investor relations website at https://ir.extraspace.com. To listen to the live webcast, go to the site at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software.
A replay of the call will be available for 30 days on the investor relations section of the Company’s website beginning at 5:00 p.m. Eastern Time on August 3, 2022.
Forward-Looking Statements:
Certain information set forth in this release contains “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements include statements concerning the benefits of store acquisitions, developments, favorable market conditions, our outlook and estimates for the year and other statements concerning our plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, the competitive landscape, plans or intentions relating to acquisitions and developments and other information that is not historical information. In some cases, forward-looking statements can be identified by terminology such as “believes,” “estimates,” “expects,” “may,” “will,” “should,” “anticipates,” or “intends,” or the negative of such terms or other comparable terminology, or by discussions of strategy. We may also make additional forward-looking statements from time to time. All such subsequent forward-looking statements, whether written or oral, by us or on our behalf, are also expressly qualified by these cautionary statements. There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements contained in or contemplated by this release. Any forward-looking statements should be considered in light of the risks referenced in the “Risk Factors” section included in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Such factors include, but are not limited to:
 
•adverse changes in general economic conditions, the real estate industry and the markets in which we operate;
•failure to close pending acquisitions and developments on expected terms, or at all;
•the effect of competition from new and existing stores or other storage alternatives, which could cause rents and occupancy rates to decline;
•potential liability for uninsured losses and environmental contamination;
•the impact of the regulatory environment as well as national, state and local laws and regulations, including, without limitation, those governing real estate investment trusts (“REITs”), tenant reinsurance and other aspects of our business, which could adversely affect our results;
•disruptions in credit and financial markets and resulting difficulties in raising capital or obtaining credit at reasonable rates or at all, which could impede our ability to grow;
•impacts from the COVID-19 pandemic or the future outbreak of other highly infectious or contagious diseases, including reduced demand for self-storage space and ancillary products and services such as tenant reinsurance, and potential decreases in occupancy and rental rates and staffing levels, which could adversely affect our results;
•our reliance on information technologies, which are vulnerable to, among other things, attack from computer viruses and malware, hacking, cyberattacks and other unauthorized access or misuse, any of which could adversely affect our business and results;
•increases in interest rates;
•reductions in asset valuations and related impairment charges;
•our lack of sole decision-making authority with respect to our joint venture investments;
•the effect of recent or future changes to U.S. tax laws;
•the failure to maintain our REIT status for U.S. federal income tax purposes; and
•economic uncertainty due to the impact of natural disasters, war or terrorism, which could adversely affect our business plan.


All forward-looking statements are based upon our current expectations and various assumptions. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them, but there can be no assurance that management’s expectations, beliefs and projections will result or be achieved. All forward-looking statements apply only as of the date made. We undertake no obligation to publicly update or revise forward-looking statements which may be made to reflect events or circumstances after the date made or to reflect the occurrence of unanticipated events.
Definition of FFO:
FFO provides relevant and meaningful information about the Company’s operating performance that is necessary, along with net income and cash flows, for an understanding of the Company’s operating results. The Company believes FFO is a meaningful disclosure as a supplement to net income. Net income assumes that the values of real estate assets diminish predictably over time as reflected through depreciation and amortization expenses. The values of real estate assets fluctuate due to market conditions and the Company believes FFO more accurately reflects the value of the Company’s real estate assets. FFO is defined by the National Association of Real Estate Investment Trusts, Inc. (“NAREIT”) as net income computed in accordance with U.S. generally accepted accounting principles (“GAAP”), excluding gains or losses on sales of operating stores and impairment write downs of depreciable real estate assets, plus depreciation and amortization related to real estate and after adjustments to record unconsolidated partnerships and joint ventures on the same basis. The Company believes that to further understand the Company’s performance, FFO should be considered along with the reported net income and cash flows in accordance with GAAP, as presented in the Company’s consolidated financial statements. FFO should not be considered a replacement of net income computed in accordance with GAAP.
For informational purposes, the Company also presents Core FFO. Core FFO excludes revenues and expenses not core to our operations and non-cash interest. Although the Company’s calculation of Core FFO differs from NAREIT’s definition of FFO and may not be comparable to that of other REITs and real estate companies, the Company believes it provides a meaningful supplemental measure of operating performance. The Company believes that by excluding revenues and expenses not core to our operations and non-cash interest charges, stockholders and potential investors are presented with an indicator of our operating performance that more closely achieves the objectives of the real estate industry in presenting FFO. Core FFO by the Company should not be considered a replacement of the NAREIT definition of FFO. The computation of FFO may not be comparable to FFO reported by other REITs or real estate companies that do not define the term in accordance with the current NAREIT definition or that interpret the current NAREIT definition differently. FFO does not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to net income as an indication of the Company’s performance, as an alternative to net cash flow from operating activities as a measure of liquidity, or as an indicator of the Company’s ability to make cash distributions.

Definition of Same-Store:
The Company’s same-store pool for the periods presented consists of 870 stores that are wholly-owned and operated and that were stabilized by the first day of the earliest calendar year presented. The Company considers a store to be stabilized once it has been open for three years or has sustained average square foot occupancy of 80.0% or more for one calendar year. The Company believes that by providing same-store results from a stabilized pool of stores, with accompanying operating metrics including, but not limited to occupancy, rental revenue (growth), operating expenses (growth), net operating income (growth), etc., stockholders and potential investors are able to evaluate operating performance without the effects of non-stabilized occupancy levels, rent levels, expense levels, acquisitions or completed developments.  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.

About Extra Space Storage Inc.:
Extra Space Storage Inc., headquartered in Salt Lake City, Utah, is a self-administered and self-managed REIT and a member of the S&P 500. As of June 30, 2022, the Company owned and/or operated 2,177 self-storage stores in 41 states and Washington, D.C. The Company’s stores comprise approximately 1.6 million units and approximately 168.0 million square feet of rentable space. The Company offers customers a wide selection of conveniently located and secure storage units across the country, including boat storage, RV storage and business storage. The Company is the second largest owner and/or operator of self-storage stores in the United States and is the largest self-storage management company in the United States.
###
For Information:
Jeff Norman
Extra Space Storage Inc.
(801) 365-1759


Extra Space Storage Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share data)
June 30, 2022December 31, 2021
(Unaudited)
Assets:
Real estate assets, net$9,135,464 $8,834,649 
Real estate assets - operating lease right-of-use assets232,045 227,949 
Investments in unconsolidated real estate entities544,771 457,326 
Investments in debt securities and notes receivable702,354 719,187 
Cash and cash equivalents58,729 71,126 
Restricted cash11,437 5,068 
Other assets, net353,967 159,172 
Total assets $11,038,767 $10,474,477 
Liabilities, Noncontrolling Interests and Equity:
Notes payable, net$1,288,487 $1,320,755 
Unsecured term loans, net1,742,995 1,741,926 
Unsecured senior notes, net2,757,158 2,360,066 
Revolving lines of credit599,000 535,000 
Operating lease liabilities238,392 233,356 
Cash distributions in unconsolidated real estate ventures65,377 63,582 
Accounts payable and accrued expenses171,918 142,285 
Other liabilities282,200 291,531 
Total liabilities 7,145,527 6,688,501 
Commitments and contingencies
Noncontrolling Interests and Equity:
Extra Space Storage Inc. stockholders' equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized, no shares issued or outstanding— — 
Common stock, $0.01 par value, 500,000,000 shares authorized, 133,900,184 and 133,922,305 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively1,339 1,339 
Additional paid-in capital3,334,317 3,285,948 
Accumulated other comprehensive income (loss)25,555 (42,546)
Accumulated deficit(159,091)(128,245)
Total Extra Space Storage Inc. stockholders' equity3,202,120 3,116,496 
Noncontrolling interest represented by Preferred Operating Partnership units, net 261,231 259,110 
Noncontrolling interests in Operating Partnership, net and other noncontrolling interests429,889 410,370 
Total noncontrolling interests and equity3,893,240 3,785,976 
Total liabilities, noncontrolling interests and equity$11,038,767 $10,474,477 



Consolidated Statement of Operations for the Three and Six Months Ended June 30, 2022 and 2021
(In thousands, except share and per share data) - Unaudited
For the Three Months Ended March 31,For the Six Months Ended June 30,
2022202120222021
Revenues:
Property rental$408,044 $321,500 $787,852 $625,093 
Tenant reinsurance46,427 42,334 90,224 81,953 
Management fees and other income20,517 14,796 40,474 30,441 
Total revenues474,988 378,630 918,550 737,487 
Expenses:
Property operations104,252 89,155 207,794 181,522 
Tenant reinsurance 7,537 6,735 14,579 13,896 
Transaction related costs 1,465 — 1,465 — 
General and administrative31,251 26,341 61,013 49,881 
Depreciation and amortization69,067 59,570 136,973 118,169 
Total expenses213,572 181,801 421,824 363,468 
Gain on real estate transactions14,249 — 14,249 63,883 
Income from operations275,665 196,829 510,975 437,902 
Interest expense(47,466)(40,240)(90,004)(80,935)
Interest income15,060 12,838 34,049 25,142 
Income before equity in earnings and dividend income from unconsolidated real estate ventures and income tax expense243,259 169,427 455,020 382,109 
Equity in earnings and dividend income from unconsolidated real estate entities10,190 8,322 19,287 15,278 
Equity in earnings of unconsolidated real estate ventures - gain on sale of real estate assets and purchase of joint venture partner's interest— 6,251 — 6,251 
Income tax expense(5,615)(5,421)(8,756)(9,558)
Net income247,834 178,579 465,551 394,080 
Net income allocated to Preferred Operating Partnership noncontrolling interests(4,491)(3,438)(8,824)(7,118)
Net income allocated to Operating Partnership and other noncontrolling interests(11,213)(7,193)(21,018)(16,016)
Net income attributable to common stockholders$232,130 $167,948 $435,709 $370,946 
Earnings per common share
Basic $1.73 $1.25 $3.24 $2.79 
Diluted $1.73 $1.25 $3.24 $2.79 
Weighted average number of shares
Basic134,192,540 133,756,610 134,186,426 132,886,933 
Diluted142,737,909 140,407,195 141,600,206 140,428,558 
Cash dividends paid per common share$1.50 $1.00 $3.00 $2.00 



Reconciliation of GAAP Net Income to Total Same-Store Net Operating Income — for the Three and Six Months Ended June 30, 2022 and 2021 (In thousands) - Unaudited
For the Three Months Ended June 30,For the Six Months Ended June 30,
2022202120222021
Net Income$247,834 $178,579 $465,551 $394,080 
Adjusted to exclude:
Gain on real estate transactions(14,249)— (14,249)(63,883)
Equity in earnings and dividend income from unconsolidated real estate entities(10,190)(8,322)(19,287)(15,278)
Equity in earnings of unconsolidated real estate ventures - gain on sale of real estate assets and purchase of joint venture partner's interest— (6,251)— (6,251)
Interest expense47,466 40,240 90,004 80,935 
Depreciation and amortization69,067 59,570 136,973 118,169 
Income tax expense5,615 5,421 8,756 9,558 
Transaction related costs 1,465 — 1,465 — 
General and administrative31,251 26,341 61,013 49,881 
Management fees, other income and interest income(35,577)(27,634)(74,523)(55,583)
Net tenant insurance(38,890)(35,599)(75,645)(68,057)
Non same-store rental revenue(45,852)(23,899)(83,771)(46,502)
Non same-store operating expense20,781 12,809 39,466 25,697 
Total same-store net operating income$278,721 $221,255 $535,753 $422,766 
Same-store rental revenues362,192 297,601 704,081 578,591 
Same-store operating expenses83,471 76,346 168,328 155,825 
Same-store net operating income$278,721 $221,255 $535,753 $422,766 




























Reconciliation of the Range of Estimated GAAP Fully Diluted Earnings Per Share to Estimated Fully Diluted FFO Per Share — for the Year Ending December 31, 2022 - Unaudited
For the Year Ending December 31, 2022
Low EndHigh End
Net income attributable to common stockholders per diluted share$6.01 $6.21 
Income allocated to noncontrolling interest - Preferred Operating Partnership and Operating Partnership0.40 0.40 
Fixed component of income allocated to non-controlling interest - Preferred Operating Partnership(0.02)(0.02)
Net income attributable to common stockholders for diluted computations6.39 6.59 
Adjustments:
Real estate depreciation1.83 1.83 
Amortization of intangibles0.06 0.06 
Unconsolidated joint venture real estate depreciation and amortization0.11 0.11 
Gain on real estate transactions(0.10)(0.10)
Funds from operations attributable to common stockholders8.29 8.49 
Adjustments:
Transaction related costs 0.01 0.01 
Core funds from operations attributable to common stockholders$8.30 $8.50 



Reconciliation of Estimated GAAP Net Income to Estimated Same-Store Net Operating Income —
for the Year Ending December 31, 2022 (In thousands) - Unaudited
For the Year Ending December 31, 2022
 Low  High
Net Income$899,200 $937,600 
Adjusted to exclude:
Equity in earnings of unconsolidated joint ventures(43,000)(44,000)
Interest expense212,000 210,000 
Depreciation and amortization279,000 279,000 
Income tax expense23,000 22,000 
General and administrative 125,500 124,500 
Management fees and other income(82,500)(83,500)
Interest income(60,500)(61,500)
Net tenant reinsurance income(153,500)(155,500)
Non same-store rental revenues(195,000)(195,000)
Non same-store operating expenses84,000 84,000 
Total same-store net operating income1
$1,088,200 $1,117,600 
Same-store rental revenues1
1,429,500 1,454,000 
Same-store operating expenses1
341,300 336,400 
Total same-store net operating income1
$1,088,200 $1,117,600 

(1)Estimated same-store rental revenues, operating expenses and net operating income are for the Company's 2022 same-store pool of 870 stores.