filings.toolsItem 15. Exhibits and Financial Statement Schedules
206K characters. Original on sec.gov ·
Item 15. Exhibits and Financial Statement Schedules
a. 1. Financial Statements
The financial statements listed in the accompanying Index to Consolidated Financial Statements and Schedules hereof are filed as part of this report.
2.Financial Statement Schedules
The financial statements schedules listed in the accompanying Index to Consolidated Financial Statements and Schedules are filed as part of this report.
3.Exhibits
See Index to Exhibits contained herein.
b.Exhibits:
See Index to Exhibits contained herein.
c.Financial Statement Schedules
Not applicable.
PUBLIC STORAGE
INDEX TO EXHIBITS (1)
(Items 15(a)(3) and 15(c))
| 23.1 | Consent of Ernst & Young LLP. Filed herewith. | ||||
| 31.1 | Rule 13a – 14(a) Certification. Filed herewith. | ||||
| 31.2 | Rule 13a – 14(a) Certification. Filed herewith. | ||||
| 32 | Section 1350 Certifications. Filed herewith. | ||||
| 97.1 | Policy Relating to Recovery of Erroneously Awarded Compensation. Filed as Exhibit 97.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 and incorporated herein by reference. | ||||
| 101 .INS | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) | ||||
| 101 .SCH | Inline XBRL Taxonomy Extension Schema. Filed herewith. | ||||
| 101 .CAL | Inline XBRL Taxonomy Extension Calculation Linkbase. Filed herewith. | ||||
| 101 .DEF | Inline XBRL Taxonomy Extension Definition Linkbase. Filed herewith. | ||||
| 101 .LAB | Inline XBRL Taxonomy Extension Label Linkbase. Filed herewith. | ||||
| 101 .PRE | Inline XBRL Taxonomy Extension Presentation Link. Filed herewith. | ||||
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) | ||||
| _ (1) | SEC File No. 001-33519 unless otherwise indicated. | ||||
| * | Denotes management compensatory plan agreement or arrangement. |
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| PUBLIC STORAGE | ||||||||
| Date: February 24, 2025 | By: | /s/ Joseph D. Russell, Jr. | ||||||
| Joseph D. Russell, Jr., Chief Executive Officer, President and Trustee |
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
| Signature | Title | Date | ||||||
| /s/ Joseph D. Russell, Jr. | Chief Executive Officer, President and Trustee (principal executive officer) | February 24, 2025 | ||||||
| Joseph D. Russell, Jr. | ||||||||
| /s/ H. Thomas Boyle | Chief Financial and Investment Officer (principal financial officer) | February 24, 2025 | ||||||
| H. Thomas Boyle | ||||||||
| /s/ Ronald L. Havner, Jr. | Chairman of the Board | February 24, 2025 | ||||||
| Ronald L. Havner, Jr. | ||||||||
| /s/ Tamara Hughes Gustavson | Trustee | February 24, 2025 | ||||||
| Tamara Hughes Gustavson | ||||||||
| /s/ Maria R. Hawthorne | Trustee | February 24, 2025 | ||||||
| Maria R. Hawthorne | ||||||||
| /s/ Shankh S. Mitra | Trustee | February 24, 2025 | ||||||
| Shankh S. Mitra | ||||||||
| /s/ Rebecca Owen | Trustee | February 24, 2025 | ||||||
| Rebecca Owen | ||||||||
| /s/ Kristy M. Pipes | Trustee | February 24, 2025 | ||||||
| Kristy M. Pipes | ||||||||
| /s/ Avedick B. Poladian | Trustee | February 24, 2025 | ||||||
| Avedick B. Poladian | ||||||||
| /s/ John Reyes | Trustee | February 24, 2025 | ||||||
| John Reyes | ||||||||
| /s/ Tariq M. Shaukat | Trustee | February 24, 2025 | ||||||
| Tariq M. Shaukat |
| Signature | Title | Date | ||||||
| /s/ Ronald P. Spogli | Trustee | February 24, 2025 | ||||||
| Ronald P. Spogli | ||||||||
| /s/ Paul S. Williams | Trustee | February 24, 2025 | ||||||
| Paul S. Williams |
PUBLIC STORAGE
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
AND SCHEDULES
(Item 15 (a))
| Page References | |||||
| Report of Independent Registered Public Accounting Firm Auditor name: Ernst & Young LLP; Firm ID: (42); Auditor location: Los Angeles, California | F-1 | ||||
| Consolidated Balance Sheets as of December 31, 2024 and 2023 | F-3 | ||||
| For the years ended December 31, 2024, 2023, and 2022: | |||||
| Consolidated Statements of Income | F-4 | ||||
| Consolidated Statements of Comprehensive Income | F-5 | ||||
| Consolidated Statements of Equity and Redeemable Noncontrolling Interests | F-6 | ||||
| Consolidated Statements of Cash Flows | F-8 | ||||
| Notes to Consolidated Financial Statements | F-10 | ||||
| Schedule: | |||||
| III – Real Estate and Accumulated Depreciation | F-36 |
All other schedules have been omitted since the required information is not present or not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements or notes thereto.
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Trustees of Public Storage
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Public Storage (the Company) as of December 31, 2024 and 2023, the related consolidated statements of income, comprehensive income, equity and redeemable noncontrolling interests and cash flows for each of the three years in the period ended December 31, 2024 , and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control–Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated February 24, 2025 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
F-1
| Purchase Price Allocation | ||||||||
| Description of the Matter | For the year ended December 31, 2024, the Company completed the acquisition of 22 self-storage facilities for a total purchase price of $267 million. As further discussed in Notes 2 and 3 of the consolidated financial statements, the transactions were accounted for as asset acquisitions, and the purchase price was allocated based on a relative fair value of assets acquired and liabilities assumed, which consisted principally of land and buildings. Auditing the accounting for the Company’s 2024 acquisitions of self-storage facilities was subjective because the Company must exercise a high level of management judgment in determining the estimated fair value of land and buildings. The estimated fair value of land is based upon observable transactions involving comparable land in similar locations, as adjusted for location quality, parcel size and date of sale associated with the acquired facilities. Determining the fair value of acquired land was difficult due to the judgment utilized by management in making adjustments to the observable transaction data used in the estimate, particularly when there is a lack of recent comparable land market data. The estimated fair value of the acquired buildings was based upon the income approach, which included estimating the fair value of hypothetical vacant acquired buildings and adjusting for the estimated fair value of land. Determining the fair value of the acquired buildings was challenging due to the judgment utilized by management in determining the assumptions utilized in the income approach, including future stabilized operating cash flows and capitalization rate. | |||||||
| How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over management’s accounting for acquired self-storage facilities, including controls over the review of assumptions underlying the purchase price allocation and accuracy of the underlying data used. For example, we tested controls over the determination of the estimated fair values of the land and buildings, including the controls over the review of the valuation models and the underlying assumptions used to develop such estimates. For the 2024 acquisitions of self-storage facilities described above, our procedures included, but were not limited to, reading the purchase and sale agreements and other closing documents, evaluating whether the Company had appropriately determined the transaction was an asset acquisition or business combination and performing a sensitivity analysis to evaluate the impact on the Company’s financial statements resulting from changes in allocated land and building values. For certain of these asset acquisitions, we also evaluated the methods and significant assumptions used by the Company and tested the completeness and accuracy of the underlying data supporting the significant assumptions and estimates. Additionally, for certain of these asset acquisitions, we involved our valuation specialists to assist in the assessment of the methodology utilized by the Company and to perform corroborative analyses to assess whether the assumptions used in the valuation and the estimated fair values were supported by observable market data. |
/s/ Ernst & Young LLP
We have served as the Company's auditor since 1980.
Los Angeles, California
February 24, 2025
F-2
PUBLIC STORAGE
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share data)
| December 31, 2024 | December 31, 2023 | ||||||||||
| ASSETS | |||||||||||
| Cash and equivalents | $ | 447,416 | $ | 370,002 | |||||||
| Real estate facilities, at cost: | |||||||||||
| Land | 5,711,685 | 5,628,488 | |||||||||
| Buildings | 22,767,053 | 21,836,750 | |||||||||
| 28,478,738 | 27,465,238 | ||||||||||
| Accumulated depreciation | (10,426,186) | (9,423,974) | |||||||||
| 18,052,552 | 18,041,264 | ||||||||||
| Construction in process | 308,101 | 345,453 | |||||||||
| 18,360,653 | 18,386,717 | ||||||||||
| Investment in unconsolidated real estate entity | 382,490 | 390,180 | |||||||||
| Goodwill and other intangible assets, net | 282,187 | 387,267 | |||||||||
| Other assets | 282,188 | 275,050 | |||||||||
| Total assets | $ | 19,754,934 | $ | 19,809,216 | |||||||
| LIABILITIES AND EQUITY | |||||||||||
| Notes payable | $ | 9,353,034 | $ | 9,103,277 | |||||||
| Accrued and other liabilities | 588,248 | 598,993 | |||||||||
| Total liabilities | 9,941,282 | 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, 175,408,393 shares issued (175,670,727 shares at December 31, 2023) | 17,541 | 17,567 | |||||||||
| Paid-in capital | 6,116,113 | 5,980,760 | |||||||||
| Accumulated deficit | (699,083) | (267,910) | |||||||||
| Accumulated other comprehensive loss | (71,965) | (67,239) | |||||||||
| Total Public Storage shareholders’ equity | 9,712,606 | 10,013,178 | |||||||||
| Noncontrolling interests | 101,046 | 93,768 | |||||||||
| Total equity | 9,813,652 | 10,106,946 | |||||||||
| Total liabilities and equity | $ | 19,754,934 | $ | 19,809,216 |
See accompanying notes.
F-3
PUBLIC STORAGE
CONSOLIDATED STATEMENTS OF INCOME
(Amounts in thousands, except per share amounts)
| For the Years Ended December 31, | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||||||||
| Self-storage facilities | $ | 4,395,993 | $ | 4,259,613 | 3,946,028 | ||||||||||||||||||||||||
| Ancillary operations | 299,623 | 258,077 | 236,135 | ||||||||||||||||||||||||||
| 4,695,616 | 4,517,690 | 4,182,163 | |||||||||||||||||||||||||||
| Expenses: | |||||||||||||||||||||||||||||
| Self-storage cost of operations | 1,136,720 | 1,061,950 | 980,209 | ||||||||||||||||||||||||||
| Ancillary cost of operations | 121,281 | 85,996 | 72,698 | ||||||||||||||||||||||||||
| Depreciation and amortization | 1,129,766 | 970,056 | 888,146 | ||||||||||||||||||||||||||
| Real estate acquisition and development expense | 15,506 | 26,451 | 28,744 | ||||||||||||||||||||||||||
| General and administrative | 106,677 | 80,632 | 71,672 | ||||||||||||||||||||||||||
| Interest expense | 287,401 | 201,132 | 136,319 | ||||||||||||||||||||||||||
| 2,797,351 | 2,426,217 | 2,177,788 | |||||||||||||||||||||||||||
| Other increases (decreases) to net income: | |||||||||||||||||||||||||||||
| Interest and other income | 67,212 | 85,590 | 40,567 | ||||||||||||||||||||||||||
| Equity in earnings of unconsolidated real estate entities | 19,821 | 27,897 | 106,981 | ||||||||||||||||||||||||||
| Foreign currency exchange gain (loss) | 102,244 | (51,197) | 98,314 | ||||||||||||||||||||||||||
| Gain on sale of real estate | 1,537 | 17,178 | 1,503 | ||||||||||||||||||||||||||
| Gain on sale of equity investment in PS Business Parks, Inc. | — | — | 2,128,860 | ||||||||||||||||||||||||||
| Income before income tax expense | 2,089,079 | 2,170,941 | 4,380,600 | ||||||||||||||||||||||||||
| Income tax expense | (4,669) | (10,821) | (14,326) | ||||||||||||||||||||||||||
| Net income | 2,084,410 | 2,160,120 | 4,366,274 | ||||||||||||||||||||||||||
| Allocation to noncontrolling interests | (12,399) | (11,793) | (17,127) | ||||||||||||||||||||||||||
| Net income allocable to Public Storage shareholders | 2,072,011 | 2,148,327 | 4,349,147 | ||||||||||||||||||||||||||
| Allocation of net income to: | |||||||||||||||||||||||||||||
| Preferred shareholders | (194,703) | (194,703) | (194,390) | ||||||||||||||||||||||||||
| Restricted share units and unvested LTIP units | (4,623) | (4,883) | (12,469) | ||||||||||||||||||||||||||
| Net income allocable to common shareholders | $ | 1,872,685 | $ | 1,948,741 | $ | 4,142,288 | |||||||||||||||||||||||
| Net income per common share: | |||||||||||||||||||||||||||||
| Basic | $ | 10.68 | $ | 11.11 | $ | 23.64 | |||||||||||||||||||||||
| Diluted | $ | 10.64 | $ | 11.06 | $ | 23.50 | |||||||||||||||||||||||
| Basic weighted average common shares outstanding | 175,351 | 175,472 | 175,257 | ||||||||||||||||||||||||||
| Diluted weighted average common shares outstanding | 176,038 | 176,143 | 176,280 |
See accompanying notes.
F-4
PUBLIC STORAGE
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Amounts in thousands)
| For the Years Ended December 31, | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||||||||||||||
| Net income | $ | 2,084,410 | $ | 2,160,120 | $ | 4,366,274 | |||||||||||||||||||||||
| Foreign currency translation (loss) gain on investment in Shurgard | (4,739) | 13,078 | (26,730) | ||||||||||||||||||||||||||
| Total comprehensive income | 2,079,671 | 2,173,198 | 4,339,544 | ||||||||||||||||||||||||||
| Allocation to noncontrolling interests | (12,386) | (11,793) | (17,127) | ||||||||||||||||||||||||||
| Comprehensive income allocable to Public Storage shareholders | $ | 2,067,285 | $ | 2,161,405 | $ | 4,322,417 |
See accompanying notes.
F-5
PUBLIC STORAGE
CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS
(Amounts in thousands, except share and per share amounts)
| Cumulative Preferred Shares | Common Shares | Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total Public Storage Shareholders' Equity | Noncontrolling Interests | Total Equity | Redeemable Noncontrolling Interests | |||||||||||||||||||||||||||||||||||||||||||||
| Balances at December 31, 2021 | $ | 4,100,000 | $ | 17,513 | $ | 5,821,667 | $ | (550,416) | $ | (53,587) | $ | 9,335,177 | $ | 20,112 | $ | 9,355,289 | $ | 68,249 | |||||||||||||||||||||||||||||||||||
| Issuance of 10,000 preferred shares (Note 9) | 250,000 | — | (7,168) | — | — | 242,832 | — | 242,832 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common shares in connection with share-based compensation (283,190 shares) (Note 11) | — | 29 | 35,376 | — | — | 35,405 | — | 35,405 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Retirement of common shares (151,977 shares) | — | (15) | 15 | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
| Taxes paid upon net share settlement of restricted share units | — | — | (16,827) | — | — | (16,827) | — | (16,827) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation expense (Note 11) | — | — | 63,360 | — | — | 63,360 | — | 63,360 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Contributions by noncontrolling interests | — | — | — | — | — | — | 6,708 | 6,708 | 15,426 | ||||||||||||||||||||||||||||||||||||||||||||
| Reclassification from redeemable noncontrolling interests to noncontrolling interests | — | — | — | — | — | — | 83,826 | 83,826 | (83,826) | ||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | 4,366,274 | — | 4,366,274 | — | 4,366,274 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Net income allocated to noncontrolling interests | — | — | — | (17,127) | — | (17,127) | 16,467 | (660) | 660 | ||||||||||||||||||||||||||||||||||||||||||||
| Distributions to: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred shareholders (Note 9) | — | — | — | (194,390) | — | (194,390) | — | (194,390) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Noncontrolling interests | — | — | — | — | — | — | (33,714) | (33,714) | (509) | ||||||||||||||||||||||||||||||||||||||||||||
| Common shareholders and restricted share unitholders ($21.15 per share) | — | — | — | (3,714,572) | — | (3,714,572) | — | (3,714,572) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | (26,730) | (26,730) | — | (26,730) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Balances at December 31, 2022 | $ | 4,350,000 | $ | 17,527 | $ | 5,896,423 | $ | (110,231) | $ | (80,317) | $ | 10,073,402 | $ | 93,399 | $ | 10,166,801 | $ | — | |||||||||||||||||||||||||||||||||||
| Issuance of common shares in connection with share-based compensation (405,059 shares) (Note 11) | — | 40 | 53,346 | — | — | 53,386 | — | 53,386 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Taxes paid upon net share settlement of restricted share units | — | — | (13,950) | — | — | (13,950) | — | (13,950) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation expense (Note 11) | — | — | 44,941 | — | — | 44,941 | — | 44,941 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Contributions by noncontrolling interests | — | — | — | — | — | — | 3,203 | 3,203 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | 2,160,120 | — | 2,160,120 | — | 2,160,120 | — |
See accompanying notes.
F-6
PUBLIC STORAGE
CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS
(Amounts in thousands, except share and per share amounts)
| Cumulative Preferred Shares | Common Shares | Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Total Public Storage Shareholders' Equity | Noncontrolling Interests | Total Equity | Redeemable Noncontrolling Interests | |||||||||||||||||||||||||||||||||||||||||||||
| Net income allocated to noncontrolling interests | — | — | — | (11,793) | — | (11,793) | 11,793 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
| Distributions to: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred shareholders (Note 9) | — | — | — | (194,703) | — | (194,703) | — | (194,703) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Noncontrolling interests | — | — | — | — | — | — | (14,627) | (14,627) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Common shareholders and restricted share unitholders ($12.00 per share) | — | — | — | (2,111,303) | — | (2,111,303) | — | (2,111,303) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | 13,078 | 13,078 | — | 13,078 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Balances at December 31, 2023 | $ | 4,350,000 | $ | 17,567 | $ | 5,980,760 | $ | (267,910) | $ | (67,239) | $ | 10,013,178 | $ | 93,768 | $ | 10,106,946 | $ | — | |||||||||||||||||||||||||||||||||||
| Issuance of common shares (184,390 shares) (Note 9) | — | 18 | 60,303 | — | — | 60,321 | — | 60,321 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common shares in connection with share-based compensation (280,141 shares) (Note 11) | — | 29 | 47,382 | — | — | 47,411 | — | 47,411 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Taxes paid upon net share settlement of restricted share units (Note 11) | — | — | (12,667) | — | — | (12,667) | — | (12,667) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Share-based compensation cost (Note 11) | — | — | 49,317 | — | — | 49,317 | — | 49,317 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Repurchase of common shares (726,865 shares) (Note 9) | — | (73) | — | (199,927) | — | (200,000) | — | (200,000) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Acquisition of noncontrolling interests | — | — | (1,602) | — | — | (1,602) | 11 | (1,591) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Contributions by noncontrolling interests | — | — | — | — | — | — | 2,938 | 2,938 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Net income | — | — | — | 2,084,410 | — | 2,084,410 | — | 2,084,410 | — | ||||||||||||||||||||||||||||||||||||||||||||
| Net income allocated to noncontrolling interests | — | — | — | (12,399) | — | (12,399) | 12,399 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
| Reallocation of equity | — | — | (7,380) | — | — | (7,380) | 7,380 | — | — | ||||||||||||||||||||||||||||||||||||||||||||
| Distributions to: | |||||||||||||||||||||||||||||||||||||||||||||||||||||
| Preferred shareholders (Note 9) | — | — | — | (194,703) | — | (194,703) | — | (194,703) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Noncontrolling interests | — | — | — | — | — | — | (15,437) | (15,437) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Common shareholders, restricted share unitholders and unvested LTIP unitholders ($12.00 per share/unit) (Note 9) | — | — | — | (2,108,554) | — | (2,108,554) | — | (2,108,554) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | — | (4,726) | (4,726) | (13) | (4,739) | — | ||||||||||||||||||||||||||||||||||||||||||||
| Balances at December 31, 2024 | $ | 4,350,000 | $ | 17,541 | $ | 6,116,113 | $ | (699,083) | $ | (71,965) | $ | 9,712,606 | $ | 101,046 | $ | 9,813,652 | $ | — |
See accompanying notes.
F-7
PUBLIC STORAGE
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
| For the Years Ended December 31, | |||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||
| Cash flows from operating activities: | |||||||||||||||||
| Net income | $ | 2,084,410 | $ | 2,160,120 | $ | 4,366,274 | |||||||||||
| Adjustments to reconcile net income to net cash flows from operating activities: | |||||||||||||||||
| Gain on sale of equity investment in PS Business Parks, Inc. | — | — | (2,128,860) | ||||||||||||||
| Gain on sale of real estate | (1,537) | (17,178) | (1,503) | ||||||||||||||
| Depreciation and amortization | 1,129,766 | 970,056 | 888,146 | ||||||||||||||
| Equity in earnings of unconsolidated real estate entities | (19,821) | (27,897) | (106,981) | ||||||||||||||
| Distributions from cumulative equity in earnings of unconsolidated real estate entities | 11,039 | 29,333 | 134,769 | ||||||||||||||
| Unrealized foreign currency exchange (gain) loss | (101,974) | 51,239 | (97,563) | ||||||||||||||
| Share-based compensation expense | 44,747 | 41,566 | 56,703 | ||||||||||||||
| Other non-cash adjustments | 11,410 | 20,508 | 15,207 | ||||||||||||||
| Changes in operating assets and liabilities, excluding the impact of acquisitions: | |||||||||||||||||
| Other assets | (44,968) | (16,365) | (29,638) | ||||||||||||||
| Accrued and other liabilities | 15,183 | 35,266 | 20,587 | ||||||||||||||
| Net cash flows from operating activities | 3,128,255 | 3,246,648 | 3,117,141 | ||||||||||||||
| Cash flows from investing activities: | |||||||||||||||||
| Capital expenditures to maintain real estate facilities | (239,655) | (236,572) | (218,713) | ||||||||||||||
| Capital expenditures for property enhancements | (126,757) | (159,939) | (189,699) | ||||||||||||||
| Capital expenditures for energy efficiencies (LED lighting, solar) | (53,612) | (64,626) | (51,361) | ||||||||||||||
| Development and expansion of real estate facilities | (326,854) | (364,445) | (313,511) | ||||||||||||||
| Acquisition of real estate facilities and intangible assets | (267,473) | (473,176) | (757,944) | ||||||||||||||
| Acquisition of BREIT Simply Storage LLC, net of cash acquired | — | (2,178,151) | — | ||||||||||||||
| Issuance of notes receivable | (9,960) | — | — | ||||||||||||||
| Distributions in excess of cumulative equity in earnings from unconsolidated real estate entities | 13,285 | 10,975 | 13,670 | ||||||||||||||
| Contributions to unconsolidated real estate entity | — | (112,554) | — | ||||||||||||||
| Proceeds from sale of real estate investments | 8,388 | 39,986 | 1,543 | ||||||||||||||
| Proceeds from sale of equity investment in PS Business Parks, Inc. | — | — | 2,636,011 | ||||||||||||||
| Net cash flows (used in) from investing activities | (1,002,638) | (3,538,502) | 1,119,996 | ||||||||||||||
| Cash flows from financing activities: | |||||||||||||||||
| Issuance costs on amendment of credit facility | — | (8,377) | — | ||||||||||||||
| Repayments of notes payable | (808,505) | (8,259) | (513,495) | ||||||||||||||
| Issuance of notes payable, net of issuance costs | 1,151,022 | 2,181,273 | — | ||||||||||||||
| Issuance of preferred shares | — | — | 242,832 | ||||||||||||||
| Issuance of common shares | 60,321 | — | — | ||||||||||||||
| Issuance of common shares in connection with share-based compensation | 47,278 | 53,131 | 35,271 | ||||||||||||||
| Taxes paid upon net share settlement of restricted share units | (12,667) | (13,950) | (16,827) | ||||||||||||||
| Repurchase of common shares | (200,000) | — | — | ||||||||||||||
| Acquisition of noncontrolling interests | (1,591) | — | — | ||||||||||||||
| Contributions by noncontrolling interests | 2,938 | 3,203 | 1,669 | ||||||||||||||
| Distributions paid to preferred shareholders, common shareholders, restricted share unitholders and unvested LTIP unitholders | (2,301,935) | (2,305,322) | (3,908,497) | ||||||||||||||
| Distributions paid to noncontrolling interests | (15,437) | (14,627) | (34,223) | ||||||||||||||
| Net cash flows used in financing activities | (2,078,576) | (112,928) | (4,193,270) | ||||||||||||||
| Net increase (decrease) in cash and equivalents, including restricted cash | $ | 47,041 | $ | (404,782) | $ | 43,867 |
See accompanying notes.
F-8
PUBLIC STORAGE
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
| For the Years Ended December 31, | |||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||
| Cash and equivalents, including restricted cash at beginning of the period: | |||||||||||||||||
| Cash and equivalents | $ | 370,002 | $ | 775,253 | $ | 734,599 | |||||||||||
| Restricted cash included in other assets | 30,373 | 29,904 | 26,691 | ||||||||||||||
| $ | 400,375 | $ | 805,157 | $ | 761,290 | ||||||||||||
| Cash and equivalents, including restricted cash at end of the period: | |||||||||||||||||
| Cash and equivalents | $ | 447,416 | $ | 370,002 | $ | 775,253 | |||||||||||
| Restricted cash included in other assets | — | 30,373 | 29,904 | ||||||||||||||
| $ | 447,416 | $ | 400,375 | $ | 805,157 | ||||||||||||
| Supplemental schedule of non-cash investing and financing activities: | |||||||||||||||||
| Costs incurred during the period remaining unpaid at period end for: | |||||||||||||||||
| Capital expenditures to maintain real estate facilities | $ | (7,324) | $ | (10,798) | $ | (9,903) | |||||||||||
| Capital expenditures for property enhancements | (1,087) | (3,046) | (4,502) | ||||||||||||||
| Capital expenditures for energy efficiencies (LED lighting, solar) | (1,179) | (386) | (855) | ||||||||||||||
| Construction or expansion of real estate facilities | (47,159) | (68,099) | (65,650) | ||||||||||||||
| Real estate acquired in exchange for noncontrolling interests | — | — | (19,865) | ||||||||||||||
| Supplemental cash flow information: | |||||||||||||||||
| Cash paid for interest, net of amounts capitalized | $ | 269,498 | $ | 146,213 | $ | 127,711 | |||||||||||
| Cash paid for income taxes, net of refunds | 6,877 | 11,056 | 11,293 | ||||||||||||||
See accompanying notes.
F-9
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- Description of the Business
Public Storage 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 equity interests in PSOC. As of December 31, 2024, Public Storage owned all of the general partner interests and approximately 99.87% of the limited partnership interests of PSA OP, with the remaining 0.13% of limited partnership interests owned by certain trustees and officers of the Company.
Unless stated otherwise or the context otherwise requires, references to “Public Storage” mean the parent entity, Public Storage, and references to “the Company,” “we,” “us,” and “our” mean collectively Public Storage, PSA OP, PSOC, and those entities/subsidiaries owned or controlled by Public Storage, PSA OP, and PSOC.
At December 31, 2024, we owned interests in 3,073 self-storage facilities (with approximately 221.3 million net rentable square feet) located in 40 states in the United States (“U.S.”) operating under the Public Storage® name, and 1.0 million net rentable square feet of commercial and retail space. In addition, we managed 307 facilities (with approximately 23.3 million net rentable square feet) for third parties at December 31, 2024.
At December 31, 2024, we owned an approximate 35% common equity interest in Shurgard Self Storage Limited (“Shurgard”), a public company traded on the Euronext Brussels under the “SHUR” symbol, which owned 318 self-storage facilities (with approximately 17 million net rentable square feet) located in seven Western European countries, all operating under the Shurgard® name.
- Basis of Presentation and Summary of Significant Accounting Policies
Basis of Presentation
We have prepared the accompanying consolidated financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) as set forth in the Accounting Standards Codification of the Financial Accounting Standards Board, and in conformity with the rules and regulations of the Securities and Exchange Commission (“SEC”).
Disclosures of the number and square footage of facilities, as well as the number and coverage of tenant reinsurance policies (Note 14) are unaudited and outside the scope of our independent registered public accounting firm’s audit of our financial statements in accordance with the standards of the Public Company Accounting Oversight Board (U.S.).
F-10
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
Summary of Significant Accounting Policies
Consolidation and Equity Method of Accounting
We consider entities to be Variable Interest Entities (“VIEs”) when they have insufficient equity to finance their activities without additional subordinated financial support provided by other parties, or the equity holders as a group do not have a controlling financial interest. In addition, we have general partner interests in limited partnerships along with third-party investors to develop, construct or operate self-storage facilities. As the general partner, we consider the limited partnerships to be VIEs if the limited partners lack both substantive participating rights and substantive kick-out rights. We consolidate VIEs when we have (i) the power to direct the activities most significantly impacting economic performance, and (ii) either the obligation to absorb losses or the right to receive benefits from the VIE. PSA OP met the definition of a VIE and is consolidated by the Company as the primary beneficiary of PSA OP. All of the assets and liabilities of the Company are held by PSA OP. The total assets, primarily real estate assets, and the total liabilities of our other consolidated VIEs are not material as of December 31, 2024. We consolidate all other entities when we control them through voting shares or contractual rights. We refer to the entities we consolidate, for the period in which the reference applies, collectively as the “Subsidiaries,” and we eliminate intercompany transactions and balances.
We account for our investments in entities that we do not consolidate but over which we have significant influence using the equity method of accounting. We refer to these entities, for the periods in which the reference applies, collectively as the “Unconsolidated Real Estate Entities,” and we eliminate intra-entity profits and losses and amortize any differences between the cost of our investment and the underlying equity in net assets against equity in earnings as if the Unconsolidated Real Estate Entity were a consolidated subsidiary.
Equity in earnings of unconsolidated real estate entities presented on our income statements represents our pro-rata share of the earnings of the Unconsolidated Real Estate Entities. The dividends we receive from the Unconsolidated Real Estate Entities are reflected on our consolidated statements of cash flows as “distributions from cumulative equity in earnings of unconsolidated real estate entities” to the extent of our cumulative equity in earnings, with any excess classified as “distributions in excess of cumulative equity in earnings from unconsolidated real estate entities.”
Use of Estimates
The preparation of consolidated financial statements and accompanying notes in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported. Actual results could differ from those estimates and assumptions.
Cash Equivalents
Cash equivalents represent highly liquid financial instruments that mature within three months of acquisition such as money market funds with a rating of at least AAA by Standard & Poor’s, commercial paper that is rated A1 by Standard & Poor’s or deposits with highly rated commercial banks.
Fair Value
As used herein, the term “fair value” is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. In the absence of active markets for identical assets or liabilities, such measurements involve developing assumptions based on market observable data and, in the absence of such data, internal information that is consistent with what market participants would use in a hypothetical transaction that occurs at the balance sheet date.
Assets and liabilities recorded at fair value are measured and classified in accordance with a three-tier fair value hierarchy based on the observability of the inputs available in the market used to measure fair value:
Level 1 Quoted prices in active markets for identical assets or liabilities at the measurement date.
F-11
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
Level 2 Significant observable inputs other than Level 1, that are observable for the asset or liability, either directly or indirectly through corroboration with observable market data.
Level 3 Unobservable inputs that are supported by little or no market data for the related assets or liabilities.
The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
Our financial instruments consist of cash and cash equivalents, notes receivable, other assets, other liabilities, and notes payable. Cash equivalents, notes receivable, other assets and other liabilities are stated at book value, which approximates fair value as of the balance sheet date due to the short time period to maturity.
We estimate and disclose the fair value of our notes payable using Level 2 inputs by discounting the related future cash flows at a rate based upon quoted interest rates for securities that have similar characteristics such as credit quality and time to maturity.
We use significant judgment to estimate fair values of real estate facilities, goodwill, and other intangible assets for the purposes of purchase price allocation or impairment analysis. In estimating their values, we consider Level 3 inputs such as market prices of land, market capitalization rates, expected returns, earnings multiples, projected levels of earnings, costs of construction, and functional depreciation.
Real Estate Facilities
We record real estate facilities at cost. We capitalize all costs incurred to acquire, develop, construct, renovate and improve facilities as part of major repair and maintenance programs, including interest and property taxes incurred during the construction period. We expense the costs of demolition of existing facilities associated with a renovation as incurred. We allocate the net acquisition cost of acquired real estate facilities to the underlying land, buildings, and identified intangible assets based upon their respective individual estimated fair values.
We expense costs associated with dispositions of real estate, as well as routine repairs and maintenance costs, as incurred. We depreciate buildings and improvements on a straight-line basis over estimated useful lives ranging generally between 5 to 40 years.
When we sell a full or partial interest in a real estate facility without retaining a controlling interest following sale, we recognize a gain or loss on sale as if 100% of the property was sold at fair value. If we retain a controlling interest following the sale, we record a noncontrolling interest for the book value of the partial interest sold, and recognize additional paid-in capital for the difference between the consideration received and the partial interest at book value.
Goodwill and Other Intangible Assets
Intangible assets consist of goodwill, the Shurgard® trade name, which Shurgard uses pursuant to a fee-based licensing agreement, and finite-lived assets. Goodwill and the Shurgard® trade name have indefinite lives and are not amortized. Our finite-lived assets consist primarily of (i) acquired customers in place amortized relative to the benefit of the customers in place, with such amortization reflected as depreciation and amortization expense on our income statement, (ii) property tax abatements acquired and amortized relative to the reduction in property tax paid, with such amortization reflected as self-storage cost of operations on our income statement and (iii) acquired non real estate-related contracts, with such amortization reflected as depreciation and amortization expense on our income statement.
F-12
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
Notes Receivable
We account for notes receivable from bridge loans we originate to third-party self-storage owners at amortized cost. The bridge loans, collateralized by operating self-storage properties, typically have a term of three years or four years with two one-year extensions, and have variable interest rates. We recognize interest income and other fee income related to the bridge loans using the effective interest method, with deferred fees and costs amortized over the lives of the related loans as yield adjustment. We recognize an allowance for expected credit losses for outstanding notes receivable and unfunded loan commitments. At December 31, 2024, we had a notes receivable balance of $10.0 million included in other assets and an unfunded loan commitment of $12.5 million expected to close in 2025 subject to the satisfaction of certain conditions. As of December 31, 2024, none of the notes receivable were in past-due or nonaccrual status and the allowance for expected credit losses was immaterial.
Evaluation of Asset Impairment
We evaluate our real estate and finite-lived intangible assets for impairment each quarter. If there are indicators of impairment and we determine that the asset is not recoverable from future undiscounted cash flows to be received through the asset’s remaining life (or, if earlier, the expected disposal date), we record an impairment charge to the extent the carrying amount exceeds the asset’s estimated fair value or net proceeds from expected disposal.
We evaluate our investment in unconsolidated real estate entity for impairment quarterly. We record an impairment charge to the extent the carrying amount exceeds estimated fair value, when we believe any such shortfall is other than temporary.
We evaluate goodwill for impairment annually and whenever relevant events, circumstances, and other related factors indicate that it is more likely than not that the fair value of the related reporting unit is less than the carrying amount. When we conclude that it is not more likely than not that the fair value of the reporting unit is less than the aggregate carrying amount, no impairment charge is recorded and no further analysis is performed. Otherwise, we record an impairment charge to the extent the carrying amount of the goodwill exceeds the amount that would be allocated to goodwill if the reporting unit were acquired for estimated fair value.
We evaluate other indefinite-lived intangible assets, such as the Shurgard® trade name for impairment at least annually and whenever relevant events, circumstances and other related factors indicate that it is more likely than not that the asset is impaired. When we conclude that it is not more likely than not that the asset is impaired, we do not record an impairment charge and no further analysis is performed. Otherwise, we record an impairment charge to the extent the carrying amount exceeds the asset’s estimated fair value.
No impairments were recorded in any of our evaluations for all periods presented herein.
Revenue and Expense Recognition
We recognize revenues from self-storage facilities, which primarily comprise rental income earned pursuant to month-to-month leases, as well as associated late charges and administrative fees, as earned. Promotional discounts reduce rental income over the promotional period, which is generally one month. We recognize ancillary revenues when earned.
We accrue for property tax expense based upon actual amounts billed and, in some circumstances, estimates when bills or assessments have not been received from the taxing authorities. If these estimates are incorrect, the timing and amount of expense recognition could be incorrect. We expense cost of operations (including advertising expenditures), general and administrative expense, and interest expense as incurred.
F-13
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
Foreign Currency Exchange Translation
The local currency (the Euro) is the functional currency for our equity interests in Shurgard. The related balance sheet amounts are translated into U.S. Dollars at the exchange rates at the respective financial statement date, while amounts on our consolidated statements of income are translated at the average exchange rates during the respective period. Cumulative translation adjustments, are included in equity as a component of accumulated other comprehensive income (loss).
When financial instruments denominated in a currency other than the U.S. Dollar are expected to be settled in cash in the foreseeable future, the impact of changes in the U.S. Dollar equivalent are reflected in current earnings.
At December 31, 2024, due primarily to our investment in Shurgard (Note 4) and our notes payable denominated in Euros (Note 7), our operating results and financial position are affected by fluctuations in currency exchange rates between the Euro, against the U.S. Dollar. The Euro was translated at exchange rates of approximately 1.039 U.S. Dollars per Euro at December 31, 2024 (1.104 at December 31, 2023), and average exchange rates of 1.082, 1.081 and 1.054 for the years ended December 31, 2024, 2023, and 2022, respectively.
Income Taxes
We and a subsidiary of PSOC have elected to be treated as a REIT, as defined in the Internal Revenue Code of 1986, as amended (the “Code”). For each taxable year in which we qualify for taxation as a REIT, we will not be subject to U.S. federal corporate income tax on our “REIT taxable income” (generally, taxable income subject to specified adjustments, including a deduction for dividends paid and excluding our net capital gain) that is distributed to our shareholders. We believe we have met these REIT requirements for all periods presented herein. Accordingly, we have recorded no U.S. federal corporate income tax expense related to our REIT taxable income.
We have elected taxable REIT subsidiary (“TRS”) status for some of our consolidated subsidiaries. Our tenant reinsurance, merchandise, third party management operations and our equity investment in Shurgard are conducted under these TRSs and are subject to federal corporate income tax. For these entities, deferred tax assets and liabilities for temporary differences are recognized based on the future tax consequences attributable to differences that exist between the financial statement carrying amounts of assets and liabilities and their respective tax bases, as well as tax attributes such as operating loss, capital loss and tax credits carryforwards on a taxing jurisdiction basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts that are expected more likely than not to be realized in the future.
We recognize tax benefits of uncertain income tax positions only if we believe it is more likely than not that the position would ultimately be sustained assuming the relevant taxing authorities had full knowledge of the relevant facts and circumstances of our positions. As of December 31, 2024, we had no uncertain tax positions.
We also incur income taxes in certain state and local jurisdictions, which are included in income tax expense in the Consolidated Statements of Income.
Share-Based Compensation
Under various share-based compensation plans and under terms established or modified by our Board or a committee thereof, we grant awards to trustees, officers, and key employees, including non-qualified options to purchase the Company’s common shares, restricted share units (“RSUs”), deferred share units (“DSUs”), and unrestricted common shares issued in lieu of trustee compensation.
In February 2024, we amended our 2021 Equity and Performance-Based Incentive Plan to further provide for the grant of awards to certain officers and trustees of the Company in the form of LTIP units and appreciation-only LTIP units (“AO LTIP units”) of PSA OP. LTIP units are structured as “profit interests” for U.S. federal income tax purposes.
F-14
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
We estimate the fair value of share-based payment awards on the date of grant. We determine the fair value of RSUs, DSUs, and LTIP units with no market conditions based on the closing market price of the Company’s common shares on the date of grant. We value stock options and AO LTIP units with no market conditions at the grant date using the Black-Scholes option-pricing model. We value awards with market conditions at the grant date using a Monte-Carlo valuation simulation. Our determination of the fair value of share-based payment awards on the date of grant using an option-pricing model or Monte-Carlo valuation simulation is affected by our stock price as well as assumptions regarding a number of subjective and complex variables. These variables include, but are not limited to, our expected stock price volatility over the expected term of the awards. For stock options and AO LTIP units, variables also include actual and projected stock option exercise and AO LTIP unit conversion behaviors. For awards with performance conditions, we adjust compensation cost each quarter as needed for any changes in the assessment of the probability that the specified performance criteria will be achieved.
We amortize the grant-date fair value of awards as compensation expense over the service period, which begins on the grant date and ends on the expected vesting date. For awards that are earned solely upon the passage of time and continued service, the entire cost of the award is amortized on a straight-line basis over the service period. For awards with market and/or performance conditions, the individual cost of each vesting is amortized separately over each individual service period (the “accelerated attribution” method). For awards with performance conditions, the estimated number of stock awards that will ultimately vest requires judgment, and to the extent actual results or updated estimates differ from our current estimates, such amounts will be recorded as a cumulative adjustment in the period estimates are revised. In amortizing share-based compensation expense, we do not estimate future forfeitures. Instead, we reverse previously amortized share-based compensation expense with respect to grants that are forfeited in the period the employee terminates employment.
Our share-based compensation plans allow immediate vesting of outstanding unvested awards upon retirement (“Retirement Acceleration”) for employees who meet certain conditions. We accelerate amortization of compensation expense for each grant by changing the end of the service period from the original vesting date to the date an employee is expected to be eligible for Retirement Acceleration, if earlier.
Recent Accounting Pronouncements Not Yet Adopted
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, to enhance the transparency and decision-usefulness of income tax disclosures, particularly in the rate reconciliation table and disclosures about income taxes paid. The ASU’s amendments are effective for annual periods beginning after December 15, 2024 on a prospective basis. Early adoption is permitted. We are currently evaluating the impact of this ASU on our Consolidated Financial Statements and related disclosures.
In November 2024, the FASB issued ASU 2024-03, Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40) that requires the disclosure of additional information related to certain costs and expenses, including amounts of inventory purchases, employee compensation, and depreciation and amortization included in each income statement line item. The guidance also requires disclosure of the total amount of selling expenses and the entity’s definition selling expenses. The guidance is effective for annual periods beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. The guidance may be applied prospectively or retrospectively. Early adoption is permitted. We are currently evaluating the impact of this ASU on our Consolidated Financial Statements and related disclosures.
F-15
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- Real Estate Facilities
Activity in real estate facilities during 2024, 2023, and 2022 is as follows:
| For the Years Ended December 31, | |||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||
| (Amounts in thousands) | |||||||||||||||||
| Operating facilities, at cost: | |||||||||||||||||
| Beginning balance | $ | 27,465,238 | $ | 24,219,126 | $ | 22,807,833 | |||||||||||
| Capital expenditures to maintain real estate facilities | 234,541 | 232,048 | 205,169 | ||||||||||||||
| Capital expenditures for property enhancements | 126,324 | 163,380 | 194,931 | ||||||||||||||
| Capital expenditures for energy efficiencies (LED lighting, solar) | 54,433 | 65,026 | 52,216 | ||||||||||||||
| Acquisitions | 254,940 | 2,442,118 | 733,442 | ||||||||||||||
| Dispositions and other | (106) | (19,322) | (1,704) | ||||||||||||||
| Developed or expanded facilities opened for operation | 343,368 | 362,862 | 227,239 | ||||||||||||||
| Ending balance | 28,478,738 | 27,465,238 | 24,219,126 | ||||||||||||||
| Accumulated depreciation: | |||||||||||||||||
| Beginning balance | (9,423,974) | (8,554,155) | (7,773,308) | ||||||||||||||
| Depreciation expense | (1,002,212) | (881,255) | (781,931) | ||||||||||||||
| Dispositions and other | — | 11,436 | 1,084 | ||||||||||||||
| Ending balance | (10,426,186) | (9,423,974) | (8,554,155) | ||||||||||||||
| Construction in process: | |||||||||||||||||
| Beginning balance | 345,453 | 372,992 | 272,471 | ||||||||||||||
| Costs incurred to develop and expand real estate facilities | 307,650 | 356,788 | 336,948 | ||||||||||||||
| Acquisitions | — | 2,922 | — | ||||||||||||||
| Write-off of cancelled projects and transfer to other assets | (1,634) | (24,387) | (9,188) | ||||||||||||||
| Developed or expanded facilities opened for operation | (343,368) | (362,862) | (227,239) | ||||||||||||||
| Ending balance | 308,101 | 345,453 | 372,992 | ||||||||||||||
| Total real estate facilities at December 31, | $ | 18,360,653 | $ | 18,386,717 | $ | 16,037,963 |
During 2024, we acquired 22 self-storage facilities (1.7 million net rentable square feet of storage space), for a total cost of $267.5 million in cash. Approximately $12.5 million of the total cost was allocated to intangible assets. We completed development and redevelopment activities costing $343.4 million, adding 1.5 million net rentable square feet of self-storage space. Construction in process at December 31, 2024 consisted of projects to develop new self-storage facilities and expand existing self-storage facilities.
During 2023, we acquired all the membership interests of BREIT Simply Storage LLC, a self-storage company that owns and operates 127 self-storage facilities (9.4 million net rentable square feet) and manages 25 self-storage facilities for third parties, for a purchase price of $2.2 billion in cash (the “Simply Acquisition”). Approximately $2.0 billion of the total costs was allocated to real estate facilities and $214.3 million was allocated to intangible assets.
F-16
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
During 2023, in addition to the Simply Acquisition, we acquired 37 self-storage facilities (2.7 million net rentable square feet of storage space), for a total cost of $473.2 million in cash. Approximately $23.2 million of the total cost was allocated to intangible assets. We completed development and redevelopment activities costing $362.9 million during 2023, adding 1.7 million net rentable square feet of self-storage space. Construction in process at December 31, 2023 consisted of projects to develop new self-storage facilities and expand existing self-storage facilities. During 2023, we wrote off $11.7 million of accumulated development costs for cancelled development and redevelopment projects in construction in process as real estate acquisition and development expense. We also transferred $12.7 million of land cost related to cancelled development projects to other assets at December 31, 2023.
During 2023, we completed a real estate transaction with a third-party, through which we sold an operating self-storage facility with a net book value of $7.1 million for gross proceeds of $40.0 million and acquired a nearby land parcel for $13.5 million. At the close of the transaction, we entered into a leaseback of the self-storage facility until we complete development of the acquired land into a self-storage facility, no later than December 31, 2026. Of the $40.0 million in gross proceeds, $24.3 million was allocated to the sale of the property based on its estimated fair value, resulting a net gain on sale of real estate of $17.1 million after direct transaction costs, and $15.7 million was classified as a reduction of costs to develop the acquired land included in construction in process.
During 2023, we also sold a land parcel for $0.1 million in cash and recorded a related gain on sale of real estate of $0.1 million.
During 2022, we acquired 74 self-storage facilities (4.7 million net rentable square feet of storage space), for a total cost of $730.5 million, consisting of $710.6 million in cash and $19.9 million in partnership units in one of our subsidiaries. Approximately $24.1 million of the total cost was allocated to intangible assets. We completed development and redevelopment activities costing $227.2 million during 2022, adding 1.4 million net rentable square feet of self-storage space. Construction in process at December 31, 2022 consisted of projects to develop new self-storage facilities and expand existing self-storage facilities. During 2022, we wrote off $7.0 million of accumulated development costs for cancelled development and redevelopment projects in construction in process as real estate acquisition and development expense. We also transferred $2.2 million of land cost related to a cancelled development project to other assets at December 31, 2022.
Additionally, on July 8, 2022, we acquired from PS Business Parks, Inc. (“PSB”) the commercial interests in five properties at three sites jointly occupied with certain of our self-storage facilities located in Maryland and Virginia, for $47.3 million. We recognized $27.0 million of real estate assets and $0.7 million of intangibles for the properties acquired, representing the cost of these commercial properties that we did not have interest in through our equity investment in PSB. We recognized the remaining $19.6 million as an increase to our basis in our equity investment in PSB, which represents the elimination of our portion of the gain recorded by PSB.
During 2022, we sold portions of real estate facilities in connection with eminent domain proceedings for $1.5 million in cash proceeds and recorded a related gain on sale of real estate of approximately $1.5 million.
At December 31, 2024, the adjusted basis of real estate facilities for U.S. federal tax purposes was approximately $18.6 billion (unaudited).
F-17
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- Investment in Unconsolidated Real Estate Entities
The following table sets forth our equity in earnings of the Unconsolidated Real Estate Entities (amounts in thousands):
| Equity in Earnings of Unconsolidated Real Estate Entities for the | |||||||||||||||||||||||||||||
| Year Ended December 31, | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||||||||||||||
| Shurgard | $ | 19,821 | $ | 27,897 | $ | 26,385 | |||||||||||||||||||||||
| PSB | — | — | 80,596 | ||||||||||||||||||||||||||
| Total | $ | 19,821 | $ | 27,897 | $ | 106,981 |
Investment in Shurgard
Throughout all periods presented, we had an approximately 35% equity interest in Shurgard. On November 14, 2023, Shurgard issued 8,163,265 new common shares to institutional investors. We participated on a pro-rata basis in the offering and acquired 2,863,674 common shares for a cost of $112.6 million. On September 26, 2024, Shurgard issued 1,114,194 new common shares to its shareholders who opted to exchange the cash dividend rights declared on August 13, 2024 for additional shares. We received 487,600 new common shares in exchange for all of our dividend rights. At December 31, 2024, we effectively owned 34,619,733 common shares of Shurgard. Based upon the closing price at December 31, 2024 (€35.85 per share of Shurgard common stock, at 1.039 exchange rate of U.S. Dollars to the Euro), the shares we owned had a market value of approximately $1.3 billion.
Our equity in earnings of Shurgard comprise our equity share of Shurgard’s net income, less amortization of the Shurgard Basis Differential (defined below). During 2024, 2023, and 2022, we received $4.3 million, $3.8 million, and $3.5 million of trademark license fees that Shurgard pays to us for the use of the Shurgard® trademark, respectively. We eliminated $1.5 million, $1.3 million, and $1.2 million of intra-entity profits and losses for 2024, 2023, and 2022, 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 Consolidated Statements of Income.
During 2024, 2023, and 2022, we received cash dividend distributions from Shurgard totaling $22.8 million, $39.0 million, and $37.8 million, respectively. Approximately $13.3 million, $11.0 million, and $13.7 million of total cash distributions from Shurgard during the year ended 2024, 2023, and 2022, respectively, represented distributions in excess of cumulative equity in earnings from Shurgard, which was classified within cash flows from investing activities in the Consolidated Statements of Cash Flows.
At December 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 $62.6 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 increased by $3.4 million during 2024, due to an increase of our ownership interest in Shurgard from the exchange of our cash dividend rights for additional common shares of Shurgard. The Shurgard Basis Differential is being amortized as a reduction to equity in earnings of the Unconsolidated Real Estate Entities. Such amortization totaled approximately $4.5 million, $4.1 million, and $6.9 million during 2024, 2023, and 2022, respectively.
As of December 31, 2024, 2023, and 2022, we translated the book value of our investment in Shurgard from Euro to U.S. Dollars and recorded $4.7 million other comprehensive loss, $13.1 million other comprehensive income, and $26.7 million other comprehensive loss, respectively.
F-18
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
Investment in PSB
On July 20, 2022, in connection with the closing of the merger of PS Business Parks, Inc. (“PSB”) with affiliates of Blackstone Real Estate (“Blackstone”), we completed the sale of our 41% common equity interest in PSB in its entirety. At the close of the merger transaction, we received a total of $2.7 billion of cash proceeds and recognized a gain of $2.1 billion during the third quarter of 2022.
During 2022, we received cash distributions from PSB totaling $109.5 million, which were classified within cash flows from operating activities in the Consolidated Statements of Cash flows. Since the sale of PSB in July 2022, we no longer recognize equity in earnings or receive cash distributions from PSB.
- Goodwill and Other Intangible Assets
Goodwill and other intangible assets consisted of the following (amounts in thousands):
| At December 31, 2024 | At December 31, 2023 | ||||||||||||||||||||||||||||||||||
| Gross Book Value | Accumulated Amortization | Net Book Value | Gross Book Value | Accumulated Amortization | Net Book Value | ||||||||||||||||||||||||||||||
| Goodwill | $ | 165,843 | $ | — | $ | 165,843 | $ | 165,843 | $ | — | $ | 165,843 | |||||||||||||||||||||||
| Shurgard® Trade Name | 18,824 | — | 18,824 | 18,824 | — | 18,824 | |||||||||||||||||||||||||||||
| Finite-lived intangible assets, subject to amortization | 1,008,111 | (910,591) | 97,520 | 995,578 | (792,978) | 202,600 | |||||||||||||||||||||||||||||
| Total goodwill and other intangible assets | $ | 1,192,778 | $ | (910,591) | $ | 282,187 | $ | 1,180,245 | $ | (792,978) | $ | 387,267 |
Finite-lived intangible assets consist primarily of acquired customers in place. Amortization expense related to intangible assets subject to amortization was $117.6 million, $82.7 million and $95.2 million in 2024, 2023, and 2022, respectively. During 2024, 2023, and 2022, intangibles increased $12.5 million, $237.5 million, and $24.8 million, respectively, in connection with the acquisition of real estate facilities and Simply Acquisition (Note 3).
The remaining amortization expense will be recognized over a weighted average life of approximately 1.2 years. The estimated future amortization expense for our finite-lived intangible assets at December 31, 2024 is as follows (amounts in thousands):
| Year | Amount | |||||||
| 2025 | $ | 69,121 | ||||||
| 2026 | 21,573 | |||||||
| 2027 | 2,956 | |||||||
| 2028 | 381 | |||||||
| 2029 | 212 | |||||||
| Thereafter | 3,277 | |||||||
| Total | $ | 97,520 |
F-19
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- 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 December 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 December 31, 2024). At December 31, 2024 and February 24, 2025, we had no outstanding borrowings under this Credit Facility. We had undrawn standby letters of credit, which reduce our borrowing capacity, totaling $19.4 million at December 31, 2024 and $19.6 million at February 24, 2025 ($14.6 million at December 31, 2023). The Credit Facility has various customary restrictive covenants with which we were in compliance at December 31, 2024.
Public Storage has provided a full and unconditional guarantee of PSOC’s obligations under the Credit Facility.
F-20
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- Notes Payable
Our notes payable (all of which were issued by PSOC), are reflected net of issuance costs (including original issue discounts), which are amortized as interest expense on the effective interest method over the term of each respective note. Our notes payable at December 31, 2024 and December 31, 2023 are set forth in the tables below:
| Amounts at December 31, 2024 | Amounts at December 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||
| Coupon Rate | Effective Rate | Principal | Unamortized Costs | Book Value | Fair Value | Book Value | Fair Value | ||||||||||||||||||||||||||||||||||||||||
| ($ amounts in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||
| U.S. Dollar Denominated Unsecured Debt | |||||||||||||||||||||||||||||||||||||||||||||||
| Notes due April 23, 2024 | SOFR+0.47% | 5.818% | $ | — | $ | — | $ | — | $ | — | $ | 699,779 | $ | 700,031 | |||||||||||||||||||||||||||||||||
| Notes due July 25, 2025 | SOFR+0.60% | 5.164% | 400,000 | (463) | 399,537 | 400,714 | 398,722 | 400,295 | |||||||||||||||||||||||||||||||||||||||
| Notes due February 15, 2026 | 0.875% | 1.030% | 500,000 | (840) | 499,160 | 479,639 | 498,419 | 462,362 | |||||||||||||||||||||||||||||||||||||||
| Notes due November 9, 2026 | 1.500% | 1.640% | 650,000 | (1,617) | 648,383 | 614,981 | 647,513 | 597,131 | |||||||||||||||||||||||||||||||||||||||
| Notes due April 16, 2027 | SOFR+0.70% | 5.326% | 700,000 | (2,456) | 697,544 | 706,119 | — | — | |||||||||||||||||||||||||||||||||||||||
| Notes due September 15, 2027 | 3.094% | 3.218% | 500,000 | (1,436) | 498,564 | 480,904 | 498,036 | 476,394 | |||||||||||||||||||||||||||||||||||||||
| Notes due May 1, 2028 | 1.850% | 1.962% | 650,000 | (2,244) | 647,756 | 592,876 | 647,078 | 584,520 | |||||||||||||||||||||||||||||||||||||||
| Notes due November 9, 2028 | 1.950% | 2.044% | 550,000 | (1,856) | 548,144 | 494,867 | 547,663 | 490,758 | |||||||||||||||||||||||||||||||||||||||
| Notes due January 15, 2029 | 5.125% | 5.260% | 500,000 | (2,361) | 497,639 | 506,074 | 497,053 | 516,899 | |||||||||||||||||||||||||||||||||||||||
| Notes due May 1, 2029 | 3.385% | 3.459% | 500,000 | (1,327) | 498,673 | 472,031 | 498,363 | 477,692 | |||||||||||||||||||||||||||||||||||||||
| Notes due May 1, 2031 | 2.300% | 2.419% | 650,000 | (4,327) | 645,673 | 555,387 | 644,988 | 562,240 | |||||||||||||||||||||||||||||||||||||||
| Notes due November 9, 2031 | 2.250% | 2.322% | 550,000 | (2,430) | 547,570 | 459,682 | 547,218 | 469,845 | |||||||||||||||||||||||||||||||||||||||
| Notes due August 1, 2033 | 5.100% | 5.207% | 700,000 | (4,972) | 695,028 | 695,171 | 694,448 | 725,753 | |||||||||||||||||||||||||||||||||||||||
| Notes due August 1, 2053 | 5.350% | 5.474% | 900,000 | (15,776) | 884,224 | 856,992 | 592,017 | 628,413 | |||||||||||||||||||||||||||||||||||||||
| 7,750,000 | (42,105) | 7,707,895 | 7,315,437 | 7,411,297 | 7,092,333 | ||||||||||||||||||||||||||||||||||||||||||
| Euro Denominated Unsecured Debt | |||||||||||||||||||||||||||||||||||||||||||||||
| Notes due April 12, 2024 | 1.540% | 1.540% | — | — | — | — | 110,372 | 109,380 | |||||||||||||||||||||||||||||||||||||||
| Notes due November 3, 2025 | 2.175% | 2.175% | 251,385 | — | 251,385 | 249,979 | 267,116 | 261,083 | |||||||||||||||||||||||||||||||||||||||
| Notes due September 9, 2030 | 0.500% | 0.640% | 727,105 | (6,370) | 720,735 | 630,159 | 765,119 | 638,177 | |||||||||||||||||||||||||||||||||||||||
| Notes due January 24, 2032 | 0.875% | 0.978% | 519,361 | (3,786) | 515,575 | 443,113 | 547,540 | 455,895 | |||||||||||||||||||||||||||||||||||||||
| Notes due April 11, 2039 | 4.080% | 4.080% | 155,808 | (72) | 155,736 | 166,979 | — | — | |||||||||||||||||||||||||||||||||||||||
| 1,653,659 | (10,228) | 1,643,431 | 1,490,230 | 1,690,147 | 1,464,535 | ||||||||||||||||||||||||||||||||||||||||||
| Mortgage Debt, secured by 2 real estate facilities with a net book value of $11.2 million | 4.328% | 4.328% | 1,708 | — | 1,708 | 1,591 | 1,833 | 1,733 | |||||||||||||||||||||||||||||||||||||||
| $ | 9,405,367 | $ | (52,333) | $ | 9,353,034 | $ | 8,807,258 | $ | 9,103,277 | $ | 8,558,601 |
Public Storage has provided a full and unconditional guarantee of PSOC’s obligations under each series of unsecured notes.
F-21
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
U.S. Dollar Denominated Unsecured Notes
On April 16, 2024, PSOC completed a public offering of $1.0 billion aggregate principal amount of senior notes, including $700 million aggregate principal amount of floating rate senior notes bearing interest at a rate of Compounded SOFR + 0.70% (reset quarterly) maturing on April 16, 2027 and $300 million aggregate principal amount of senior notes bearing interest at a fixed annual rate of 5.350% maturing on August 1, 2053. The 2053 notes issued at a discount of $5.3 million constitute a further issuance of, and form a single series with, PSOC’s outstanding 5.350% senior notes due 2053 issued on July 26, 2023 in the aggregate principal amount of $600 million. Interest on the floating rate senior notes is payable quarterly, commencing on July 16, 2024. Interest on the 2053 notes is payable semi-annually, commencing on August 1, 2024. In connection with the offering, we received $988.5 million in net proceeds.
On April 23, 2024, we repaid PSOC’s outstanding $700 million aggregate principal amount of floating rate senior notes bearing interest at a rate of Compounded SOFR + 0.47% at maturity.
On July 26, 2023, PSOC completed a public offering of $400 million, $500 million, $700 million, and $600 million aggregate principal amount of unsecured senior notes bearing interest at an annual rate of Compounded SOFR + 0.60% (reset quarterly), 5.125%, 5.100%, and 5.350%, respectively, and maturing on July 25, 2025, January 15, 2029, August 1, 2033, and August 1, 2053, respectively. Interest on the 2025 notes is payable quarterly, commencing on October 25, 2023. Interest on the 2029 notes is payable semi-annually, commencing on January 15, 2024. Interest on the 2033 notes and 2053 notes is payable semi-annually, commencing on February 1, 2024. In connection with the offering, we incurred a total of $18.7 million in costs.
On August 15, 2022, PSOC redeemed its 2.370% Senior Notes due September 15, 2022, with an aggregate principal amount of $500.0 million.
The U.S. Dollar denominated unsecured notes (the “U.S. Dollar Denominated Unsecured Notes”) have various financial covenants with which we were in compliance at December 31, 2024. Included in these covenants are (a) a maximum Debt to Total Assets of 65% (approximately 17% at December 31, 2024) and (b) a minimum ratio of Adjusted EBITDA to Interest Expense of 1.5x (approximately 12x for the twelve months ended December 31, 2024) as well as covenants limiting the amount we can encumber our properties with mortgage debt.
Euro Denominated Unsecured Notes
At December 31, 2024, our Euro denominated unsecured notes (the “Euro Notes”) consisted of four tranches: (i) €242.0 million issued to institutional investors on November 3, 2015, (ii) €500.0 million issued in a public offering on January 24, 2020, (iii) €700.0 million issued in a public offering on September 9, 2021, and (iv) €150.0 million issued to institutional investors on April 11, 2024. Interest is payable semi-annually on the notes issued November 3, 2015 and April 11, 2024, and annually on the notes issued January 24, 2020 and September 9, 2021. The Euro Notes have financial covenants similar to those of the U.S. Dollar Denominated Unsecured Notes.
The €150.0 million notes issued to institutional investors on April 11, 2024 bear interest at a fixed rate of 4.080% and mature on April 11, 2039. We received $162.5 million in net proceeds upon converting the Euros to U.S. Dollars. On April 11, 2024, we repaid PSOC’s outstanding €100.0 million aggregate principal amount 1.540% senior notes due April 12, 2024 to the same institutional investors for $108.4 million.
We reflect changes in the U.S. Dollar equivalent of the amount payable including the associated interest, as a result of changes in foreign exchange rates as “Foreign currency exchange gain (loss)” on our income statement (gains of $103.0 million for 2024, as compared to losses of $51.6 million for 2023 and gains of $99.2 million for 2022).
Mortgage Notes
We assumed our non-recourse mortgage debt in connection with property acquisitions, and we recorded such debt at fair value with any premium or discount to the stated note balance amortized using the effective interest method.
F-22
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
At December 31, 2024, the related contractual interest rates of our mortgage notes are fixed, ranging between 3.9% and 7.1%, and mature between September 1, 2028 and July 1, 2030.
At December 31, 2024, approximate principal maturities of our Notes Payable are as follows (amounts in thousands):
| Unsecured Debt | Mortgage Debt | Total | |||||||||||||||
| 2025 | $ | 651,385 | $ | 131 | $ | 651,516 | |||||||||||
| 2026 | 1,150,000 | 138 | 1,150,138 | ||||||||||||||
| 2027 | 1,200,000 | 146 | 1,200,146 | ||||||||||||||
| 2028 | 1,200,000 | 129 | 1,200,129 | ||||||||||||||
| 2029 | 1,000,000 | 88 | 1,000,088 | ||||||||||||||
| Thereafter | 4,202,274 | 1,076 | 4,203,350 | ||||||||||||||
| $ | 9,403,659 | $ | 1,708 | $ | 9,405,367 | ||||||||||||
| Weighted average effective rate | 3.1% | 4.3% | 3.1% |
Interest capitalized as real estate totaled $10.5 million, $9.3 million, and $6.0 million for 2024, 2023, and 2022, respectively.
- Noncontrolling Interests
There are noncontrolling interests related to several subsidiaries of PSOC we consolidate of which we do not own 100% of the equity. At December 31, 2024, certain of these subsidiaries have issued 499,966 partnership units to third-parties that are redeemable by the holders on a one-for-one basis for common shares of the Company or cash at our option. The holders of these partnership units are entitled to receive the same per-unit cash distributions equal to the dividends paid on our common shares.
Noncontrolling interests also include the partnership interests of PSA OP not owned by the Company, including common units (“OP Units”) and vested LTIP units from equity awards we issue to certain officers and trustees of the Company (see Note 11 Share-based Compensation). Vested LTIP units (subject to certain conditions) may be converted into the same number of OP Units of PSA OP, which are redeemable by the holders on a one-for-one basis for common shares of the Company or cash at our option. The holders of OP Units and vested LTIP units are entitled to receive per-unit cash distributions equal to the per-share dividends received by our common shareholders. At December 31, 2024, approximately 0.13% of the partnership interests of PSA OP, representing 227,340 vested LTIP units, were not owned by the Company. There were no outstanding OP Units not owned by the Company at December 31, 2024. We adjust the balance of noncontrolling interests of PSA OP to reflect their proportionate share of the net assets of PSA OP as of the end of each period.
F-23
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- Shareholders’ Equity
Preferred Shares
At December 31, 2024 and 2023, we had the following series of Cumulative Preferred Shares (“Preferred Shares”) outstanding:
| At December 31, 2024 | At December 31, 2023 | |||||||||||||||||||||||||||||||||||||
| Series | Earliest Redemption Date | Dividend Rate | Shares Outstanding | Liquidation Preference | Shares Outstanding | Liquidation Preference | ||||||||||||||||||||||||||||||||
| (Dollar amounts in thousands) | ||||||||||||||||||||||||||||||||||||||
| Series F | 6/2/2022 | 5.150 | % | 11,200 | $ | 280,000 | 11,200 | $ | 280,000 | |||||||||||||||||||||||||||||
| Series G | 8/9/2022 | 5.050 | % | 12,000 | 300,000 | 12,000 | 300,000 | |||||||||||||||||||||||||||||||
| Series H | 3/11/2024 | 5.600 | % | 11,400 | 285,000 | 11,400 | 285,000 | |||||||||||||||||||||||||||||||
| Series I | 9/12/2024 | 4.875 | % | 12,650 | 316,250 | 12,650 | 316,250 | |||||||||||||||||||||||||||||||
| Series J | 11/15/2024 | 4.700 | % | 10,350 | 258,750 | 10,350 | 258,750 | |||||||||||||||||||||||||||||||
| Series K | 12/20/2024 | 4.750 | % | 9,200 | 230,000 | 9,200 | 230,000 | |||||||||||||||||||||||||||||||
| Series L | 6/17/2025 | 4.625 | % | 22,600 | 565,000 | 22,600 | 565,000 | |||||||||||||||||||||||||||||||
| Series M | 8/14/2025 | 4.125 | % | 9,200 | 230,000 | 9,200 | 230,000 | |||||||||||||||||||||||||||||||
| Series N | 10/6/2025 | 3.875 | % | 11,300 | 282,500 | 11,300 | 282,500 | |||||||||||||||||||||||||||||||
| Series O | 11/17/2025 | 3.900 | % | 6,800 | 170,000 | 6,800 | 170,000 | |||||||||||||||||||||||||||||||
| Series P | 6/16/2026 | 4.000 | % | 24,150 | 603,750 | 24,150 | 603,750 | |||||||||||||||||||||||||||||||
| Series Q | 8/17/2026 | 3.950 | % | 5,750 | 143,750 | 5,750 | 143,750 | |||||||||||||||||||||||||||||||
| Series R | 11/19/2026 | 4.000 | % | 17,400 | 435,000 | 17,400 | 435,000 | |||||||||||||||||||||||||||||||
| Series S | 1/13/2027 | 4.100 | % | 10,000 | 250,000 | 10,000 | 250,000 | |||||||||||||||||||||||||||||||
| Total Preferred Shares | 174,000 | $ | 4,350,000 | 174,000 | $ | 4,350,000 |
The holders of our Preferred Shares have general preference rights with respect to liquidation, quarterly distributions, and any accumulated unpaid distributions. Except as noted below, holders of the Preferred Shares do not have voting rights. In the event of a cumulative arrearage equal to six quarterly dividends, holders of all outstanding series of preferred shares (voting as a single class without regard to series) will have the right to elect two additional members to serve on our Board of Trustees (our “Board”) until the arrearage has been cured. At December 31, 2024, there were no dividends in arrears. The affirmative vote of at least 66.67% of the outstanding shares of a series of Preferred Shares is required for any material and adverse amendment to the terms of such series. The affirmative vote of at least 66.67% of the outstanding shares of all of our Preferred Shares, voting as a single class, is required to issue shares ranking senior to our Preferred Shares.
Except under certain conditions relating to the Company’s qualification as a REIT, the Preferred Shares are not redeemable prior to the dates indicated on the table above. On or after the respective dates, each of the series of Preferred Shares is redeemable at our option, in whole or in part, at $25.00 per depositary share, plus accrued and unpaid dividends. Holders of the Preferred Shares cannot require us to redeem such shares.
Upon issuance of our Preferred Shares, we classify the liquidation value as preferred equity on our consolidated balance sheet with any issuance costs recorded as a reduction to Paid-in capital.
In 2022, we issued 10.0 million depositary shares, each representing 0.001 of a share of our 4.100% Series S Preferred Shares, at an issuance price of $25.00 per depositary share, for a total of $250.0 million in gross proceeds, and we incurred $7.2 million in issuance costs.
F-24
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
Common Shares
During 2024, 2023, and 2022, activity with respect to our common shares was as follows (dollar amounts in thousands):
| 2024 | 2023 | 2022 | |||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||
| Employee stock-based compensation and exercise of stock options (Note 11) | 280,141 | $ | 47,411 | 405,059 | $ | 53,386 | 283,190 | $ | 35,405 | ||||||||||||||||||||||||||
| Issuance of commons shares for cash | 184,390 | 60,321 | — | — | — | — | |||||||||||||||||||||||||||||
| Repurchase of common shares | (726,865) | (200,000) | — | — | — | — | |||||||||||||||||||||||||||||
| (262,334) | $ | (92,268) | 405,059 | $ | 53,386 | 283,190 | $ | 35,405 |
In 2024, our Board authorized an “at the market” offering program pursuant to which management may issue common shares up to an aggregate gross sales price of $2.0 billion on the open market or in privately negotiated transactions. In 2024, we issued 184,390 of our common shares on the open market for aggregate net proceeds of approximately $60.3 million in cash.
Our Board has authorized a share repurchase program pursuant to which management may repurchase up to 35,000,000 of our common shares on the open market or in privately negotiated transactions. During 2024, we repurchased 726,865 of our common shares under the repurchase program on the open market for a total cost of $200.0 million. The repurchased shares are constructively retired and returned to an authorized and unissued status. There are 10,551,219 common shares that may yet be repurchased under our repurchase program as of December 31, 2024.
On February 4, 2023, our Board declared a 50% increase in our regular common quarterly dividend from $2.00 to $3.00 per share. The distribution equates to an annualized increase to the Company’s regular common dividend from $8.00 to $12.00 per share. Common share dividends paid, including amounts paid to our restricted share unitholders, deferred share unitholders, and unvested LTIP unitholders totaled $2.107 billion ($12.00 per share), $2.111 billion ($12.00 per share), and $3.714 billion ($21.15 per share) for the years ended December 31, 2024, 2023, and 2022, respectively. Included in common share dividends paid during 2022 is $2.3 billion of a special cash dividend (“Special Dividend”) of $13.15 per common share paid on August 4, 2022 in connection with the sale of our equity investment in PSB on July 20, 2022. Preferred share dividends totaled $194.7 million, $194.7 million and $194.4 million for the years ended December 31, 2024, 2023, and 2022, respectively.
The unaudited characterization of dividends for U.S. federal corporate income tax purposes is made based upon earnings and profits of the Company, as defined by the Code. For the tax year ended December 31, 2024, distributions for the common shares and all the various series of preferred shares were classified as follows:
| 2024 (unaudited) | |||||||||||||||||||||||||||||
| 1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | ||||||||||||||||||||||||||
| Ordinary Dividends | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % | |||||||||||||||||||||
| Capital Gain Distributions | 0.00 | % | 0.00 | % | 0.00 | % | 0.00 | % | |||||||||||||||||||||
| Total | 100.00 | % | 100.00 | % | 100.00 | % | 100.00 | % |
The ordinary income dividends distributed for the tax year ended December 31, 2024 are not qualified dividends under the Internal Revenue Code; however, they are subject to the 20% deduction under IRS Section 199A.
F-25
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- Related Party Transactions
At December 31, 2024, Tamara Hughes Gustavson, a current member of our Board, held less than a 0.1% equity interest in, and is a manager of, a limited liability company that owns 66 self-storage facilities in Canada. Two of Ms. Gustavson’s adult children own the remaining equity interest in the limited liability company. These facilities operate under the Public Storage® tradename, which we license to the owners of these facilities for use in Canada on a royalty-free, non-exclusive basis. We have no ownership interest in these facilities, and we do not own or operate any facilities in Canada. If we chose to acquire or develop our own facilities in Canada, we would have to share the use of the Public Storage® name in Canada. We have a right of first refusal, subject to limitations, to acquire the stock or assets of the corporation engaged in the operation of these facilities if their owners agree to sell them. Our subsidiaries reinsure risks relating to loss of goods stored by customers in these facilities, and have received premium payments of approximately $2.2 million, $2.1 million and $2.2 million for 2024, 2023, and 2022, respectively.
- Share-Based Compensation
We recorded share-based compensation expense associated with our equity awards in the various expense categories in the Consolidated Statements of Income as set forth in the following table. In addition, $3.1 million, $2.4 million, and $4.1 million of share-based compensation cost was capitalized as real estate facilities for the year ended December 31, 2024, 2023, and 2022, respectively.
| For Years Ended December 31, | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||||||||||||||
| (Amounts in thousands) | |||||||||||||||||||||||||||||
| Self-storage cost of operations | $ | 12,128 | $ | 13,636 | $ | 17,950 | |||||||||||||||||||||||
| Ancillary cost of operations | 1,161 | 1,289 | 888 | ||||||||||||||||||||||||||
| Real estate acquisition and development expense | 2,750 | 1,242 | 11,204 | ||||||||||||||||||||||||||
| General and administrative | 28,708 | 25,399 | 26,661 | ||||||||||||||||||||||||||
| Total | $ | 44,747 | $ | 41,566 | $ | 56,703 |
Following the amendment of our 2021 Equity and Performance-Based Incentive Plan in February 2024, which further provided for the grant of awards in the form of LTIP units and AO LTIP units of PSA OP, we issued LTIP units and AO LTIP units in substitution for 156,632 RSUs and 2,238,874 stock options, respectively. The LTIP units and AO LTIP units issued have the same vesting conditions as the original awards and remain classified as equity awards. The fair value of the LTIP units and AO LTIP units issued is materially the same as the original awards immediately before the substitution. As a result, we did not adjust the share-based compensation costs associated with these substituted awards.
F-26
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
Restricted Share Units and LTIP Units
We have service-based and performance-based RSUs and LTIP units outstanding, which generally vest over 5 to 8 years from the grant date. Performance-based RSUs and LTIP units outstanding vest upon meeting certain performance conditions or market conditions. Upon vesting, the grantee of RSUs receives new common shares equal to the number of vested RSUs, less common shares withheld to satisfy the grantee’s statutory tax liabilities arising from the vesting. Vested LTIP units represent noncontrolling interests of PSA OP and may be converted, subject to the satisfaction of all applicable vesting conditions, on a one-for-one basis into common units of PSA OP, which are exchangeable by the holders for cash, or at the Company’s election, on a one-for-one basis into common shares of the Company. Holders of RSUs and LTIP units are entitled to receive per-unit cash distributions equal to the per-share dividends received by our common shareholders, except that holders of performance-based awards are not entitled to receive the full distributions until expiration of the applicable performance period, at which time holders of any earned performance-based awards are entitled to receive a catch-up distribution for the periods prior to such time.
For the years ended December 31, 2024, 2023, and 2022, we incurred share-based compensation cost for RSUs and LTIP units of $34.4 million, $28.2 million, and $39.9 million, respectively.
Among the 128,565 RSUs and LTIP units granted in 2024, 34,550 performance-based LTIP unit awards and 3,770 performance-based RSUs were granted to certain executive officers and key employees. The vesting of performance-based LTIP unit awards is dependent upon meeting certain market conditions over a three-year period from March 5, 2024 through March 4, 2027, with continued service-based vesting through the first quarter of 2029. These LTIP unit awards require relative achievement of the Company’s total shareholder return as compared to the weighted average total shareholder return of specified peer groups and can result in grantees earning from zero to a maximum of 69,100 LTIP units. The vesting of performance-based RSUs is dependent upon meeting certain operational performance targets in 2024 and continued service through 2028. These performance targets were met at 100% achievement at December 31, 2024.
During 2023, 37,211 RSUs were awarded where vesting is dependent upon meeting certain market conditions over a three-year period from March 15, 2023 through March 14, 2026, with continued service-based vesting through the first quarter of 2028. These RSUs require relative achievement of the Company’s total shareholder return as compared to the weighted average total shareholder return of specified peer groups and can result in grantees earning up to 200% of the target RSUs originally granted. During 2024, we issued LTIP units in substitution for these outstanding RSUs.
During 2022, 21,985 RSUs were awarded where vesting is dependent upon meeting certain market conditions over a three-year period from January 1, 2022 through December 31, 2024, with continued service-based vesting through the first quarter of 2027. During 2024, we issued LTIP units in substitution for these RSUs. As of December 31, 2024, these targets were met at 130% achievement.
Remaining compensation cost related to RSUs and LTIP units outstanding at December 31, 2024 totals approximately $68.6 million and is expected to be recognized over the next three years on average. The following tables set forth relevant information with respect to restricted shares (dollar amounts in thousands):
F-27
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
| Service-Based | Performance-Based (a) | Total | |||||||||||||||||||||||||||||||||
| Number of Awards | Weighted-Average Grant-Date Fair Value | Number of Awards | Weighted-Average Grant-Date Fair Value | Number of Awards | Weighted-Average Grant-Date Fair Value | ||||||||||||||||||||||||||||||
| Unvested awards outstanding January 1, 2022 | 524,572 | $ | 249.90 | 46,250 | $ | 275.12 | 570,822 | $ | 251.95 | ||||||||||||||||||||||||||
| Granted | 51,575 | 293.43 | 21,985 | 465.11 | 73,560 | 344.74 | |||||||||||||||||||||||||||||
| Vested | (146,138) | (240.71) | — | — | (146,138) | (240.71) | |||||||||||||||||||||||||||||
| Forfeited | (22,197) | (256.50) | — | — | (22,197) | (256.50) | |||||||||||||||||||||||||||||
| Unvested awards outstanding December 31, 2022 | 407,812 | $ | 258.34 | 68,235 | $ | 336.33 | 476,047 | $ | 269.52 | ||||||||||||||||||||||||||
| Granted | 77,974 | 296.19 | 37,211 | 295.61 | 115,185 | 296.01 | |||||||||||||||||||||||||||||
| Vested | (132,909) | (245.19) | (9,250) | (275.12) | (142,159) | (247.13) | |||||||||||||||||||||||||||||
| Forfeited | (30,229) | (266.60) | (2,183) | (300.86) | (32,412) | (268.91) | |||||||||||||||||||||||||||||
| Unvested awards outstanding December 31, 2023 | 322,648 | $ | 272.14 | 94,013 | $ | 327.06 | 416,661 | $ | 284.53 | ||||||||||||||||||||||||||
| Granted (b) | 83,651 | 308.24 | 44,914 | 228.68 | 128,565 | 280.45 | |||||||||||||||||||||||||||||
| Vested | (130,321) | (259.20) | (10,004) | (275.12) | (140,325) | (260.33) | |||||||||||||||||||||||||||||
| Forfeited | (18,104) | (286.93) | (866) | (300.86) | (18,970) | (287.57) | |||||||||||||||||||||||||||||
| Unvested awards outstanding December 31, 2024 | 257,874 | $ | 289.35 | 128,057 | $ | 296.79 | 385,931 | $ | 291.82 |
| 2024 | 2023 | 2022 | |||||||||||||||
| Amounts for the year (in 000's, except number of shares): | |||||||||||||||||
| Fair value of vested shares and vested LTIP units on vesting date | $ | 41,848 | $ | 41,999 | $ | 47,244 | |||||||||||
| Cash paid for taxes upon vesting in lieu of issuing common shares | $ | 12,667 | $ | 13,950 | $ | 16,827 | |||||||||||
| Common shares issued upon vesting | 63,840 | 96,657 | 99,009 | ||||||||||||||
| Vested LTIP units issued upon vesting | 40,396 | — | — | ||||||||||||||
| Average assumptions used in valuing restricted share and LTIP units with market conditions with the Monte-Carlo simulation method: | |||||||||||||||||
| Time from the valuation date to the end of the performance period | 3 | 3 | 3 | ||||||||||||||
| Risk-free interest rate | 4.2% | 3.8% | 1.6% | ||||||||||||||
| Expected volatility, based upon historical volatility | 23.8% | 28.2% | 26.5% | ||||||||||||||
| Expected dividend yield | 4.3% | 4.1% | 2.3% |
(a)Number of performance-based awards are presented based on the target performance pursuant to the terms of each applicable award when granted and adjusted to the actual number of awards earned based on the actual performance.
(b)Amount granted for performance-based awards includes 6,594 LTIP units for payout adjustments based on Total Shareholder Return modifier for awards granted in 2022.
Stock Options and AO LTIP Units
We have service-based and performance-based stock options and AO LTIP units outstanding. Performance-based stock options and AO LTIP units vest upon meeting certain performance conditions or market conditions. Stock options and AO LTIP units generally vest over 1 to 5 years, expire 10 years after the grant date, and have an exercise or conversion price equal to the closing trading price of our common shares on the grant date. Common shares of the Company are issued for options exercised and vested LTIP units are issued for AO LTIP units converted. Employees cannot require the Company to settle their awards in cash.
F-28
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
For the years ended December 31, 2024, 2023, and 2022, we incurred share-based compensation cost for outstanding stock options of $12.7 million, $14.9 million and $19.9 million, respectively.
During 2024, we granted 106,484 of service-based AO LTIP units, 63,717 of performance-based AO LTIP units, and 3,600 service-based options to certain executive officers and trustees. The vesting of the performance-based AO LTIP units is dependent upon meeting certain market conditions over a three-year period from March 5, 2024 through March 4, 2027, with continued service-based vesting through the first quarter of 2029. These performance-based AO LTIP units require relative achievement of the Company’s total shareholder return as compared to the weighted average total shareholder return of specified peer groups and can result in grantees earning from zero to a maximum of 127,434 AO LTIP units.
During 2023, we granted 60,000 stock options in connection with non-management trustee compensation. 117,168 stock options were awarded during 2023 where vesting is dependent upon meeting certain market conditions over the three-year period from March 15, 2023 through March 14, 2026, with continued service-based vesting through the first quarter of 2028. These stock options require relative achievement of the Company’s total shareholder return as compared to the weighted average total shareholder return of specified peer groups and can result in grantees earning up to 200% of the target options originally granted. During 2024, we issued AO LTIP units in substitution for these stock options.
During 2022, 77,683 stock options were awarded where vesting is dependent upon meeting certain market conditions over the three-year period from January 1, 2022 through December 31, 2024, with continued service-based vesting through the first quarter of 2027. During 2024, we issued AO LTIP units in substitution for these stock options. As of December 31, 2024, these targets were met at 130% achievement.
The stock options and AO LTIP units outstanding at December 31, 2024 have an aggregate intrinsic value (the excess, if any, of each option’s market value over the exercise price) of approximately $172.5 million and remaining average contractual lives of approximately five years. Total compensation cost related to nonvested AO LTIP units and stock options that have not yet been recognized is $10.2 million and are expected to be recognized as compensation cost over approximately two years on average. Exercisable stock options and convertible AO LTIP units have an aggregate intrinsic value of approximately $143.4 million at December 31, 2024 and remaining average contractual lives of approximately four years.
F-29
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
Additional information with respect to stock options and AO LTIP units during 2024, 2023, and 2022 is as follows:
| Service-Based | Performance-Based (a) | Total | |||||||||||||||||||||||||||||||||
| Number of Awards | Weighted Average Exercise or Conversion Price per Award | Number of Awards | Weighted Average Exercise or Conversion Price per Award | Number of Awards | Weighted Average Exercise or Conversion Price per Award | ||||||||||||||||||||||||||||||
| Awards outstanding January 1, 2022 | 1,899,951 | $ | 208.16 | 1,140,000 | $ | 229.16 | 3,039,951 | $ | 216.04 | ||||||||||||||||||||||||||
| Granted | 65,000 | 398.97 | 138,933 | 299.88 | 203,933 | 331.46 | |||||||||||||||||||||||||||||
| Special dividend adjustment (b) | 62,512 | N/A | 41,836 | N/A | 104,348 | N/A | |||||||||||||||||||||||||||||
| Exercised | (173,422) | (189.95) | (10,327) | (221.68) | (183,749) | (191.74) | |||||||||||||||||||||||||||||
| Awards outstanding December 31, 2022 | 1,854,041 | $ | 209.53 | 1,310,442 | $ | 229.39 | 3,164,483 | $ | 217.75 | ||||||||||||||||||||||||||
| Granted (c) | 60,000 | 286.81 | 180,425 | 265.46 | 240,425 | 270.79 | |||||||||||||||||||||||||||||
| Exercised | (272,250) | (167.15) | (34,401) | (221.68) | (306,651) | (173.26) | |||||||||||||||||||||||||||||
| Cancelled | (12,049) | (293.81) | (34,987) | (229.34) | (47,036) | (245.86) | |||||||||||||||||||||||||||||
| Awards outstanding December 31, 2023 | 1,629,742 | $ | 218.83 | 1,421,479 | $ | 234.16 | 3,051,221 | $ | 225.97 | ||||||||||||||||||||||||||
| Granted (d) | 110,084 | 278.82 | 87,782 | 297.12 | 197,866 | 286.94 | |||||||||||||||||||||||||||||
| Exercised or converted (e) | (381,850) | (194.09) | (301,498) | (221.83) | (683,348) | (206.33) | |||||||||||||||||||||||||||||
| Cancelled | (10,110) | (320.69) | (5,164) | (221.68) | (15,274) | (287.21) | |||||||||||||||||||||||||||||
| Awards outstanding December 31, 2024 | 1,347,866 | $ | 229.98 | 1,202,599 | $ | 241.90 | 2,550,465 | $ | 235.60 | ||||||||||||||||||||||||||
| Awards exercisable or convertible at December 31, 2024 | 1,187,232 | $ | 221.59 | 612,112 | $ | 221.97 | 1,799,344 | $ | 221.72 |
(a)Number of performance-based awards are presented based on the target performance pursuant to the terms of each applicable award when granted and adjusted to the actual number of awards earned based on the actual performance.
(b)On August 4, 2022, we paid a Special Dividend of $13.15 per common share to shareholders of record as of August 1, 2022. Stock options that were outstanding at the time of the Special Dividend were adjusted pursuant to the anti-dilution provisions of the Company’s applicable equity and performance-based incentive compensation plans that provide for equitable adjustments in the event of an extraordinary cash dividend. The anti-dilution adjustments proportionately increased the number of outstanding stock options and reduced the exercise prices of outstanding stock options by a conversion rate of 1.03275, resulting in an increase of 104,348 stock options outstanding. The adjustments did not result in incremental share-based compensation expense.
(c)Amount granted for performance-based stock options includes 63,257 options for payout adjustments based on Total Shareholder Return modifier for options granted in 2021.
(d)Amount granted for performance-based awards includes 24,065 AO LTIP units for payout adjustments based on Total Shareholder Return for awards granted in 2022.
(e)214,996 common shares were issued upon the exercise of stock options. 186,944 vested LTIP units were issued upon conversion of 468,352 AO LTIP units in the year ended December 31, 2024.
F-30
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
| 2024 | 2023 | 2022 | |||||||||||||||
| Aggregate exercise date intrinsic value of options and AO LTIP units exercised or converted during the year (in 000's) | $ | 85,833 | $ | 35,662 | $ | 27,210 | |||||||||||
| Average assumptions used in valuing options and AO LTIP units with the Black-Scholes method: | |||||||||||||||||
| Expected life of options in years | 6 | 6 | 6 | ||||||||||||||
| Risk-free interest rate | 4.2% | 3.5% | 2.9% | ||||||||||||||
| Expected volatility, based upon historical volatility | 24.4% | 24.4% | 22.9% | ||||||||||||||
| Expected dividend yield | 4.3% | 4.2% | 2.0% | ||||||||||||||
| Average assumptions used in valuing options and AO LTIP units with market conditions with the Monte-Carlo simulation method: | |||||||||||||||||
| Expected life of options in years | 7 | 7 | 7 | ||||||||||||||
| Risk-free interest rate | 4.1% | 3.5% | 1.8% | ||||||||||||||
| Expected volatility, based upon historical volatility | 24.1% | 23.8% | 22.6% | ||||||||||||||
| Expected dividend yield | 4.3% | 4.1% | 2.3% | ||||||||||||||
| Average estimated value of options and AO LTIP units granted during the year | $ | 51.33 | $ | 56.86 | $ | 87.57 |
Trustee Deferral Program
Non-management trustees may elect to receive all or a portion of their cash retainers in cash, unrestricted common shares, or fully-vested DSUs to be settled at a specified future date. Unrestricted common shares and/or DSUs will be granted to the non-management trustee on the last day of each calendar quarter based on the cash retainer earned for that quarter and converted into a number of shares or units based on the applicable closing price of our common shares on such date. During 2024, we granted 1,836 DSUs and 434 unrestricted common shares. During 2024, 871 previously granted DSUs were settled in common shares. A total of 11,734 DSUs were outstanding at December 31, 2024 (10,769 at December 31, 2023).
F-31
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- Net Income per Common Share
We allocate net income to (i) noncontrolling interests based upon their contractual rights in the respective subsidiaries or for participating noncontrolling interests based upon their participation in both distributed and undistributed earnings of the Company, (ii) preferred shareholders, for distributions paid or payable, (iii) preferred shareholders, to the extent redemption cost exceeds the related original net issuance proceeds (a “preferred share redemption charge”), and (iv) RSUs and unvested LTIP units, for non-forfeitable dividends and distributions paid and adjusted for participation rights in undistributed earnings of the Company.
We calculate basic and diluted net income per common share based upon net income allocable to common shareholders, divided by (i) weighted average common shares for basic net income per common share, and (ii) weighted average common shares adjusted for the impact of dilutive stock options and AO LTIP units outstanding for diluted net income per common share. Stock options and AO LTIP units representing 138,739 common shares were excluded from the computation of diluted earnings per share for 2024, as compared to 375,577 common shares for 2023, because their effect would have been antidilutive.
The following table reconciles the numerators and denominators of the basic and diluted net income per common shares computation for the year ended December 31, 2024, 2023, and 2022, respectively (in thousands, except per share amounts):
| For the Years Ended December 31, | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||||||||||||||
| Numerator for basic and dilutive net income per common share – net income allocable to common shareholders | $ | 1,872,685 | $ | 1,948,741 | $ | 4,142,288 | |||||||||||||||||||||||
| Denominator for basic net income per share - weighted average common shares outstanding | 175,351 | 175,472 | 175,257 | ||||||||||||||||||||||||||
| Net effect of dilutive stock options and AO LTIP units - based on treasury stock method | 687 | 671 | 1,023 | ||||||||||||||||||||||||||
| Denominator for dilutive net income per share - weighted average common shares outstanding | 176,038 | 176,143 | 176,280 | ||||||||||||||||||||||||||
| Net income per common share: | |||||||||||||||||||||||||||||
| Basic | $ | 10.68 | $ | 11.11 | $ | 23.64 | |||||||||||||||||||||||
| Dilutive | $ | 10.64 | $ | 11.06 | $ | 23.50 |
F-32
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- Segment Information
Our operating segments reflect the significant components of our operations where discrete financial information is evaluated separately by our President and Chief Executive Officer, who is our chief operating decision maker (“CODM”).
Self-Storage Operations
The Self-Storage Operations reportable segment reflects the aggregated rental operations from the self-storage facilities we own through the following operating segments: (i) Same Store Facilities, (ii) Acquired Facilities, (iii) Newly Developed and Expanded Facilities, and (iv) Other Non-Same Store Facilities. Our CODM evaluates performance and allocates resources for the Self-Storage Operations reportable segment based on its Net Operating Income (“NOI”), which represents the related revenue less cost of operations. Our CODM utilizes NOI during the budget and forecasting process to allocate capital and personnel resources and evaluates financial performance and operating trends of the reportable segment based on the budget-to-actual variance and year-over-year change of the NOI on an ongoing basis.
The presentation in the table below sets forth the revenue, significant expense categories, and NOI of this reportable segment, as well as the related depreciation expense. For all periods presented, substantially all of our real estate facilities, goodwill and other intangible assets, other assets, and accrued and other liabilities are associated with the Self-Storage Operations reportable segment.
Ancillary Operations
The Ancillary Operations reflects the combined operations of our tenant reinsurance, merchandise sales, and third party property management operating segments.
F-33
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
Presentation of Segment Information
The following table reconciles NOI and net income attributable to our reportable segment to our consolidated net income:
| For the Years Ended December 31, | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2022 | |||||||||||||||||||||||||||
| (amounts in thousands) | |||||||||||||||||||||||||||||
| Self-Storage Operations Reportable Segment | |||||||||||||||||||||||||||||
| Revenue | $ | 4,395,993 | $ | 4,259,613 | $ | 3,946,028 | |||||||||||||||||||||||
| Cost of operations: | |||||||||||||||||||||||||||||
| Property taxes | (451,992) | (411,323) | (385,034) | ||||||||||||||||||||||||||
| On-site property manager payroll | (167,258) | (164,405) | (152,914) | ||||||||||||||||||||||||||
| Repairs and maintenance | (93,763) | (83,429) | (74,857) | ||||||||||||||||||||||||||
| Utilities | (63,611) | (62,462) | (61,510) | ||||||||||||||||||||||||||
| Marketing | (106,414) | (90,717) | (63,358) | ||||||||||||||||||||||||||
| Other direct property costs | (122,119) | (114,879) | (101,939) | ||||||||||||||||||||||||||
| Supervisory payroll | (51,616) | (50,065) | (50,895) | ||||||||||||||||||||||||||
| Centralized management costs | (67,820) | (71,034) | (71,752) | ||||||||||||||||||||||||||
| Share-based compensation | (12,127) | (13,636) | (17,950) | ||||||||||||||||||||||||||
| Total cost of operations | (1,136,720) | (1,061,950) | (980,209) | ||||||||||||||||||||||||||
| Net operating income | 3,259,273 | 3,197,663 | 2,965,819 | ||||||||||||||||||||||||||
| Depreciation and amortization | (1,129,766) | (970,056) | (888,146) | ||||||||||||||||||||||||||
| Net income | 2,129,507 | 2,227,607 | 2,077,673 | ||||||||||||||||||||||||||
| Ancillary Operations | |||||||||||||||||||||||||||||
| Revenue | 299,623 | 258,077 | 236,135 | ||||||||||||||||||||||||||
| Cost of operations | (121,281) | (85,996) | (72,698) | ||||||||||||||||||||||||||
| Net operating income | 178,342 | 172,081 | 163,437 | ||||||||||||||||||||||||||
| Total net income allocated to segments | 2,307,849 | 2,399,688 | 2,241,110 | ||||||||||||||||||||||||||
| Other items not allocated to segments: | |||||||||||||||||||||||||||||
| Real estate acquisition and development expense | (15,506) | (26,451) | (28,744) | ||||||||||||||||||||||||||
| General and administrative | (106,677) | (80,632) | (71,672) | ||||||||||||||||||||||||||
| Interest and other income | 67,212 | 85,590 | 40,567 | ||||||||||||||||||||||||||
| Interest expense | (287,401) | (201,132) | (136,319) | ||||||||||||||||||||||||||
| Equity in earnings of unconsolidated real estate entities | 19,821 | 27,897 | 106,981 | ||||||||||||||||||||||||||
| Foreign currency exchange gain (loss) | 102,244 | (51,197) | 98,314 | ||||||||||||||||||||||||||
| Gain on sale of real estate | 1,537 | 17,178 | 1,503 | ||||||||||||||||||||||||||
| Gain on sale of equity investment in PS Business Parks, Inc. | — | — | 2,128,860 | ||||||||||||||||||||||||||
| Income tax expense | (4,669) | (10,821) | (14,326) | ||||||||||||||||||||||||||
| Net income | $ | 2,084,410 | $ | 2,160,120 | $ | 4,366,274 |
F-34
PUBLIC STORAGE
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2024
- Commitments and Contingencies
Contingent Losses
We are a party to various legal proceedings and subject to various claims and complaints; however, we believe that the likelihood of these contingencies resulting in a material loss to the Company, either individually or in the aggregate, is remote.
Insurance and Loss Exposure
We carry property, earthquake, general liability, employee medical insurance, and workers compensation coverage through internationally recognized insurance carriers, subject to deductibles. Our deductible for general liability is $2.0 million per occurrence. Our annual deductible for property loss is $25.0 million per occurrence. This deductible decreases to $5.0 million once we reach $35.0 million in aggregate losses for occurrences that exceed $5.0 million. Insurance carriers’ aggregate limits on these policies of $75.0 million for property losses and $102.0 million for general liability losses are higher than estimates of maximum probable losses that could occur from individual catastrophic events determined in recent engineering and actuarial studies; however, in case of multiple catastrophic events, these limits could be exceeded.
We reinsure a program that provides insurance to our customers from an independent third-party insurer. This program covers customer claims for losses to goods stored at our facilities as a result of specific named perils (earthquakes are not covered by this program), up to a maximum limit of $5,000 per storage unit. We reinsure all risks in this program, but purchase insurance to cover this exposure for a limit of $15.0 million for losses in excess of $10.0 million per occurrence. We are subject to licensing requirements and regulations in all states. Customers participate in the program at their option. At December 31, 2024, there were approximately 1.4 million certificates held by self-storage customers under the program, representing aggregate coverage of approximately $6.8 billion.
Commitments
We have construction commitments representing future expected payments for construction under contract totaling $194.9 million at December 31, 2024. We expect to pay approximately $166.1 million in 2025 and $28.8 million in 2026 for these construction commitments.
We have future contractual payments on land, equipment and office space under various lease commitments totaling $61.8 million at December 31, 2024. We expect to pay approximately $4.1 million in each of 2025 and 2026, $2.7 million in 2027, $2.5 million in each of 2028 and 2029, and $45.9 million thereafter for these commitments.
We have an unfunded loan commitment totaling $12.5 million at December 31, 2024. We expect to fund the loan in 2025 subject to the satisfaction of certain conditions.
- Subsequent Events
Subsequent to December 31, 2024, we acquired or were under contract to acquire nine self-storage facilities across six states with 0.7 million net rentable square feet, for $140.7 million.
In early 2025, multiple wildfires erupted in southern California and caused significant destruction of business and residential structures. We did not incur any direct property damage in the affected areas. In response to the devastation, a “State of Emergency” has been declared for Los Angeles County and Ventura County, under which a temporary governmental pricing limitation is in place for our self-storage facilities located in these counties. These self-storage facilities generated approximately 10% of revenues earned by our Same Store Facilities in 2024. We anticipate a potentially significant negative impact on the revenue growth from these self-storage facilities, the extent of which depends largely on the duration of the State of Emergency order and other future actions by government authorities, among other factors.
F-35
PUBLIC STORAGE
SCHEDULE III - REAL ESTATE
AND ACCUMULATED DEPRECIATION
(Amounts in thousands, except number of properties)
| Initial Cost | Gross Carrying Amount At December 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Description | No. of Facilities | Net Rentable Square Feet | 2024 Encum- brances | Land | Buildings & Improvements | Costs Subsequent to Acquisition | Land | Buildings | Total | Accumulated Depreciation | |||||||||||||||||||||||||||||||||||||||||||||||||
| Self-storage facilities by market: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Los Angeles | 232 | 17,467 | $ | 248 | $ | 574,307 | $ | 1,111,245 | $ | 549,871 | $ | 579,775 | $ | 1,655,648 | $ | 2,235,423 | $ | 1,062,270 | |||||||||||||||||||||||||||||||||||||||||
| Dallas/Ft. Worth | 218 | 19,443 | — | 378,140 | 2,255,401 | 274,810 | 380,571 | 2,527,780 | 2,908,351 | 632,547 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Houston | 166 | 13,963 | — | 273,784 | 912,051 | 336,695 | 273,106 | 1,249,424 | 1,522,530 | 476,974 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Chicago | 143 | 9,309 | — | 156,554 | 519,539 | 207,680 | 159,391 | 724,382 | 883,773 | 476,306 | |||||||||||||||||||||||||||||||||||||||||||||||||
| San Francisco | 141 | 9,422 | — | 245,623 | 557,398 | 361,192 | 258,374 | 905,839 | 1,164,213 | 627,244 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Washington DC | 119 | 8,470 | — | 423,176 | 1,329,933 | 227,094 | 438,682 | 1,541,521 | 1,980,203 | 567,893 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Atlanta | 115 | 7,697 | 1,460 | 143,692 | 434,433 | 141,734 | 144,055 | 575,804 | 719,859 | 355,586 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Orlando/Daytona | 111 | 6,529 | — | 177,574 | 590,015 | 108,423 | 183,055 | 692,957 | 876,012 | 244,461 | |||||||||||||||||||||||||||||||||||||||||||||||||
| New York | 106 | 8,034 | — | 314,288 | 736,217 | 392,123 | 320,926 | 1,121,702 | 1,442,628 | 636,153 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Seattle/Tacoma | 102 | 7,333 | — | 246,108 | 634,810 | 225,107 | 248,368 | 857,657 | 1,106,025 | 488,989 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Miami | 100 | 7,545 | — | 259,200 | 563,334 | 205,780 | 261,093 | 767,221 | 1,028,314 | 465,690 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Denver | 71 | 5,313 | — | 120,585 | 328,245 | 129,745 | 121,305 | 457,270 | 578,575 | 223,070 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Minneapolis/St. Paul | 68 | 5,505 | — | 128,142 | 332,631 | 154,639 | 131,695 | 483,717 | 615,412 | 210,948 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Tampa | 68 | 4,734 | — | 107,321 | 371,573 | 101,191 | 110,635 | 469,450 | 580,085 | 194,524 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Philadelphia | 67 | 4,470 | — | 66,271 | 297,576 | 99,517 | 65,292 | 398,072 | 463,364 | 219,646 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Charlotte | 62 | 4,752 | — | 89,937 | 250,135 | 109,993 | 97,800 | 352,265 | 450,065 | 190,588 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Detroit | 54 | 3,963 | — | 77,077 | 289,354 | 83,259 | 78,484 | 371,206 | 449,690 | 171,808 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Phoenix | 53 | 3,920 | — | 108,051 | 367,874 | 67,421 | 108,042 | 435,304 | 543,346 | 175,570 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Baltimore | 51 | 4,160 | — | 141,077 | 787,692 | 81,603 | 142,301 | 868,071 | 1,010,372 | 203,133 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Portland | 50 | 2,929 | — | 65,013 | 225,043 | 56,624 | 65,671 | 281,009 | 346,680 | 151,739 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Oklahoma City | 48 | 3,527 | — | 69,100 | 310,648 | 35,229 | 69,100 | 345,877 | 414,977 | 65,848 | |||||||||||||||||||||||||||||||||||||||||||||||||
| West Palm Beach | 46 | 3,850 | — | 156,788 | 221,479 | 129,817 | 157,736 | 350,348 | 508,084 | 193,751 | |||||||||||||||||||||||||||||||||||||||||||||||||
| San Antonio | 41 | 2,936 | — | 56,453 | 237,783 | 46,153 | 56,411 | 283,978 | 340,389 | 107,429 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Raleigh | 40 | 2,899 | — | 92,421 | 233,949 | 56,297 | 93,390 | 289,277 | 382,667 | 107,472 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Austin | 39 | 3,103 | — | 72,382 | 212,110 | 62,590 | 74,904 | 272,178 | 347,082 | 131,590 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Indianapolis | 37 | 2,450 | — | 46,160 | 171,251 | 32,612 | 47,160 | 202,863 | 250,023 | 74,840 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Norfolk | 36 | 2,197 | — | 47,939 | 125,410 | 38,406 | 47,378 | 164,377 | 211,755 | 97,324 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Sacramento | 36 | 2,120 | — | 32,023 | 92,323 | 45,327 | 32,507 | 137,166 | 169,673 | 102,237 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Columbia | 35 | 2,237 | — | 39,521 | 165,797 | 34,641 | 40,280 | 199,679 | 239,959 | 62,235 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Columbus | 32 | 2,432 | — | 55,843 | 143,208 | 42,154 | 55,950 | 185,255 | 241,205 | 69,078 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Kansas City | 31 | 2,119 | — | 20,212 | 114,080 | 62,257 | 20,412 | 176,137 | 196,549 | 82,289 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Boston | 29 | 2,038 | — | 85,717 | 223,625 | 43,838 | 86,283 | 266,897 | 353,180 | 148,893 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Las Vegas | 27 | 1,857 | — | 35,047 | 148,111 | 27,347 | 34,295 | 176,210 | 210,505 | 71,762 | |||||||||||||||||||||||||||||||||||||||||||||||||
| St. Louis | 27 | 1,749 | — | 22,546 | 85,838 | 48,397 | 24,295 | 132,486 | 156,781 | 81,773 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Nashville/Bowling Green | 25 | 1,651 | — | 46,669 | 134,144 | 38,632 | 46,667 | 172,778 | 219,445 | 46,574 | |||||||||||||||||||||||||||||||||||||||||||||||||
| San Diego | 24 | 2,340 | — | 89,782 | 162,043 | 78,791 | 92,292 | 238,324 | 330,616 | 132,474 |
F-36
PUBLIC STORAGE
SCHEDULE III - REAL ESTATE
AND ACCUMULATED DEPRECIATION
(Amounts in thousands, except number of properties)
| Initial Cost | Gross Carrying Amount At December 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Description | No. of Facilities | Net Rentable Square Feet | 2024 Encum- brances | Land | Buildings & Improvements | Costs Subsequent to Acquisition | Land | Buildings | Total | Accumulated Depreciation | |||||||||||||||||||||||||||||||||||||||||||||||||
| Memphis | 22 | 1,418 | — | 27,627 | 167,899 | 17,992 | 28,980 | 184,538 | 213,518 | 37,310 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Cincinnati | 22 | 1,338 | — | 21,126 | 79,210 | 32,176 | 21,044 | 111,468 | 132,512 | 45,948 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Mobile | 20 | 1,168 | — | 26,313 | 99,387 | 13,595 | 26,140 | 113,155 | 139,295 | 25,324 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Fort Myers/Naples | 17 | 1,346 | — | 36,676 | 121,930 | 26,861 | 36,910 | 148,557 | 185,467 | 37,930 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Colorado Springs | 17 | 1,169 | — | 13,667 | 64,569 | 29,288 | 13,664 | 93,860 | 107,524 | 42,074 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Greensville/Spartanburg/Asheville | 17 | 1,051 | — | 13,415 | 73,643 | 17,783 | 14,331 | 90,510 | 104,841 | 32,180 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Louisville | 16 | 982 | — | 24,868 | 50,185 | 13,271 | 24,867 | 63,457 | 88,324 | 26,745 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Richmond | 16 | 789 | — | 21,121 | 56,202 | 11,382 | 20,926 | 67,779 | 88,705 | 30,745 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Charleston | 15 | 1,056 | — | 19,490 | 69,158 | 27,340 | 20,466 | 95,522 | 115,988 | 40,459 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Milwaukee | 15 | 964 | — | 13,189 | 32,071 | 16,008 | 13,158 | 48,110 | 61,268 | 39,900 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Jacksonville | 15 | 922 | — | 14,454 | 47,415 | 18,660 | 14,503 | 66,026 | 80,529 | 43,028 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Greensboro | 15 | 911 | — | 15,590 | 43,181 | 21,084 | 17,679 | 62,176 | 79,855 | 36,395 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Birmingham | 15 | 606 | — | 6,316 | 25,567 | 21,603 | 6,204 | 47,282 | 53,486 | 33,526 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Chattanooga | 13 | 857 | — | 10,030 | 45,578 | 12,357 | 9,832 | 58,133 | 67,965 | 23,983 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Salt Lake City | 13 | 800 | — | 20,454 | 41,607 | 9,197 | 20,103 | 51,155 | 71,258 | 20,838 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Savannah | 13 | 766 | — | 36,503 | 52,174 | 9,443 | 35,175 | 62,945 | 98,120 | 27,963 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Honolulu | 12 | 896 | — | 69,611 | 127,041 | 24,917 | 70,528 | 151,041 | 221,569 | 92,010 | |||||||||||||||||||||||||||||||||||||||||||||||||
| New Orleans | 12 | 863 | — | 14,096 | 72,425 | 15,022 | 14,264 | 87,279 | 101,543 | 38,687 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Omaha | 11 | 938 | — | 17,965 | 69,085 | 6,836 | 17,965 | 75,921 | 93,886 | 17,172 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Hartford/New Haven | 11 | 693 | — | 6,778 | 19,959 | 28,640 | 8,443 | 46,934 | 55,377 | 38,998 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Cleveland/Akron | 10 | 631 | — | 5,916 | 30,775 | 10,568 | 6,309 | 40,950 | 47,259 | 18,181 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Augusta | 10 | 584 | — | 9,833 | 35,451 | 6,567 | 9,833 | 42,018 | 51,851 | 12,832 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Buffalo/Rochester | 9 | 462 | — | 6,785 | 17,954 | 8,612 | 6,783 | 26,568 | 33,351 | 18,780 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Boise | 7 | 671 | — | 16,756 | 71,912 | 2,284 | 16,756 | 74,196 | 90,952 | 10,162 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Reno | 7 | 559 | — | 5,487 | 18,704 | 7,969 | 5,487 | 26,673 | 32,160 | 16,796 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Tucson | 7 | 439 | — | 9,403 | 25,491 | 9,538 | 9,884 | 34,548 | 44,432 | 26,539 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Wichita | 7 | 433 | — | 2,017 | 6,691 | 11,032 | 2,130 | 17,610 | 19,740 | 13,483 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Monterey/Salinas | 7 | 329 | — | 8,465 | 24,151 | 8,076 | 8,455 | 32,237 | 40,692 | 27,888 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Evansville | 5 | 326 | — | 2,340 | 14,316 | 2,720 | 2,312 | 17,064 | 19,376 | 6,831 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Huntsville/Decatur | 5 | 298 | — | 9,161 | 13,481 | 5,098 | 9,108 | 18,632 | 27,740 | 8,473 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Roanoke | 5 | 298 | — | 6,916 | 27,161 | 1,922 | 6,916 | 29,083 | 35,999 | 6,602 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Dayton | 5 | 284 | — | 1,074 | 8,975 | 6,498 | 1,073 | 15,474 | 16,547 | 9,063 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Fort Wayne | 4 | 271 | — | 3,487 | 11,003 | 4,736 | 3,487 | 15,739 | 19,226 | 7,531 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Providence | 4 | 248 | — | 2,644 | 26,118 | 4,707 | 2,644 | 30,825 | 33,469 | 9,803 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Lansing | 4 | 233 | — | 2,048 | 22,897 | 2,235 | 2,048 | 25,132 | 27,180 | 4,352 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Palm Springs | 3 | 242 | — | 8,309 | 18,065 | 3,544 | 8,309 | 21,609 | 29,918 | 15,348 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Flint | 3 | 191 | — | 2,734 | 19,228 | 1,044 | 2,733 | 20,273 | 23,006 | 3,492 |
F-37
PUBLIC STORAGE
SCHEDULE III - REAL ESTATE
AND ACCUMULATED DEPRECIATION
(Amounts in thousands, except number of properties)
| Initial Cost | Gross Carrying Amount At December 31, 2024 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Description | No. of Facilities | Net Rentable Square Feet | 2024 Encum- brances | Land | Buildings & Improvements | Costs Subsequent to Acquisition | Land | Buildings | Total | Accumulated Depreciation | |||||||||||||||||||||||||||||||||||||||||||||||||
| Rochester | 3 | 155 | — | 2,142 | 10,787 | 4,201 | 2,075 | 15,055 | 17,130 | 5,475 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Shreveport | 2 | 150 | — | 817 | 3,030 | 3,522 | 741 | 6,628 | 7,369 | 5,578 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Springfield/Holyoke | 2 | 144 | — | 1,428 | 3,380 | 2,752 | 1,427 | 6,133 | 7,560 | 5,508 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Santa Barbara | 2 | 98 | — | 5,733 | 9,106 | 1,227 | 5,733 | 10,333 | 16,066 | 7,708 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Topeka | 2 | 94 | — | 225 | 1,419 | 2,896 | 225 | 4,315 | 4,540 | 3,423 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Joplin | 1 | 56 | — | 264 | 904 | 1,454 | 264 | 2,358 | 2,622 | 1,804 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Syracuse | 1 | 55 | — | 545 | 1,279 | 1,544 | 545 | 2,823 | 3,368 | 2,295 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Modesto/Fresno/Stockton | 1 | 33 | — | 44 | 206 | 1,465 | 193 | 1,522 | 1,715 | 1,271 | |||||||||||||||||||||||||||||||||||||||||||||||||
| Commercial and non-operating real estate | — | 12,307 | 19,892 | 154,431 | 13,352 | 173,278 | 186,630 | 95,045 | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 3,073 | 221,280 | $ | 1,708 | $ | 5,620,692 | $ | 17,476,960 | $ | 5,381,086 | $ | 5,711,685 | $ | 22,767,053 | $ | 28,478,738 | $ | 10,426,186 |
Note: Buildings and improvements are depreciated on a straight-line basis over estimated useful lives ranging generally between 5 to 40 years. In addition, disclosures of the number and square footage of our facilities are unaudited.
F-38
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