ALBANY,NY • ALEXANDRIA, VA • ARLINGTON, TX • ASBURY PARK, NJ • ATLANTA, GA •
AUBURN, AL • AUSTIN, TX • BALTIMORE, MD • BATON ROUGE, LA • BEAUMONT, TX •
BILOXI, MS • BIRMINGHAM, AL • BOSTON, MA • BOULDER, CO • BRONX, NY • BROOKLYN,
NY • BRUNSWICK, ME • BUFFALO, NY • CEDAR RAPIDS, IA • CHARLESTON, SC • CHARLOTTE,
NC • CHATTANOOGA, TN • CHESAPEAKE, VA • CHICAGO, IL • CINCINNATI, OH • CLEVE-
LAND, OH • COLORADO SPRINGS, CO • COLUMBIA, SC • COLUMBUS, GA • COLUMBUS, OH
• CONCORD, NH • DALLAS, TX • DENVER, CO • DES MOINES, IA • DETROIT, MI •
DOYLESTOWN, PA • EAST RUTHERFORD, NJ • FORT LAUDERDALE, FL • FORT MYERS, FL •
FORT WAYNE, IN • FORT WORTH, TX • FREDERICK, MD • GREENSBORO, NC • GREENVILLE,
SC • HACKENSACK, NJ • HARTFORD, CT • HOUSTON, TX • HUNTSVILLE, AL • JACKSON, MS
\
JACKSONVILLE, FL • KANSAS CITY, MO • LAFAYETTE, IN • LAFAYETTE, LA • LAS VEGAS, NV
• LITTLE ROCK, AR • LOS ANGELES, CA • LOUISVILLE, KY • MANCHESTER, NH • MANHATTAN,
NY • MIAMI, FL • MILWAUKEE, WI • MINNEAPOLIS, MN • MOBILE, AL • MONTGOMERY, AL •
MYRTLE BEACH, SC • NAPLES, FL • NASHUA, NH • NASHVILLE, TN • NEW HAVEN, CT • NEW
ORLEANS, LA • NEWARK, NJ • NEWPORT NEWS, VA • NORFOLK, VA • OKLAHOMA CITY, OK
• ORLANDO, FL • PATERSON, NJ • PENSACOLA, FL • PHILADELPHIA, PA • PHOENIX, AZ •
PORTLAND, ME • PORTLAND, OR • PORTSMOUTH, NH • PROVIDENCE, RI • QUEENS, NY •
RALEIGH, NC • RICHMOND, VA • ROCHESTER, NY • SACRAMENTO, CA • SAINT AUGUSTINE,
FL • SAINT LOUIS, MO • SAINT PETERSBURG, FL • SAN ANTONIO, TX • SAN DIEGO, CA • SAN
JOSE, CA • SANTA ROSA, CA • SARASOTA, FL • SAVANNAH, GA • SEATTLE, WA • STAMFORD,
CT • STATEN ISLAND, NY • SYRACUSE, NY • TAMPA, FL • TRENTON, NJ • TUCSON, AZ •
TULSA, OK • VANCOUVER, WA • VIRGINIA BEACH, VA • WASHINGTON, DC • WINSTON-SA
2022 ANNUAL REPORT
DEAR FELLOW SHAREHOLDERS:
For Life Storage, 2022 was a year marked by record growth and significant progress towards our strategic initiatives.
The Life Storage team generated over one billion dollars in consolidated revenue for the first time in our company’s history,
nearly doubling what we reported just five years ago, achieved key milestones in our portfolio growth and third-party
management platform, and continued to innovate to enhance our business model.
Since 2015, we have completed over $5 billion in acquisitions, including nearly $1 billion during 2022. Our disciplined
acquisitions furthered our strategy of growing our portfolio in strong primary and secondary markets with over 70% focused
across the rapidly growing sunbelt regions, and 78% in the top 25 fastest growing markets. Acquiring in strong markets has
been important to our success and allowed us to drive sector-leading results, including 15.1% in-place rate growth during 2022.
Our third-party management platform - which feeds into our acquisition strategy - remains in high demand as Life Storage’s
reputation for first-class performance and tailored service helps owners optimize operations and drive results. Another strong
year of acquisitions and third-party management pushed us to nearly 1,200 stores across 37 states and the District of Columbia
at the end of 2022.
As we have grown, we have also focused on further enhancing our operations to better serve customers and drive
strong performance. The Life Storage team continues to innovate and implement new technologies, which are a key
component of our success. Our first-in-class Rent Now solution remains a core channel of move-ins, accounting for nearly
40% of all move-ins during 2022, up from 10% only a few years ago. We successfully launched a kiosk pilot program during the
second quarter across 11 different markets and we continued to expand digital store operations across our portfolio. These
solutions continue to improve overall customer experience while driving operational efficiencies.
Prudent management, strategic acquisitions and operational excellence have also enhanced total shareholder
returns. We ended the year having delivered a 101% shareholder return on a 5-year basis, which leads our peer group over that
period. A key component of our industry-leading returns has been our consistent dividend growth. We raised our dividend
25.6% year-over-year as of the fourth quarter of 2022.
Our company delivered leading growth and shareholder returns while continuing to strengthen the balance sheet.
Life Storage ended the year with a strong 4.8x debt to EBITDA ratio, with the only variable-rate debt being tied to our credit
facility. This amounted to a modest 3.8% weighted average cost of debt with no material near-term debt maturities.
Our performance hasn’t gone unnoticed by our largest peers. Outstanding work by the entire Life Storage team
results in a key ingredient for our agreement to combine with Extra Space Storage in an all-stock merger transaction, as
announced in April 2023. Through this transaction, we will be bringing together two industry-leading platforms with similar
portfolios, operating models and strategic visions to create the preeminent storage operator in America. Extra Space
recognized our similar cultures, strength of the Life Storage team, technological capabilities, and customer centric focus. The
combined company will have an even stronger financial profile with robust cash flow generation to invest in growth and build
upon both companies’ long track records of industry-leading shareholder returns.
The combination with Extra Space is the culmination of the transformation we have been executing over the last
several years, and we are confident that it is the best path forward for our stakeholders. The pending transaction with Extra
Space provides a significant immediate premium and is most likely to deliver superior long-term returns for our shareholders.
As always, we thank you for your support and confidence in Life Storage. We look forward to continuing to deliver
sustainable value to our shareholders in the next phase of our journey.
David Dodman • COO
Alex Gress • CFO
Joe Saffire • CEO
$683524
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2022
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File Number:
1-13820 (Life Storage, Inc.)
0-24071 (Life Storage LP)
LIFE STORAGE, INC.
LIFE STORAGE LP
(Exact name of Registrant as specified in its charter)
Maryland (Life Storage, Inc.)
Delaware (Life Storage LP)
16-1194043 (Life Storage, Inc.)
16-1481551 (Life Storage LP)
(State of incorporation
or organization)
(I.R.S. Employer
Identification No.)
6467 Main Street
Williamsville, NY 14221
(Address of principal executive offices) (Zip code)
(716) 633-1850
(Registrant’s telephone number including area code)
Securities registered pursuant to Section 12(b) of the Act:
Life Storage, Inc.:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, $.01 Par Value
LSI
New York Stock Exchange
Life Storage LP:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Securities registered pursuant to section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Life Storage, Inc.
Yes ☒ No ☐
Life Storage LP
Yes ☒ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.
Life Storage, Inc.
Yes ☐ No ☒
Life Storage LP
Yes ☐ No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past
90 days.
Life Storage, Inc.
Yes ☒ No ☐
Life Storage LP
Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Life Storage, Inc.
Yes ☒ No ☐
Life Storage LP
Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an
emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule
12b-2 of the Exchange Act.
Life Storage, Inc.:
Large accelerated filer
☒
Accelerated filer
☐
Non-accelerated filer
☐
Smaller reporting company
☐
Emerging growth company
☐
Life Storage LP:
Large accelerated filer
☐
Accelerated filer
☐
Non-accelerated filer
☒
Smaller reporting company
☐
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or
revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Life Storage, Inc.
☐
Life Storage LP
☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over
financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
Life Storage, Inc.
☒
Life Storage LP
☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing
reflect the correction of an error to previously issued financial statements.
Life Storage, Inc.
☐
Life Storage LP
☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by
any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).
Life Storage, Inc.
☐
Life Storage LP
☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Life Storage, Inc.
Yes ☐ No ☒
Life Storage LP
Yes ☐ No ☒
As of June 30, 2022, the aggregate market value of the Common Stock held by non-affiliates of Life Storage, Inc. was approximately $9,422,359,871 (based on
the closing price of the Common Stock on the New York Stock Exchange on June 30, 2022). As of February 16, 2023, 85,061,573 shares of Common Stock, $.01 par
value per share, were outstanding.
As of June 30, 2022, the aggregate market value of the limited partnership units (the “OP Units”) held by non-affiliates of Life Storage LP was $116,295,007
(based on the closing price of the Common Stock of Life Storage, Inc. on the New York Stock Exchange on June 30, 2022). (For this calculation, the market value of all
OP Units beneficially owned by Life Storage, Inc. has been excluded.)
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant’s Proxy Statement for the 2023 Annual Meeting of Shareholders are incorporated herein by reference in Part III of this Annual Report
on Form 10-K to the extent stated herein. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of the registrants’ fiscal
year ended December 31, 2022.
2
EXPLANATORY NOTE
This report combines the annual reports on Form 10-K for the year ended December 31, 2022 of Life Storage, Inc. (the “Parent
Company”) and Life Storage LP (the “Operating Partnership”). The Parent Company is a real estate investment trust, or REIT, that owns its
assets and conducts its operations through the Operating Partnership, a Delaware limited partnership, and subsidiaries of the Operating
Partnership. The Parent Company, the Operating Partnership and their consolidated subsidiaries are collectively referred to in this report as the
“Company.” In addition, terms such as “we,” “us,” or “our” used in this report may refer to the Company, the Parent Company and/or the
Operating Partnership.
Life Storage Holdings, Inc., a wholly-owned subsidiary of the Parent Company (“Holdings”), is the sole general partner of the Operating
Partnership; the Parent Company is a limited partner of the Operating Partnership, and through its ownership of Holdings and its limited
partnership interest, controls the operations of the Operating Partnership, holding a 97.9% ownership interest therein as of December 31, 2022,
assuming the conversion of all preferred operating partnership units at that date. The remaining ownership interests in the Operating
Partnership are held by certain former owners of assets acquired by the Operating Partnership. As the owner of the sole general partner of the
Operating Partnership, the Parent Company has full and complete authority over the Operating Partnership’s day-to-day operations and
management.
Management operates the Parent Company and the Operating Partnership as one enterprise. The management teams of the Parent
Company and the Operating Partnership are identical.
There are few differences between the Parent Company and the Operating Partnership, which are reflected in the note disclosures in this
report. The Company believes it is important to understand the differences between the Parent Company and the Operating Partnership in the
context of how these entities operate as a consolidated enterprise. The Parent Company is a REIT, whose only material asset is its ownership of
the partnership interests of the Operating Partnership. As a result, the Parent Company does not conduct business itself, other than acting as the
owner of the sole general partner of the Operating Partnership, issuing public equity from time to time and guaranteeing the debt obligations of
the Operating Partnership. The Operating Partnership holds substantially all the assets of the Company and, directly or indirectly, holds the
ownership interests in the Company’s real estate ventures. The Operating Partnership conducts the operations of the Company’s business and is
structured as a partnership with no publicly traded equity. Except for net proceeds from equity issuances by the Parent Company, which are
contributed to the Operating Partnership in exchange for partnership units, the Operating Partnership generates the capital required by the
Company’s business through the Operating Partnership’s operations, by the Operating Partnership’s direct or indirect incurrence of
indebtedness or through the issuance of partnership units of the Operating Partnership.
The substantive difference between the Parent Company’s filings and the Operating Partnership’s filings is the fact that the Parent
Company is a REIT with public equity, while the Operating Partnership is a partnership with no publicly traded equity. In the financial
statements, this difference is primarily reflected in the equity (or capital for the Operating Partnership) section of the consolidated balance
sheets and in the consolidated statements of shareholders’ equity (or partners’ capital). Apart from the different equity treatment, the
consolidated financial statements of the Parent Company and the Operating Partnership are nearly identical.
The Company believes that combining the annual reports on Form 10-K of the Parent Company and the Operating Partnership into a
single report will:
•
facilitate a better understanding by the investors of the Parent Company and the Operating Partnership by enabling them to view
the business as a whole in the same manner as management views and operates the business;
•
remove duplicative disclosures and provide a more straightforward presentation in light of the fact that a substantial portion of the
disclosure applies to both the Parent Company and the Operating Partnership; and
•
create time and cost efficiencies through the preparation of one combined report instead of two separate reports.
In order to highlight the differences between the Parent Company and the Operating Partnership, the separate sections in this report for
the Parent Company and the Operating Partnership specifically refer to the Parent Company and the Operating Partnership. In the sections that
combine disclosures of the Parent Company and the Operating Partnership, this report refers to such disclosures as those of the Company.
Although the Operating Partnership is generally the entity that directly or indirectly enters into contracts and real estate ventures and holds
assets and debt, reference to the Company is appropriate because the business is one enterprise and the Parent Company operates the business
through the Operating Partnership.
As the owner of the general partner with control of the Operating Partnership, the Parent Company consolidates the Operating
Partnership for financial reporting purposes, and the Parent Company does not have significant assets other than its investment in the Operating
Partnership. Therefore, the assets and liabilities of the Parent Company and the Operating Partnership are the same on their respective financial
statements. The separate discussions of the Parent Company and the Operating Partnership in this report should be read in conjunction with
each other to understand the results of the Company’s operations on a consolidated basis and how management operates the Company.
This report also includes separate Item 9A - Controls and Procedures sections, signature pages and Exhibit 31 and 32 certifications for
each of the Parent Company and the Operating Partnership in order to establish that the Chief Executive Officer and the Chief Financial Officer
of the Parent Company and the Chief Executive Officer and the Chief Financial Officer of the Operating Partnership have made the requisite
certifications and that the Parent Company and the Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities
Exchange Act of 1934, as amended and 18 U.S.C. §1350.
3
TABLE OF CONTENTS
Part I ..........................................................................................................................................................................................................
4
Item 1. Business....................................................................................................................................................................................
5
Item 1A. Risk Factors...........................................................................................................................................................................
10
Item 1B. Unresolved Staff Comments..................................................................................................................................................
16
Item 2. Properties..................................................................................................................................................................................
16
Item 3. Legal Proceedings ....................................................................................................................................................................
18
Item 4. Mine Safety Disclosures...........................................................................................................................................................
18
Part II....................................................................................................................................................................................................
19
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities..............
19
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations ..................................................
22
Item 7A. Quantitative and Qualitative Disclosures About Market Risk ..............................................................................................
31
Item 8. Financial Statements and Supplementary Data........................................................................................................................
31
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.................................................
66
Item 9A. Controls and Procedures........................................................................................................................................................
66
Item 9B. Other Information..................................................................................................................................................................
70
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections ..................................................................................
70
Part III...................................................................................................................................................................................................
71
Item 10. Directors, Executive Officers and Corporate Governance.....................................................................................................
71
Item 11. Executive Compensation........................................................................................................................................................
71
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters..............................
71
Item 13. Certain Relationships and Related Transactions, and Director Independence.......................................................................
71
Item 14. Principal Accountant Fees and Services ................................................................................................................................
71
Part IV...................................................................................................................................................................................................
72
Item 15. Exhibits, Financial Statement Schedules ...............................................................................................................................
72
Item 16. Form 10-K Summary .............................................................................................................................................................
76
SIGNATURES ..........................................................................................................................................................................................
77
4
Part I
Forward Looking Statements
When used in this discussion and elsewhere in this document, the words “intends,” “believes,” “expects,” “anticipates,” and similar
expressions are intended to identify “forward-looking statements” within the meaning of that term in Section 27A of the Securities Act of 1933
and in Section 21E of the Securities Exchange Act of 1934.
All forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause our actual results,
performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking statements.
We may also make additional forward-looking statements from time to time. All such subsequent forward-looking statements, whether written
or oral, by us or on our behalf, are also expressly qualified by these cautionary statements. All forward-looking statements apply only as of the
date made. We undertake no obligation to publicly update or revise forward-looking statements which may be made to reflect events or
circumstances after the date made or to reflect the occurrence of unanticipated events.
There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements
contained in this report. Any forward-looking statements should be considered in light of the risks referenced in “Part I. Item 1A. Risk Factors”
below. Such factors include, but are not limited to:
•
adverse changes in general economic conditions, the real estate industry and in the markets in which we operate;
•
the effect of competition from new self-storage facilities or other storage alternatives, which would cause rents and occupancy rates
to decline;
•
impacts from the COVID-19 pandemic or the future outbreak of other highly infectious or contagious diseases on the U.S.,
regional and global economies and our financial condition and results of operations;
•
potential liability for uninsured losses and environmental contamination;
•
the impact of the regulatory environment as well as national, state, and local laws and regulations including, without limitation,
those governing real estate investment trusts (“REITs”), tenant reinsurance and other aspects of our business, which could
adversely affect our results;
•
loss of key personnel;
•
the Company’s ability to evaluate, finance and integrate acquired self-storage facilities on expected terms into the Company’s
existing business and operations;
•
costs incurred by the Company in response to Public Storage's unsolicited efforts to acquire the Company;
•
the Company’s ability to effectively compete in the industry in which it does business;
•
disruptions in credit and financial markets and resulting difficulties in raising capital or obtaining credit at reasonable rates or at all,
which could impede our ability to grow.
•
the Company’s existing indebtedness may mature in an unfavorable credit environment, preventing refinancing or forcing
refinancing of the indebtedness on terms that are not as favorable as the existing terms;
•
interest rates may increase, impacting costs associated with the Company’s outstanding floating rate debt, if any, and impacting the
Company’s ability to comply with debt covenants;
•
exposure to litigation or other claims;
•
risks associated with breaches of our data security;
•
the regional concentration of the Company's business may subject the Company to economic downturns in the states of Florida and
Texas;
•
the Company’s cash flow may be insufficient to meet required payments of operating expenses, principal, interest and dividends;
and
•
failure to maintain our REIT status for U.S. federal income purposes, including tax law changes that may change the taxability of
future income.
The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all
information currently available to us. These beliefs, assumptions and expectations are subject to risks and uncertainties and can change as a
result of many possible events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity and
results of operations may vary materially from those expressed in our forward-looking statements. You should carefully consider these risks
before you make an investment decision with respect to our securities.
5
Item 1. Business
The Company is a self-administered and self-managed real estate company that acquires, owns and manages self-storage properties. We
refer to the self-storage properties in which we have an ownership interest, lease, and/or are managed by us as “Properties.” We began
operations on June 26, 1995. We were formed to continue the business of our predecessor company, which had engaged in the self-storage
business since 1985. At December 31, 2022, we had an ownership interest in and/or managed 1,198 self-storage properties in 37 states and the
District of Columbia. Among our 1,198 self-storage properties are 141 properties that we manage for unconsolidated joint ventures, 299
properties that we manage and have no ownership interest, and five properties that we lease. We believe we are the fourth largest operator of
self-storage properties in the United States based on square feet owned and managed. Our Properties in the United States conduct business
under the customer-friendly name Life Storage ®.
At December 31, 2022, the Parent Company owned a direct or indirect interest in 899 of the Properties through the Operating
Partnership, which includes 758 wholly-owned properties and 141 properties owned by unconsolidated joint ventures. In total, we own a 97.9%
economic interest in the Operating Partnership and unaffiliated third parties collectively own a 2.1% limited partnership interest at
December 31, 2022, assuming the conversion of all preferred operating partnership units at that date. We believe that this structure, commonly
known as an umbrella partnership real estate investment trust (“UPREIT”), facilitates our ability to acquire properties by using units of the
Operating Partnership as currency. By utilizing interests in the Operating Partnership as currency in self-storage facility acquisitions, we may
partially defer the seller’s income tax liability which in turn may allow us to obtain more favorable pricing.
The Parent Company was incorporated on April 19, 1995 under Maryland law. The Operating Partnership was formed on June 1, 1995 as
a Delaware limited partnership and has engaged in virtually all aspects of the self-storage business, including the development, acquisition,
management, ownership and operation of self-storage facilities. Our principal executive offices are located at 6467 Main Street, Williamsville,
New York 14221, our telephone number is (716) 633-1850, and our website is www.lifestorage.com.
We seek to enhance shareholder value through internal growth, acquisition of additional storage properties, expansion and enhancement
of existing self-storage properties, expansion of our third-party management platform, select new development, and advances in innovative
technology. Internal growth is achieved through aggressive property management: optimizing rental rates, increasing occupancy levels,
controlling costs, maximizing collections, and strategically expanding and enhancing the Properties. Should demographic and economic
conditions warrant, we may develop new properties. We believe that there continues to be opportunity for growth through acquisitions,
including acquisitions through unconsolidated joint ventures of the Company. We seek to acquire self-storage properties that are susceptible to
realization of increased economies of scale and improved performance through application of our expertise.
Industry Overview
We believe that self-storage facilities offer affordable storage space to residential and commercial users. In addition to fully enclosed and
secure storage space, many facilities also offer outside storage for automobiles, recreational vehicles and boats. Modern facilities, such as those
owned and/or managed by the Company, are usually fenced and well lit with automated access systems and surveillance cameras and offer
temperature and humidity control features. Our customers rent space on a month-to-month basis and typically have access to their storage space
up to 15 hours a day, with 24-hour access in certain circumstances. Individual storage spaces are secured by the customer’s lock, and the
customer has control of access to the space.
According to the 2023 Self-Storage Almanac, of the estimated 51,000 core self-storage facilities in the United States (those properties
identified as having self-storage operated as the core business at the address), approximately 24.2% are owned and/or managed by the 10
largest operators. This results in a highly fragmented industry as the remainder of the industry is characterized by numerous small, local
operators. The scarcity of capital available to small operators for acquisitions and expansions, internet marketing, call centers, and the potential
for savings through economies of scale are factors that are leading to consolidation in the industry. We believe that, as a result of this trend,
significant growth opportunities exist for operators with proven management systems and sufficient capital resources to grow through
acquisitions and/or third-party management platforms.
Property Management
We have over 35 years of experience acquiring, building, expanding and managing self-storage facilities, and the combined experience of
our key personnel makes us one of the leaders in the industry. Our primary business objectives are to maximize cash flow available for
distribution to our stockholders and to achieve sustainable long-term growth in cash flow per share in order to maximize long-term stockholder
value at acceptable levels of risk. To support our long-term growth, we employ the following strategies with respect to our property
management:
6
Our People:
We recognize the importance of quality people to the success of an organization. Accordingly, we hire and train to ensure that associates
can reach their full potential. We conduct annual anonymous surveys of all employees to proactively identify areas for improvement. We strive
to ensure that all associates conduct themselves in accordance with our core values: Teamwork, Respect, Accountability, Integrity, and
Innovation. In turn, we support them with state-of-the-art training tools including an online learning management system, a company intranet
and a network of certified training personnel. Every store team also has frequent, and sometimes daily, interaction with an Area Manager, a
Regional Vice President, an Accounting Representative, and other support personnel. As such, our store associates are held to high standards
for customer service, store appearance, financial performance, and overall operations.
Training & Development:
Our employees benefit from a wide array of training and development opportunities. New store employees undergo a comprehensive,
proprietary training program designed to drive sales and operational results while ensuring the delivery of quality customer service. To
supplement their initial training, employees enjoy continuing edification, coaching, and performance feedback, including customer satisfaction
surveying, throughout their tenure.
All learning and development activities are facilitated through our online training and development portal. This portal delivers and tracks
hundreds of computer-based training and compliance courses; it also administers tests, surveys, and the employee appraisal process. The
Company’s training and development program encompasses the tools and support we deem essential to the success of our employees and
business.
Marketing and Advertising:
The digital age has changed consumer behavior – the way people shop, their expectations, and the way we communicate with them. As
such, we utilize the following strategies to market our properties and products:
•
We created, developed and implemented Rent Now, our proprietary fully-digital rental platform for customers who prefer to self-
serve and complete the rental process online. Customers can now “skip the counter” by selecting a storage unit, completing the
rental agreement and making their rental payment online. The customer receives their property access code and step-by-step
directions to their specific rental unit on a digital map sent to their mobile device. Rent Now is fully-integrated with Life Storage’s
operating, security and revenue management systems, allowing for real-time and efficient inventory and sales management.
•
We employ a Customer Care Center (call center) that services an average of 56,000 rental related inquiries per month. Our Sales
Representatives answer incoming sales calls for all of our locations, 364 days a year, 24 hours a day. In addition, they respond to
email inquiries and serve as overnight customer service agents to assist customers outside of regular office hours. The team
undergoes continuous training and coaching in effective storage sales techniques and best practices in customer service, which we
believe results in higher conversions of inquiries to rentals.
•
We maintain a website and involve internal and external expertise to manage our internet presence and leverage a search engine
and social media marketing strategy to attract customers and gain rentals online, through our call center and at our stores. Precise
targeting and tracking through campaign management and analysis allows us to attract the right customers, at the right time, for
reasonable costs of acquisition.
•
Since demand for storage is largely based on timing, the goal is to create positive brand recognition through a variety of channels,
both digital and traditional. When the time comes for a customer to select a storage company, we want the Life Storage brand to be
recognized as the most trusted and respected provider. We employ a variety of different strategies to create brand awareness; this
includes our branded merchandise such as moving and packing supplies, regional marketing in the communities in which we
operate, and digital targeting using search, social media and remarketing campaigns. We strive to introduce storage solutions early
and often to gain the most exposure as possible for the longest duration.
•
Approximately 59.7% of our self-storage space is comprised of units with temperature and/or humidity control capabilities which
we market to corporate, retail and residential customers seeking storage solutions for valuable, sentimental, or otherwise sensitive
items.
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Third-Party Management:
We seek to add third-party managed stores to our portfolio in order to help drive fee revenue, brand awareness, cost efficiencies and
customer data to make more informed revenue management decisions with little capital investment. The portfolio also may, in certain
circumstances, serve to supplement our acquisition pipeline.
To broaden opportunities available, we have implemented a bridge lending program, under which an unconsolidated joint venture of the
Company provides financing to properties that we will manage. We anticipate that this program will help us increase our management business,
create additional future acquisition opportunities, and strengthen our relationship with partners, all while providing interest and fee income.
This joint venture generally originates mortgage loans and mezzanine loans, with the intent to sell the mortgage loans to third parties, while
retaining the joint venture's interests in these loans.
Corporate Customer Value Proposition:
We offer a differentiated corporate customer value proposition through Warehouse Anywhere. Warehouse Anywhere is Life Storage’s
proprietary intelligent and technologically advanced warehousing solution that provides third-party logistics (3PL) through a forward deployed,
unmanned model combining storage asset management with a proprietary inventory management application across a network of more than
12,000 Life Storage or partner facilities.
Ancillary Income:
We know that our over 690,000 customers require more than just a storage space. Knowing this, we offer a wide range of other products
and services that fulfill their needs while providing us with ancillary income. We rent moving dollies and blankets, in addition to carrying a
wide assortment of moving and packing supplies including boxes, tape, locks, and other essential items. For those customers who do not carry
storage insurance, we make available renters insurance on which we earn income by providing reinsurance through a wholly-owned subsidiary
of the Company. We also receive incidental income from billboards and cell towers.
Information Systems:
Each of our primary business functions is linked to our customized computer applications, many of which are proprietary. These systems
provide for consistent, timely and accurate flow of information throughout our critical platforms:
•
Our proprietary operating software (“LifeOS”) is installed at all locations and performs the functions necessary for field personnel
to efficiently and effectively run a property. This includes customer account management, automatic imposition of late fees, move-
in and move-out analysis, generation of essential legal notices, and marketing reports to aid in regional marketing efforts. Financial
reports are automatically transmitted to our Corporate Offices overnight to allow for strict accounting oversight.
•
LifeOS is linked with each of our primary sales channels (customer care center, internet, store) allowing for real-time access to
space type and inventory, pricing, promotions, and other pertinent store information. This robust flow of information facilitates our
commitment to capturing prospective customers from all channels.
•
LifeOS provides our revenue management team with raw data on historical pricing, move-in and move-out activity, specials and
occupancies, etc. This data is utilized in the various algorithms that form the foundation of our revenue management program.
Changes to pricing and specials are “pushed out” to all sales channels instantaneously.
•
LifeOS generates financial reports for each property that provide our accounting and audit departments with the necessary
oversight of transactions; this allows us to maintain proper control of cash receipts.
Revenue Management:
Our proprietary revenue management system is constantly evolving through the efforts of our dedicated data science and revenue
management team. We have the ability to change pricing instantaneously for any single unit type, at any single location, based on the
occupancy, competition, and forecasted changes in demand. By analyzing current customer rent tenures, we can implement rental rate increases
at optimal times to increase revenues. Advanced pricing analytics enable us to reduce the amount of concessions, attracting a more stable
customer base and discouraging short-term price shoppers. This system continues to drive revenue stability and/or growth throughout our
portfolio.
Property Maintenance:
We take great pride in the appearance and structural integrity of our Properties. All of our Properties go through a thorough annual
inspection performed by experienced project managers. These inspections provide the basis for short and long term planned projects that are all
performed under a standardized set of specifications. Routine maintenance such as landscaping, pest control, and snowplowing is contracted to
local providers to whom we clearly communicate our standards. Further, our software tracks repairs, monitors contractor performance and
measures the useful life of assets. As with many other aspects of our Company, our size has allowed us to enjoy relatively low maintenance
8
costs because we have the benefit of economies of scale in purchasing, travel, and overhead absorption. In addition, we continually look to
green alternatives and implement energy saving alternatives as new technology becomes available. This includes the installation of solar
panels, LED lighting, energy efficient air conditioning units, and cool roofs which are all environmentally friendly solutions that have the
potential to reduce energy consumption (thereby reducing costs) in the buildings in which they are installed. We continue to implement and
expand the Company’s solar panel initiative which has reduced energy consumption and costs at those installed locations.
Environmental Social Governance:
Our Environmental, Social and Governance (“ESG”) Committee supports our on-going commitment to sustainability by identifying,
evaluating and monitoring ESG issues throughout the Company and overseeing the integration of strategic ESG initiatives throughout the
organization. On-going initiatives can be found within our annual Sustainability Report located on our website at
https://www.lifestorage.com/company/sustainability/.
Environmental and Other Regulations
We are subject to federal, state, and local environmental regulations that apply generally to the ownership of real property. We have not
received notice from any governmental authority or private party of any material environmental noncompliance, claim, or liability in
connection with any of the Properties, and are not aware of any environmental condition with respect to any of the Properties that could have a
material adverse effect on our financial condition or results of operations.
The Properties are also generally subject to the same types of local regulations governing other real property, including zoning
ordinances. We believe that the Properties are in substantial compliance with all such regulations.
Insurance
Each of the Properties is covered by fire and property insurance (including comprehensive liability and business interruption), and all-
risk property insurance policies, which are provided by reputable companies and on commercially reasonable terms. In addition, we maintain a
policy insuring against environmental liabilities resulting from tenant storage on terms customary for the industry, and title insurance insuring
fee title to the Company-owned Properties in an amount that we believe to be adequate.
Federal Income Tax
We operate, and we intend to continue to operate, in such a manner as to continue to qualify as a REIT under the Internal Revenue Code
of 1986, as amended (the “Code”), but no assurance can be given that we will at all times so qualify. To the extent that we continue to qualify
as a REIT, we will not be taxed, with certain limited exceptions, on the taxable income that is distributed to our shareholders. We have elected
to treat certain of our subsidiaries as taxable REIT subsidiaries. In general, our taxable REIT subsidiaries may perform additional services for
customers and generally may engage in certain real estate or non-real estate related business. Our taxable REIT subsidiaries are subject to
federal and state corporate income taxes. See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of
Operations - REIT Qualification and Distribution Requirements.”
Competition
The primary factors upon which competition in the self-storage industry is based are location, appearance, rental rates, suitability of the
property’s design to prospective customers’ needs, and how the property is operated and marketed. We believe we compete successfully on
these factors. The extent of competition depends significantly on local market conditions. We seek to locate where we can increase market
share while not adversely affecting any of our existing locations in that market. However, the number of self-storage facilities in a particular
area could have a material adverse effect on the performance of any of the Properties.
Several of our competitors are larger and have substantially greater financial resources than we do. These larger operators may, among
other possible advantages, be capable of greater leverage and the payment of higher prices for acquisitions. However, we believe that we are
well positioned to compete for acquisitions.
Investment Policy
While we emphasize equity real estate investments, we may, at our discretion, invest in mortgage and other real estate interests related to
self-storage properties in a manner consistent with our qualification as a REIT. We may also retain a purchase money mortgage for a portion of
the sale price in connection with the disposition of Properties from time to time. Should investment opportunities become available, we may
look to acquire additional self-storage properties via new or existing joint-venture partnerships or similar entities. We may or may not elect to
have a significant investment in such a venture, but would use such an opportunity to expand our portfolio of branded and managed properties.
We also invest in innovative, and sometimes proprietary, new technology that we believe provides us with a competitive advantage.
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Subject to the percentage of ownership limitations and gross income tests necessary for REIT qualification, we also may invest in
securities of entities engaged in real estate activities or securities of other issuers, including for the purpose of exercising control over such
entities.
Disposition Policy
Any disposition decision of our Properties is based on a variety of factors, including, but not limited to, (i) the potential to continue to
increase cash flow and value, (ii) the sale price, (iii) the strategic fit with the rest of our portfolio, (iv) the potential for, or existence of,
environmental or regulatory issues, (v) alternative uses of capital, and (vi) maintaining qualification as a REIT.
The Company did not sell any self-storage facilities in 2022, 2021, or 2020. During 2022, one of the Company's unconsolidated joint
ventures sold one self-storage facility, which was acquired by the Company. During 2021, the Company’s unconsolidated joint ventures sold a
total of four self-storage facilities, all of which were acquired by the Company. During 2020, the Company's unconsolidated joint ventures sold
a total of 36 self-storage facilities, 32 of which were acquired by the Company.
Distribution Policy
We intend to pay regular quarterly distributions to our shareholders. However, future distributions by us will be at the discretion of the
Board of Directors and will depend on the actual cash available for distribution, our financial condition and capital requirements, the annual
distribution requirements under the REIT provisions of the Code and such other factors as the Board of Directors deems relevant. In order to
maintain our qualification as a REIT, we must make annual distributions to shareholders of at least 90% of our REIT taxable income (which
does not include capital gains or losses). Under certain circumstances, we may be required to make distributions in excess of cash available for
distribution in order to meet the minimum requirements.
Financing Policy
Our Board of Directors currently limits the amount of debt that may be incurred by us to less than 50% of the sum of the market value of
our issued and outstanding common and preferred stock plus our debt. We, however, may from time to time re-evaluate and modify our
borrowing policy considering current economic conditions, relative costs of debt and equity capital, market values of properties, growth and
acquisition opportunities and other factors. In addition to our Board of Directors’ debt limits, our most restrictive debt covenants limit our
leverage. However, we believe cash flow from operations, access to the capital markets and access to our credit facility, as described below, are
adequate to execute our current business plan and remain in compliance with our debt covenants.
The following sets forth certain financing activities during the year ended December 31, 2022:
On July 13, 2022, the Company entered into an amended and restated credit facility. Under the amended credit facility, the Company's
revolving credit facility increased to $1.25 billion and the maturity date of such facility was extended to January 13, 2027. The new revolving
credit facility bears interest at a variable annual rate equal to Term SOFR plus a 0.10% SOFR adjustment plus a margin based on the
Company's credit rating (the margin was 0.775% at December 31, 2022) and requires an annual facility fee on the revolving credit facility
which varies based on the Company’s credit rating (the facility fee was 0.15% at December 31, 2022). The interest rate on the Company’s
revolving credit facility at December 31, 2022 was approximately 5.20%. At December 31, 2022, there was $654.9 million available on the
unsecured line of credit. The Company has the option under this credit facility to increase the total aggregate borrowing capacity to $2.0
billion.
Amounts outstanding on the Company’s line of credit at December 31, 2022 totaled $595.0 million.
During 2022, the Company issued 1,352,833 shares of common stock under the Company’s continuous equity offering programs at a
weighted average issue price of $135.22, generating net proceeds of $180.8 million.
To the extent that we desire to obtain additional capital to pay distributions, to provide working capital, to pay existing indebtedness or to
finance acquisitions, expansions or development of new properties, we may utilize amounts available under our line of credit, common or
preferred stock offerings, floating or fixed rate debt financing, retention of cash flow (subject to satisfying our distribution requirements under
the REIT rules) or a combination of these methods. Additional debt financing may also be obtained through mortgages on our Properties,
which may be recourse, non-recourse, or cross-collateralized and may contain cross-default provisions. We have not established any limit on
the number or amount of mortgages that may be placed on any single Property or on our portfolio as a whole, although certain of our existing
term loans contain limits on overall mortgage indebtedness. For additional information regarding borrowings and equity activities, see Item 7,
“Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” and Notes 5, 6
and 12 to the Consolidated Financial Statements filed herewith.
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Employees
At December 31, 2022, we employ a total of 2,508 employees, including 1,052 property managers, 70 area managers, and 979 associate
managers and part-time employees. At our headquarters, in addition to our three senior executive officers, we employ 404 people engaged in
various support activities, including accounting, human resources, customer care, and management information systems. None of our
employees are covered by a collective bargaining agreement. We consider our employee relations to be excellent.
Available Information
We file with the U.S. Securities and Exchange Commission quarterly and annual reports on Forms 10-Q and 10-K, respectively, current
reports on Form 8-K, and proxy statements pursuant to the Securities Exchange Act of 1934, in addition to other information as required. We
file this information with the SEC electronically, and the SEC maintains an Internet site that contains reports, proxy and information
statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov. Our annual reports on Form 10-
K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports are available free of charge on our web
site at http://www.lifestorage.com as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. In
addition, our Codes of Ethics and Charters of our Nominating, Governance and Corporate Responsibility Committee, Audit and Risk
Management Committee, and Compensation and Human Capital Committee are available free of charge on our website at
http://www.lifestorage.com .
Also, copies of our annual report and Charters of our committees will be made available, free of charge, upon written request to Life
Storage, Inc., Attn: Investor Relations, 6467 Main Street, Williamsville, NY 14221.
Item 1A. Risk Factors
You should carefully consider the risks described below, together with all of the other information included in or incorporated by
reference into our Form 10-K, as part of your evaluation of the Company. If any of the following risks actually occur, our business could be
harmed. In such case, the trading price of our securities could decline, and you may lose all or part of your investment.
Our Acquisitions May Not Perform as Anticipated
We have completed hundreds of acquisitions of self-storage facilities since our initial public offering of common stock in June 1995. One
of our strategies is to continue to grow by acquiring additional self-storage facilities. Acquisitions entail risks that investments will fail to
perform in accordance with our expectations. Our judgments with respect to the prices paid for acquired self-storage facilities and the costs of
any improvements required to bring an acquired property up to our standards may prove to be inaccurate. Acquisitions also involve general
investment risks associated with any new real estate investment.
We May Incur Problems with Our Real Estate Financing
Unsecured Credit Facility, Term Notes and Senior Notes. We have a line of credit and term note agreements with a syndicate of financial
institutions and other lenders, along with senior debt of $2.4 billion. This indebtedness is recourse to us and the required payments are not
reduced if the economic performance of any of the properties declines. The facilities limit our ability to make distributions to our shareholders,
except in limited circumstances.
Rising Interest Rates. Indebtedness that we incur under the unsecured credit facility bears interest at a variable rate. Accordingly,
increases in interest rates could increase our interest expense, which would reduce our cash available for distribution and our ability to pay
expected distributions to our shareholders. We manage our exposure to rising interest rates by entering into fixed rate financing agreements for
a portion of our outstanding indebtedness and through other available mechanisms, including interest rate swaps, as deemed necessary. If the
amount of our indebtedness bearing interest at a variable rate increases, our unsecured credit facility may require us to enter into interest rate
swaps.
Refinancing May Not Be Available. It may be necessary for us to refinance our indebtedness through additional debt financing or equity
offerings. If we were unable to refinance this indebtedness on acceptable terms, we might be forced to dispose of some of our self-storage
facilities upon disadvantageous terms, which might result in losses to us and might adversely affect the cash available for distribution. If
prevailing interest rates or other factors at the time of refinancing result in higher interest rates on any refinancings, our interest expense would
increase, which would adversely affect our cash available for distribution and our ability to pay expected distributions to shareholders.
Covenants and Risk of Default. Our loan instruments require us to operate within certain covenants, including financial covenants with
respect to leverage, fixed charge coverage, minimum net worth, limitations on additional indebtedness and dividend limitations. If we violate
any of these covenants or otherwise default under these instruments, then our lenders could declare all indebtedness under these facilities to be
immediately due and payable which would have a material adverse effect on our business and could require us to sell self-storage facilities
under distressed conditions and seek replacement financing on substantially more expensive terms.
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Reduction in or Loss of Credit Rating. Certain of our debt instruments require us to maintain an investment grade rating from at least one,
and in some cases two, debt ratings agencies. Should we receive a reduction in our credit rating from the agencies, the interest rate on our line
of credit would increase by up to 1.40%. Should we fail to attain an investment grade rating from the agencies, the interest rate on our $175
million term note due 2024 would increase by 1.750%.
Our Debt Levels May Increase
Our Board of Directors currently has a policy of limiting the amount of our debt at the time of incurrence to less than 50% of the sum of
the market value of our issued and outstanding common stock and preferred stock plus the amount of our debt at the time that debt is incurred.
However, our organizational documents do not contain any limitation on the amount of indebtedness we might incur. Accordingly, our Board
of Directors could alter or eliminate the current policy limitation on borrowing without a vote of our shareholders. We could become highly
leveraged if this policy were changed. However, our ability to incur debt is limited by covenants in our debt instruments.
We Are Subject to the Risks Posed by Fluctuating Demand and Significant Competition in the Self-Storage Industry
Our self-storage facilities are subject to all operating risks common to the self-storage industry. These risks include but are not limited to
the following:
•
Decreases in demand for rental spaces in a particular locale;
•
Changes in supply of similar or competing self-storage facilities in an area;
•
Changes in market rental rates; and
•
Inability to collect rents from customers.
Our current strategy is to acquire interests only in self-storage facilities. Consequently, we are subject to risks inherent in investments in a
single industry. Our self-storage facilities compete with other self-storage facilities in their geographic markets. Due to competition, the self-
storage facilities could experience a decrease in occupancy levels and rental rates, which would decrease our cash available for distribution. We
compete in operations and for acquisition opportunities with companies that have substantial financial resources. Competition may reduce the
number of suitable acquisition opportunities offered to us and increase the bargaining power of property owners seeking to sell. The self-
storage industry has at times experienced overbuilding in response to perceived increases in demand. A recurrence of overbuilding might cause
us to experience a decrease in occupancy levels, limit our ability to increase rents, and compel us to offer discounted rents.
We have incurred costs, and expect to incur additional costs, responding to Public Storage's unsolicited efforts to acquire the Company
On February 5, 2023, Public Storage made public an unsolicited proposal to acquire the Company. On February 16, 2023, the Company
issued a press release announcing that the Company's board of directors unanimously rejected the proposal. The Company has incurred legal
and professional fees and other costs related to Public Storage's unsolicited proposal and expects to incur additional fees and other costs and
charges in the future in connection with the proposal. Such fees and other costs may be significant and could have a significant negative effect
on our business, financial condition and results of operations.
We are Subject to Risks from Natural Disasters and Climate Change
We are subject to risks from natural disasters and climate change. Natural disasters and severe weather such as earthquakes, tornadoes,
hurricanes or floods may result in significant damage to our properties. The extent of our casualty losses and loss in operating income in
connection with such events is a function of the severity of the event and the total amount of exposure in the affected area. When we have
geographic concentration of exposures, a single catastrophe, such as a tornado affecting our properties in Texas or elsewhere, or destructive
weather event, such as a hurricane affecting our properties in Florida or elsewhere, may have a significant negative effect on our business,
financial condition and results of operations. As a result, our operating and financial results may vary significantly from one period to the next.
Our financial results may be adversely affected by our exposure to losses arising from natural disasters or severe weather. We also are exposed
to risks associated with inclement winter weather, particularly in the Northeast and Midwest regions, regions in which some of our properties
are located, including increased need for maintenance and repair of our buildings.
As a result of climate change, we may also experience extreme weather and changes in precipitation and temperature, all of which may
result in physical damage of, decreased demand for, and/or increased cost of insurance for our Properties located in the areas affected by these
conditions. Should the impact of climate change be material in nature, our financial condition or results of operations would be adversely
affected. In addition, changes in federal and state legislation and regulation on climate change could result in increased capital expenditures to
improve the energy efficiency of our existing properties in order to comply with such regulations.
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Our Real Estate Investments Are Illiquid and Are Subject to Uninsurable Risks and Government Regulation
General Risks. Our investments are subject to varying degrees of risk generally related to the ownership of real property. The underlying
value of our real estate investments and our income and ability to make distributions to our shareholders are dependent upon our ability to
operate the self-storage facilities in a manner sufficient to maintain or increase cash available for distribution. Income from our self-storage
facilities may be adversely affected by the following factors:
•
Changes in national economic conditions;
•
Changes in general or local economic conditions and neighborhood characteristics;
•
Competition from other self-storage facilities;
•
Changes in interest rates and in the availability, cost and terms of financing;
•
The impact of present or future environmental legislation and compliance with environmental laws;
•
The ongoing need for capital improvements, particularly in older facilities;
•
Changes in real estate tax rates and other operating expenses;
•
Adverse changes in governmental rules and fiscal policies;
•
Uninsured losses resulting from casualties associated with civil unrest, acts of God, including natural disasters, and acts of war;
•
Adverse changes in zoning laws; and
•
Other factors that are beyond our control.
Illiquidity of Real Estate May Limit its Value. Real estate investments are relatively illiquid. Our ability to vary our portfolio of self-
storage facilities in response to changes in economic and other conditions is limited. In addition, provisions of the Code may limit our ability to
profit on the sale of self-storage facilities held for fewer than two years. We may be unable to dispose of a facility when we find disposition
advantageous or necessary and the sale price of any disposition may not equal or exceed the amount of our investment.
Uninsured and Underinsured Losses Could Reduce the Value of our Self Storage Facilities. Some losses, generally of a catastrophic
nature, that we potentially face with respect to our self-storage facilities may be uninsurable or not insurable at an acceptable cost. Our
management uses its discretion in determining amounts, coverage limits and deductibility provisions of insurance, with a view to acquiring
appropriate insurance on our investments at a reasonable cost and on suitable terms. These decisions may result in insurance coverage that, in
the event of a substantial loss, would not be sufficient to pay the full current market value or current replacement cost of our lost investment.
Inflation, changes in building codes and ordinances, environmental considerations, and other factors also might make it infeasible to use
insurance proceeds to replace a property after it has been damaged or destroyed. Under those circumstances, the insurance proceeds received by
us might not be adequate to restore our economic position with respect to a particular property.
Possible Liability Relating to Environmental Matters. Under various federal, state and local environmental laws, ordinances and
regulations, a current or previous owner or operator of real property may be liable for the costs of removal or remediation of hazardous or toxic
substances on, under, or in that property. Those laws often impose liability even if the owner or operator did not cause or know of the presence
of hazardous or toxic substances and even if the storage of those substances was in violation of a customer’s lease. In addition, the presence of
hazardous or toxic substances, or the failure of the owner to address their presence on the property, may adversely affect the owner’s ability to
borrow using that real property as collateral. In connection with the ownership of the self-storage facilities, we may be potentially liable for any
of those costs.
Americans with Disabilities Act. The Americans with Disabilities Act of 1990, or ADA, generally requires that buildings be made
accessible to persons with disabilities. A determination that we are not in compliance with the ADA could result in imposition of fines or an
award of damages to private litigants. If we were required to make modifications to comply with the ADA, our results of operations and ability
to make expected distributions to our shareholders could be adversely affected.
There Are Limitations on the Ability to Change Control of the Company
Limitation on Ownership and Transfer of Shares. To maintain our qualification as a REIT, not more than 50% in value of our
outstanding shares of stock may be owned, directly or indirectly, by five or fewer individuals, as defined in the Code. To limit the possibility
that we will fail to qualify as a REIT under this test, our Amended and Restated Articles of Incorporation (“Articles of Incorporation”) include
ownership limits and transfer restrictions on shares of our stock. Our Articles of Incorporation limit ownership of our issued and outstanding
stock by any single shareholder to 9.8% of the aggregate value of our outstanding stock, except that the ownership by some of our shareholders
is limited to 15%.
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These ownership limits may:
•
Have the effect of precluding an acquisition of control of the Company by a third-party without consent of our Board of Directors
even if the change in control would be in the interest of shareholders; and
•
Limit the opportunity for shareholders to receive a premium for shares of our common stock they hold that might otherwise exist if
an investor were attempting to assemble a block of common stock in excess of 9.8% or 15%, as the case may be, of the outstanding
shares of our stock or to otherwise effect a change in control of the Company.
Our Board of Directors may waive the ownership limits if it is satisfied that ownership by those shareholders in excess of those limits
will not jeopardize our status as a REIT under the Code or in the event it determines that it is no longer in our best interests to be a REIT.
Waivers have been granted to the former holders of our Series C preferred stock, FMR Corporation, Cohen & Steers, Inc. and Invesco
Advisers, Inc. A transfer of our common stock and/or preferred stock to a person who, as a result of the transfer, violates the ownership limits
may not be effective under some circumstances.
Other Limitations. Other limitations could have the effect of discouraging a takeover or other transaction in which holders of some, or a
majority, of our outstanding common stock might receive a premium for their shares of our common stock that exceeds the then prevailing
market price or that those holders might believe to be otherwise in their best interest. The issuance of shares of preferred stock could have the
effect of delaying or preventing a change in control of the Company even if a change in control were in the shareholders’ interest. In addition,
the Maryland General Corporation Law, or MGCL, imposes restrictions and requires specific procedures with respect to the acquisition of
stated levels of share ownership and business combinations, including combinations with interested shareholders. These provisions of the
MGCL could have the effect of delaying or preventing a change in control of the Company even if a change in control were in the
shareholders’ interest. Our bylaws contain a provision exempting from the MGCL control share acquisition statute any and all acquisitions by
any person of shares of our stock. However, this provision may be amended or eliminated at any time. In addition, under the Operating
Partnership’s agreement of limited partnership, in general, we may not merge, consolidate or engage in any combination with another person or
sell all or substantially all of our assets unless that transaction includes the merger or sale of all or substantially all of the assets of the Operating
Partnership, which requires the approval of the holders of 75% of the limited partnership interests thereof. If we were to own less than 75% of
the limited partnership interests in the Operating Partnership, this provision of the limited partnership agreement could have the effect of
delaying or preventing us from engaging in some change of control transactions.
The Ability to Attract, Train and Retain Qualified Personnel May Have an Adverse Impact on Our Operations
We have over 2,500 personnel involved in the management and operation of our stores. We compete with various other companies in
attracting and retaining qualified personnel. Competitive pressures may require that we enhance our pay and benefits package to compete
effectively for such personnel. If there is an increase in these costs or if we fail to attract or retain qualified personnel, our business and
operating results could be adversely affected.
Legal Disputes, Settlement and Defense Costs Could Have an Adverse Effect on our Operating Results
We may have to make monetary settlements or defend actions or arbitration (including class actions) to resolve tenant-related, employee-
related or other claims and disputes. Settling any such claims and disputes could negatively impact our operating results and cash available for
distribution to shareholders, and could also adversely affect our ability to sell, lease, operate or encumber affected self-storage facilities.
Our Tenant Reinsurance Program is Subject to Significant Governmental Regulation Which May Adversely Affect our Operating
Results
Our tenant reinsurance program, which commenced April 1, 2019, is subject to significant government regulation. The regulatory
authorities generally have broad discretion to grant, renew and revoke licenses and approvals; to promulgate, interpret, and implement
regulations; and to evaluate compliance with regulations through periodic examinations, audits and investigations of the affairs of insurance
providers. As a result of regulation or private action in any jurisdiction, we may be temporarily or permanently suspended from continuing
some or all of our reinsurance activities, or otherwise fined, penalized and/or suffer an adverse judgment, which could all adversely affect our
business and results of operations.
Our Failure to Qualify as a REIT Would Have Adverse Consequences
We intend to continue to operate in a manner that will permit us to qualify as a REIT under the Code. We have not requested and do not
plan to request a ruling from the Internal Revenue Service (“IRS”) that we qualify as a REIT, and the statements in this Annual Report on Form
10-K are not binding on the IRS or any court. Qualification as a REIT involves the application of highly technical and complex Code
provisions for which there are only limited judicial and administrative interpretations. Continued qualification as a REIT depends upon our
continuing ability to meet various requirements concerning, among other things, the ownership of our outstanding stock, the nature of our
assets, the sources of our income and the amount of our distributions to our shareholders. The fact that we hold substantially all of our assets
through our Operating Partnership and its subsidiaries and joint ventures further complicates the application of the REIT requirements for us.
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Even a technical or inadvertent mistake could jeopardize our REIT status and, given the highly complex nature of the rules governing REITs
and the ongoing importance of factual determinations, we cannot provide any assurance that we will continue to qualify as a REIT.
Furthermore, Congress and the IRS might make changes to the tax laws and regulations, and the courts and the IRS might issue new rulings,
that make it more difficult, or impossible, for us to remain qualified as a REIT.
If we were to fail to qualify as a REIT in any taxable year and are unable to avail ourselves of certain savings provisions set forth in the
Code, we would not be allowed a deduction for distributions to shareholders in computing our taxable income and would be subject to federal
income tax (including possibly increased state and local taxes) on our taxable income at the regular corporate rate of 21%. Unless entitled to
relief under certain Code provisions, we also would be ineligible for qualification as a REIT for the four taxable years following the year during
which our qualification was lost. As a result, distributions to the shareholders would be reduced for each of the years involved. Although we
currently intend to continue to operate in a manner designed to qualify as a REIT, it is possible that future economic, market, legal, tax or other
considerations may cause our Board of Directors to revoke our REIT election. If we fail to qualify as a REIT for federal income tax purposes
and are able to avail ourselves of one or more of the statutory savings provisions in order to maintain our REIT status, we would nevertheless
be required to pay penalty taxes of $50,000 or more for each such failure.
We Will Pay Some Taxes Even if We Qualify as a REIT, Reducing Cash Available for Shareholders
Even if we qualify as a REIT for federal income tax purposes, we are required to pay some federal, state and local taxes on our income
and property. For example, we will be subject to income tax to the extent we distribute less than 100% of our REIT taxable income (including
capital gains). Additionally, we will be subject to a 4% nondeductible excise tax on the amount, if any, by which dividends paid by us in any
calendar year are less than the sum of 85% of our ordinary income, 95% of our capital gain net income and 100% of our undistributed income
from prior years. Moreover, if we have net income from “prohibited transactions,” that income will be subject to a 100% tax. In general,
prohibited transactions are sales or other dispositions of property held primarily for sale to customers in the ordinary course of business. The
determination as to whether a particular sale is a prohibited transaction depends on the facts and circumstances related to that sale. While we
will undertake sales of assets if those assets become inconsistent with our long-term strategic or return objectives, we do not believe that those
sales should be considered prohibited transactions, but there can be no assurance that the IRS would not contend otherwise. The need to avoid
prohibited transactions could cause us to forego or defer sales of properties that might otherwise be in our best interest to sell.
Certain of our subsidiaries have elected to be treated as “taxable REIT subsidiaries” of the Company for federal income tax purposes. A
taxable REIT subsidiary is taxed as a regular corporation and is limited in its ability to deduct interest payments made to us in excess of a
certain amount, in addition to other limitations imposed on the deductibility of interest under the applicable tax law. In addition, if we receive
or accrue certain amounts and the underlying economic arrangements between our taxable REIT subsidiaries and us are not comparable to
similar arrangements among unrelated parties, we will be subject to a 100% penalty tax on those payments in excess of amounts deemed
reasonable between unrelated parties.
Finally, some state and local jurisdictions may tax some of our income even though as a REIT we are not subject to federal income tax
on that income because not all states and localities follow the federal income tax treatment of REITs. To the extent that we are, or any taxable
REIT subsidiary is, required to pay federal, foreign, state or local taxes, we will have less cash available for distribution to shareholders.
Complying with REIT Requirements May Limit Our Ability to Hedge Effectively and May Cause Us to Incur Tax Liabilities
The REIT provisions of the Code may limit our ability to hedge our assets and operations. Under these provisions, any income that we
generate from transactions intended to hedge our interest rate risk will be excluded from gross income for purposes of the REIT 75% and 95%
gross income tests if the instrument hedges interest rate risk on liabilities used to carry or acquire real estate assets or manages the risk of
certain currency fluctuations, and such instrument is properly identified under applicable Treasury Regulations. Income from hedging
transactions that do not meet these requirements will generally constitute non-qualifying income for purposes of both the REIT 75% and 95%
gross income tests. As a result of these rules, we may have to limit our use of hedging techniques that might otherwise be advantageous or
implement those hedges through a taxable REIT subsidiary. This could increase the cost of our hedging activities because our taxable REIT
subsidiaries would be subject to tax on gains or expose us to greater risks associated with changes in interest rates than we would otherwise
want to bear. In addition, any losses in the taxable REIT subsidiary will generally not provide any tax benefit, except for being carried forward
against future taxable income in the taxable REIT subsidiary.
15
Complying with the REIT Requirements May Cause Us to Forgo and/or Liquidate Otherwise Attractive Investments
To qualify as a REIT, we must continually satisfy tests concerning, among other things, the sources of our income, the nature and
diversification of our assets, the amounts that we distribute to our shareholders and the ownership of our shares. To meet these tests, we may be
required to take actions that we would not otherwise consider advantageous or forgo taking actions that we would otherwise consider
advantageous. For instance, in order to satisfy the gross income or asset tests applicable to REITs under the Code, we may be required to forgo
investments that we otherwise would make. Furthermore, we may be required to liquidate from our portfolio otherwise attractive investments.
In addition, we may be required to make distributions to shareholders at disadvantageous times or when we do not have funds readily available
for distribution. These actions could reduce our income and amounts available for distribution to our shareholders. Thus, compliance with the
REIT requirements may hinder our investment performance.
If the Operating Partnership Fails to Qualify as a Partnership for Federal Income Tax Purposes, We Could Fail to Qualify as a REIT
and Suffer Other Adverse Consequences
We believe that the Operating Partnership is organized and operated in a manner so as to be treated as a partnership and not an
association or a publicly traded partnership taxable as a corporation, for federal income tax purposes. As a partnership, the Operating
Partnership is not subject to federal income tax on its income. Instead, each of the partners is allocated its share of the Operating Partnership’s
income. No assurance can be provided, however, that the IRS will not challenge the Operating Partnership’s status as a partnership for federal
income tax purposes, or that a court would not sustain such a challenge. If the IRS were successful in treating the Operating Partnership as an
association or publicly traded partnership taxable as a corporation for federal income tax purposes, we would fail to meet the gross income tests
and certain of the asset tests applicable to REITs and, accordingly, would cease to qualify as a REIT. Also, the failure of the Operating
Partnership to qualify as a partnership would cause it to become subject to federal corporate income tax, which would reduce significantly the
amount of its cash available for distribution to its partners, including us.
U.S. Federal Income Tax Treatment of REITs and Investments in REITs May Change, Which May Result in the Loss of Our Tax
Benefits of Operating as a REIT
Current U.S. federal income tax treatment of a REIT and an investment in a REIT may be modified by legislative, judicial or
administrative action at any time, and we cannot predict when such action may occur. We cannot predict how changes in U.S. federal income
tax law will affect us or our investors nor can we predict the long-term impact of tax reforms on REITs.
We May Change the Dividend Policy for Our Common Stock in the Future
In 2022, our Board of Directors authorized and we declared quarterly common stock dividends of $1.00 per share in January and April
and $1.08 per share in July and October, for a total 2022 dividend per share annual rate of $4.16 per share. In addition, our Board of Directors
authorized and we declared a quarterly common stock dividend of $1.20 per share in January 2023. We can provide no assurance that our
Board of Directors will not reduce or eliminate entirely dividend distributions on our common stock in the future.
Our Board of Directors will continue to evaluate our distribution policy on a quarterly basis as they monitor the capital markets and the
impact of the economy on our operations. The decisions to authorize and pay dividends on our common stock in the future, as well as the
timing, amount and composition of any such future dividends, will be at the sole discretion of our Board of Directors given conditions then
existing, including our earnings, financial condition, capital requirements, debt maturities, the availability of capital, applicable REIT and legal
restrictions and the general overall economic conditions and other factors. Any change in our dividend policy could have a material adverse
effect on the market price of our common stock.
Market Interest Rates May Influence the Price of Our Common Stock
One of the factors that may influence the price of our common stock in public trading markets or in private transactions is the annual
yield on our common stock as compared to yields on other financial instruments. An increase in market interest rates will result in higher yields
on other financial instruments, which could adversely affect the price of our common stock.
Regional Concentration of Our Business May Subject Us to Economic Downturns in the States of Texas and Florida
As of December 31, 2022, 362 of our 1,198 self-storage facilities are located in the states of Texas and Florida. For the year ended
December 31, 2022, the facilities in Texas and Florida accounted for approximately 16% and 15% of store revenues, respectively. This
concentration of business in Texas and Florida exposes us to potential losses resulting from a downturn in the economies of those states. If
16
economic conditions in those states deteriorate, we may experience a reduction in existing and new business, which may have an adverse effect
on our business, financial condition and results of operations.
When We Acquire Properties in New Markets, We Will Be Subject to Increased Operational Risks
We may acquire self-storage properties in markets where we have little or no operational experience. When we enter into new markets,
we will be subject to increased risks resulting from our lack of experience and infrastructure in these markets and may need to incur additional
costs, both expected and unexpected, to develop our operating capabilities in these markets. These risks could materially and adversely affect
us, including our growth prospects, financial condition and results of operations.
Changes in Taxation of Corporate Dividends May Adversely Affect the Value of Our Common Stock
The maximum marginal rate of tax payable by domestic noncorporate taxpayers on dividends received from a regular “C” corporation
under current federal law generally is 20%, as opposed to higher ordinary income rates, plus a 3.8% Medicare tax on net investment income.
The reduced tax rate, however, does not apply to distributions paid to domestic noncorporate taxpayers by a REIT on its stock, except for
certain limited amounts. However, the TCJA allows domestic noncorporate taxpayers to deduct 20% of their dividends from REITs, excluding
capital gain dividends and qualified dividend income (which continue to be subject to the 20% rate). As a result, dividend income received by
our domestic non-corporate shareholders is subject to a maximum effective federal income tax rate of 29.6% (plus the 3.8% Medicare tax on
net investment income). The cumulative amount that a domestic noncorporate taxpayer may deduct for any taxable year with respect to
ordinary REIT dividends from all sources (together with certain other categories of income that are eligible for such 20% deduction) may not
exceed 20% of such person’s total taxable income (excluding any net capital gain). The income tax rate changes applicable to domestic
noncorporate taxpayers and the 20% deduction for ordinary REIT dividends apply for taxable years beginning after December 31, 2017 and
before January 1, 2026.
The earnings of a REIT that are distributed to its stockholders generally remain subject to less federal income taxation than earnings of a
non-REIT “C” corporation that are distributed to its stockholders net of corporate-level income tax. However, the lower rate of taxation to
dividends paid by regular “C” corporations could cause domestic noncorporate investors to view the stock of regular “C” corporations as more
attractive relative to the stock of a REIT, because the dividends from regular “C” corporations continue to be taxed at a lower rate while
distributions from REITs (other than distributions designated as capital gain dividends) are generally taxed at the same rate as other ordinary
income for domestic noncorporate taxpayers.
We Are Heavily Dependent on Computer Systems, Telecommunications and the Internet to Process Transactions, Summarize Results
and Manage our Business. Security Breaches or a Failure of such Networks, Systems or Technology Could Adversely Impact Our
Business and Customer Relationships.
We are heavily dependent upon automated information technology and Internet commerce, with many of our new customers coming
from the Internet or the telephone, and the nature of our business involves the receipt and retention of personal information about them. We
centrally manage significant components of our operations with our computer systems, including our financial information, and we also rely
extensively on third-party vendors to retain data, process transactions and provide other systems services. These systems are subject to damage
or interruption from power outages, computer and telecommunications failures, computer worms, viruses and other destructive or disruptive
security breaches and catastrophic events.
As a result, our operations could be severely impacted by a natural disaster, terrorist attack or other circumstance that resulted in a
significant outage of our systems or those of our third-party providers, despite our use of back up and redundancy measures. Further, viruses
and other related risks could negatively impact our information technology processes. We could also be subject to a “cyber-attack” or other
data security breach which would penetrate our network security, resulting in misappropriation of our confidential information, including
customer personal information. Although the Company has insurance for such events, system disruptions and shutdowns could also result in
additional costs to repair or replace such networks or information systems and possible legal liability, including government enforcement
actions and private litigation. In addition, our customers could lose confidence in our ability to protect their personal information, which could
cause them to move out of rented storage spaces. Such events could lead to lost future sales and adversely affect our results of operations.
Item 1B. Unresolved Staff Comments
None.
Item 2. Properties
At December 31, 2022, we held ownership interests in, leased, and/or managed a total of 1,198 Properties situated in 37 states and the
District of Columbia. Among our 1,198 self-storage properties are 141 properties that we manage for unconsolidated joint ventures of which
we have varying percentage ownership interests. For additional information regarding unconsolidated joint ventures, see Note 11 to the
Consolidated Financial Statements filed herewith.
17
Our Properties offer reasonably priced, easily accessible, enclosed storage space to residential and commercial users on a month-to-
month basis. Most of our Properties are fenced and well lit with automated access systems and surveillance cameras. A majority of the
Properties are single-story, thereby providing customers with the convenience of direct vehicle access to their storage spaces. Our Properties
range in size from 17,000 to 194,000 net rentable square feet, with an average of approximately 74,000 net rentable square feet. The Properties
generally are constructed of masonry or steel walls resting on concrete slabs and have standing seam metal, shingle, or tar and gravel roofs.
Most Properties have a property manager on-site during business hours. Generally, customers have access to their storage space up to 15 hours
a day, with 24-hour access in certain circumstances. Individual storage spaces are secured by a lock furnished by the customer to provide the
customer with control of access to the space.
The following table provides certain information regarding the Properties in which we have an ownership interest, lease, and/or manage
as of December 31, 2022:
Number of
Stores at
December 31, 2022
Square
Feet
Number of
Spaces
Percentage
of Store
Revenue
Alabama
31
2,197,196
17,495
1.91%
Arizona
55
4,132,810
38,756
4.95%
Arkansas
1
84,965
595
0.07%
California
52
4,703,883
42,774
6.09%
Colorado
16
1,101,928
9,650
1.36%
Connecticut
21
1,580,793
16,188
2.32%
District of Columbia
2
225,055
3,232
0.01%
Florida
167
11,477,611
113,447
14.78%
Georgia
78
5,579,716
49,437
6.00%
Illinois
48
3,789,266
37,300
5.00%
Indiana
3
182,969
1,833
0.11%
Iowa
2
177,027
1,901
0.01%
Kansas
1
126,625
1,133
0.09%
Kentucky
3
196,022
1,864
0.18%
Louisiana
59
5,178,604
45,445
4.76%
Maine
7
426,198
4,384
0.60%
Maryland
10
533,662
5,883
0.67%
Massachusetts
27
1,556,901
15,741
1.83%
Michigan
3
209,450
2,217
0.14%
Minnesota
4
358,780
3,450
0.07%
Mississippi
17
1,380,426
11,015
1.16%
Missouri
31
2,381,556
20,441
2.13%
Nevada
26
1,995,240
17,006
2.72%
New Hampshire
15
1,092,037
9,140
1.29%
New Jersey
47
3,652,286
36,840
5.43%
New York
88
6,004,528
76,104
7.20%
North Carolina
41
2,718,936
25,786
2.70%
Ohio
31
2,162,153
18,654
2.25%
Oklahoma
6
403,210
3,194
0.23%
Oregon
1
35,356
387
0.05%
Pennsylvania
19
1,343,357
13,037
1.36%
Rhode Island
6
330,002
3,212
0.40%
South Carolina
24
1,597,092
14,671
1.78%
Tennessee
15
1,061,309
9,610
1.13%
Texas
195
14,766,311
123,471
15.66%
Virginia
29
2,237,424
21,374
2.20%
Washington
9
676,037
6,803
0.74%
Wisconsin
8
716,131
6,796
0.62%
Total
1,198
88,372,852
830,266
100.00%
At December 31, 2022, the Properties had an average occupancy of 84.9%, including the Company’s wholly owned self-storage facilities
which had an average occupancy of 90.6%. For the quarter ended December 31, 2022, the Properties had an annualized rent per occupied
square foot of $19.20, including the Company’s wholly owned self-storage facilities which had an annualized rent per occupied square foot of
$19.39.
18
Item 3. Legal Proceedings
Although we are party to various legal proceedings, we believe that the likelihood of these contingencies resulting in a material loss to
the Company, either individually or in the aggregate, is remote.
Item 4. Mine Safety Disclosures
Not Applicable
19
Part II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Our Common Stock is traded on the New York Stock Exchange under the symbol “LSI”. As of February 16, 2023, there were
approximately 459 holders of record of our Common Stock. These figures do not include common shares held by brokers and other institutions
on behalf of shareholders.
We have paid quarterly dividends to our shareholders since our inception.
For federal income tax purposes, distributions to shareholders are treated as ordinary income, capital gain, return of capital or a
combination thereof. Distributions to shareholders for 2022 represent 100% ordinary income.
On August 2, 2017, the Company’s Board of Directors authorized the repurchase of up to $200 million of the Company’s common stock.
We have not made any repurchases under such program since 2017, and up to approximately $191.8 million of the Company’s common stock
may yet be purchased under such program. The program does not have an expiration date but may be suspended or discontinued at any time.
20
EQUITY COMPENSATION PLAN INFORMATION
The following table sets forth certain information as of December 31, 2022, with respect to equity compensation plans under which
shares of the Company’s Common Stock may be issued.
Plan Category
Number of
securities to be
issued upon
exercise of
outstanding
options,
warrants
and rights
Weighted
average
exercise price
of
outstanding
options,
warrants
and rights
Number of
securities
remaining
available
for future
issuance
Equity compensation plans approved by shareholders:
2015 Award and Option Plan (1)
228,994
$
—
71,337
2009 Outside Directors’ Stock Option and Award Plan (2)
19,500
$
57.24
—
2020 Outside Directors' Stock Award Plan
—
$
—
125,041
Deferred Compensation Plan for Directors (3)
29,535
N/A
25,196
Equity compensation plans not approved by shareholders:
N/A
N/A
N/A
(1)
Includes the actual number of shares issued in February 2023 related to performance-based awards issued on December 19, 2019
(50,884) and the maximum number of shares (178,110) that could be issued as part of the performance-based awards issued in 2020,
2021, and 2022. The actual number of shares to be issued as part of the performance-based awards issued in 2020, 2021 and 2022 will be
determined at the end of the three-year performance periods in 2023, 2024 and 2025, respectively. See Note 9 to our consolidated
financial statements filed herewith.
(2)
The 2009 Outside Directors’ Stock Option and Award Plan expired on May 21, 2020 and was replaced by the 2020 Outside Directors’
Stock Award Plan. Therefore, no securities are available for future issuance under the 2009 Outside Directors’ Stock Option and Award
Plan at December 31, 2022.
(3)
Under the Deferred Compensation Plan for Directors, non-employee Directors may defer all or part of their Directors’ fees that are
otherwise payable in cash. Directors’ fees that are deferred under the Plan will be credited to each Directors’ account under the Plan in
the form of Units. The number of Units credited is determined by dividing the amount of Directors’ fees deferred by the closing price of
the Company’s Common Stock on the New York Stock Exchange on the day immediately preceding the day upon which Directors’ fees
otherwise would be paid by the Company. A Director is credited with additional Units for dividends on the shares of Common Stock
represented by Units in such Directors’ account. A Director may elect to receive the shares in a lump sum on a date specified by the
Director or in quarterly or annual installments over a specified period and commencing on a specified date.
21
CORPORATE PERFORMANCE GRAPH
The following chart and line-graph presentation compares (i) the Company’s shareholder return on an indexed basis since December 31,
2017 with (ii) the S&P Stock Index and (iii) the National Association of Real Estate Investment Trusts (NAREIT) Equity Index.
CUMULATIVE TOTAL SHAREHOLDER RETURN
LIFE STORAGE, INC.
DECEMBER 31, 2017 - DECEMBER 31, 2022
Dec. 31,
2017
Dec. 31,
2018
Dec. 31,
2019
Dec. 31,
2020
Dec. 31,
2021
Dec. 31,
2022
S&P
$
100.00
$
95.62
$
125.72
$
148.85
$
191.58
$
156.88
NAREIT
$
100.00
$
95.38
$
120.17
$
110.56
$
158.36
$
119.78
LSI
$
100.00
$
109.19
$
132.41
$
152.14
$
366.57
$
243.88
The foregoing item assumes $100.00 invested on December 31, 2017, with dividends reinvested.
22
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of the consolidated financial condition and results of operations should be read in conjunction with
the financial statements and notes thereto included elsewhere in this report. We make statements in this section that are forward-looking
statements within the meaning of the federal securities laws. For a complete discussion of forward-looking statements, see the section in this
Form 10-K entitled “Forward Looking Statements.” Certain risk factors may cause actual results, performance or achievements to differ
materially from those expressed or implied by the following discussion. For a discussion of such risk factors, see the section in this Form 10-K
entitled “Risk Factors.” Dollar amounts in thousands, except share and per share data, unless otherwise stated.
Business and Overview
We believe we are the fourth largest operator of self-storage properties in the United States based on square feet owned and managed. All
of our stores conduct business under the customer-friendly name Life Storage ®.
Operating Strategy
Our operating strategy is designed to generate growth and enhance value by:
A.
Increasing operating performance and cash flow through aggressive management of our stores:
•
We seek to differentiate our self-storage facilities from our competition through innovative marketing and value-added
product offerings including:
•
Strategic and efficient Web and Mobile marketing that places Life Storage in front of customers in search engines at
the right time for conversion;
•
Regional marketing which creates effective brand awareness in the cities where we do business;
•
Our Customer Care Center answers sales inquiries and makes reservations for all of our Properties on a centralized
basis. Further, our call center and customer contact software was developed in-house and is 100% supported by our in-
house experts;
•
Our “Rent Now” fully-digital rental platform allows customers to “skip the counter” by selecting a specific storage
unit, completing the rental agreement and making their rental payment online;
•
Our dehumidification system provides our customers with a better environment to store their goods and improves
yields on our Properties;
•
Our customized computer applications link each of our primary sales channels (customer care center, web, and store)
allowing for real time access to space type and inventory, pricing, promotions, and other pertinent store information. This
also provides us with raw data on historical and current pricing, move-in and move-out activity, specials and occupancies,
etc. This data is then used within the advanced pricing analytics programs employed by our revenue management team;
•
All of our store employees receive a high level of training. New store associates are assigned a Certified Training Manager as
a mentor during their initial training period. In addition, all employees have access to our online training and development
portal for initial training as well as continuing education. Finally, we have a company intranet that acts as a communications
portal for company policy and procedures, online ordering, incentive rankings, etc.
B.
Acquiring additional stores:
•
Our objective is to acquire new stores in markets in which we currently operate. This is a proven strategy we have employed
over the years as it facilitates our branding efforts, grows market share, and allows us to achieve improved economies of
scale through shared advertising, payroll, and other services.
•
We also look to enter new markets that are in the top 50 Metropolitan Statistical Areas (MSA) by acquiring established
multi-property portfolios. With this strategy we are then able to seek out additional acquisition or third-party management
opportunities to continue to grow market share and branding and enhance economies of scale.
•
We primarily target stores with higher average rental rates per square foot than our overall portfolio to help improve
operating margin.
C.
Expanding our management business:
•
We see our management business as a source of future acquisitions. We hold a noncontrolling interest in multiple joint
ventures which hold a total of 141 properties that we manage. In addition, we manage 299 self-storage facilities for which we
have no ownership. We may enter into additional management agreements and develop additional joint ventures in the
future.
23
•
To broaden opportunities available, we have implemented a bridge lending program under which an unconsolidated joint
venture of the Company provides financing to owners of operating properties that we manage. We anticipate that this
program will help us increase our management business, create additional future acquisition opportunities, and strengthen
our relationship with partners, all while providing interest and fee income.
D.
Expanding and enhancing our existing stores:
•
Over the past five years we have undertaken a program of expanding and enhancing our Properties. In 2018, we added or
converted to premium storage 390,000 square feet to existing Properties for a total cost of approximately $27.8 million; in
2019, we added or converted to premium storage 694,000 square feet to existing Properties for a total cost of approximately
$58.1 million; in 2020, we added or converted to premium storage 522,000 square feet to existing Properties for a total cost
of approximately $41.4 million; in 2021, we added or converted to premium storage 287,000 square feet to existing
Properties for a total cost of approximately $23.5 million; and in 2022, we added or converted to premium storage 661,000
square feet to existing Properties for a total cost of approximately $55.7 million.
Supply and Demand / Operating Trends
We believe the supply and demand model in the self-storage industry is micro-market specific in that a majority of our business comes
from within a five-mile radius of our stores. The out-performance of the sector compared to other real estate asset classes has drawn new
capital to self-storage. The self-storage industry experienced significant new competition in recent years and the Company expects modest
growth in new supply at least through 2023. Despite the inflow of additional properties throughout the nation, we have seen capitalization rates
on quality stabilized acquisitions in the top 50 major metropolitan markets (expected annual return on investment) range from approximately
4.0% to 5.5%.
We have experienced annual same store sales increases each year for the past 13 years, subsequent to the economic recession of 2009.
We feel our recent performance further supports the notion that the self-storage industry holds up well regardless of the prevailing economic
landscape. Our performance in 2022, 2021, and 2020 despite the effects of the COVID-19 global health crisis further supports this notion.
We believe the increase in same store move ins in 2022 when compared to 2021 was due to incremental demand linked to elevated levels
of mobility, decluttering, and home buying. We believe the increase in same store move outs over the same period was a result of a return to
and normalization of typical seasonal patterns.
2022
2021
Change
Same store move ins
220,036
213,018
7,018
Same store move outs
225,569
206,495
19,074
Difference
(5,533)
6,523
(12,056)
Although property tax increases were kept at moderate levels through assessment challenges in 2022, elevated property tax increases are
expected in the coming years. We expect same store expense growth resulting from increases in health costs, property insurance, and property
taxes in 2023 to be partially offset by operating efficiencies gained from leveraging technology. We believe the same store expense increases
will be at manageable levels.
Subsequent Events
On February 5, 2023, Public Storage made public an unsolicited proposal to acquire the Company. On February 16, 2023, the Company
issued a press release announcing that the Company's board of directors unanimously rejected the proposal. The Company has incurred legal
and professional fees and other costs related to Public Storage's unsolicited proposal and expects to incur additional fees and other costs and
charges in the future in connection with the proposal, which may be significant.
24
Critical Accounting Policies and Estimates
The discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements,
which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements
requires us to make estimates and judgments that affect the amounts reported in our financial statements and the accompanying notes. On an
ongoing basis, we evaluate our estimates and judgments, including those related to carrying values of storage facilities, bad debts, and
contingencies and litigation. We base these estimates on experience and on various other assumptions that we believe to be reasonable under
the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not
readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The following
estimates are considered critical because they are particularly dependent on our judgment about matters that have a significant level of
uncertainty at the time the accounting estimates are made, and changes to those estimates could have a material impact on our financial
condition or operating results.
Assigning purchase price to assets acquired: Upon adoption of Accounting Standards Update 2017-01, most of our self-storage facility
acquisitions, including all self-storage facility acquisitions in 2022 and 2021, do not meet the definition of business combinations and are
therefore treated as asset acquisitions. As a result, the cost of acquired storage facilities is assigned primarily to land, land improvements,
building, equipment, and in-place customer leases based on the relative fair values of these assets as of the date of acquisition. We use
significant unobservable inputs in our determination of the fair values of these assets. The determination of these inputs involves judgments and
estimates that can vary for each individual facility based on various factors specific to the facilities and the functional, economic and other
factors affecting each facility. The fair values of the acquired facilities are determined using financial projections and applicable capitalization
rates. To determine the fair value of land, we use prices per acre derived from observed transactions involving comparable land in similar
locations. To determine the fair value of buildings, equipment and improvements, we use current replacement cost estimates based on
information derived from construction industry data by geographic region as adjusted for age, condition, and turnkey factor, economic profit
and economic obsolescence considerations associated with these assets. The fair values of in-place customer leases are based on the rent that
would be lost due to the amount of time required to replace existing customers which is based on our historical experience with market demand
and turnover in our facilities.
Qualification as a REIT: We operate, and intend to continue to operate, as a REIT under the Code, but no assurance can be given that we
will at all times so qualify. To the extent that we continue to qualify as a REIT, we will not be taxed, with certain limited exceptions, on the
taxable income that is distributed to our shareholders. If we fail to qualify as a REIT, any requirement to pay federal income taxes could have a
material adverse impact on our financial condition and results of operations.
Recent Accounting Pronouncements
See Note 2 to the financial statements.
YEAR ENDED DECEMBER 31, 2022 COMPARED TO YEAR ENDED DECEMBER 31, 2021
We recorded rental revenues of $917.1 million for the year ended December 31, 2022, an increase of $226.3 million or 32.8% when
compared to 2021 rental revenues of $690.8 million. Of the change in rental revenue, $97.9 million of the increase resulted from a 15.5%
increase in rental revenues at the 576 core properties considered in same store sales (the Company will include stores in its same store pool in
the second year after the stores achieve 80% sustained occupancy using market rates and incentives; therefore the 576 core properties
considered in same store sales are those included in the consolidated results of operations since December 31, 2020, excluding stores not yet
stabilized, eight stores significantly impacted by natural disasters, and three stores that the Company began to fully replace between 2017 and
2020). The increase in same store rental revenues was a result of an 16.7% increase in rental income per square foot, partially offset by a 140
basis point decrease in average occupancy. Also contributing to the overall increase in rental revenues was an increase of $128.4 million in
rental revenues contributed by stores not included in the same store pool, primarily those acquired in 2022 and 2021. We recorded tenant
reinsurance revenues of $73.8 million for the year ended December 31, 2022, an increase of $15.7 million or 27.0% when compared to 2021
tenant reinsurance revenues of $58.1 million. The increase in tenant reinsurance revenues is primarily due to the increase in stores owned or
managed in 2022. Other operating income, which includes merchandise sales, truck rentals, management fees and acquisition fees, increased by
$7.5 million for the year ended December 31, 2022 compared to 2021 primarily as the result of increased management fees earned as a result of
an increase in managed properties and increased merchandise sales.
Property operations and maintenance expenses increased $36.1 million or 25.1% in 2022 compared to 2021. The 576 core properties
considered in the same store pool experienced a $6.5 million or 5.5% increase in such expenses primarily as the result of increased repairs and
maintenance expenditures, payroll expenses, utilities, office related expenses, and internet marketing. The net activity of the stores not included
in the same store pool also contributed $29.6 million to the overall increase in property operations and maintenance expenses. Tenant
reinsurance expenses increased $6.4 million or 28.0% in 2022 compared to 2021 primarily as the result of the increase in stores owned or
managed in 2022. Real estate tax expense increased $19.8 million or 24.9% in 2022 compared to 2021. The 576 core properties considered in
the same store pool experienced a $3.8 million or 5.2% increase in real estate taxes which is reflective of a net increase in property tax levies on
25
those properties. In addition to the same store real estate tax expense increase, real estate taxes increased $16.0 million from the stores not
included in the same store pool.
Our 2022 same store results consist of only those Properties that have been owned by the Company and included in our consolidated
results since December 31, 2020, excluding stores not yet stabilized, eight stores significantly impacted by natural disasters, and three stores
that the Company began to fully replace between 2017 and 2020. The impact of tenant reinsurance related items is excluded from same store
results. We believe that same store results are meaningful measures to investors in evaluating our operating performance because, given the
acquisitive nature of the industry, same store results provide information about the overall business after removing the results from those
properties that were not consistent from year-to-year. Additionally, same store results are widely used in the real estate industry and the self-
storage industry to measure performance. Same store results should be considered in addition to, but not as a substitute for, consolidated results
in accordance with generally accepted accounting principles ("GAAP").
The following table sets forth operating data for our 576 same store properties. These results provide information relating to property
operating changes without the effects of acquisitions.
Same Store Summary
Year ended December 31,
Percentage
(dollars in thousands)
2022
2021
Change
Same store rental income
$
730,567
$
632,664
15.5%
Same store other operating income
7,417
7,923
(6.4)%
Total same store operating income
737,984
640,587
15.2%
Payroll and benefits
41,981
42,638
(1.5)%
Real estate taxes
77,129
73,313
5.2%
Utilities
17,533
15,978
9.7%
Repairs and maintenance
22,615
19,910
13.6%
Office and other operating expenses
19,913
18,294
8.8%
Insurance
7,109
7,065
0.6%
Advertising
192
230
(16.5)%
Internet marketing
16,361
15,048
8.7%
Total same store operating expenses
202,833
192,476
5.4%
Same store net operating income
$
535,151
$
448,111
19.4%
Net operating income increased $192.8 million or 35.6% as a result of a 19.4% increase in our same store net operating income along
with an increase of $105.8 million primarily related to the Company’s tenant insurance program, increased management fees, and the properties
not included in the same store pool.
Net operating income or “NOI” is a non-GAAP financial measure that we define as total continuing revenues less continuing property
operating expenses. NOI also can be calculated by adding back to net income: interest expense, impairment and casualty losses, operating lease
expense, depreciation and amortization expense, any losses on sale of real estate, acquisition related costs, general and administrative expense,
and deducting from net income: income from discontinued operations, interest income, any gains on sale of real estate, and equity in income of
joint ventures. We believe that NOI is a meaningful measure to investors in evaluating our operating performance because we utilize NOI in
making decisions with respect to capital allocations, in determining current property values, and in comparing period-to-period and market-to-
market property operating results. Additionally, NOI is widely used in the real estate industry and the self-storage industry to measure the
performance and value of real estate assets without regard to various items included in net income that do not relate to or are not indicative of
operating performance, such as depreciation and amortization, which can vary depending on accounting methods and the book value of assets.
NOI should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with
GAAP, such as total revenues, operating income and net income. There are material limitations to using a measure such as NOI, including the
difficulty associated with comparing results among more than one company and the inability to analyze certain significant items, including
depreciation and interest expense, that directly affect our net income. We compensate for these limitations by considering the economic effect
of the excluded expense items independently as well as in connection with our analysis of net income.
26
The following table reconciles our net income presented in the 2022 and 2021 consolidated financial statements to NOI generated by our
self-storage facilities during those years.
Year ended December 31,
(dollars in thousands)
2022
2021
Net income
$
366,462
$
252,175
General and administrative
77,201
62,617
Depreciation and amortization
192,902
147,119
Interest expense
109,240
86,786
Interest and dividend income
(32)
(827)
Gain on sale of investments in joint ventures
(1,572)
—
Equity in income of joint ventures
(9,235)
(5,696)
Net operating income
$
734,966
$
542,174
Net operating income:
Same store
535,151
448,111
Other stores, tenant reinsurance related income,
management fee income, and gain on sale of
non-real estate assets
199,815
94,063
Total net operating income
$
734,966
$
542,174
General and administrative expenses increased $14.6 million or 23.3% from 2021 to 2022. This increase was primarily driven by an
increase in home office personnel related costs to support the growth in stores, write-offs of certain technology assets with no future use, and
costs related to terminated acquisition activity.
Depreciation and amortization expense increased to $192.9 million in 2022 from $147.1 million in 2021 as a result of depreciation and
amortization related to self-storage facilities acquired in 2022 and 2021.
Interest expense increased from $86.8 million in 2021 to $109.2 million in 2022 primarily as a result of increased outstanding debt
balances in 2022 as compared to 2021 as well as rising interest rates on the Company's line of credit in 2022.
Equity in income of joint ventures increased from $5.7 million in 2021 to $9.2 million in 2022 primarily as a result of increased profits in
2022 as compared to 2021 from existing joint ventures as stores leased up and the full-year impact of joint ventures entered into during 2021.
The Company did not sell any properties in 2022 or 2021.
YEAR ENDED DECEMBER 31, 2021 COMPARED TO YEAR ENDED DECEMBER 31, 2020
We recorded rental revenues of $690.8 million for the year ended December 31, 2021, an increase of $151.2 million or 28.0% when
compared to 2020 rental revenues of $539.6 million. Of the change in rental revenue, $72.2 million of the increase resulted from a 14.3%
increase in rental revenues at the 531 core properties considered in same store sales (the Company will include stores in its same store pool in
the second year after the stores achieve 80% sustained occupancy using market rates and incentives; therefore the 531 core properties
considered in same store sales are those included in the consolidated results of operations since December 31, 2019, excluding stores not yet
stabilized, four stores significantly impacted by natural disasters, and two stores that the Company began to fully replace in 2017). The increase
in same store rental revenues was a result of a 290 basis point increase in average occupancy coupled with a 9.8% increase in rental income per
square foot. Also contributing to the overall increase in rental revenues was an increase of $79.0 million in rental revenues contributed by
stores not included in the same store pool, primarily those acquired in 2021 and 2020. We recorded tenant reinsurance revenues of $58.1
million for the year ended December 31, 2021, an increase of $13.4 million or 29.9% when compared to 2020 tenant reinsurance revenues of
$44.7 million. The increase in tenant reinsurance revenues is primarily due to the increase in stores owned or managed in 2021. Other operating
income, which includes merchandise sales, truck rentals, management fees and acquisition fees, increased by $7.2 million for the year ended
December 31, 2021 compared to 2020 primarily as the result of increased acquisition fees, increased management fees earned as a result of an
increase in managed properties and increased revenues from the Company's Warehouse Anywhere third-party logistics and warehousing
solution.
Property operations and maintenance expenses increased $21.1 million or 17.2% in 2021 compared to 2020. The 531 core properties
considered in the same store pool experienced a $3.7 million or 3.5% increase in such expenses primarily as the result of increased repairs and
maintenance expenditures and office related expenses. The net activity of the stores not included in the same store pool also contributed $17.4
million to the overall increase in property operations and maintenance expenses. Tenant reinsurance expenses increased $7.2 million or 45.5%
in 2021 compared to 2020 primarily as the result of the increase in stores owned or managed in 2021. Real estate tax expense increased $9.6
million or 13.6% in 2021 compared to 2020. The 531 core properties considered in the same store pool experienced a $2.2 million or 3.4%
increase in real estate taxes which is reflective of a net increase in property tax levies on those properties. In addition to the same store real
estate tax expense increase, real estate taxes increased $7.3 million from the stores not included in the same store pool.
27
Our 2021 same store results consist of only those Properties that have been owned by the Company and included in our consolidated
results since December 31, 2019, excluding stores not yet stabilized, four stores significantly impacted by natural disasters, and two stores that
the Company began to fully replace in 2017. The impact of tenant reinsurance related items is excluded from same store results.
The following table sets forth operating data for our 531 same store properties. These results provide information relating to property
operating changes without the effects of acquisitions.
Same Store Summary
Year ended December 31,
Percentage
(dollars in thousands)
2021
2020
Change
Same store rental income
$
578,658
$
506,469
14.3%
Same store other operating income
6,893
6,519
5.7%
Total same store operating income
585,551
512,988
14.1%
Payroll and benefits
38,900
38,995
(0.2)%
Real estate taxes
67,142
64,918
3.4%
Utilities
14,654
14,273
2.7%
Repairs and maintenance
18,259
16,098
13.4%
Office and other operating expenses
16,680
15,397
8.3%
Insurance
6,374
6,151
3.6%
Advertising
212
241
(12.0)%
Internet marketing
13,871
14,069
(1.4)%
Total same store operating expenses
176,092
170,142
3.5%
Same store net operating income
$
409,459
$
342,846
19.4%
Net operating income increased $134.0 million or 32.8% as a result of a 19.4% increase in our same store net operating income along
with an increase of $67.4 million primarily related to the Company’s tenant insurance program, increased management fees, and the properties
not included in the same store pool.
The following table reconciles our net income presented in the 2021 and 2020 consolidated financial statements to NOI generated by our
self-storage facilities during those years.
Year ended December 31,
(dollars in thousands)
2021
2020
Net income
$
252,175
$
152,360
General and administrative
62,617
52,055
Depreciation and amortization
147,119
122,925
Gain on sale of real estate
—
(302)
Interest expense
86,786
86,015
Interest income
(827)
(19)
Equity in income of joint ventures
(5,696)
(4,838)
Net operating income
$
542,174
$
408,196
Net operating income:
Same store
409,459
342,846
Other stores, tenant reinsurance related income,
management fee income, and gain on sale of
non-real estate assets
132,715
65,350
Total net operating income
$
542,174
$
408,196
General and administrative expenses increased $10.6 million or 20.3% from 2020 to 2021. This increase was primarily driven by an
increase in home office personnel related costs to support the growth in stores and increased investments in technology.
Depreciation and amortization expense increased to $147.1 million in 2021 from $122.9 million in 2020 as a result of depreciation and
amortization related to self-storage facilities acquired in 2021 and 2020.
28
Interest expense increased from $86.0 million in 2020 to $86.8 million in 2021 primarily as a result of increased outstanding debt
balances in 2021 as compared to 2020, partially offset by a make whole payment of $4.0 million made in 2020 as part of the early repayment of
$100 million of term notes.
The Company did not sell any properties in 2021 or 2020.
FUNDS FROM OPERATIONS
We believe that Funds from Operations (“FFO”) provides relevant and meaningful information about our operating performance that is
necessary, along with net earnings and cash flows, for an understanding of our operating results. FFO adds back historical cost depreciation,
which assumes the value of real estate assets diminishes predictably in the future. In fact, real estate asset values increase or decrease with
market conditions. Consequently, we believe FFO is a useful supplemental measure in evaluating our operating performance by disregarding
(or adding back) historical cost depreciation.
FFO is defined by the National Association of Real Estate Investment Trusts, Inc. (“NAREIT”) as net income available to common
shareholders computed in accordance with GAAP, excluding gains or losses on sales of properties, plus impairment of real estate assets, plus
depreciation and amortization and after adjustments to record unconsolidated partnerships and joint ventures on the same basis. We believe that
to further understand our performance FFO should be compared with our reported net income and cash flows in accordance with GAAP, as
presented in our consolidated financial statements.
Our computation of FFO may not be comparable to FFO reported by other REITs or real estate companies that do not define the term in
accordance with the current NAREIT definition or that interpret the current NAREIT definition differently. FFO does not represent cash
generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to net income
(determined in accordance with GAAP) as an indication of our performance, as an alternative to net cash flows from operating activities
(determined in accordance with GAAP) as a measure of our liquidity, or as an indicator of our ability to make cash distributions.
Reconciliation of Net Income to Funds From Operations
For Year Ended December 31,
(dollars in thousands)
2022
2021
2020
2019
2018
Net income attributable to common shareholders
$
358,128
$
249,317
$
151,571
$
258,699
$
206,590
Net income attributable to noncontrolling common interests in
the
Operating Partnership
4,331
1,364
789
1,378
968
Net income attributable to noncontrolling preferred interests in
the
Operating Partnership during conversion period
1,998
—
—
—
—
Depreciation of real estate and amortization of intangible assets
exclusive of debt issuance costs
190,962
144,978
120,512
105,107
100,528
Depreciation and amortization from unconsolidated joint
ventures
8,956
6,227
5,814
6,195
5,107
Gain on sale of storage facilities
—
—
—
(104,353)
(56,398)
Gain on sale of investments in joint ventures
(1,572)
—
—
—
—
Funds from operations allocable to noncontrolling interest in
the Operating Partnership
(6,718)
(2,177)
(1,443)
(1,417)
(1,197)
Funds from operations available to common shareholders
$
556,085
$
399,709
$
277,243
$
265,609
$
255,598
29
LIQUIDITY AND CAPITAL RESOURCES
Our line of credit and term notes require us to meet certain financial covenants measured on a quarterly basis, including prescribed
leverage, fixed charge coverage, minimum net worth, limitations on additional indebtedness, and limitations on dividend payouts. At
December 31, 2022, the Company was in compliance with all debt covenants. In the event that the Company violates its debt covenants in the
future, the amounts due under the agreements could be callable by the lenders and could adversely affect our credit rating requiring us to pay
higher interest and other debt-related costs. We believe that if operating results remain consistent with historical levels and levels of other debt
and liabilities remain consistent with amounts outstanding at December 31, 2022, the entire availability under our line of credit could be drawn
without violating our debt covenants.
Our ability to retain cash flow is limited because we operate as a REIT. To maintain our REIT status, a substantial portion of our
operating cash flow must be used to pay dividends to our shareholders. We believe that our internally generated net cash provided by operating
activities and the availability on our line of credit will be sufficient to fund ongoing operations, capital improvements, dividends and debt
service requirements.
Cash flows from operating activities were $586.9 million, $433.9 million, and $299.0 million for the years ended December 31, 2022,
2021, and 2020, respectively. The increases in operating cash flows from 2021 to 2022 and from 2020 to 2021 were primarily due to an
increase in net income as adjusted for non-cash depreciation and amortization expenses and other non-cash items during these periods.
Cash used in investing activities was $1,140.2 million, $1,680.7 million, and $576.0 million for the years ended December 31, 2022,
2021, and 2020, respectively. The decrease in cash used in investing activities from 2021 to 2022 was primarily the result of a decrease in self-
storage facility acquisition activity, increased proceeds from the sale of non-real estate assets in 2022, and a decrease in property deposits paid
during the year, partially offset by an increase in improvements, equipment additions, and construction in progress in 2022 and a decrease in
return of investment in unconsolidated joint ventures. The increase in cash used in investing activities from 2020 to 2021 was the result of an
increase in self-storage facility acquisition activity, increased capital spending, and an increase in the Company's investment in unconsolidated
joint ventures, partially offset by an increase in return of investment in unconsolidated joint ventures.
Cash provided by financing activities was $406.4 million, $1,364.5 million, and $314.2 million during the years ended December 31,
2022, 2021, and 2020, respectively. The decrease in cash provided by financing activities from 2021 to 2022 was primarily the result of a
decrease in sales of shares of common stock under the Company's continuous equity offering programs during 2022, a decrease in proceeds
from term notes resulting from $600 million of senior notes issued in 2021 as compared to no notes issued in 2022, and an increase in
dividends paid in 2022 as compared to 2021, partially offset by an increase in net proceeds from the line of credit. The increase in cash
provided by finance activities from 2020 to 2021 was primarily the result of the Company's issuance of 2,875,000 shares of common stock
through a public equity offering in 2021 resulting in net proceeds of $348.8 million, an increase in sales of shares of common stock under the
Company's continuous equity offering programs during 2021, and an increase in proceeds from term notes resulting from $600 million of
senior notes issued in 2021 as compared to $400 million of senior notes issued in 2020, partially offset by an increase in dividends paid. Also
contributing to this increase is a reduction in the net repayment of the Company's line of credit in 2021 as compared to 2020.
For the years 2020, 2021 and 2022, see Note 5 to the consolidated financial statements for details of the Company’s unsecured line of
credit and term note activity, Note 6 to the consolidated financial statements for the Company’s mortgage activity and related details, and Note
12 to the consolidated financial statements for the Company’s equity activity. Also, see Note 11 to the consolidated financial statements for
details of the activity in debt held by unconsolidated joint ventures of the Company. The debt held by these unconsolidated joint ventures is
secured by the real estate owned by these entities and is nonrecourse to the Company.
Our line of credit facility and term notes have an investment grade rating from Standard and Poor’s (BBB) and Moody’s (Baa2).
We expect to fund operating expenses, future acquisitions, our expansion and enhancement program, share repurchases, if any, and any
other cash requirements with future cash flows from operations, draws on our line of credit, issuance of common and/or preferred stock, the
issuance of unsecured term notes, sale of properties, and private placement solicitation of joint venture equity. Should the capital markets
deteriorate, we may have to curtail acquisitions, our expansion and enhancement program, and/or any share repurchases.
30
PENDING OBLIGATIONS
The following table summarized our pending obligations:
Payments due by period (in thousands)
Contractual obligations
Total
2023
2024-2025
2026-2027
2028 and
thereafter
Line of credit
595,000
—
—
595,000
—
Term notes
2,775,000
—
175,000
1,050,000
1,550,000
Mortgages payable
36,258
7,528
28,623
107
—
Interest payments
633,089
125,219
234,919
169,269
103,682
Land leases
9,296
741
1,487
1,488
5,580
Expansion and enhancement contracts
33,435
33,435
—
—
—
Building leases
15,313
2,301
4,257
4,277
4,478
Retail space rent
6,666
6,666
—
—
—
Self-storage facility acquisitions
73,800
73,800
—
—
—
Contribution to joint venture for acquisition under contract
4,500
4,500
—
—
—
Total
$ 4,182,357
$
254,190
$
444,286
$ 1,820,141
$
1,663,740
Interest payments include actual interest on fixed rate debt.
ACQUISITION OF PROPERTIES
In 2022, we acquired 49 self-storage facilities comprising 3.8 million square feet in Arizona (7), California (8), Florida (7), Georgia (2),
Illinois (1), Maryland (1), Massachusetts (2), Minnesota (1), Missouri (5), Nevada (1), New York (3), North Carolina (5), South Carolina (1),
and Texas (5), for a total purchase price of $974.0 million. As discussed further in Note 4, the Company held an 85.8% ownership interest in
one of the properties acquired prior to the acquisition of the remaining 14.2% ownership interest in the second quarter of 2022. Additionally, as
discussed further in Note 4, during the third quarter of 2022, the Company purchased an 83% ownership interest in a self-storage facility in
New York from an unrelated joint venture partner that has been consolidated in the Company's financial statements. Additionally, nine of these
facilities were managed by the Company for a third-party prior to acquisition. Based on the trailing financial information of the entities from
which the properties were acquired, the weighted average capitalization rate for these acquisitions was 3.2%.
In 2021, we acquired 112 self-storage facilities comprising 7.9 million square feet in Alabama (7), Arizona (4), California (1), Colorado
(3), Connecticut (6), Florida (31), Georgia (16), Illinois (4), Kentucky (1), Maine (1), New Hampshire (4), New Jersey (5), New York (1),
North Carolina (6), Ohio (1), Oklahoma (2), South Carolina (5), Tennessee (1), Texas (10), Virginia (1), and Washington (2) for a total
purchase price of $1,696.3 million, which is net of the Company's equity in profit from the acquisitions of the New York store and three
Georgia facilities purchased from unconsolidated joint ventures. Additionally, 27 of these facilities were managed by the Company for a third-
party prior to acquisition. Based on the trailing financial information of the entities from which the properties were acquired, the weighted
average capitalization rate for these acquisitions was 3.6%.
In 2020 we acquired 40 self-storage facilities comprising 3.1 million square feet in California (8), Florida (6), Georgia (1), Missouri (1),
New Jersey (7), New York (1), Ohio (6), Pennsylvania (4), South Carolina (1), and Texas (5) for a total purchase price of $532.6 million. One
of these acquired facilities resulted from the Company acquiring the remaining 15% of a joint venture. Additionally, two of these facilities were
managed by the Company for a third-party prior to acquisition. Based on the trailing financial information of the entities from which the
properties were acquired, the weighted average capitalization rate for these acquisitions was 5.0%.
FUTURE ACQUISITION AND DEVELOPMENT PLANS
Our external growth strategy is to increase the number of facilities we own by acquiring suitable facilities in markets in which we already
have operations, or to expand into new markets by acquiring several facilities at once in those new markets. We are actively pursuing
acquisitions in 2023 and at December 31, 2022 we were under contract to acquire four self-storage facilities for an aggregate purchase price of
$70.8 million. The purchases of these self-storage facilities under contract are subject to customary conditions to closing, and there is no
assurance that these facilities will be acquired.
In 2022, we added or converted to premium storage 661,000 square feet to existing Properties for a total cost of approximately $55.7
million. Although we do not expect to construct any new facilities in 2023, we do plan to complete $50 million to $65 million in expansions
and enhancements to existing facilities of which $33.9 million was paid as of December 31, 2022.
In 2022, the Company spent approximately $45.9 million for recurring capitalized expenditures including roofing, paving, and office
renovations. We expect to spend $30 million to $35 million in 2023 on similar capital expenditures.
31
DISPOSITION OF PROPERTIES
The Company did not sell or otherwise dispose of any properties during 2022, 2021, or 2020.
As part of our ongoing strategy to improve overall operating efficiencies and portfolio quality, we may seek to sell certain Properties to
third-parties or joint venture partners in 2023.
REIT QUALIFICATION AND DISTRIBUTION REQUIREMENTS
As a REIT, we are not required to pay federal income tax on income that we distribute to our shareholders, provided that we satisfy
certain requirements, including distributing at least 90% of our REIT taxable income for a taxable year. These distributions must be made in the
year to which they relate, or in the following year if declared before we file our federal income tax return, and if they are paid not later than the
date of the first regular dividend of the following year.
As a REIT, we must derive at least 95% of our total gross income from income related to real property, interest and dividends. In 2022,
our percentage of revenue from such sources was approximately 97%, thereby passing the 95% test, and no special measures are expected to be
required to enable us to maintain our REIT designation. Although we currently intend to operate in a manner designed to qualify as a REIT, it
is possible that future economic, market, legal, tax or other considerations may cause our Board of Directors to revoke our REIT election.
INTEREST RATE RISK
The primary market risk to which we believe we are exposed is interest rate risk, which may result from many factors, including
government monetary and tax policies, domestic and international economic and political considerations, and other factors that are beyond our
control.
Based on our outstanding unsecured floating rate debt of $595 million at December 31, 2022, a 100 basis point increase in interest rates
would have a $6.0 million effect on our annual interest expense. This amount was determined by considering the impact of the hypothetical
interest rates on our borrowing cost on December 31, 2022. This analysis does not consider the effects of the reduced level of overall economic
activity that could exist in such an environment. Further, in the event of a change of such magnitude, we would consider taking actions to
further mitigate our exposure to the change. However, due to the uncertainty of the specific actions that would be taken and their possible
effects, the sensitivity analysis assumes no changes in our capital structure.
INFLATION
We do not believe that inflation has had or will have a direct effect on our operations. Substantially all of the leases at the facilities are on
a month-to-month basis which provides us with the opportunity to increase rental rates in a timely manner in response to any potential future
inflationary pressures.
SEASONALITY
Our revenues typically have been higher in the third and fourth quarters, primarily because self-storage facilities tend to experience
greater occupancy during the late spring, summer and early fall months due to the greater incidence of residential moves and college student
activity during these periods. However, we believe that our customer mix, diverse geographic locations, rental structure and expense structure
provide adequate protection against undue fluctuations in cash flows and net revenues during off-peak seasons. Thus, we do not expect
seasonality to materially affect distributions to shareholders.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
The information required is incorporated by reference to the information appearing under the caption “Interest Rate Risk” in “Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” above.
Item 8. Financial Statements and Supplementary Data
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Life Storage, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Life Storage, Inc. (the Parent Company) as of December 31, 2022 and 2021,
the related consolidated statements of operations, comprehensive income, shareholders’ equity and cash flows for each of the three years in the
period ended December 31, 2022, and the related notes and financial statement schedule listed in the Index at Item 15(a)(2) (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 Parent Company at December 31, 2022 and 2021, and the results of its operations and its cash flows for
each of the three years in the period ended December 31, 2022, 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
Parent Company’s internal control over financial reporting as of December 31, 2022, 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, 2023 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Parent Company’s management. Our responsibility is to express an opinion on the
Parent 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 Parent 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 critical audit matters 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.
Accounting for the Acquisition of Storage Facilities
Description of the
As described in Note 4 to the consolidated financial statements, during the year ended December 31, 2022, the Parent
Matter
Company acquired 50 storage facilities for an aggregate purchase price of $1 billion. The transactions were accounted
for as asset acquisitions and the purchase price was allocated to the assets acquired based on their relative fair value.
Auditing the Parent Company’s accounting for its storage facility acquisitions in 2022 involved a high degree of
subjectivity due to the significant estimation required to determine the fair values of the acquired land and buildings.
In particular, the fair value estimates were sensitive to assumptions such as prices per acre and current replacement
cost estimates, including adjustments for the age, condition, turnkey factor, economic profit, and economic
obsolescence associated with the acquired facilities.
32
How We Addressed
We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Parent
the Matter in Our
Company’s storage facility acquisition process. This included testing controls over management’s evaluation of the
Audit
significant assumptions used to determine the fair values of the assets acquired.
For the 2022 acquisitions of storage facilities described above, our audit procedures included, among others,
evaluating the Parent Company’s valuation methodologies and testing the significant assumptions used to determine
the fair value of the assets acquired. We tested the completeness and accuracy of the underlying data by, among other
things, recalculating the current replacement cost of buildings and comparing the adjustments for the age, condition,
turnkey factor, economic profit, and economic obsolescence associated with the acquired assets to industry
publications on a test basis. We also compared significant assumptions, including prices per acre, to third-party
sources such as recent land sales. For certain of these asset acquisitions, we involved our valuation specialists to assist
in the assessment of the methodology utilized by the Parent Company, in addition to performing corroborative
analyses to assess whether the conclusions in the valuation were supported by observable market data. For example,
our valuation specialists used independently identified data sources to evaluate management's selected comparable
land sales, replacement cost assumptions and the fair value of individual storage facilities acquired in portfolio
acquisitions.
/s/ Ernst & Young LLP
We have served as the Parent Company’s auditor since 1994.
Buffalo, New York
February 24, 2023
33
Report of Independent Registered Public Accounting Firm
To the Partners and the Board of Directors of Life Storage LP
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Life Storage LP (the Operating Partnership) as of December 31, 2022 and
2021, the related consolidated statements of operations, comprehensive income, partners’ capital and cash flows for each of the three years in
the period ended December 31, 2022, and the related notes and financial statement schedule listed in the Index at Item 15(a)(2) (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 Operating Partnership at December 31, 2022 and 2021, and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 2022, 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
Operating Partnership’s internal control over financial reporting as of December 31, 2022, 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, 2023 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Operating Partnership’s management. Our responsibility is to express an opinion on the
Operating Partnership’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 Operating Partnership 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 critical audit matters 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.
Accounting for the Acquisition of Storage Facilities
Description of the
As described in Note 4 to the consolidated financial statements, during the year ended December 31, 2022, the
Matter
Operating Partnership acquired 50 storage facilities for an aggregate purchase price of $1 billion. The transactions
were accounted for as asset acquisitions and the purchase price was allocated to the assets acquired based on their
relative fair value.
Auditing the Operating Partnership’s accounting for its storage facility acquisitions in 2022 involved a high degree
of subjectivity due to the significant estimation required to determine the fair values of the acquired land and
buildings. In particular, the fair value estimates were sensitive to assumptions such as prices per acre and current
replacement cost estimates, including adjustments for the age, condition, turnkey factor, economic profit, and
economic obsolescence associated with the acquired facilities.
34
How We Addressed
We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the
the Matter in Our
Operating Partnership’s storage facility acquisition process. This included testing controls over management’s
Audit
evaluation of the significant assumptions used to determine the fair values of the assets acquired.
For the 2022 acquisitions of storage facilities described above, our audit procedures included, among others,
evaluating the Operating Partnership’s valuation methodologies and testing the significant assumptions used to
determine the fair value of the assets acquired. We tested the completeness and accuracy of the underlying data by,
among other things, recalculating the current replacement cost of buildings and comparing the adjustments for the
age, condition, turnkey factor, economic profit, and economic obsolescence associated with the acquired assets to
industry publications on a test basis. We also compared significant assumptions, including prices per acre, to third-
party sources such as recent land sales. For certain of these asset acquisitions, we involved our valuation specialists to
assist in the assessment of the methodology utilized by the Operating Partnership, in addition to performing
corroborative analyses to assess whether the conclusions in the valuation were supported by observable market data.
For example, our valuation specialists used independently identified data sources to evaluate management's selected
comparable land sales, replacement cost assumptions and the fair value of individual storage facilities acquired in
portfolio acquisitions.
/s/ Ernst & Young LLP
We have served as the Operating Partnership’s auditor since 2016.
Buffalo, New York
February 24, 2023
35
LIFE STORAGE, INC.
CONSOLIDATED BALANCE SHEETS
December 31,
(dollars in thousands, except share data)
Assets
Investment in storage facilities:
Land
$
1,307,425
$
1,185,976
Building, equipment, and construction in progress
6,864,381
5,904,481
8,171,806
7,090,457
Less: accumulated depreciation
(1,170,520)
(1,007,650)
Investment in storage facilities, net
7,001,286
6,082,807
Cash and cash equivalents
24,406
171,865
Accounts receivable
24,153
17,784
Receivable from unconsolidated joint ventures
1,562
333
Investment in unconsolidated joint ventures
275,190
213,003
Prepaid expenses
10,363
9,918
Trade name
16,500
16,500
Other assets
34,270
44,387
Total Assets
$
7,387,730
$
6,556,597
Liabilities
Line of credit
$
595,000
$
—
Term notes, net
2,751,632
2,747,838
Accounts payable and accrued liabilities
148,130
131,778
Deferred revenue
33,192
27,277
Mortgages payable
36,258
37,030
Total Liabilities
Noncontrolling redeemable Preferred Operating Partnership Units at redemption value
Noncontrolling redeemable Common Operating Partnership Units (see Note 2)
107,074
142,892
Shareholders’ Equity
Common stock $.01 par value, 200,000,000 shares authorized, 85,019,884 shares outstanding
at December 31, 2022 (83,565,710 at December 31, 2021)
850
836
Additional paid-in capital
3,886,317
3,697,000
Dividends in excess of net income
(261,510)
(314,713)
Accumulated other comprehensive loss
(3,207)
(4,124)
Total Shareholders’ Equity
3,622,450
3,378,999
Noncontrolling interest in consolidated subsidiary
4,917
—
Total Equity
3,627,367
3,378,999
Total Liabilities and Equity
$
7,387,730
$
6,556,597
See notes to consolidated financial statements.
2022
2021
3,564,212
2,943,923
89,077
90,783
36
—
)
)
)
—
—
—
LIFE STORAGE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
2022
2021
2020
Year Ended December 31,
(dollars in thousands, except per share data)
Revenues
Rental income
$
917,143
$
690,758
$
539,554
Tenant reinsurance
73,805
58,103
44,742
Other operating income
47,218
39,704
32,475
Total operating revenues
1,038,166
788,565
616,771
Expenses
Property operations and maintenance
179,760
143,648
122,544
Tenant reinsurance
29,280
22,882
15,729
Real estate taxes
99,710
79,861
70,302
General and administrative
77,201
62,617
52,055
Depreciation and amortization
192,902
147,119
122,925
Total operating expenses
578,853
456,127
383,555
Gain on sale of non-real estate assets
5,550
—
—
Gain on sale of real estate
—
—
302
Income from operations
464,863
332,438
233,518
Other income (expenses)
Interest expense
Interest income
(109,240)
(86,786)
(86,015
32
827
19
Gain on sale of investments in joint ventures
1,572
—
—
Equity in income of joint ventures
9,235
5,696
4,838
Net income
366,462
252,175
152,360
Net income attributable to noncontrolling preferred interests in the Operating
Partnership
(4,331)
(1,364)
(789
(4,001)
(1,494)
—
Net income attributable to noncontrolling common interests in the Operating
Partnership
Net income attributable to noncontrolling interests in consolidated subsidiary
(2)
—
—
Net income attributable to common shareholders
$
358,128
$
249,317
$
151,571
Earnings per common share attributable to common shareholders - basic
$
4.25
$
3.18
$
2.13
Earnings per common share attributable to common shareholders - diluted
$
4.22
$
3.17
$
2.13
See notes to consolidated financial statements.
37
)
917
LIFE STORAGE, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Year Ended December 31,
(dollars in thousands)
2022
2021
2020
Net income
$
366,462
$
252,175
$
152,360
Other comprehensive income:
Effective portion of gain on derivatives net of reclassification to interest
expense
917
917
Total comprehensive income
Comprehensive income attributable to noncontrolling interests in the Operating
Partnership
Comprehensive income attributable to common shareholders
$
367,379
(8,343)
359,036
$
253,092
(2,863)
250,229
$
153,277
(794)
152,483
See notes to consolidated financial statements.
38
(48)
(48)
(314,713)
(4,124)
(4,000)
(1)
(192)
(192)
$
(261,510) $
(3,207)
LIFE STORAGE, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
—
—
—
(202,357)
—
(202,357)
(238,338)
(5,958)
(1)
(2,884)
(2,884)
Accumulated
Other
(dollars in thousands, except share data)
Common
Stock
Shares
Common
Stock
Additional
Paid-in
Capital
Dividends in
Excess of
Net Income
Comprehensive
Income (Loss)
(AOCL)
Total
Shareholders’
Equity
Balance January 1, 2020
70,013,899
$
467
$ 2,376,723
$
$
$
2,132,894
Net proceeds from issuance of common stock
4,091,666
27
295,935
—
—
295,962
Issuance of non-vested stock
113,829
1
—
—
—
Forfeiture of non-vested stock
(7,474)
—
—
—
—
—
Earned portion of non-vested stock
—
—
4,559
—
—
4,559
Carrying value less than redemption value on redeemed
noncontrolling interest
—
—
(264)
—
—
(264)
Adjustment to redemption value of noncontrolling
redeemable Operating Partnership Units
—
—
—
—
Purchases of equity in consolidated subsidiary from
noncontrolling interests
—
—
(5,641)
3,341
—
(2,300)
Net income attributable to common shareholders
—
—
—
151,571
—
151,571
Amortization of terminated hedge included in AOCL
—
—
—
—
917
917
Dividends
Balance December 31, 2020
74,211,920
495
2,671,311
(288,667)
(5,041)
2,378,098
Net proceeds from issuance of common stock
9,244,736
88
1,019,269
—
—
1,019,357
Issuance of non-vested stock
109,112
1
(1)
—
—
—
Earned portion of non-vested stock
—
—
6,604
—
—
6,604
Stock dividend
(58)
252
(252)
—
—
—
Carrying value less than redemption value on redeemed
noncontrolling interest
—
—
—
—
Adjustment to redemption value of noncontrolling
redeemable Operating Partnership Units
—
—
—
(34,163)
—
(34,163)
Deferred compensation - Directors
—
—
117
—
—
117
Net income attributable to common shareholders
—
—
—
249,317
—
249,317
Amortization of terminated hedge included in AOCL
—
—
—
—
917
917
Dividends
—
—
—
(241,200)
—
(241,200)
Balance December 31, 2021
83,565,710
836
3,697,000
3,378,999
Net proceeds from issuance of common stock
1,360,544
13
180,787
—
—
180,800
Exercise of stock options
5,250
1
173
—
—
174
Issuance of non-vested stock
92,380
1
(1)
—
—
—
Forfeiture of non-vested stock
1
—
—
—
Earned portion of non-vested stock
—
—
8,432
—
—
8,432
Carrying value less than redemption value on redeemed
noncontrolling interest
—
—
—
—
Adjustment to redemption value of noncontrolling
redeemable Operating Partnership Units
—
—
—
46,006
—
46,006
Deferred compensation - Directors
—
—
117
—
—
117
Net income attributable to common shareholders
—
—
—
358,128
—
358,128
Amortization of terminated hedge included in AOCL
—
—
—
—
917
917
Dividends
—
—
—
(350,931)
—
(350,931)
Balance December 31, 2022
85,019,884
$
850
$ 3,886,317
$
3,622,450
See notes to consolidated financial statements.
39
286
5,730
4,513
4,096
LIFE STORAGE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
2022
2021
2020
Year Ended December 31,
(dollars in thousands)
Operating Activities
Net income
$
366,462
$
252,175
$
152,360
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
192,902
147,119
122,925
Amortization of debt issuance costs and bond discount
Gain on sale of real estate
—
—
(302)
Equity in income of joint ventures
(9,235)
(5,696)
(4,838)
Distributions from unconsolidated joint ventures
17,628
13,866
14,098
Non-vested stock earned
Other
(7,134)
(73)
Changes in assets and liabilities (excluding the effects of acquisitions):
Accounts receivable
(445)
(1,569)
(247)
(6,310)
(2,140)
(2,915)
Prepaid expenses
(Advances to) receipts from joint ventures
(1,229)
731
(95)
Accounts payable and other liabilities
17,332
13,888
4,787
Deferred revenue
2,725
4,483
4,252
Net cash provided by operating activities
586,858
433,901
298,966
Investing Activities
Acquisition of storage facilities, net of cash and restricted cash acquired
Improvements, equipment additions, and construction in progress
(953,464)
(1,514,684)
(520,943)
(100,401)
(85,080)
(56,397)
Proceeds from sale of non-real estate assets
9,084
—
—
Return of investment in unconsolidated joint ventures
5,060
37,584
28,008
Gain on sale of investments in unconsolidated joint ventures
1,572
—
—
Investment in unconsolidated joint ventures
(105,884)
(113,465)
(35,850)
(26,383)
Loans to unconsolidated joint ventures
—
—
Loan payments received from unconsolidated joint ventures
—
—
35,850
Property deposits
3,785
(5,089)
(280)
Net cash used in investing activities
Financing Activities
Net proceeds from sale of common stock
180,974
1,019,357
295,962
Proceeds from line of credit
1,247,000
459,000
285,000
Repayment of line of credit
(652,000)
(459,000)
(350,000)
Proceeds from term notes, net of discount
—
594,498
398,096
Repayment of term notes
Debt issuance costs
Dividends paid - common stock
(8,190)
(1,751)
(1,047)
(350,931)
(241,200)
(202,357)
Distributions to noncontrolling interest holders
Payments to acquire equity in consolidated subsidiary from noncontrolling
interests
—
—
(3,849)
(805)
(2,751)
(2,000)
Redemption of operating partnership units
Mortgage principal payments
(514)
(489)
(3,169)
Net cash provided by financing activities
406,417
1,364,496
314,244
Net increase in cash and restricted cash
Cash and restricted cash at beginning of period
Cash and restricted cash at end of period
Supplemental cash flow information
Cash paid for interest, net of interest capitalized
$
104,504
$
81,421
$
79,423
Cash paid for income taxes, net of refunds
$
3,495
$
1,727
$
1,294
See notes to consolidated financial statements.
8,432
6,604
4,559
(1,140,248)
(1,680,734)
(575,995)
—
—
(100,000)
(6,073)
(5,114)
(3,490)
(146,973)
117,663
37,215
176,434
58,771
21,556
$
29,461
$
176,434
$
58,771
40
333
LIFE STORAGE LP
CONSOLIDATED BALANCE SHEETS
2022
2021
December 31,
(dollars in thousands, except unit data)
Assets
Investment in storage facilities:
Land
$
1,307,425
$
1,185,976
Building, equipment, and construction in progress
6,864,381
5,904,481
8,171,806
7,090,457
Less: accumulated depreciation
(1,170,520)
(1,007,650)
Investment in storage facilities, net
7,001,286
6,082,807
Cash and cash equivalents
24,406
171,865
Accounts receivable
24,153
17,784
Receivable from unconsolidated joint ventures
1,562
Investment in unconsolidated joint ventures
275,190
213,003
Prepaid expenses
10,363
9,918
Trade name
16,500
16,500
Other assets
34,270
44,387
Total Assets
$
7,387,730
$
6,556,597
Liabilities
Line of credit
$
595,000
$
—
Term notes, net
2,751,632
2,747,838
Accounts payable and accrued liabilities
148,130
131,778
Deferred revenue
33,192
27,277
Mortgages payable
36,258
37,030
Total Liabilities
3,564,212
2,943,923
Limited partners’ preferred redeemable capital interest at redemption value (3,523,113 and
3,590,603 units outstanding at December 31, 2022 and December 31, 2021, respectively)
89,077
90,783
Limited partners’ common redeemable capital interest (see Note 2) (1,041,260 and
960,708 units outstanding at December 31, 2022 and December 31, 2021, respectively)
Partners’ Capital
General partner (893,360 and 881,030 units outstanding at December 31, 2022
and December 31, 2021, respectively)
38,247
36,131
Limited partner (84,126,524 and 82,684,680 units outstanding at December 31, 2022
and December 31, 2021, respectively)
3,587,410
3,346,992
Accumulated other comprehensive loss
(3,207)
(4,124)
Total Controlling Partners’ Capital
3,622,450
3,378,999
Noncontrolling interest in consolidated subsidiary
4,917
—
Total Partners' Capital
3,627,367
3,378,999
Total Liabilities and Partners’ Capital
$
7,387,730
$
6,556,597
See notes to consolidated financial statements.
107,074
142,892
41
2022
2021
2020
LIFE STORAGE LP
CONSOLIDATED STATEMENTS OF OPERATIONS
Year Ended December 31,
(dollars in thousands, except per unit data)
Revenues
Rental income
$
917,143
$
690,758
$
539,554
Tenant reinsurance
73,805
58,103
44,742
Other operating income
47,218
39,704
32,475
Total operating revenues
1,038,166
788,565
616,771
Expenses
Property operations and maintenance
179,760
143,648
122,544
Tenant reinsurance
29,280
22,882
15,729
Real estate taxes
99,710
79,861
70,302
General and administrative
77,201
62,617
52,055
Depreciation and amortization
192,902
147,119
122,925
Total operating expenses
578,853
456,127
383,555
Gain on sale of non-real estate assets
5,550
—
—
Gain on sale of real estate
—
—
302
Income from operations
464,863
332,438
233,518
Other income (expenses)
Interest expense
Interest income
(109,240)
(86,786)
(86,015)
32
827
19
Gain on sale of investments in joint ventures
1,572
—
—
Equity in income of joint ventures
9,235
5,696
4,838
Net income
366,462
252,175
152,360
Net income attributable to noncontrolling preferred interests in the Operating
Partnership
(4,331)
(1,364)
(789)
(4,001)
(1,494)
—
Net income attributable to noncontrolling common interests in the Operating
Partnership
Net income attributable to noncontrolling interests in consolidated subsidiary
(2)
—
—
Net income attributable to common unitholders
$
358,128
$
249,317
$
151,571
Earnings per common unit attributable to common unitholders - basic
$
4.25
$
3.18
$
2.13
Earnings per common unit attributable to common unitholders - diluted
$
4.22
$
3.17
$
2.13
Net income attributable to general partner
$
3,665
$
2,522
$
1,524
Net income attributable to limited partners
$
354,463
$
246,795
$
150,047
See notes to consolidated financial statements.
42
917
LIFE STORAGE LP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Year Ended December 31,
(dollars in thousands)
2022
2021
2020
Net income
$
366,462
$
252,175
$
152,360
Other comprehensive income:
Effective portion of gain on derivatives net of reclassification
to interest expense
)
917
917
Total comprehensive income
Comprehensive income attributable to noncontrolling interests
in the Operating Partnership
Comprehensive income attributable to common unitholders
$
367,379
(8,343)
359,036
$
253,092
(2,863
250,229
$
153,277
(794)
152,483
See notes to consolidated financial statements.
43
(22)
(170)
—
Balance January 1, 2020
$
21,594
$
2,117,258
$
(5,958) $
2,132,894
Net proceeds from issuance of Operating Partnership Units
2,960
293,002
—
295,962
Issuance of non-vested stock
—
—
—
—
Forfeiture of non-vested stock
—
—
—
—
Earned portion of non-vested stock
46
4,513
—
4,559
Carrying value less than redemption value on redeemed
noncontrolling interest
(28)
(2,884)
(236)
—
(2,884)
(264)
Adjustment to redemption value of noncontrolling redeemable
Operating Partnership Units
—
—
Purchases of equity in consolidated subsidiary from
noncontrolling interests
(23)
(2,277)
—
(2,300)
Net income attributable to common unitholders
1,521
150,050
—
151,571
Amortization of terminated hedge included in AOCL
9
(9)
917
917
Distributions
Balance December 31, 2020
24,045
2,359,094
(5,041)
2,378,098
Net proceeds from issuance of Operating Partnership Units
10,194
1,009,163
—
1,019,357
Issuance of non-vested stock
—
—
—
—
Earned portion of non-vested stock
66
6,538
—
6,604
Issuance of common Operating Partnership Units
829
(898)
(829)
—
—
Issuance of preferred Operating Partnership Units
898
—
—
Carrying value less than redemption value on redeemed
noncontrolling interest
(8)
(34,163)
(40)
—
(34,163)
(48)
Adjustment to redemption value of noncontrolling redeemable
Operating Partnership Units
—
—
Deferred compensation - Directors
1
116
—
117
Net income attributable to common unitholders
2,522
246,795
—
249,317
Amortization of terminated hedge included in AOCL
Distributions
Balance December 31, 2021
36,132
3,346,991
(4,124)
3,378,999
Net proceeds from issuance of Operating Partnership Units
1,807
178,993
—
180,800
Exercise of stock options
3
171
—
174
Issuance of non-vested stock
—
—
—
—
Forfeiture of non-vested stock
—
—
—
—
Earned portion of non-vested stock
84
8,348
—
8,432
Issuance of common Operating Partnership Units
120
(120)
—
—
Carrying value less than redemption value on redeemed
noncontrolling interest
(192)
Adjustment to redemption value of noncontrolling redeemable
Operating Partnership Units
—
46,006
—
46,006
Deferred compensation - Directors
1
116
—
(9)
117
Net income attributable to common unitholders
3,665
354,463
—
358,128
Amortization of terminated hedge included in AOCL
9
917
917
Distributions
(3,552)
(347,379)
—
(350,931)
Balance December 31, 2022
$
38,247
$
3,587,410
$
$
3,622,450
(3,207)
See notes to consolidated financial statements.
(2,034)
(200,323)
—
(202,357)
9
(9)
917
917
(2,424)
(238,776)
—
(241,200)
LIFE STORAGE LP
CONSOLIDATED STATEMENTS OF PARTNERS’ CAPITAL
Life Storage
Holdings, Inc.
Life Storage, Inc.
General
Limited
(dollars in thousands)
Partner
Partner
Accumulated
Other
Comprehensive
Income (Loss)
Total
Controlling
Partners’
Capital
44
(dollars in thousands)
Life Storage
Holdings, Inc.
General
Partner
Life Storage, Inc.
Limited
Partner
Accumulated
Other
Comprehensive
Income (Loss)
Total
Controlling
Partners’
Capital
Balance January 1, 2020
$
21,594
$
2,117,258
$
(5,958)
$
2,132,894
Net proceeds from issuance of Operating Partnership Units
2,960
293,002
—
295,962
Issuance of non-vested stock
—
—
—
—
Forfeiture of non-vested stock
—
—
—
—
Earned portion of non-vested stock
46
4,513
—
4,559
Carrying value less than redemption value on redeemed
noncontrolling interest
(28)
(236)
—
(264)
Adjustment to redemption value of noncontrolling redeemable
Operating Partnership Units
—
(2,884)
—
(2,884)
Purchases of equity in consolidated subsidiary from
noncontrolling interests
(23)
(2,277)
—
(2,300)
Net income attributable to common unitholders
1,521
150,050
—
151,571
Amortization of terminated hedge included in AOCL
9
(9)
917
917
Distributions
(2,034)
(200,323)
—
(202,357)
Balance December 31, 2020
24,045
2,359,094
(5,041)
2,378,098
Net proceeds from issuance of Operating Partnership Units
10,194
1,009,163
—
1,019,357
Issuance of non-vested stock
—
—
—
—
Earned portion of non-vested stock
66
6,538
—
6,604
Issuance of common Operating Partnership Units
829
(829)
—
—
Issuance of preferred Operating Partnership Units
898
(898)
—
—
Carrying value less than redemption value on redeemed
noncontrolling interest
(8)
(40)
—
(48)
Adjustment to redemption value of noncontrolling redeemable
Operating Partnership Units
—
(34,163)
—
(34,163)
Deferred compensation - Directors
1
116
—
117
Net income attributable to common unitholders
2,522
246,795
—
249,317
Amortization of terminated hedge included in AOCL
9
(9)
917
917
Distributions
(2,424)
(238,776)
—
(241,200)
Balance December 31, 2021
36,132
3,346,991
(4,124)
3,378,999
Net proceeds from issuance of Operating Partnership Units
1,807
178,993
—
180,800
Exercise of stock options
3
171
—
174
Issuance of non-vested stock
—
—
—
—
Forfeiture of non-vested stock
—
—
—
—
Earned portion of non-vested stock
84
8,348
—
8,432
Issuance of common Operating Partnership Units
120
(120)
—
—
Carrying value less than redemption value on redeemed
noncontrolling interest
(22)
(170)
—
(192)
Adjustment to redemption value of noncontrolling redeemable
Operating Partnership Units
—
46,006
—
46,006
Deferred compensation - Directors
1
116
—
117
Net income attributable to common unitholders
3,665
354,463
—
358,128
Amortization of terminated hedge included in AOCL
9
(9)
917
917
Distributions
(3,552)
(347,379)
—
(350,931)
Balance December 31, 2022
$
38,247
$
3,587,410
$
(3,207)
$
3,622,450
See notes to consolidated financial statements.
44
286
5,730
4,513
4,096
LIFE STORAGE LP
CONSOLIDATED STATEMENTS OF CASH FLOWS
2022
2021
2020
Year Ended December 31,
(dollars in thousands)
Operating Activities
Net income
$
366,462
$
252,175
$
152,360
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
192,902
147,119
122,925
Amortization of debt issuance costs and bond discount
Gain on sale of real estate
—
—
(302)
Equity in income of joint ventures
(9,235)
(5,696)
(4,838)
Distributions from unconsolidated joint ventures
17,628
13,866
14,098
Non-vested stock earned
Other
(7,134)
(73)
Changes in assets and liabilities (excluding the effects of acquisitions):
Accounts receivable
(445)
(1,569)
(247)
(6,310)
(2,140)
(2,915)
Prepaid expenses
(Advances to) receipts from joint ventures
(1,229)
731
(95)
Accounts payable and other liabilities
17,332
13,888
4,787
Deferred revenue
2,725
4,483
4,252
Net cash provided by operating activities
586,858
433,901
298,966
Investing Activities
Acquisition of storage facilities, net of cash and restricted cash acquired
Improvements, equipment additions, and construction in progress
(953,464)
(1,514,684)
(520,943)
(100,401)
(85,080)
(56,397)
Proceeds from sale of non-real estate assets
9,084
—
—
Return of investment in unconsolidated joint ventures
5,060
37,584
28,008
Gain on sale of investments in unconsolidated joint ventures
1,572
—
—
Investment in unconsolidated joint ventures
(105,884)
(113,465)
(35,850)
(26,383)
Loans to unconsolidated joint ventures
—
—
Loan payments received from unconsolidated joint ventures
—
—
35,850
Property deposits
3,785
(5,089)
(280)
Net cash used in investing activities
Financing Activities
Net proceeds from sale of partnership units
180,974
1,019,357
295,962
Proceeds from line of credit
1,247,000
459,000
285,000
Repayment of line of credit
(652,000)
(459,000)
(350,000)
Proceeds from term notes, net of discount
—
594,498
398,096
Repayment of term notes
Debt issuance costs
Distributions to unitholders
(8,190)
(1,751)
(1,047)
(350,931)
(241,200)
(202,357)
Distributions to noncontrolling interest holders
Payments to acquire equity in consolidated subsidiary from noncontrolling
interests
—
—
(3,849)
(805)
(2,751)
(2,000)
Redemption of operating partnership units
Mortgage principal payments
(514)
(489)
(3,169)
Net cash provided by financing activities
406,417
1,364,496
314,244
Net increase in cash and restricted cash
Cash and restricted cash at beginning of period
Cash and restricted cash at end of period
Supplemental cash flow information
Cash paid for interest, net of interest capitalized
$
104,504
$
81,421
$
79,423
Cash paid for income taxes, net of refunds
$
3,495
$
1,727
$
1,294
See notes to consolidated financial statements.
8,432
6,604
4,559
(1,140,248)
(1,680,734)
(575,995)
—
—
(100,000)
(6,073)
(5,114)
(3,490)
(146,973)
117,663
37,215
176,434
58,771
21,556
$
29,461
$
176,434
$
58,771
45
LIFE STORAGE, INC. AND LIFE STORAGE LP
DECEMBER 31, 2022
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. ORGANIZATION
The Parent Company, which operates as a self-administered and self-managed real estate investment trust (a “REIT”), was formed on
April 19, 1995 to own and operate self-storage facilities throughout the United States. On June 26, 1995, the Parent Company commenced
operations effective with the completion of its initial public offering. The Parent Company, the Operating Partnership and their consolidated
subsidiaries are collectively referred to in this report as the “Company.” In addition, terms such as “we,” “us,” or “our” used in this report may
refer to the Company, the Parent Company and/or the Operating Partnership.
At December 31, 2022, we had an ownership interest in, and/or managed 1,198 self-storage properties in 37 states and the District of
Columbia. Among our 1,198 self-storage properties are 141 properties that we manage for unconsolidated joint ventures (See Note 11), 299
properties that we manage and have no ownership interest, and five properties that we lease. During 2022, approximately 16% and 15% of the
Company’s revenue was derived from stores in the states of Texas and Florida, respectively.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation : All of the Company’s assets are owned by, and all of its operations are conducted through, the Operating
Partnership. Life Storage Holdings, Inc. (“Holdings”), a wholly-owned subsidiary of the Parent Company, is the sole general partner of the
Operating Partnership; the Parent Company is a limited partner of the Operating Partnership, and, through its ownership of Holdings and its
limited partnership interest, controls the operations of the Operating Partnership, holding a 97.9% ownership interest therein as of
December 31, 2022. The remaining ownership interests in the Operating Partnership (the “Units”) are held by certain former owners of assets
acquired by the Operating Partnership. Share and per share amounts and unit and per unit amounts for all years presented have been adjusted to
reflect the impact of the three-for-two distribution of common stock announced by the Company on January 4, 2021 and distributed on January
27, 2021 to shareholders and unitholders of record on January 15, 2021.
We consolidate all wholly owned subsidiaries. Partially owned subsidiaries and joint ventures are consolidated when we control the
entity. Our consolidated financial statements include the accounts of the Parent Company, the Operating Partnership, Life Storage Solutions,
LLC (one of the Parent Company’s taxable REIT subsidiaries), Warehouse Anywhere LLC, and all other wholly-owned subsidiaries. Also
included in our consolidated financial statements is one joint venture of which we own 83% of the equity and are the primary beneficiary of the
joint venture. All intercompany transactions and balances have been eliminated. Investments in joint ventures that we do not control but for
which we have significant influence over are accounted for using the equity method.
Included in the Parent Company’s consolidated balance sheets are noncontrolling redeemable Operating Partnership Units and included
in the Operating Partnership’s consolidated balance sheets are limited partners’ redeemable capital interests at redemption value. These
interests are presented in the “mezzanine” section of the consolidated balance sheets because they do not meet the functional definition of a
liability or equity under current accounting literature. These represent the outside ownership interests of the limited partners in the Operating
Partnership. There were 1,041,260 and 960,708 common noncontrolling redeemable Operating Partnership Units outstanding at December 31,
2022 and December 31, 2021, respectively, and 3,523,113 and 3,590,603 preferred noncontrolling redeemable Operating Partnership Units
outstanding at December 31, 2022 and December 31, 2021, respectively. The preferred noncontrolling redeemable Operating Partnership Units
rank senior to all other partnership interests with respect to distributions and liquidation.
The common unitholders are entitled to receive distributions per unit equivalent to the dividends declared per share on the Parent
Company’s common stock. The preferred unitholders are entitled to receive a fixed priority return of 4.5% and the preferred noncontrolling
redeemable Operating Partnership Units are convertible at the option of the unitholders into common noncontrolling redeemable Operating
Partnership Units. Upon any such conversion, each preferred noncontrolling redeemable Operating Partnership Unit being converted shall be
convertible into a number of common Operating Partnership Units equal to the quotient of (i) the stated value of the preferred noncontrolling
redeemable Operating Partnership Units being converted (such stated value being $25.00 per preferred noncontrolling redeemable Operating
Partnership Unit) plus any accrued and unpaid distributions, divided by (ii) the average closing price of the Parent Company's common stock
over the 90 consecutive trading days ending the trading day preceding the date of conversion. The Operating Partnership is obligated to redeem
each of the common noncontrolling redeemable Operating Partnership Units at the request of the holder thereof for cash equal to the fair
market value of a share of the Parent Company’s common stock based on a 10-day average of the daily market price, at the time of such
redemption, provided that the Company, at its option, may elect to acquire any such Unit presented for redemption for one common share or
cash.
The Company accounts for the noncontrolling redeemable Operating Partnership Units under the provisions of Accounting Standards
Codification (ASC) Topic 480-10-S99. The application of the ASC Topic 480-10-S99 accounting model requires the noncontrolling interest to
follow normal noncontrolling interest accounting and then be marked to redemption value at the end of each reporting period if higher (but
never adjusted below that normal noncontrolling interest accounting amount) for the common noncontrolling redeemable Operating Partnership
Units. The offset to the adjustment to the carrying amount of the common noncontrolling redeemable Operating Partnership Units is reflected
46
in the Parent Company’s dividends in excess of net income and in the Operating Partnership’s general partner and limited partners capital
balances. The value of common noncontrolling redeemable Operating Partnership Units at December 31, 2021 is equal to the number of
common noncontrolling interest units outstanding multiplied by the fair market value of the Parent Company’s common stock at that date.
Redemption value exceeded the value determined under the Company’s historical basis of accounting at December 31, 2021. The redemption
value of the common noncontrolling redeemable Operating Partnership Units was less than the normal noncontrolling interest amount at
December 31, 2022. Accordingly, in the accompanying consolidated balance sheets, common noncontrolling redeemable Operating Partnership
Units are reflected at the normal noncontrolling interest accounting amount at December 31, 2022 and at redemption value at December 31,
2021.
ASC Topic 480-10-S99 requires the preferred noncontrolling redeemable Operating Partnership Units to be valued at fair value as of the
date of issuance and to continue to be recorded at the value determined at initial measurement plus any accrued distributions.
The following is a reconciliation of the Parent Company’s common noncontrolling redeemable Operating Partnership Units and the
Operating Partnership’s limited partners’ redeemable capital interest for the years ending December 31:
(dollars in thousands)
2022
2021
Beginning balance
$
142,892
$
26,446
Redemption of units
(1,970)
(757)
Issuance of units
11,997
82,951
Net income attributable to noncontrolling interests in the
Operating Partnership
4,331
1,364
Distributions
(4,170)
(1,275)
Adjustment to redemption value
(46,006)
34,163
Ending balance
$
107,074
$
142,892
In 2022 and 2021, the Operating Partnership issued a total of 82,552 and 633,559, respectively, common noncontrolling redeemable
Operating Partnership Units with aggregate fair values of $10.3 million and $83.0 million, respectively, as part of the consideration paid to
acquire certain self-storage facilities. The fair value of these common Operating Partnership Units on the date of issuance was determined
based upon the average fair market value of the Company's common stock for the fifteen consecutive trading days preceding that date.
Additionally during 2022, 67,490 preferred noncontrolling redeemable Operating Partnership Units were converted to 13,958 common
redeemable Operating Partnership Units with an aggregate fair value of $1.7 million. The fair value of these common Operating Partnership
Units on the date of issuance was determined based upon the average fair market value of the Company’s common stock for the ten
consecutive trading days preceding that date.
In 2022 and 2021, 15,958 and 7,000 common noncontrolling redeemable Operating Partnership Units, respectively, were redeemed for
cash.
The following is a reconciliation of the Parent Company's preferred noncontrolling redeemable Operating Partnership Units and the
Operating Partnership's limited partners' preferred redeemable capital interest for the years ending December 31:
(dollars in thousands)
2022
2021
Beginning balance
$
90,783
$
—
Redemption of units
(4,020)
(476)
(1,687)
—
Issuance of units
—
89,765
Net income attributable to noncontrolling interests in the
Operating Partnership
4,001
1,494
Distributions
Ending balance
$
89,077
$
90,783
On August 19, 2021, the Company issued 3,590,603 preferred redeemable Operating Partnership Units with a fair value of $89.8 million
in connection with the acquisition of certain self-storage facilities. The fair value of these preferred Units on the date of issuance was
determined based upon the fixed priority return on these preferred Units of 4.5% as compared to the estimated market return of similar
instruments on the date of issuance.
In 2022, 67,490 preferred noncontrolling redeemable Operating Partnership Units were converted to 13,958 common redeemable
Operating Partnership Units with an aggregate fair value of $1.7 million, as discussed above. The conversion rate was determined based upon
the average fair market value of the Company's common stock for the 90 consecutive trading days preceding the conversion date. No preferred
noncontrolling redeemable Operating Partnership Units were issued by the Operating Partnership in 2022.
Cash, Cash Equivalents, and Restricted Cash : The Company considers all highly liquid investments purchased with maturities of three
months or less to be cash equivalents. Restricted cash represents those amounts required to be placed in escrow by banks with whom the
Company has entered into mortgages and amounts required to be placed into escrow related the Company’s tenant reinsurance program.
Restricted cash is included in other assets in the consolidated balance sheets.
47
The following table provides a reconciliation of cash and restricted cash reported within the consolidated statements of cash flows for the
years ending December 31:
(dollars in thousands)
2022
2021
2020
Cash
Restricted cash
$
24,406
5,055
$
171,865
4,569
$
54,400
4,371
Total cash and restricted cash
$
29,461
$
176,434
$
58,771
Accounts Receivable : Accounts receivable are composed of trade and other receivables recorded at billed amounts and do not bear
interest. The allowance for doubtful accounts on leasing receivables is the Company’s best estimate of the amount of probable uncollectible
amounts in the Company’s existing accounts receivable. In accordance with ASU 2016-13, "Financial Instruments - Credit Losses (Topic
326)," the allowance for doubtful accounts on non-leasing receivables is the Company's best estimate of the amount that will ultimately not be
collected at the time that revenue is recognized. The Company determines these allowances based on a number of factors, including experience,
credit worthiness of customers, and current market and economic conditions. The Company reviews the allowance for doubtful accounts on a
regular basis. Account balances are charged against the allowance after all means of collection have been exhausted and the potential for
recovery is considered remote. The allowance for doubtful accounts is recorded as a reduction of accounts receivable and amounted to $1.2
million and $1.5 million at December 31, 2022 and 2021, respectively. ASU 2016-13 is not applicable to the Company's leasing receivables.
Revenue and Expense Recognition : ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” requires an entity to
recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to
which the entity expects to be entitled to in exchange for those goods or services. Payment from the Company’s revenue streams is due and
generally collected upon invoice.
Leases are specifically excluded from the scope of ASU 2014-09 and instead are accounted for following the guidance under ASU 2016
20. Rental income is recognized when earned pursuant to the terms of month-to-month leases for storage space. Promotional discounts are
recognized as a reduction to rental income over the promotional period, which is generally during the first month of occupancy. Rental income
received prior to the start of the rental period is included in deferred revenue.
Management fee income, which relates to managing self-storage facilities for third-parties and unconsolidated joint ventures, is recorded
over time each month as the related management services are provided. The total amount of consideration under property management
contracts is variable as the Company’s management fee is based on monthly revenues. The Company has elected to apply a practical expedient
provided in ASC 606-10-55-18 which allows the Company to recognize revenue in the amount of management fees to which the Company has
a right to invoice as that amount corresponds directly with the value to the customer of the entity’s performance completed to date.
The Company recognizes tenant reinsurance revenue in the period during which premiums are earned and tenant reinsurance is provided.
Equity in earnings of real estate joint ventures that we have significant influence over is recognized based on our ownership interest in
the earnings of these entities.
The disaggregated revenues of the Company presented in accordance with ASC Topic 606, “Revenue from Contracts with Customers”
are as follows:
(dollars in thousands)
2022
2021
2020
Rental income
$
917,143
$
690,758
$
539,554
Tenant reinsurance
73,805
58,103
44,742
Management and acquisition fee income
27,190
22,127
17,407
Other
20,028
17,577
15,068
Total operating revenues
$ 1,038,166
$
788,565
$
616,771
Other revenue consists primarily of sales of storage-related merchandise (locks and packing supplies) and storage and inventory
management services provided by Warehouse Anywhere.
Cost of operations, general and administrative expense, interest expense and advertising costs are expensed as incurred. For the years
ended December 31, 2022, 2021, and 2020, advertising costs were $21.6 million, $16.9 million, and $15.3 million, respectively. The Company
accrues property taxes based on actual invoices, estimates and historical trends. If these estimates are incorrect, the timing and amount of
expense recognition would be affected. Expenses related to tenant reinsurance are comprised of actual and estimated claims, costs to administer
the Company's tenant reinsurance program, and fees related to tenant reinsurance paid to owners of self-storage facilities that the Company
manages for third-parties.
Investment in Storage Facilities : Storage facilities are recorded at cost. The purchase price of acquired facilities is allocated to land,
land improvements, building, equipment, and in-place customer leases based on the relative fair value of each component, or based on the fair
value of each component if accounted for as a business combination. The fair values of the acquired facilities are determined using financial
projections and applicable capitalization rates. The fair values of land are determined based upon comparable market sales information using
prices per acre derived from observed transactions involving comparable land in similar locations. The fair values of buildings are determined
using current replacement cost estimates based on information derived from construction industry data by geographic region as adjusted for
age, condition, and the turnkey factor, economic profit and economic obsolescence considerations associated with these assets.
48
Depreciation is computed using the straight-line method over estimated useful lives of 40 years for buildings and improvements, and five
to 20 years for furniture, fixtures and equipment. Estimated useful lives are reevaluated when facts and circumstances indicate that the
economic lives of assets do not extend to their currently assigned useful lives. Expenditures for significant renovations or improvements that
extend the useful life of assets are capitalized. Depreciation expense was $172.7 million, $134.8 million and $117.3 million for the years
ending December 31, 2022, 2021, and 2020, respectively. Interest and other costs incurred during the construction period of major expansions,
and on investments in joint ventures with properties under construction, are capitalized. Interest capitalized during the years ended
December 31, 2022, 2021, and 2020 totaled $1.5 million, $0.4 million and $0.4 million, respectively. Repair and maintenance costs are
expensed as incurred.
Whenever events or changes in circumstances indicate that the carrying value of the Company’s property may not be recoverable, the
Company’s policy is to complete an assessment of impairment. Impairment is evaluated based upon comparing the sum of the property’s
expected undiscounted future cash flows to the carrying value of the property. If the sum of the undiscounted cash flows is less than the
carrying amount of the property, an impairment loss is recognized for any amount by which the carrying amount of the asset exceeds the fair
value of the asset. For the years ended December 31, 2022, 2021, and 2020, no assets have been determined to be impaired under this policy.
In general, sales of real estate and non-real estate assets and related profits or losses are recognized when control of the underlying assets
has transferred.
Trade Name : The Company’s trade name, which was acquired in 2016, has an indefinite life and is not amortized but is reviewed for
impairment annually or more frequently when facts and circumstances indicate that the carrying value of the Company’s trade name may not
be recoverable. We may elect to perform a qualitative assessment that considers economic, industry and company-specific factors as part of our
annual test. If, after completing this assessment, it is determined that it is more likely than not that the fair value of the trade name is less than
its carrying value, we proceed to a quantitative test. We did not elect to perform a qualitative assessment in 2022.
Quantitative testing requires a comparison of the fair value of the trade name to its carrying value. We use a discounted cash flow
analysis under the relief-from-royalty method to estimate the fair value of the trade name. This method incorporates various assumptions,
including projected revenue growth rates, the terminal growth rate, the royalty rate to be applied, and the discount rate utilized. If the carrying
value of the trade name exceeds the calculated fair value, the trade name is considered impaired to the extent that the carrying value exceeds
the fair value. We did not record any impairment in 2022.
Other Assets : Included in other assets are restricted cash balances as discussed above, property deposits and the unamortized value
placed on in-place customer leases related to self-storage facilities acquired by the Company. Property deposits at December 31, 2022 and 2021
were $1.9 million and $5.7 million, respectively.
The Company allocates a portion of the purchase price of acquisitions to in-place customer leases. The methodology used to determine
the fair value of in-place customer leases is described in Note 8. The Company amortizes in-place customer leases on a straight-line basis over
12 months (the estimated future benefit period).
Investment in Unconsolidated Joint Ventures : The Company’s investment in unconsolidated joint ventures where the Company has
significant influence but not control, and joint ventures which are variable interest entities in which the Company is not the primary
beneficiary, are recorded under the equity method of accounting in the accompanying consolidated financial statements. Under the equity
method, the Company’s investment in unconsolidated joint ventures is stated at cost, adjusted for the Company’s share of net earnings or
losses, and reduced by distributions. Equity in earnings of unconsolidated joint ventures is generally recognized based on the Company’s
ownership interest in the earnings of each of the unconsolidated joint ventures. For the purposes of presentation in the statement of cash flows,
the Company follows the “look through” approach for classification of distributions from joint ventures. Under this approach, distributions are
reported under operating cash flow unless the facts and circumstances of a specific distribution clearly indicate that it is a return of capital (e.g.,
a liquidating dividend or distribution of the proceeds from the joint venture’s sale of assets), in which case it is reported as an investing activity.
Accounts Payable and Accrued Liabilities : Accounts payable and accrued liabilities consist primarily of trade payables, accrued
interest, property tax accruals, and the Company’s lease liability related to operating leases where the Company is the lessee.
Income Taxes : The Company qualifies as a REIT under the Internal Revenue Code of 1986, as amended, and will generally not be
subject to corporate income taxes to the extent it distributes its taxable income to its shareholders and complies with certain other requirements.
The Company has elected to treat certain of its subsidiaries as taxable REIT subsidiaries. In general, the Company’s taxable REIT
subsidiaries may perform additional services for tenants and generally may engage in certain real estate or non-real estate related business. A
taxable REIT subsidiary is subject to federal and state corporate income taxes. Deferred tax assets and liabilities are determined based on
differences between financial reporting and tax bases of assets and liabilities.
49
The Company recorded federal and state income tax expense of $4.0 million, $1.7 million, and $1.6 million in 2022, 2021, and 2020,
respectively, which is included in general and administrative expenses in the consolidated statements of operations. Included in 2022 income
tax expense is current tax expense of $3.9 million and deferred tax expense of $0.1 million. At December 31, 2022 and 2021, there were no
material unrecognized tax benefits and the Company had no interest or penalties related to uncertain tax provisions during the years then ended.
Interest and penalties relating to uncertain tax positions will be recognized in income tax expense when incurred. Income taxes payable by the
Company and the net deferred tax liabilities of our taxable REIT subsidiaries are classified within accounts payable and accrued liabilities in
the consolidated balance sheets, while prepaid income taxes are classified within prepaid expenses. As of December 31, 2022, the Company’s
taxable REIT subsidiaries have deferred tax assets of $0.5 million and a deferred tax liability of $2.0 million. As of December 31, 2021, the
Company’s taxable REIT subsidiaries have deferred tax assets of $0.4 million and a deferred tax liability of $1.8 million. The tax years 2019
2022 remain open to examination by the major taxing jurisdictions to which the Company is subject.
The Tax Cuts and Jobs Act (the “TCJA”) was enacted on December 20, 2017. The TCJA significantly changed the U.S. federal income
tax laws applicable to businesses and their owners, including REITs and their shareholders. Under the TCJA, the corporate income tax rate is
reduced from a maximum rate of 35% to a flat 21% rate. The reduced corporate income tax rate, which is effective for taxable years beginning
after December 31, 2017, applies to income earned by our taxable REIT subsidiaries.
Leases : The Company leases corporate office space as well as the land and/or buildings in which certain of the Company's self-storage
facilities operate. The Company accounts for these leases under the guidance in ASU 2016-02, “Leases (Topic 842)” (ASC 842) which requires
lessees to recognize a right-of-use asset and a lease liability for virtually all leases (other than leases that meet the definition of a short-term
lease). The lease liability under this guidance is equal to the present value of lease payments and the right-of-use asset is based on the lease
liability, subject to adjustments such as for initial direct costs and prepaid or accrued lease payments. All leases where the Company is the
lessee qualify as operating leases under the guidance in ASC 842. Three of the leases for real estate at which the Company operates self-storage
facilities include unilateral options for the Company to extend the terms of these leases. However, those extension periods are not included in
the terms of the respective leases under ASC 842 due to the Company’s inability to assert that it is reasonably certain to exercise those options
based primarily on the length of time before such options would be exercised. Future lease payments which are based on changes to the
consumer price index and future common area maintenance charges related to leases of corporate office space have been excluded from the
future minimum noncancelable lease payments for the respective leases due to their variable nature.
The Company has made the following accounting policy elections and practical expedient elections provided for in ASC 842:
•
The package of practical expedients in ASC 842-10-65-1(f) which, if elected, stipulates that for all leases existing at the date of
application (1) an entity need not reassess whether any expired or existing contracts contain leases; (2) an entity need not reassess
the lease classification for any expired or existing leases; and (3) an entity need not reassess initial direct costs for any existing
leases.
•
The practical expedient in ASC 842-10-65-1(g) which, if elected, stipulates that an entity may use hindsight at the date of initial
application in determining the lease term and in assessing impairment of the entity’s right to use assets.
•
The practical expedient in ASC 842-10-65-1(gg) which, if elected, stipulates that an entity need not assess whether existing or
expired land easements that were not previously accounted for as leases under ASC 840 are or contain a lease under ASC 842.
•
The practical expedient in ASC 842-10-15-37 which, if elected, allows a lessee to choose not to separate nonlease components
from lease components and instead account for each separate lease component and the nonlease components associated with that
lease component as a single lease component.
•
The practical expedient in ASC 842-10-15-42A which, if elected, allows a lessor to choose not to separate nonlease components
from lease components and, instead, to account for each separate lease component and the nonlease components associated with
that lease component as a single lease component if the nonlease components otherwise would be accounted for under ASC 606,
“Revenue from Contracts with Customers,” and both (1) the timing and pattern of transfer for the lease component and nonlease
component(s) associated with the lease component are the same, and (2) the lease component, if accounted for separately, would be
classified as an operating lease in accordance with ASC 842-10-25 paragraphs 2 and 3.
•
The option in ASC 842-20-25-2 for a lessee to elect, as an accounting policy, not to apply the recognition requirements in ASC 842
to short-term leases and, instead, to recognize the lease payments in profit or loss on a straight-line basis over the lease term and
variable lease payments in the period in which the obligation for those payments is incurred. Leases are considered short-term
when they have a term of less than one year.
•
The Company has elected to define the term “major part,” as referenced in ASC 842-10-25-2 related to the remaining economic
life of an asset, as being 75% or more of the remaining economic life of the asset.
50
•
The Company has elected to define the term “substantially all,” as referenced in ASC 842-10-25-2 related to the fair value of an
asset, as being 90% or more of the fair value of the underlying asset.
•
The Company has elected to define the term “at or near the end,” as referenced in ASC 842-10-25-2 related to a lease
commencement date, as being a date that falls within the last 25% of the total economic life of the underlying asset.
At December 31, 2022 and December 31, 2021, the Company’s aggregate right-of-use assets totaled $17.4 million and $19.5 million,
respectively, and are included in other assets on the consolidated balance sheets. The related lease liabilities total $17.1 million and $19.2
million at December 31, 2022 and December 31, 2021, respectively, and are included in accounts payable and accrued liabilities on the
consolidated balance sheets. Expenses related to operating leases under ASC 842 totaled $2.7 million, $2.5 million, and $2.1 million in 2022,
2021, and 2020, respectively. At December 31, 2022, the weighted average remaining lease term and weighted average discount rate for the
Company’s operating leases were 9.5 years and 4.6%, respectively.
Derivative Financial Instruments : The Company accounts for derivatives in accordance with ASC Topic 815 “Derivatives and
Hedging,” which requires companies to carry all derivatives on the balance sheet at fair value. The Company determines the fair value of
derivatives using an income approach. The accounting for changes in the fair value of a derivative instrument depends on whether it has been
designated and qualifies as part of a hedging relationship and, if so, the reason for holding it. The Company’s use of derivative instruments has
been limited to cash flow hedges of certain interest rate risks.
Recent Accounting Pronouncements : In August 2020, the FASB issued ASU 2020-06, “Debt – Debt with Conversion and Other
Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40: Accounting for Convertible
Instruments and Contracts in an Entity’s Own Equity,” which reduced the number of accounting models for convertible debt instruments and
convertible preferred stock, thus simplifying the accounting for convertible instruments. ASU 2020-06 is effective for annual periods beginning
after December 31, 2021, and interim periods within those annual periods, and is therefore effective for the Company as of January 1, 2022.
Management has evaluated the impact of the adoption of ASU 2020-06 on the Company, including, but not limited to, the accounting for the
Company’s noncontrolling redeemable Operating Partnership Units, and has concluded that the adoption of ASU 2020-06 did not have a
material impact on the Company.
Stock-Based Compensation : The Company accounts for stock-based compensation under the provisions of ASC Topic 718,
“Compensation - Stock Compensation.” The Company recognizes compensation cost in its financial statements for all share-based payments
granted, modified, or settled during the period. For awards with graded vesting, compensation cost is recognized on a straight-line basis over
the related vesting period. Forfeitures are recognized when incurred.
The Company recorded compensation expense (included in general and administrative expense) of $8.4 million, $6.6 million, and $4.6
million, respectively, related to amortization of non-vested stock grants for the years ended December 31, 2022, 2021, and 2020.
In October 2022, the Company announced that then current Chief Financial Officer, Andrew Gregoire, would be retiring effective
January 2, 2023. In conjunction with this announcement, the vesting periods of certain restricted stock awards previously granted to Mr.
Gregoire were accelerated to reflect his January 2, 2023 retirement date. As a result of this change, an additional $1.4 million of compensation
expense was recorded in 2022. In September 2021, the Company announced that then current Chief Operating Officer, Edward Killeen, would
be retiring effective December 31, 2021. In conjunction with this announcement, the vesting periods of certain restricted stock awards
previously granted to Mr. Killeen were accelerated to reflect his December 31, 2021 retirement date. As a result of this change, an additional
$0.6 million of compensation expense was recorded in 2021.
The Company uses the Black-Scholes Merton option pricing model to estimate the fair value of stock options granted subsequent to the
adoption of ASC Topic 718. The application of this pricing model involves assumptions that are judgmental and sensitive in the determination
of compensation expense. To determine expected volatility, the Company uses historical volatility based on daily closing prices of its Common
Stock over periods that correlate with the expected terms of the options granted. The risk-free rate is based on the United States Treasury yield
curve at the time of grant for the expected life of the options granted. Expected dividends are based on the Company’s history and expectation
of dividend payouts. The expected life of stock options is based on the midpoint between the vesting date and the end of the contractual term.
The Company recognizes the impact of any forfeitures as they occur. There were no options granted during the years ended December 31,
2022, 2021 and 2020.
51
During 2022, 2021, and 2020, the Company issued performance based non-vested stock awards to certain executives. The fair values of
the performance-based awards in 2022, 2021 and 2020 were estimated at the time the awards were granted using a Monte Carlo pricing model
applying the following weighted-average assumptions:
2022
2021
2020
Expected life (years)
3.0
3.0
3.0
Risk free interest rate
3.90%
0.93%
0.19%
Expected volatility
Fair value
$
110.50
$
157.61
$
78.00
31.67%
27.75%
28.15%
The Monte Carlo pricing model was not used to value any other non-vested shares granted in 2022, 2021, or 2020 as no market
conditions were present in these awards. The value of these other non-vested shares was equal to the stock price of the Company on the date of
grant.
Use of Estimates : The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires
management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual
results could differ from those estimates.
3. EARNINGS PER SHARE AND EARNINGS PER UNIT
The Company reports earnings per share and earnings per unit data in accordance with ASC Topic 260, “Earnings Per Share.” Under
ASC Topic 260-10, unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents, whether paid
or unpaid, are participating securities and shall be included in the computation of earnings-per-share pursuant to the two-class method. The
Parent Company and the Operating Partnership have calculated their basic and diluted earnings per share/unit using the two-class method.
The following table sets forth the computation of basic and diluted earnings per common share of the Parent Company utilizing the two-
class method.
Year Ended December 31,
(amounts in thousands, except per share data)
2022
2021
2020
Numerator:
Net income attributable to common shareholders
$
358,128
$
249,317
$
151,571
Denominator:
Denominator for basic earnings per share - weighted average
shares
84,322
78,425
71,055
Effect of Dilutive Securities:
Stock options and non-vested stock
562
183
123
Denominator for diluted earnings per share - adjusted weighted
average shares and assumed conversion
84,884
$
$
78,608
$
$
71,178
Basic Earnings per common share attributable to common
shareholders
$
4.25
3.18
2.13
Diluted Earnings per common share attributable to common
shareholders
$
4.22
3.17
2.13
The following table sets forth the computation of basic and diluted earnings per common unit of the Operating Partnership utilizing the
two-class method.
Year Ended December 31,
(amounts in thousands, except per unit data)
2022
2021
2020
Numerator:
Net income attributable to common unitholders
$
358,128
$
249,317
$
151,571
Denominator:
Denominator for basic earnings per unit - weighted average units
84,322
78,425
71,055
Effect of Dilutive Securities:
Stock options and non-vested stock
562
183
123
Denominator for diluted earnings per unit - adjusted weighted
average units and assumed conversion
84,884
$
$
78,608
$
$
71,178
Basic Earnings per common unit attributable to common
unitholders
$
4.25
3.18
2.13
Diluted Earnings per common unit attributable to common
unitholders
$
4.22
3.17
2.13
52
(13,760)
(747)
$
8,171,806
$
7,090,457
$
1,007,650
$
873,178
172,717
134,773
(9,847)
(301)
Not included in the effect of dilutive securities above are 133,481 unvested restricted shares for the year ended December 31, 2022;
133,660 unvested restricted shares for the year ended December 31, 2021; and 159,228 unvested restricted shares for the year ended December
31, 2020. The effects of including these securities would have been anti-dilutive.
4. INVESTMENT IN STORAGE FACILITIES AND INTANGIBLE ASSETS
The following summarizes activity in storage facilities during the years ended December 31, 2022 and December 31, 2021.
(dollars in thousands)
2022
2021
Cost:
Beginning balance
$
7,090,457
$
5,330,323
Acquisition of storage facilities
992,613
1,675,366
Improvements and equipment additions
103,857
(1,361)
59,569
Net (decrease) increase in construction in progress
25,946
Dispositions
Ending balance
Accumulated Depreciation:
Beginning balance
Additions during the year
Dispositions
Ending balance
$
1,170,520
$
1,007,650
The Company acquired 50 self-storage facilities during 2022 and 112 self-storage facilities during 2021. The acquisitions of these
facilities were accounted for as asset acquisitions. The cost of these facilities, including closing costs, was assigned to land, buildings,
equipment, improvements, construction in progress and in-place customer leases based upon their relative fair values. The operating results of
the facilities acquired have been included in the Company’s operations since the respective acquisition dates.
The purchase price of the 50 facilities acquired in 2022 and the 112 facilities acquired in 2021 has been assigned as follows:
(dollars in thousands)
Consideration Paid
Acquisition Date Fair Value
Value of
Operating
Partnership
Net Other
Carrying
Units/
Liabilities
Building,
Value of Joint
Member
Assumed
Equipment,
In-Place
Number of
Date of
Purchase
Venture
Interest
(Assets
and
Customer
States
Properties
Acquisition
Price
Cash Paid
Interest
Issued
Acquired)
Land
Improvements
Leases
2022
CA
6
1/4/2022 $ 165,225
165,160
$
—
$
—
$
65
$
20,321
$ 143,243
$
1,661
GA, NC, SC
—
$
140
$ 1,003,043
10/13/2022
$
—
3
3/11/2022
48,586
48,446
(45)
$
$
1,324
3,926
44,300
$
360
IL, NC, TX
—
—
8
3/15/2022
116,048
115,410
638
12,292
102,439
1,317
MD
—
—
1
3/28/2022
21,651
21,646
5
1,640
19,856
155
NY
30,186
—
1
4/4/2022
35,802
5,557
59
10,287
25,280
235
FL
—
—
3
4/19/2022
52,343
52,060
283
7,894
43,814
635
GA
—
—
1
4/22/2022
16,403
16,390
13
1,333
14,903
167
MA
—
—
1
4/25/2022
20,083
20,087
(4)
810
19,041
232
FL
—
—
1
5/10/2022
17,218
17,112
106
3,712
13,306
200
FL
—
—
1
5/12/2022
36,452
36,254
198
5,101
31,079
272
NY
—
—
2
5/17/2022
32,487
32,374
113
1,524
30,594
369
TX
—
10,300
1
5/17/2022
17,097
6,608
189
1,273
15,615
209
FL
—
—
1
5/31/2022
22,021
21,880
141
3,563
18,171
287
CA
—
—
1
6/21/2022
12,675
12,641
34
5,967
6,572
136
NC
—
—
1
7/6/2022
20,059
19,970
89
428
19,428
203
NV
—
—
1
8/12/2022
29,113
29,154
(41)
2,354
26,512
247
NY
—
4,915
1
8/12/2022
29,000
24,130
8,079
20,734
187
CA
—
—
1
8/23/2022
10,709
10,690
19
9,292
93
AZ
—
—
1
8/24/2022
30,550
30,388
162
3,959
26,255
336
MO
5
9/14/2022
93,103
91,820
—
—
1,283
8,212
83,702
1,189
MA
—
—
1
9/21/2022
16,650
16,618
32
640
15,819
191
FL
1
9/22/2022
17,363
17,233
—
—
130
1,830
15,369
164
AZ, MN
—
—
7
142,405
141,836
569
13,829
126,991
1,585
Total acquired 2022
50
$ 953,464
30,186
15,215
4,178
120,298
872,315
10,430
$
53
(dollars in thousands)
Consideration Paid
Acquisition Date Fair Value
Net Other
Value of
Liabilities
Building,
Operating
Assumed
Equipment,
In-Place
Number of
Date of
Purchase
Partnership
(Assets
and
Customer
States
Properties
Acquisition
Price
Cash Paid
Units Issued
Acquired)
Land
Improvements
Leases
2021
SC
1
1/4/2021 $
8,070
8,042
$
—
$
28
$
812
$
7,153
$
105
CA
—
1
1/21/2021
18,287
18,251
36
1,322
16,830
135
NY
—
1
3/4/2021
47,947
47,933
14
10,591
37,020
336
FL
—
8
3/11/2021
85,156
84,586
570
13,381
70,538
1,237
AZ
—
3
3/24/2021
67,089
66,890
199
7,129
59,320
632
WA
—
2
3/25/2021
39,666
39,495
171
6,166
33,037
443
FL
1
5/3/2021
16,545
16,497
—
48
1,658
14,739
148
NJ
—
5
5/12/2021
90,944
90,710
234
11,557
78,116
1,271
NC
—
2
6/1/2021
26,942
26,793
149
2,209
24,395
338
TX
—
4
6/10/2021
44,563
43,952
611
9,163
34,746
654
FL
—
1
6/16/2021
14,344
14,235
109
2,601
11,526
217
FL, NH
—
3
6/22/2021
59,618
59,257
361
19,101
39,752
765
NC
—
1
6/23/2021
14,539
14,468
71
657
13,695
187
NH
—
2
7/29/2021
22,315
22,311
4
6,271
15,743
301
FL
—
1
8/17/2021
14,846
14,740
106
2,884
11,789
173
AL, CO, FL, GA, KY,
OH, OK, SC, TX
22
8/19/2021
229,982
137,188
91,265
1,529
23,173
203,682
3,127
AZ
—
1
8/25/2021
17,190
17,187
3
1,034
15,974
182
GA
—
3
9/1/2021
51,707
51,375
332
5,570
45,447
690
TX
4
10/1/2021
58,904
25,180
32,841
883
9,407
48,641
856
FL
2
10/20/2021
58,043
57,613
—
430
13,147
44,281
615
GA, NC, SC, TN
7
10/21/2021
129,345
125,778
3,300
267
13,769
114,338
1,238
VA
1
11/16/2021
14,488
14,449
—
39
341
13,963
184
ME
1
12/2/2021
20,100
20,082
—
18
1,669
18,204
227
IL
1
12/8/2021
19,044
18,922
—
122
1,705
17,136
203
FL
1
12/10/2021
12,577
12,540
—
37
2,746
9,661
170
FL, GA, IL
23
12/13/2021
369,487
367,635
—
1,852
47,189
317,719
4,579
FL
1
12/15/2021
14,095
14,056
—
39
2,989
10,924
182
CO
2
12/16/2021
33,087
14,334
18,173
580
3,726
28,940
421
FL
1
6
12/17/2021
20,596
20,548
—
48
737
19,623
236
CT
12/28/2021
76,801
49,666
27,137
(2)
10,461
65,269
1,071
Total acquired 2021
112
$ 1,696,317
$ 1,514,713
$
172,716
$
8,888
$
233,165
$ 1,442,201
$
20,923
The facility purchased in New York during April 2022 was acquired as a result of the Company's acquisition of the remaining 14.2%
ownership interest in Life Storage 898 McDonald LLC ("McDonald"). Prior to this acquisition, McDonald was a joint venture between the
Company and an otherwise unrelated third party which had been accounted for by the Company using the equity method of accounting (see
Note 11 for additional information on McDonald). The purchase price for this acquisition includes the carrying value of the Company's equity
investment in McDonald of $30.2 million at the time of the acquisition.
During August 2022, the Company purchased a self-storage facility in New York from an unrelated joint venture partner for total
consideration of $29.0 million, which includes $4.9 million related to the seller's retained interest in the joint venture. The Company owns 83%
of this joint venture with the remaining 17% owned by the Company's joint venture partner. Based on the facts and circumstances of the joint
venture, the Company determined that the facility should be consolidated in accordance with ASC 810, Consolidation. The assets and liabilities
of the property are included in the Company's consolidated balance sheets. Additionally included in the Company's consolidated balance sheets
is the joint venture partner's noncontrolling interest, which totals $4.9 million at December 31, 2022. The Company's net investment in the joint
venture is $24.1 million at December 31, 2022.
The facility purchased in New York in 2021 was acquired from SNL Orix Merrick ("Merrick"), an unconsolidated joint venture in which
the Company held a 5% ownership interest. In accordance with ASC Topic 970, “Real Estate – General,” ("ASC 970") the Company recorded
its equity in the profit from the sale of this self-storage facility as a reduction in the respective purchase price allocated to land and depreciable
fixed assets. In addition to the $47.9 million cash payment for the self-storage facility acquired from Merrick, the Company also recognized
$0.8 million as a return on the Company's investment in Merrick as discussed further in Note 11.
The three facilities purchased in Georgia in September 2021 were acquired from Life Storage-SERS Storage LLC ("SERS"), an
unconsolidated joint venture in which the Company held a 20% ownership interest. In accordance with ASC 970, the Company recorded its
equity in the profit from the sale of these self-storage facilities as a reduction in the respective purchase price allocated to land and depreciable
fixed assets. In addition to the $51.7 million cash payment for the self-storage facilities acquired from SERS, the Company also recognized
$8.3 million as a return on the Company's investment in SERS as discussed further in Note 11.
54
Nine of the facilities acquired in 2022 and 27 of the facilities acquired in 2021 were managed by the Company for third-parties prior to
their respective acquisition. The remaining 39 and 81 facilities acquired in 2022 and 2021, respectively, were all acquired from unrelated third-
parties.
Non-cash investing activities during 2022 include the Company's equity investment in McDonald at carrying value, the noncontrolling
interest in the self-storage facility acquired in New York, the issuance of $10.3 million of common Operating Partnership Units based on the
average closing price of the Parent Company's common stock over the 15 consecutive trading days prior to closing on the related self-storage
facility acquisition, and the assumption of net other liabilities totaling $4.2 million. Non-cash investing activities during 2021 include the
issuance of $89.8 million of preferred Operating Partnership Units valued based upon the terms of the preferred Operating Partnership Units as
compared to market rates for similar instruments at the time of acquisition, the issuance of $82.9 million of common Operating Partnership
Units based on the average closing price of the Parent Company's common stock for a stated number of days prior to closing on the related self-
storage facility acquisitions, and the assumption of net other liabilities totaling $8.9 million. Non-cash investing activities during 2020 include
the Company’s equity investment in an unconsolidated joint venture at carrying value, the assumption of a mortgage with an acquisition date
fair value of $6.4 million, and the assumption of net other liabilities totaling $1.8 million.
The Company measures the fair value of in-place customer lease intangible assets based on the Company’s experience with customer
turnover and the estimated cost to replace the in-place leases. The Company amortizes in-place customer leases on a straight-line basis over 12
months (the estimated future benefit period).
In-place customer leases are included in other assets on the Company’s consolidated balance sheets at December 31 as follows:
(dollars in thousands)
2022
2021
In-place customer leases
$
118,216
$
107,786
Accumulated amortization
(114,005)
(93,820)
Net carrying value at the end of period
$
4,211
$
13,966
Amortization expense related to in-place customer leases totaled $20.2 million, $12.4 million, and $5.6 million, during the years ended
December 31, 2022, 2021, and 2020, respectively. Amortization expense is expected to be $4.2 million in 2023 based on in-place customer
leases at December 31, 2022.
Property Dispositions
No self-storage facilities were sold during 2022, 2021, or 2020.
Change in Useful Life Estimates
As part of the Company’s capital improvement efforts, buildings at certain self-storage facilities were identified for replacement. As a
result of the decision to replace these buildings, the Company reassessed the estimated useful lives of the then existing buildings. This useful
life reassessment resulted in increases in depreciation expense of approximately $0.2 million, $2.5 million, and $5.8 million in 2022, 2021, and
2020, respectively. The Company estimates that the change in estimated useful lives of buildings identified for replacement as of December 31,
2022 will not have a significant impact on depreciation expense in 2023.
The accelerated depreciation resulting from the events discussed above had minimal impact on basic and diluted earnings per share/unit
during 2022 and reduced both basic and diluted earnings per share/unit by approximately $0.03 and $0.08 per share/unit in 2021 and 2020,
respectively.
55
5. UNSECURED LINE OF CREDIT AND TERM NOTES
Borrowings outstanding on our unsecured line of credit and term notes are as follows:
(dollars in thousands )
Dec. 31, 2022
Dec. 31, 2021
Revolving line of credit borrowings
$
595,000
$
—
Term note due April 8, 2024
175,000
175,000
Senior term note due July 1, 2026
600,000
600,000
Senior term note due December 15, 2027
450,000
450,000
Term note due July 21, 2028
200,000
200,000
Senior term note due June 15, 2029
350,000
350,000
Senior term note due October 15, 2030
400,000
400,000
Senior term note due October 15, 2031
600,000
600,000
Total term note principal balance outstanding
2,775,000
2,775,000
Less: unamortized debt issuance costs
(13,685)
(16,008)
Less: unamortized senior term note discount
(9,683)
(11,154)
Term notes payable
$
2,751,632
$
2,747,838
Until July 13, 2022, the Company had maintained an unsecured amended credit agreement including a revolving credit facility with a
limit of $500 million and a maturity date of March 10, 2023. Such credit agreement provided for interest on the revolving credit facility at a
variable annual rate equal to LIBOR plus a margin based on the Company's credit rating and required an annual facility fee on the revolving
credit facility which varied based upon the Company's credit rating (at December 31, 2021 the facility fee was 0.15%). The interest rate on the
Company's revolving credit facility at December 31, 2021 was approximately 1.05%.
On July 13, 2022, the Company entered into an amended and restated credit facility which replaced the credit facility discussed above.
Under this amended credit facility, the Company's revolving credit facility increased to $1.25 billion and the maturity date of such facility was
extended to January 13, 2027. The new revolving credit facility bears interest at a variable annual rate equal to Term SOFR plus a 0.10% SOFR
adjustment plus a margin based on the Company's credit rating (the margin was 0.775% at December 31, 2022) and requires an annual facility
fee on the revolving credit facility which varies based on the Company’s credit rating (the facility fee was 0.15% at December 31, 2022). The
interest rate on the Company’s revolving credit facility at December 31, 2022 was approximately 5.20%. At December 31, 2022, there was
$654.9 million available on the unsecured line of credit. The Company has the option under this credit facility to increase the total aggregate
borrowing capacity to $2.0 billion.
On October 7, 2021, the Operating Partnership issued $600 million in aggregate principal amount of 2.400% unsecured senior notes due
October 15, 2031 (the "2031 Senior Notes"). The 2031 Senior Notes were issued at 0.917% discount to par value. Interest on the 2031 Senior
Notes is payable semi-annually in arrears on each April 15 and October 15. Proceeds received upon issuance, net of discount to par of $5.5
million, and underwriting discount and other offering expenses of $5.1 million, totaled $589.4 million.
On September 23, 2020, the Operating Partnership issued $400 million in aggregate principal amount of 2.200% unsecured senior notes
due October 15, 2030 (the “2030 Senior Notes”). The 2030 Senior Notes were issued at 0.476% discount to par value. Interest on the 2030
Senior Notes is payable semi-annually in arrears on each April 15 and October 15. Proceeds received upon issuance, net of discount to par of
$1.9 million and underwriting and other offering expenses of $3.5 million, totaled $394.6 million.
On June 3, 2019, the Operating Partnership issued $350 million in aggregate principal amount of 4.000% unsecured senior notes due
June 15, 2029 (the “2029 Senior Notes”). The 2029 Senior Notes were issued at a 0.524% discount to par value. Interest on the 2029 Senior
Notes is payable semi-annually in arrears on each June 15 and December 15. Proceeds received upon issuance, net of discount to par of $1.8
million and underwriting discount and other offering expenses of $3.1 million, totaled $345.1 million.
On December 7, 2017, the Operating Partnership issued $450 million in aggregate principal amount of 3.875% unsecured senior notes
due December 15, 2027 (the “2027 Senior Notes”). The 2027 Senior Notes were issued at a 0.477% discount to par value. Interest on the 2027
Senior Notes is payable semi-annually in arrears on June 15 and December 15. Proceeds received upon issuance, net of discount to par of $2.1
million and underwriting discount and other offering expenses totaling $4.0 million, totaled $443.9 million.
On June 20, 2016, the Operating Partnership issued $600 million in aggregate principal amount of 3.50% unsecured senior notes due July
1, 2026 (the “2026 Senior Notes”). The 2026 Senior Notes were issued at a 0.553% discount to par value. Interest on the 2026 Senior Notes is
payable semi-annually in arrears on January 1 and July 1. Proceeds received upon issuance, net of discount to par of $3.3 million and
underwriting discount and other offering expenses of $5.5 million, totaled $591.2 million.
The 2031 Senior Notes, the 2030 Senior Notes, the 2029 Senior Notes, the 2027 Senior Notes and the 2026 Senior Notes (collectively the
"Senior Notes") are all fully and unconditionally guaranteed by the Parent Company. The indenture under which the Senior Notes were issued
restricts the ability of the Company and its subsidiaries to incur debt unless the Company and its consolidated subsidiaries comply with a
56
leverage ratio not to exceed 60% and an interest coverage ratio of more than 1.5:1 on all outstanding debt, after giving effect to the incurrence
of the debt. The indenture also restricts the ability of the Company and its subsidiaries to incur secured debt unless the Company and its
consolidated subsidiaries comply with a secured debt leverage ratio not to exceed 40% after giving effect to the incurrence of the debt. The
indenture also contains other financial and customary covenants, including a covenant not to own unencumbered assets with a value less than
150% of the unsecured indebtedness of the Company and its consolidated subsidiaries. At December 31, 2022, the Company was in
compliance with such covenants.
On July 21, 2016, the Company entered into a $200 million term note maturing July 21, 2028 bearing interest at a fixed rate of 3.67%.
On April 8, 2014, the Company entered into a $175 million term note maturing April 8, 2024 bearing interest at a fixed rate of 4.533%.
The interest rate on this term note increases to 6.283% if the Company is not rated by at least one rating agency or if the Company’s credit
rating is downgraded.
In 2011, the Company entered into a $100 million term note maturing August 5, 2021 bearing interest at a fixed rate of 5.54%. On
October 9, 2020, the Company paid off this $100 million term note in addition to making a make-whole payment of $4.0 million required as a
result of paying off the term note prior to its maturity. Such make-whole payment is included in interest expense in the 2020 consolidated
statement of operations.
The line of credit and term notes require the Company to meet certain financial covenants, measured on a quarterly basis, including
prescribed leverage, fixed charge coverage, minimum net worth, limitations on additional indebtedness and limitations on dividend payouts. At
December 31, 2022, the Company was in compliance with such covenants.
We believe that if operating results remain consistent with historical levels and levels of other debt and liabilities remain consistent with
amounts outstanding at December 31, 2022, the entire availability on the line of credit could be drawn without violating our debt covenants.
The Company’s fixed rate term notes contain a provision that allows for the noteholders to call the debt upon a change of control of the
Company at an amount that includes a make whole premium based on rates in effect on the date of the change of control.
Deferred debt issuance costs and the discount on the outstanding term notes are both presented as reductions of term notes in the
accompanying consolidated balance sheets at December 31, 2022 and December 31, 2021. Amortization expense related to these deferred debt
issuance costs was $3.3 million, $2.5 million and $2.4 million for the periods ended December 31, 2022, 2021 and 2020, respectively, and is
included in interest expense in the consolidated statements of operations.
6. MORTGAGES PAYABLE AND DEBT MATURITIES
Mortgages payable at December 31, 2022 and 2021 consist of the following:
December 31,
December 31,
(dollars in thousands)
2022
$
2021
4.065% mortgage note due April 1, 2023, secured by one self
storage facility with an aggregate net book value of $6.9 million,
principal and interest paid monthly (effective interest rate 4.32%)
$
3,620
3,728
5.26% mortgage note due November 1, 2023, secured by one self
storage facility with an aggregate net book value of $7.5 million,
principal and interest paid monthly (effective interest rate 5.58%)
3,566
3,650
4.4625% mortgage notes due December 6, 2024, secured by three self
storage facilities with an aggregate net book value of $53.5 million,
interest paid monthly with principal due at maturity (effective
interest rate 3.30%)
22,169
22,427
4.44% mortgage note due July 6, 2025, secured by one self
storage facility with an aggregate net book value of $13.1 million,
principal and interest paid monthly (effective interest rate 4.56%)
6,108
6,228
5.99% mortgage note due May 1, 2026, secured by one self
storage facility with an aggregate net book value of $6.2 million,
principal and interest paid monthly (effective interest rate 6.45%)
795
Total mortgages payable
$
36,258
$
37,030
57
997
The table below summarizes the Company’s debt obligations at December 31, 2022. The estimated fair value of financial instruments is
subjective in nature and is dependent on a number of important assumptions, including discount rates and relevant comparable market
information associated with each financial instrument. The fair values of the fixed rate term notes and mortgage notes were estimated by
discounting the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and for
the same remaining maturities. These assumptions are considered Level 2 inputs within the fair value hierarchy as described in Note 8. The
carrying values of our variable rate debt instruments, if any, approximate their fair values as these debt instruments bear interest at current
market rates that approximate market participant rates. This is considered a Level 2 input within the fair value hierarchy. The use of different
market assumptions and estimation methodologies may have a material effect on the reported estimated fair value amounts. Accordingly, the
estimates presented below are not necessarily indicative of the amounts the Company would realize in a current market exchange.
(dollars in thousands)
Line of credit—variable rate SOFR
+ 0.775% (5.20% at
December 31, 2022)
Notes Payable:
Term note—fixed rate 4.533%
Term note—fixed rate 3.50%
Term note—fixed rate 3.875%
Term note—fixed rate 3.67%
Term note—fixed rate 4.00%
Term note—fixed rate 2.20%
Term note—fixed rate 2.40%
Mortgage note—fixed rate 4.065%
Mortgage note—fixed rate 5.26%
Expected Maturity Date Including Discount
2023
2024
2025
2026
2027
Thereafter
Total
Fair Value
$
—
$
—
$
—
$
—
$
595,000
$
—
$
595,000
—
$ 595,000
175,000
—
—
—
—
175,000
170,566
—
—
—
600,000
—
—
600,000
554,995
—
—
—
—
450,000
—
450,000
415,811
—
—
—
—
—
200,000
200,000
178,296
—
—
—
—
—
350,000
350,000
315,228
—
—
—
—
—
400,000
400,000
307,559
—
—
—
—
—
600,000
600,000
448,673
3,620
—
—
—
—
—
3,620
3,583
3,566
—
—
—
—
—
3,566
3,506
Mortgage notes—fixed rate 4.4625%
—
22,169
—
—
—
—
22,169
20,706
Mortgage notes—fixed rate 4.44%
126
131
5,851
—
—
—
6,108
5,809
Mortgage note—fixed rate 5.99%
216
229
243
107
—
—
795
788
Total
$
6,094
$ 7,528
$197,529
$ 1,550,000
$ 3,406,258
$600,107
$1,045,000
7. DERIVATIVE FINANCIAL INSTRUMENTS
In 2015 and 2016, the Company entered into forward starting interest rate swap agreements to hedge the risk of changes in the interest-
related cash flows associated with the potential issuance of fixed rate long-term debt. In conjunction with the issuance of the 2026 Senior Notes
(see Note 5), the Company terminated these hedges and settled the forward starting swap agreements for approximately $9.2 million. The $9.2
million has been deferred in AOCL and is being amortized as additional interest expense over the 10-year term of the 2026 Senior Notes or
until such time as interest payments on the 2026 Senior Notes are no longer probable. The Company expects to record $0.9 million of interest
expense in 2023 as a result of the amortization of the amount deferred in AOCL related to these forward starting interest rate swap agreements.
The changes in AOCL for the years ended December 31, 2022, 2021, and 2020 are summarized as follows:
(dollars in thousands)
(4,124) $
(5,041) $
(5,958)
(3,207) $
(4,124) $
(5,041)
2022
2021
2020
Accumulated other comprehensive loss beginning of period
$
Realized loss reclassified from accumulated other
comprehensive loss to interest expense
917
917
917
Accumulated other comprehensive loss end of period
$
58
8. FAIR VALUE MEASUREMENTS
The Company applies the provisions of ASC Topic 820 “Fair Value Measurements and Disclosures” in determining the fair value of its
financial and nonfinancial assets and liabilities. ASC Topic 820 establishes a valuation hierarchy for disclosure of the inputs to valuation used
to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in
active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that
are observable for the asset or liability, either directly or indirectly through market corroboration. Level 3 inputs are unobservable inputs based
on our own assumptions used to measure assets and liabilities at fair value. A financial asset or liability’s classification within the hierarchy is
determined based on the lowest level input that is significant to the fair value measurement.
Refer to Note 6 for presentation of the fair values of debt obligations which are disclosed at fair value on a recurring basis.
There are no assets or liabilities carried at fair value measured on a recurring basis on the consolidated balance sheets at December 31,
2022 and 2021.
9. STOCK BASED COMPENSATION
The Company established the 2015 Award and Option Plan (the “2015 Plan”) for the purpose of attracting and retaining the Company’s
executive officers and other key employees. There are 841,500 shares authorized for issuance under the 2015 Plan. The exercise price for
qualified incentive stock options must be at least equal to the fair market value of the common shares at the date of grant. As of December 31,
2022, there were no options outstanding under the 2015 Plan and options for 71,337 shares of common stock were available for future issuance.
The Company may also grant other stock-based awards under the 2015 Plan, including restricted stock and performance-based awards.
The Company also established the 2009 Outside Directors’ Stock Option and Award Plan (the “2009 Directors’ Plan”) for the purpose of
attracting and retaining the services of experienced and knowledgeable outside directors. Prior to April 1, 2016, the 2009 Directors’ Plan
provided for the granting of options to purchase shares of common stock to eligible directors. The issuance of stock options to directors was
discontinued in 2016. In addition, each outside director received non-vested shares annually equal to 80% of the annual fees paid to them. As of
December 31, 2022, options for 19,500 common shares were outstanding under the 2009 Directors’ Plan.
The 2009 Directors’ Plan expired on May 21, 2020 and was replaced by the 2020 Outside Directors’ Stock Award Plan (the “2020
Directors’ Plan”) which provides for the issuance of shares of restricted stock to eligible directors. Such non-vested shares vest over a one-year
period. Dividends payable with respect to the restricted stock are accumulated during the vesting period and paid to the respective directors
only upon vesting of the restricted stock. There are 150,000 shares authorized for issuance under the 2020 Directors’ Plan. During 2022, 3,868
non-vested shares were issued to outside directors and certain directors elected to defer a total of 2,901 shares. As of December 31, 2022,
125,041 shares of common stock were available for future issuance. As of December 31, 2022, 19,005 of non-vested shares were outstanding
under the 2020 Directors’ Plan.
A summary of the Company’s stock option activity and related information for the years ended December 31 follows:
2022
2021
2020
Weighted
Weighted
Weighted
average
average
average
exercise
exercise
exercise
Options
price
Options
price
Options
price
Outstanding at beginning of year:
24,750
$
52.09
24,750
$
52.09
24,750
$
52.09
Granted
—
—
—
—
—
—
Exercised
(5,250)
32.95
—
—
—
—
Adjusted / (forfeited)
—
—
—
—
—
—
Outstanding at end of year
19,500
$
57.24
24,750
$
52.09
24,750
$
52.09
Exercisable at end of year
19,500
$
57.24
24,750
$
52.09
24,750
$
52.09
A summary of the Company’s stock options outstanding at December 31, 2022 follows:
Outstanding
Exercisable
Weighted
Weighted
average
average
exercise
exercise
Exercise Price Range
Options
price
Options
price
$40.00 – $49.99
3,000
$
46.60
3,000
$
46.60
$50.00 – $61.05
16,500
$
59.17
16,500
$
59.17
Total
19,500
$
57.24
19,500
$
57.24
Intrinsic value of outstanding stock options at December 31, 2022
$
804,590
Intrinsic value of exercisable stock options at December 31, 2022
$
804,590
59
The intrinsic value of stock options exercised during the year ended December 31, 2022 was $0.5 million.
Proceeds from stock options exercised during the year ended December 31, 2022 totaled $0.2 million.
The aggregate intrinsic value is calculated as the difference between the exercise price of the underlying awards and the quoted price of
the Company’s common stock at December 31, 2022, or the price on the date of exercise for those exercised during the year. The weighted
average remaining contractual life of all outstanding options, which are all exercisable, is 1.9 years.
Non-vested stock
The Company has also issued shares of non-vested stock to employees which vest over two- to eight-year periods. During the restriction
period, the non-vested shares may not be sold, transferred, or otherwise encumbered. The holder of the non-vested shares has all rights of a
holder of common shares, including the right to vote and receive dividends. For issuances of non-vested stock during the year ended
December 31, 2022, the fair market value of the non-vested stock on the date of grant ranged from $107.20 to $149.73. During 2022, 54,270
shares of non-vested stock were issued to employees and directors with an aggregate fair value of $6.4 million. The Company charges the fair
value ratably to expense over the vesting period. The Company uses the average of the high and low price of its common stock on the date the
award is granted as the fair value for non-vested stock awards that do not have a market condition.
A summary of the status of unvested shares of stock issued to employees and directors as of and during the years ended December 31
follows:
2022
2021
2020
Weighted
Weighted
Weighted
Non-vested
Shares
average
grant date
fair value
Non-vested
Shares
average
grant date
fair value
Non-vested
Shares
average
grant date
fair value
Unvested at beginning of year:
149,487
$
84.21
154,770
$
66.62
147,723
$
63.07
Granted
54,270
117.28
55,433
114.61
60,288
71.70
Vested
(45,244)
79.00
(60,716)
67.14
(45,767)
63.10
Forfeited
(7,474)
(4,000)
85.65
—
—
59.06
Unvested at end of year
154,513
$
97.31
154,770
$
66.62
149,487
$
84.21
Compensation expense of $8.4 million, $6.6 million, and $4.6 million was recognized for the vested portion of non-vested stock grants in
2022, 2021, and 2020, respectively. The fair value of non-vested stock that vested during 2022, 2021, and 2020 was $3.6 million, $4.1 million,
and $2.9 million, respectively. The total unrecognized compensation cost related to non-vested stock was $12.3 million at December 31, 2022,
and the remaining weighted-average period over which this expense will be recognized was 3.8 years.
Performance-based awards
During 2022, 2021 and 2020, the Company granted performance-based awards that entitle the recipients to earn up to 54,804, 53,034 and
70,272 shares, respectively, if certain performance criteria are achieved over a three-year period. The actual number of shares to be issued will
be determined at the end of the three-year period. The Company issued 38,110, 53,680, and 53,541 performance-based shares in 2022, 2021,
and 2020, respectively. The performance-based shares issued are based upon the Company’s performance over a three-year period depending
on the Company’s total shareholder return relative to a group of peer companies. Performance-based awards are recognized as compensation
expense based on the fair value of the awards on the date of grant, the number of shares ultimately expected to vest and the vesting period of
the awards. For accounting purposes, the performance shares are considered to have a market condition. The effect of the market condition is
reflected in the grant date fair value of the award and thus, compensation expense is recognized on this type of award provided that the
requisite service is rendered (regardless of whether the market condition is achieved). The Company estimated the fair value of each
performance-based award granted under the Plans on the date of grant using a Monte Carlo simulation that uses the assumptions discussed in
Note 2.
During 2022, compensation expense of $3.3 million (included in the $8.4 million discussed above) was recognized for performance
awards granted in 2022 and prior. The total unrecognized compensation cost related to non-vested performance awards was $5.1 million at
December 31, 2022 and the weighted-average period over which this expense will be recognized is 2.3 years.
Deferred compensation plan for Directors
Under the Deferred Compensation Plan for Directors, non-employee Directors may defer all or part of their Directors’ fees that are
otherwise payable in cash. Directors’ fees that are deferred under this plan are credited to each Directors’ account under the plan in the form of
Units. The number of Units credited is determined by dividing the amount of Directors’ fees deferred by the closing price of the Company’s
Common Stock on the New York Stock Exchange on the day immediately preceding the day upon which Directors’ fees otherwise would be
60
paid by the Company. A Director is credited with additional Units for dividends on the shares of Common Stock represented by Units in such
Directors’ account. A Director may elect to receive the shares in a lump sum on a date specified by the Director or in quarterly or annual
installments over a specified period and commencing on a specified date. The Directors may not elect to receive cash in lieu of shares. Under
this plan there were a total of 29,535 units outstanding at December 31, 2022. During 2022 and 2021, non-employee directors elected to defer
fees totaling $116,800 and $117,000, respectively. No fees were elected to be deferred by any non-employee Directors in 2020.
10. RETIREMENT PLAN
Employees of the Company qualifying under certain age and service requirements are eligible to be a participant in a 401(k) Plan
sponsored by the Company. The Company contributes to the Plan at the rate of 33% of the first 5% of gross wages that the employee
contributes. Total expense to the Company was approximately $1,207,000, $1,046,000, and $926,000 for the years ended December 31, 2022,
2021, and 2020, respectively.
11. INVESTMENT IN JOINT VENTURES
A summary of the Company’s unconsolidated joint ventures is as follows:
Number of
Company
Carrying value
Carrying value
Properties at
common
of investment
of investment
December 31,
ownership
at December 31,
at December 31,
Venture
2022
interest
2022
2021
Sovran HHF Storage Holdings LLC (“Sovran HHF”)1
37
20%
$63.6 million
$58.7 million
Sovran HHF Storage Holdings II LLC (“Sovran HHF II”)2
22
15%
($2.4 million)
($2.4 million)
Life Storage-HIERS Storage LLC (“HIERS”)
17
20%
$13.7 million
$13.9 million
191 V Life Storage Holdings LLC ("191 V")3
17
20%
$27.5 million
$27.4 million
GII Life Storage Holdings LLC ("GII")4
13
35%
$48.6 million
$51.5 million
LS HF8 ComRef LLC ("HF8")5
—
3
20%
$11.9 million
LS HF9 ComRef Texas LLC ("HF9")6
—
4
20%
$13.7 million
Life Storage HHF Wasatch Holdings LLC ("Wasatch")7
—
15
20%
$52.8 million
Iskalo Office Holdings, LLC (“Iskalo”)8
49%
($2.3 million)
($2.4 million)
Life Storage Spacemax, LLC ("Spacemax")9
N/A
6
40%
$13.7 million
$14.5 million
Life Storage 898 McDonald LLC ("McDonald")10
—
—
0%
$30.0 million
Life Storage ArrowMark Venture LLC ("ArrowMark
Venture")11
50%
$5.9 million
$1.5 million
Joint ventures with properties in development stage12
N/A
5
Various
$16.1 million
$3.8 million
Other unconsolidated joint ventures
6
Various
$7.6 million
$11.7 million
1.
In September 2020, the Company acquired 17 self-storage facilities and related assets from Sovran HHF for total consideration of $175.2
million, which is net of the Company’s share of Sovran HHF’s gain resulting from the transaction. In connection with this transaction,
non-recourse loans with principal balances totaling $34.0 million were settled. Also in September 2020, Sovran HHF sold four self-
storage facilities to an unrelated third-party for total consideration of $42.3 million, resulting in a gain on sale of $2.1 million. In June
2022, Sovran HHF acquired on additional self-storage facility for cash consideration of $33.4 million. The Company made an additional
contribution of $6.7 million as the Company's share of this transaction. As of December 31, 2022, the carrying value of the Company’s
investment in Sovran HHF exceeds its share of the underlying equity in net assets of Sovran HHF by approximately $1.7 million as a
result of the capitalization of certain acquisition related costs in 2008. This difference is included in the carrying value of the investment.
2.
In September 2020, the Company acquired eight self-storage facilities and related assets from Sovran HHF II for total consideration of
$120.2 million, which is net of the Company’s share of Sovran HHF II’s gain resulting from the transaction. In connection with this
transaction, $35.8 million of non-recourse loans related to these properties were settled in April 2021. Also in connection with this
transaction, the Company made a $12.7 million contribution to Sovran HHF II. On April 1, 2021, Sovran HHF II paid off $69.1 million
in existing nonrecourse mortgage debt and entered into $110 million of new nonrecourse mortgage debt which matures in 2029. As a
result of the net proceeds from these transactions, the Company received a distribution of $31.6 million from Sovran HHF II. This
distribution is included in return of investment in unconsolidated joint ventures on the 2021 consolidated statement of cash flows.
3.
In May 2021, the Company executed a joint venture agreement, 191 V Life Storage Holdings LLC, with an unrelated third-party with the
purpose of acquiring and operating self-storage facilities. In June 2021, 191 V acquired 17 self-storage facilities for a total of $320
million, at which time 191 V entered into $184 million of nonrecourse mortgage debt which matures in 2026. During 2021, the Company
contributed $28.7 million to 191 V as the Company's share of the initial capital investment in the joint venture.
4.
In November 2021, the Company executed a joint venture agreement, GII Life Storage Holdings LLC, with an unrelated third-party with
the purpose of acquiring and operating self-storage facilities. In December 2021, GII acquired 13 self-storage facilities for a total of
$290.6 million, at which time GII entered into $145.3 million of nonrecourse mortgage debt which matures in 2029. During 2021, the
Company contributed $52.0 million to GII as the Company's share of the initial capital investment in the joint venture.
61
5.
In August 2022, the Company executed a joint venture agreement, LS HF8 ComRef LLC, with an unrelated third-party with the purpose
of acquiring and operating self-storage facilities. In October 2022, HF8 acquired three self-storage facilities for a total contractual
purchase price of $59.0 million. During 2022, the Company contributed $12.0 million to HF8 as the Company's share of the initial capital
investment in the joint venture.
6.
In October 2022, the Company executed a joint venture agreement, LS HF9 ComRef Texas LLC, with an unrelated third-party with the
purpose of acquiring and operating self-storage facilities. In October 2022, HF9 acquired four self-storage facilities for a total contractual
purchase price of $67.5 million. During 2022, the Company contributed $13.8 million to HF9 as the Company's share of the initial capital
investment in the joint venture.
7.
In July 2022, the Company executed a joint venture agreement, Life Storage HHF Wasatch Holdings LLC, with an unrelated third-party
with the purpose of acquiring and operating self-storage facilities. In September 2022, Wasatch acquired 15 self-storage facilities for a
total contractual purchase price of $262.0 million. During 2022, the Company contributed $53.4 million to Wasatch as the Company's
share of the initial capital investment in the joint venture. At December 31, 2022, the joint venture was under contract to acquire one
additional self-storage facility for an aggregate purchase price of $22.5 million.
8.
Iskalo owns the building that houses the Company’s headquarters. The Company paid rent to Iskalo of $1.5 million, $1.5 million, and
$1.3 million during 2022, 2021, and 2020, respectively.
9.
In 2019, the Company executed a joint venture agreement, Life Storage Spacemax, LLC, with an unrelated third-party with the purpose
of acquiring and operating self-storage facilities. During 2019, Spacemax acquired six self-storage facilities for a total of $82.7 million.
In connection with this acquisition, Spacemax entered into $42.0 million of nonrecourse mortgage debt. During 2020, the Company
contributed $16.3 million to Spacemax as the Company's share of the initial capital investment in the joint venture.
10.
In September 2021, the Company made an additional investment of $27.3 million in McDonald (formerly SNL/Orix 1200 McDonald
Ave., LLC) which increased the Company's ownership interest in McDonald from 5% to 86%. In April 2022, the Company purchased
the remaining equity interest in McDonald for total consideration of $5.2 million. The allocated purchase price of McDonald also
includes the carrying value of the Company's investment in McDonald at the date of acquisition, which totaled $30.2 million. See Note 4
for additional information regarding this transaction.
11.
In October 2021, the Company executed a joint venture agreement, Life Storage ArrowMark Venture LLC, with the purpose of arranging
and originating mortgage loans to owners of self-storage facilities throughout the United States. During 2022 and 2021, the Company
contributed $4.2 million and $1.6 million, respectively, to ArrowMark Venture as the Company's share of the funding of mortgage loans
to third-parties.
12.
The Company has entered into five separate joint ventures, four of which are developing self-storage facilities in the New York City
market and one of which is developing a self-storage facility in the Tampa, FL, market. The Company has contributed an aggregate total
of $12.4 million as its share of capital to these joint ventures.
In addition to the joint venture activity in the preceding table, in 2021, the Company acquired a self-storage facility and related assets
from SNL Orix Merrick LLC ("Merrick"), an unconsolidated joint venture in which the Company held a 5% ownership interest, for total
consideration of $47.9 million, which is net of the Company's share of Merrick's gain resulting from the transaction. In connection with this
transaction, all non-recourse loans held by Merrick were settled. See Note 4 for additional information regarding this transaction.
Additionally, Life Storage SERS Storage LLC ("SERS") owned three self-storage facilities which the Company acquired in September
2021 for total consideration of $51.7 million, which is net of the Company's share of SERS's gain resulting from the transaction. In connection
with this transaction, all non-recourse loans held by SERS were settled. As SERS no longer operates any self-storage facilities, the Company
received a distribution of $2.8 million in September 2021 as the Company's return of its remaining investment in SERS. SERS was dissolved in
2022.
Based on the facts and circumstances of each of the Company’s joint ventures, the Company has determined that one of the joint ventures
at December 31, 2022 is a variable interest entity (“VIE”) in accordance with ASC 810, “Consolidation.” The Company has consolidated that
joint venture as it was determined that the Company has substantive participation rights over the activities as stipulated in the joint venture
agreement and is the primary beneficiary of the joint venture. The Company used the voting model under ASC 810 to determine whether or not
to consolidate the remaining joint ventures. Based upon each member’s substantive participation rights over the activities as stipulated in the
joint venture agreements, none of the joint ventures evaluated under the voting model are consolidated by the Company. Due to the Company’s
significant influence over the operations of each of the joint ventures, all above joint ventures are accounted for under the equity method of
accounting.
The carrying values of the Company’s investments in joint ventures are assessed for other-than-temporary impairment on a periodic basis
and no such impairments have been recorded on any of the Company’s investments in joint ventures.
62
As property manager of the self-storage facilities owned by each of the operational joint ventures, the Company earns management
and/or call center fees based on a percentage of joint venture gross revenues. These fees earned from joint ventures, which are included in other
operating income in the consolidated statements of operations, totaled $11.1 million, $8.2 million and $8.5 million in 2022, 2021 and 2020,
respectively.
The Company’s share of the unconsolidated joint ventures’ income (loss) is as follows:
Year Ended
Year Ended
Year Ended
(dollars in thousands)
Venture
December 31,
2022
December 31,
2021
December 31,
2020
Sovran HHF
$
4,271
$
3,270
$
3,743
Sovran HHF II
2,185
1,627
1,884
191 V
1,618
—
(280)
Other unconsolidated joint ventures
1,161
1,079
(789)
The Company does not guarantee the debt of any of its equity method investees.
We do not expect to have material future cash outlays relating to these joint ventures outside our share of capital for future acquisitions of
self-storage facilities, our share of capital for the origination of nonrecourse loans by ArrowMark Venture, our share of capital required for the
development of properties under construction, and our share of the payoff of secured debt held by these joint ventures.
A summary of our revenues, expenses and cash flows arising from the off-balance sheet arrangements with unconsolidated joint ventures
for the three years ended December 31, 2022 are as follows:
Year ended December 31,
(dollars in thousands)
2022
2021
2020
Operating activities
$
9,235
$
5,696
$
4,838
Other operating income (management fees and acquisition fee income)
$
12,785
$
10,017
$
8,694
General and administrative expenses (corporate office rent)
1,541
1,494
1,269
Equity in income of joint ventures
9,235
5,696
4,838
Distributions from unconsolidated joint ventures
17,628
13,866
14,098
(Advances to) receipts from joint ventures, net
Investing activities
(1,229)
731
(95)
Investment in unconsolidated joint ventures
(105,884)
(113,465)
(26,383)
Return of investment in unconsolidated joint ventures
5,060
37,584
28,008
Gain on sale of investments in unconsolidated joint ventures
1,572
—
—
12. SHAREHOLDERS’ EQUITY
On December 29, 2020, the Company entered into a continuous equity offering program (“2020 Equity Program”) with multiple sales
agents, pursuant to which the Company was permitted to sell up to $500 million in aggregate offering price of shares of the Company’s
common stock. The 2020 Equity Program was replaced on June 15, 2021 when the Company entered into a new continuous equity offering
program ("2021 Equity Program") with multiple sales agents pursuant to which the Company is permitted to sell up to $500 million in
aggregate offering price of shares of the Company's stock. The 2021 Equity Program was replaced on August 11, 2022 when the Company
entered into a new continuous equity offering program ("2022 Equity Program") with multiple sales agents pursuant to which the Company is
permitted to sell up to $1 billion in aggregate offering price of shares of the Company's stock. Actual sales under this continuous equity
offering program will depend on a variety of factors and conditions, including, but not limited to, market conditions, the trading price of the
Company’s common stock, and determinations of the appropriate sources of funding for the Company. The Company expects to offer, sell and
issue shares of common stock under this equity program from time to time based on various factors and conditions, although the Company is
under no obligation to sell any shares under this equity program. The 2020 Equity Program, 2021 Equity Program, and 2022 Equity Program
are referred to collectively as the "Equity Programs."
During 2022, the Company issued 1,352,833 shares of common stock under the Equity Programs at a weighted average issue price of
$135.22, generating net proceeds of $180.8 million after deducting $1.8 million of sales commissions paid to the sales agents as well as other
expenses of $0.3 million. The Company used such proceeds primarily to fund a portion of the 50 self-storage facilities acquired in 2022.
During 2021, the Company issued 6,365,971 shares of common stock under the Equity Programs at a weighted average issue price of
$106.51, generating net proceeds of $670.3 million after deducting $6.8 million of sales commissions paid to the sales agents, as well as other
expenses of $0.9 million. The Company used such proceeds primarily to fund a portion of the 112 self-storage facilities acquired in 2021.
63
During 2020, the Company issued 4,091,666 shares of common stock under the Equity Programs at a weighted average issue price of
$73.16, generating net proceeds of $296.0 million after deducting $3.0 million of sales commissions paid to the sales agents, as well as other
expenses of $0.3 million. The Company used such proceeds primarily to fund a portion of the 40 self-storage facilities acquired in 2020.
On September 16, 2021, the Company completed the public offering of 2,875,000 shares of the Company's common stock at $122.30 per
share. Net proceeds to the Company after deducting underwriting discounts and commissions and offering expenses were approximately
$348.8 million. The Company used the net proceeds from the offering to repay amounts outstanding under the Company's revolving credit
facility, to fund acquisitions, and for general corporate purposes.
On August 2, 2017, the Company’s Board of Directors authorized the repurchase of up to $200 million of the Company’s outstanding
common shares (“Buyback Program”). The Buyback Program allows the Company to purchase shares of its common stock in accordance with
applicable securities laws on the open market, through privately negotiated transactions, or through other methods of acquiring shares. The
Buyback Program may be suspended or discontinued at any time. The Company did not repurchase any outstanding common shares under the
Buyback Program in 2022, 2021, or 2020.
In 2013, the Company implemented a Dividend Reinvestment Plan which was suspended by the Company's Board of Directors in 2017.
As a result, the Company did not issue any shares under the Dividend Reinvestment Plan during 2022, 2021, or 2020.
13. SUPPLEMENTARY QUARTERLY FINANCIAL DATA (UNAUDITED)
The following is a summary of quarterly results of Life Storage, Inc. operations for the years ended December 31, 2022 and 2021 (dollars
in thousands, except per share data):
2022 Quarter Ended
Mar. 31
Jun. 30
Sept. 30
Dec. 31
Operating revenue
$
233,490
$
257,046
$
272,954
$
274,676
Net income
75,418
94,377
100,744
95,923
Net income attributable to common shareholders
73,575
92,264
98,505
93,784
Net income per share attributable to common shareholders
Basic
$
0.88
$
1.09
$
1.16
$
1.10
Diluted
$
0.88
$
1.09
$
1.16
$
1.10
2021 Quarter Ended
Mar. 31
Jun. 30
Sept. 30
Dec. 31
Operating revenue
$
171,887
$
187,262
$
208,256
$
221,159
Net income
47,592
57,765
71,051
75,767
Net income attributable to common shareholders
47,383
57,516
70,274
74,145
Net income per share attributable to common shareholders
Basic
$
0.63
$
0.75
$
0.89
$
0.90
Diluted
$
0.63
$
0.74
$
0.89
$
0.90
The following is a summary of quarterly results of Life Storage LP operations for the years ended December 31, 2022 and 2021 (dollars
in thousands, except per unit data):
2022 Quarter Ended
Mar. 31
Jun. 30
Sept. 30
Dec. 31
Operating revenue
$
233,490
$
257,046
$
272,954
$
274,676
Net income
75,418
94,377
100,744
95,923
Net income attributable to common unitholders
73,575
92,264
98,505
93,784
Net income per unit attributable to common unitholders
Basic
$
0.88
$
1.09
$
1.16
$
1.10
Diluted
$
0.88
$
1.09
$
1.16
$
1.10
2021 Quarter Ended
Mar. 31
Jun. 30
Sept. 30
Dec. 31
Operating revenue
$
171,887
$
187,262
$
208,256
$
221,159
Net income
47,592
57,765
71,051
75,767
Net income attributable to common unitholders
47,383
57,516
70,274
74,145
Net income per unit attributable to common unitholders
Basic
$
0.63
$
0.75
$
0.89
$
0.90
Diluted
$
0.63
$
0.74
$
0.89
$
0.90
64
See Note 2 for discussion of the Company’s three-for-two distribution of common stock announced by the Company on January 4, 2021.
See Note 4 for a discussion of the depreciation resulting from the change in estimated useful lives of buildings identified for replacement at
certain of the Company’s self-storage facilities. See Note 5 for financing transactions entered into in 2022 and 2021.
14. COMMITMENTS AND CONTINGENCIES
The Company’s current practice is to conduct environmental investigations in connection with property acquisitions. At this time, the
Company is not aware of any environmental contamination of any of its facilities that individually or in the aggregate would be material to the
Company’s overall business, financial condition, or results of operations.
At December 31, 2022 the Company has approximately $21.8 million of operating lease commitments, excluding variable consideration.
Future minimum lease payments on land and building leases related to self-storage facilities and the lease of the Company’s headquarters are as
follows (dollars in thousands):
Year ending December 31:
2023
$
2,663
2024
2,584
2025
2,402
2026
2,483
2027
2,524
Thereafter
9,173
Total
$
21,829
At December 31, 2022, the Company was under contract to acquire four self-storage facilities for an aggregate purchase price of $70.8
million. The purchases of these self-storage facilities are subject to customary conditions to closing, and there is no assurance that these
facilities will be acquired.
At December 31, 2022, one of the Company's unconsolidated joint ventures was under contract to acquire one self-storage facility for a
purchase price of $22.5 million, of which the Company's contribution is $4.5 million. The purchase of this self-storage facility is subject to
customary conditions to closing, and there is no assurance that this facility will be acquired.
At December 31, 2022, the Company has signed contracts in place with third-party contractors for expansion and enhancements at its
existing facilities. The Company expects to pay $33.4 million under these contracts in 2023.
15. SUBSEQUENT EVENTS
On January 3, 2023, the Company declared a quarterly dividend of $1.20 per common share. The dividend was paid on January 26, 2023
to shareholders of record on January 13, 2023. The total dividend paid amounted to $102.0 million.
During February 2023, holders of 2,332,706 preferred noncontrolling redeemable Operating Partnership Units elected to convert their
preferred Units to common noncontrolling redeemable Operating Partnership Units. A total of 561,063 common noncontrolling redeemable
Operating Partnership Units with an aggregate value of $58.6 million were issued as part of this conversion.
65
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
Controls and Procedures (Parent Company)
Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures
The Parent Company’s management conducted an evaluation of the effectiveness of the design and operation of the Parent Company’s
disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as
amended (Exchange Act), under the supervision of and with the participation of the Parent Company’s management, including the Chief
Executive Officer and Chief Financial Officer. Based on that evaluation, the Parent Company’s management, including the Chief Executive
Officer and Chief Financial Officer, concluded that the Parent Company’s disclosure controls and procedures were effective at December 31,
2022. There have not been changes in the Parent Company’s internal controls or in other factors that could significantly affect these controls
during the quarter ended December 31, 2022.
Management’s Report on Life Storage, Inc. Internal Control Over Financial Reporting
Management of Life Storage, Inc. (the “Parent Company”) is responsible for establishing and maintaining adequate internal control over
financial reporting, and for performing an assessment of the effectiveness of internal control over financial reporting as of December 31, 2022.
The Parent Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. The Parent Company’s system of internal control over financial reporting includes those policies and procedures that (i) pertain to
the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Parent
Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and expenditures of the Parent Company are being made only in
accordance with authorizations of management and directors of the Parent Company; and (iii) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition of the Parent Company’s assets that could have a material effect
on the financial statements.
The Parent Company’s management performed an assessment of the effectiveness of the Parent Company’s internal control over
financial reporting as of December 31, 2022 based upon criteria in Internal Control – Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (2013 Framework) (“COSO”). Based on our assessment, management determined that
the Parent Company’s internal control over financial reporting was effective as of December 31, 2022 based on the criteria in Internal Control-
Integrated Framework issued by COSO.
The effectiveness of the Parent Company’s internal control over financial reporting as of December 31, 2022 has been audited by Ernst &
Young LLP (PCAOB ID: 42), an independent registered public accounting firm, as stated in their report which is included in Item 9A herein.
/S/ Joseph V. Saffire
/S/ Alexander Gress
Chief Executive Officer
Chief Financial Officer
66
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Life Storage, Inc.
Opinion on Internal Control Over Financial Reporting
We have audited Life Storage, Inc.’s internal control over financial reporting as of December 31, 2022, based on criteria established in
the Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013
framework) (the COSO criteria). In our opinion, Life Storage, Inc. (the Parent Company) maintained, in all material respects, effective internal
control over financial reporting at December 31, 2022, based on the COSO criteria.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB),
the consolidated balance sheets of the Parent Company as of December 31, 2022 and 2021, the related consolidated statements of operations,
comprehensive income, shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2022, and the related
notes and financial statement schedule listed in the index at Item 15(a)(2) and our report dated February 24, 2023 expressed an unqualified
opinion thereon.
Basis for Opinion
The Parent Company’s management is responsible for maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Life
Storage, Inc. Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Parent Company’s internal control
over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent
with respect to the Parent 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 audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other
procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of
management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of
any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
Buffalo, New York
February 24, 2023
67
Controls and Procedures (Operating Partnership)
Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures
The Operating Partnership’s management conducted an evaluation of the effectiveness of the design and operation of the Operating
Partnership’s disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act
of 1934, as amended (Exchange Act), under the supervision of and with the participation of the Operating Partnership’s management, including
the Chief Executive Officer and Chief Financial Officer. Based on that evaluation, the Operating Partnership’s management, including the
Chief Executive Officer and Chief Financial Officer, concluded that the Operating Partnership’s disclosure controls and procedures were
effective at December 31, 2022. There have not been changes in the Operating Partnership’s internal controls or in other factors that could
significantly affect these controls during the quarter ended December 31, 2022.
Management’s Report on Life Storage LP Internal Control Over Financial Reporting
Management of Life Storage LP (the “Operating Partnership”) is responsible for establishing and maintaining adequate internal control
over financial reporting, and for performing an assessment of the effectiveness of internal control over financial reporting as of December 31,
2022. The Operating Partnership’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles. The Operating Partnership’s system of internal control over financial reporting includes those policies and procedures
that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the
assets of the Operating Partnership; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of
financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Operating
Partnership are being made only in accordance with authorizations of management and directors of the Operating Partnership; and (iii) provide
reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Operating Partnership’s
assets that could have a material effect on the financial statements.
The Operating Partnership’s management performed an assessment of the effectiveness of the Operating Partnership’s internal control
over financial reporting as of December 31, 2022 based upon criteria in Internal Control – Integrated Framework issued by the Committee of
Sponsoring Organizations of the Treadway Commission (2013 Framework) (“COSO”). Based on our assessment, management determined that
the Operating Partnership’s internal control over financial reporting was effective as of December 31, 2022 based on the criteria in Internal
Control-Integrated Framework issued by COSO.
The effectiveness of the Operating Partnership’s internal control over financial reporting as of December 31, 2022 has been audited by
Ernst & Young LLP (PCAOB ID: 42), an independent registered public accounting firm, as stated in their report which is included in Item 9A
herein.
/S/ Joseph V. Saffire
/S/ Alexander Gress
Chief Executive Officer
Chief Financial Officer
68
Report of Independent Registered Public Accounting Firm
To the Partners and the Board of Directors of Life Storage LP
Opinion on Internal Control Over Financial Reporting
We have audited Life Storage LP’s internal control over financial reporting as of December 31, 2022, based on criteria established in the
Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013
framework) (the COSO criteria). In our opinion, Life Storage LP (the Operating Partnership) maintained, in all material respects, effective
internal control over financial reporting at December 31, 2022, based on the COSO criteria.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB),
the consolidated balance sheets of the Operating Partnership as of December 31, 2022 and 2021, the related consolidated statements of
operations, comprehensive income, partners’ capital and cash flows for each of the three years in the period ended December 31, 2022, and the
related notes and financial statement schedule listed in the index at Item 15(a)(2) and our report dated February 24, 2023 expressed an
unqualified opinion thereon.
Basis for Opinion
The Operating Partnership’s management is responsible for maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Life Storage
LP Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Operating Partnership’s internal control over
financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with
respect to the Operating Partnership 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 audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other
procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting
principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of
records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of
management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of
any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions,
or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
Buffalo, New York
February 24, 2023
69
Item 9B. Other Information
None
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
70
Part III
Item 10. Directors, Executive Officers and Corporate Governance
The information contained in the Parent Company’s Proxy Statement for the 2023 Annual Meeting of Shareholders to be filed with the
SEC within 120 days of the fiscal year ended December 31, 2022 (“2023 Proxy Statement”), with respect to directors, executive officers, audit
committee, and audit committee financial experts of the Company and Section 16(a) beneficial ownership reporting compliance, is
incorporated herein by reference in response to this item.
The Company has adopted a code of ethics that applies to all of its directors, officers, and employees. The Company has made the Code
of Ethics available on its website at http://www.lifestorage.com.
Item 11. Executive Compensation
The information required is incorporated by reference to “Executive Compensation” and “Director Compensation” in the 2023 Proxy
Statement and is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required herein is incorporated by reference to “Stock Ownership By Directors and Executive Officers” and “Security
Ownership of Certain Beneficial Owners” in the 2023 Proxy Statement and is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required herein is incorporated by reference to “Certain Transactions” and “Election of Directors—Director
Independence” in the 2023 Proxy Statement and is incorporated herein by reference.
Item 14. Principal Accountant Fees and Services
The information required herein is incorporated by reference to “Appointment of Independent Registered Public Accounting Firm” in the
2023 Proxy Statement and is incorporated herein by reference.
71
Part IV
Item 15. Exhibits, Financial Statement Schedules
(a)
Documents filed as part of this Annual Report on Form 10-K:
1.
The following consolidated financial statements of Life Storage, Inc. are included in Item 8.
(i)
Consolidated Balance Sheets as of December 31, 2022 and 2021;
(ii)
Consolidated Statements of Operations for Years Ended December 31, 2022, 2021 and 2020;
(iii)
Consolidated Statements of Comprehensive Income for Years Ended December 31, 2022, 2021 and 2020;
(iv)
Consolidated Statements of Shareholders’ Equity for Years Ended December 31, 2022, 2021 and 2020;
(v)
Consolidated Statements of Cash Flows for Years Ended December 31, 2022, 2021 and 2020; and
(vi)
Notes to Consolidated Financial Statements.
The following consolidated financial statements of Life Storage LP are included in Item 8.
(i)
Consolidated Balance Sheets as of December 31, 2022 and 2021;
(ii)
Consolidated Statements of Operations for Years Ended December 31, 2022, 2021 and 2020;
(iii)
Consolidated Statements of Comprehensive Income for Years Ended December 31, 2022, 2021 and 2020;
(iv)
Consolidated Statements of Partners’ Capital for Years Ended December 31, 2022, 2021 and 2020;
(v)
Consolidated Statements of Cash Flows for Years Ended December 31, 2022, 2021 and 2020; and
(vi)
Notes to Consolidated Financial Statements.
2.
The following financial statement Schedule as of the period ended December 31, 2022 is included in this Annual Report on Form 10-K.
Schedule III Real Estate and Accumulated Depreciation at December 31, 2022.
All other Consolidated financial schedules are omitted because they are inapplicable, not required, or the information is included
elsewhere in the consolidated financial statements or the notes thereto.
72
3.
Exhibits
The exhibits required to be filed as part of this Annual Report on Form 10-K have been included as follows:
3.1
Amended and Restated Articles of Incorporation of the Parent Company (incorporated by reference to Exhibit 3.1 to the Parent
Company and the Operating Partnership’s Annual Report on Form 10-K filed February 27, 2018).
3.2
Articles Supplementary to the Amended and Restated Articles of Incorporation of the Parent Company classifying and designating
the Series A Junior Participating Cumulative Preferred Stock (incorporated by reference to Exhibit 3.1 to the Parent Company’s
Form 8-A filed December 3, 1996).
3.3
Articles Supplementary to the Amended and Restated Articles of Incorporation of the Parent Company classifying and designating
the 9.85% Series B Cumulative Redeemable Preferred Stock (incorporated by reference to Exhibit 1.6 to the Parent Company’s Form
8-A filed July 29, 1999).
3.4
Articles Supplementary to the Amended and Restated Articles of Incorporation of the Parent Company classifying and designating
the 8.375% Series C Convertible Cumulative Preferred Stock (incorporated by reference to Exhibit 4.1 to the Parent Company’s
Current Report on Form 8-K filed July 12, 2002).
3.5
Articles Supplementary to the Amended and Restated Articles of Incorporation of the Parent Company reclassifying shares of Series
B Cumulative Redeemable Preferred Stock into Preferred Stock. (incorporated by reference to Exhibit 3.1 to the Parent Company’s
Current Report on Form 8-K filed May 31, 2011).
3.6
Articles of Amendment of the Parent Company (incorporated by reference to Exhibit 3.1 to the Parent Company and the Operating
Partnership’s Current Report on Form 8-K filed August 11, 2016).
Articles of Amendment of the Parent Company (incorporated by reference to Exhibit 3.1 to the Parent Company and the Operating
3.7
Partnership’s Current Report on Form 8-K filed June 1, 2021)
3.8
Bylaws, as amended, of the Parent Company (incorporated by reference to Exhibit 3.2 to the Parent Company and the Operating
Partnership’s Current Report on Form 8-K filed August 11, 2016).
3.9
Amendment to Bylaws (incorporated by reference to Exhibit 3.1 to the Parent Company and the Operating Partnership’s Current
Report on Form 8-K filed May 19, 2017).
3.10
Amendment to Bylaws (incorporated by reference to Exhibit 3.1 to the Parent Company and Operating Partnership’s Current Report
on Form 8-K filed May 31, 2019).
3.11
Amended and Restated Certificate of Limited Partnership (incorporated by reference to Exhibit 3.3 to the Parent Company and the
Operating Partnership’s Current Report on Form 8-K filed August 11, 2016).
Amended and Restated Agreement of Limited Partnership of Life Storage LP (incorporated by reference to Exhibit 3.1 to the Parent
3.12
Company and the Operating Partnership's Current Report on Form 8-K filed June 8, 2021).
Certificate of Designation of 4.5% Series A Preferred Limited Partnership Units (incorporated by reference to Exhibit 3.1 to the Parent
3.13
Company and the Operating Partnership's Current Report on Form 8-K filed August 23, 2021).
4.1
Form of Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Parent Company’s Registration Statement on
Form S-11 (File No. 33-91422) filed June 19, 1995). P
4.2
Base Indenture, dated as of June 20, 2016, among the Company, the Operating Partnership and Wells Fargo Bank, National
Association (incorporated by reference to Exhibit 4.1 to the Parent Company and the Operating Partnership’s Current Report on
Form 8-K filed June 20, 2016).
4.3
First Supplemental Indenture, dated as of June 20, 2016, among the Parent Company, the Operating Partnership and Wells Fargo
Bank, National Association (incorporated by reference to Exhibit 4.2 to the Parent Company and the Operating Partnership’s Current
Report on Form 8-K filed June 20, 2016).
4.4
Form of Note representing the Notes (incorporated by reference to Exhibit 4.3 to the Parent Company and the Operating
Partnership’s Current Report on Form 8-K filed June 20, 2016).
4.5
Form of Guarantee (included in Exhibit 4.4).
4.6
Second Supplemental Indenture, dated as of December 7, 2017, among the Parent Company, the Operating Partnership and Wells
Fargo Bank, National Association (incorporated by reference to Exhibit 4.1 to the Parent Company and the Operating Partnership’s
Current Report on Form 8-K filed December 7, 2017).
4.7
Form of Note representing the Notes (incorporated by reference to Exhibit 4.2 to the Parent Company and the Operating
Partnership’s Current Report on Form 8-K filed December 7, 2017).
73
4.8
Form of Guarantee (included in Exhibit 4.7).
4.9
Third Supplemental Indenture, dated as of June 3, 2019, among the Parent Company, the Operating Partnership and Wells Fargo
Bank, National Association (incorporated by reference to Exhibit 4.1 to the Parent Company and the Operating Partnership’s Current
Report on Form 8-K filed June 3, 2019).
4.10
Form of Note representing the Notes (incorporated by reference to Exhibit 4.2 to the Parent Company and the Operating
Partnership’s Current Report on Form 8-K filed June 3, 2019).
4.11
Form of Guarantee (included in Exhibit 4.10).
4.12
Fourth Supplemental Indenture, dated as of September 23, 2020, among the Parent Company, the Operating Partnership and Wells
Fargo Bank, National Association (incorporated by reference to Exhibit 4.1 to the Parent Company and Operating Partnership’s
Current Report on Form 8-K filed September 23, 2020).
4.13
Form of Note representing the Notes (incorporated by reference to Exhibit 4.2 to the Parent Company and Operating Partnership’s
Current Report on Form 8-K filed September 23, 2020).
4.14
Form of Guarantee (included in Exhibit 4.13).
4.15
Fifth Supplemental Indenture, dated as of October 7, 2021, among the Parent Company, the Operating Partnership and Wells Fargo
Bank, National Association (incorporated by reference to Exhibit 4.1 to the Parent Company and Operating Partnership's Current
Report on Form 8-K filed October 8, 2021).
4.16
Form of Note representing the Notes (incorporated by reference to Exhibit 4.2 to the Parent Company and Operating Partnership’s
Current Report on Form 8-K filed October 8, 2021).
4.17
Form of Guarantee (included in Exhibit 4.16).
4.18*
Description of Securities Registered Under Section 12 of the Exchange Act of 1934
10.1+
2015 Award and Option Plan, as amended (incorporated by reference to Exhibit 10.1 to the Parent Company and the Operating
Partnership’s Annual Report on Form 10-K filed February 27, 2017).
10.2+
Deferred Compensation Plan for Directors (incorporated by reference to the Parent Company’s Schedule 14A Proxy Statement filed
April 8, 2015).
10.3+
Form of Indemnification Agreements with members of the Board of Directors (incorporated by reference to Exhibit 10.1 to the
Parent Company and Operating Partnership’s Current Report on Form 8-K filed February 16, 2021).
10.4
Eighth Amended and Restated Revolving Credit Agreement dated as of July 13, 2022 among the Parent Company and the Operating
Partnership, certain financial institutions a party thereto or which may become a party thereto (the "Lenders"), Manufacturers and
Traders Trust Company, as administrative agent, and various other parties as joint lead arrangers, joint bookrunners, syndication
agents and documentation agents (incorporated by reference to Exhibit 10.1 to the Parent Company and the Operating Partnership's
Current Report on Form 8-K filed July 15, 2022).
10.5
Note Purchase Agreement dated as of April 8, 2014 among the Parent Company, the Operating Partnership and the institutions
named in Schedule A thereto as purchasers of $175 million, 4.533% Senior Guaranteed Notes, Series E due April 8, 2024
(incorporated by reference to Exhibit 10.1 to the Parent Company’s Current Report on Form 8-K filed April 9, 2014).
10.6
Amendment No. 2 to Note Purchase Agreement (2014) dated June 29, 2016 by and among the Parent Company and the Operating
Partnership and the Required Holders (incorporated by reference to Exhibit 10.2 to the Parent Company and the Operating
Partnership’s Current Report on Form 8-K filed July 6, 2016).
10.7
Amendments to Note Purchase Agreement (2014) (incorporated by reference to Exhibit 10.25 to the Parent Company and the
Operating Partnership’s Annual Report on Form 10-K filed February 27, 2018).
10.8
Note Purchase Agreement dated as of July 21, 2016 among the Parent Company and the Operating Partnership and the institutions
named in Schedule A thereto as purchasers (incorporated by reference to Exhibit 10.1 to the Parent Company and the Operating
Partnership’s Current Report on Form 8-K filed July 26, 2016).
10.9
Amendment to Note Purchase Agreement (2016) (incorporated by reference to Exhibit 10.27 to the Parent Company and the
Operating Partnership’s Annual Report on Form 10-K filed February 27, 2018).
10.10+
Amended and Restated 2009 Outside Directors Stock Option and Award Plan (incorporated by reference to the Parent Company’s
Schedule 14A Proxy Statement filed April 16, 2019).
74
10.11+
Outside Directors’ Stock Award Plan (incorporated by reference to the Parent Company’s Schedule 14A Proxy Statement filed April
17, 2020).
10.12*+ Outside Director Fee Schedule.
10.13+
Annual Incentive Compensation Plan for Executive Officers, as amended (incorporated by reference to Exhibit 10.1 to the Parent
Company and the Operating Partnership’s Quarterly Report on Form 10-Q filed May 3, 2018).
10.14+
Amended and Restated Employment Agreement between the Parent Company, the Operating Partnership and Andrew J. Gregoire
dated November 1, 2017 (incorporated by reference to Exhibit 10.5 to the Parent Company and the Operating Partnership’s Quarterly
Report on Form 10-Q filed November 3, 2017).
Amendment to Employment Agreement and Retirement Agreement by and among the Parent Company, the Operating Partnership and
10.15+ Andrew J. Gregoire, dated October 25, 2022 (incorporated by reference to Exhibit 10.1 to the Parent Company and Operating
Partnership's Current Report on Form 8-K filed October 25, 2022).
10.16+
Amended and Restated Employment Agreement between the Parent Company, the Operating Partnership and Edward F. Killeen
dated November 1, 2017 (incorporated by reference to Exhibit 10.6 to the Parent Company and the Operating Partnership’s
Quarterly Report on Form 10-Q filed November 3, 2017).
10.17+
Separation Agreement by and among the Parent Company, the Operating Partnership and Edward F. Killeen, dated September 2,
2021 (incorporated by reference to Exhibit 10.1 to the Parent Company and the Operating Partnership's Current Report on Form 8-K
filed September 2, 2021).
10.18+
Employment Agreement between the Parent Company, the Operating Partnership and Joseph Saffire dated November 1, 2017
(incorporated by reference to Exhibit 10.1 to the Parent Company and the Operating Partnership’s Quarterly Report on Form 10-Q
filed November 3, 2017).
10.19+
Letter Agreement between the Parent Company and Joseph V. Saffire (incorporated by reference to Exhibit 10.1 to the Parent
Company and the Operating Partnership’s Current Report on Form 8-K filed March 1, 2019.
10.20+
Amended and Restated Employment Agreement by and among the Parent Company, the Operating Partnership and Alexander Gress,
dated January 2, 2023 (incorporated by reference to Exhibit 10.1 to the Parent Company and Operating Partnership's Current Report
on Form 8-K filed January 3, 2023).
10.21+
Amended and Restated Employment Agreement by and among the Parent Company, the Operating Partnership and David Dodman
dated January 1, 2022 (incorporated by reference to Exhibit 10.1 to the Parent Company and the Operating Partnership’s Current
Report on Form 8-K filed January 3, 2022).
10.22+
Form of Long Term Incentive Stock Award Notice (incorporated by reference to Exhibit 10.1 to the Parent Company and the
Operating Partnership’s Current Report on Form 8-K filed December 21, 2018).
10.23+
Form of Long Term Incentive Restricted Stock Award Notice (incorporated by reference to Exhibit 10.1 to the Parent Company and
the Operating Partnership’s Current Report on Form 8-K filed December 19, 2019).
10.24+
Form of Performance-Based Award Notice (incorporated by reference to Exhibit 10.2 to the Parent Company and the Operating
Partnership’s Current Report on Form 8-K filed December 19, 2019).
10.25+
Form of Long Term Restricted Stock Award Notice (incorporated by reference to Exhibit 10.1 to the Parent Company and Operating
Partnership’s Current Report on Form 8-K filed December 18, 2020).
10.26+
Form of Performance-Based Award Notice (incorporated by reference to Exhibit 10.2 to the Parent Company and Operating
Partnership’s Current Report on Form 8-K filed December 18, 2020).
10.27+
Form of Long Term Restricted Stock Award Notice (incorporated by reference to Exhibit 10.1 to the Parent Company and Operating
Partnership’s Current Report on Form 8-K filed December 20, 2021).
10.28+
Form of Performance-Based Award Notice (incorporated by reference to Exhibit 10.2 to the Parent Company and Operating
Partnership’s Current Report on Form 8-K filed December 20, 2021).
10.29+
Form of Long Term Restricted Stock Award Notice (incorporated by reference to Exhibit 10.1 to the Parent Company and Operating
Partnershp's Current Report on Form 8-K filed December 16, 2022).
10.30+
Form of Performance-Based Award Notice (incorporated by reference to Exhibit 10.2 to the Parent Company and Operating
Partnership's Current Report on Form 8-K filed December 16, 2022).
10.31
Form of Equity Distribution Agreement, dated August 11, 2022, by and among the Parent Company, the Operating Partnership, Life
Storage Holdings, Inc., the Sales Agents, the Forward Sellers and the Forward Purchasers (incorporated by reference to Exhibit 1.1
of the Parent Company and Operating Partnership’s Current Report on Form 8-K filed August 11, 2022).
21.1*
Subsidiaries of the Company.
75
23.1*
Consent of Independent Registered Public Accounting Firm
23.2*
Consent of Independent Registered Public Accounting Firm
24.1*
Powers of Attorney (included on signature pages).
31.1*
Certification of Chief Executive Officer of Life Storage, Inc. pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities
Exchange Act, as amended.
31.2*
Certification of Chief Financial Officer of Life Storage, Inc. pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities
Exchange Act, as amended.
31.3*
Certification of Chief Executive Officer of Life Storage LP pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities
Exchange Act, as amended.
31.4*
Certification of Chief Financial Officer of Life Storage LP pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange
Act, as amended.
32.1*
Certification of Chief Executive Officer and Chief Financial Officer of Life Storage, Inc. Pursuant to 18 U.S.C. Section 1350 as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*
Certification of Chief Executive Officer and Chief Financial Officer of Life Storage LP Pursuant to 18 U.S.C. Section 1350 as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101*
The following financial statements from Life Storage, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2022,
formatted in inline XBRL, as follows:
(i)
Consolidated Balance Sheets at December 31, 2022 and 2021;
(ii) Consolidated Statements of Operations for Years Ended December 31, 2022, 2021 and 2020;
(iii) Consolidated Statements of Comprehensive Income for Years Ended December 31, 2022, 2021 and 2020;
(iv) Consolidated Statements of Shareholders’ Equity for Years Ended December 31, 2022, 2021 and 2020;
(v) Consolidated Statements of Cash Flows for Years Ended December 31, 2022, 2021 and 2020; and
(vi) Notes to Consolidated Financial Statements.
The following financial statements from Life Storage LP’s Annual Report on Form 10-K for the year ended December 31, 2022,
formatted in inline XBRL, as follows:
(i)
Consolidated Balance Sheets at December 31, 2022 and 2021;
(ii) Consolidated Statements of Operations for Years Ended December 31, 2022, 2021 and 2020;
(iii) Consolidated Statements of Comprehensive Income for Years Ended December 31, 2022, 2021 and 2020;
(iv) Consolidated Statements of Partners’ Capital for Years Ended December 31, 2022, 2021 and 2020;
(v) Consolidated Statements of Cash Flows for Years Ended December 31, 2022, 2021 and 2020; and
(vi) Notes to Consolidated Financial Statements.
104
Cover Page Interactive Data File (embedded within the Inline XBRL document)
*
Filed herewith.
+
Management contract or compensatory plan or arrangement.
Item 16. Form 10-K Summary
Not applicable.
76
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
February 24, 2023
LIFE STORAGE, INC.
By: /s/ Alexander Gress
Alexander Gress
Chief Financial Officer
(Principal Accounting Officer)
February 24, 2023
LIFE STORAGE LP
By: /s/ Alexander Gress
Alexander Gress
Chief Financial Officer
(Principal Accounting Officer)
Pursuant to the requirements 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/ Mark G. Barberio
Mark G. Barberio
Chair of Board and Director of Life Storage, Inc.
February 24, 2023
/s/ Joseph V. Saffire
Joseph V. Saffire
Chief Executive Officer (Principal Executive Officer) and
Director of Life Storage, Inc. and Life Storage Holdings, Inc.,
general partner of Life Storage LP
February 24, 2023
/s/ Alexander Gress
Alexander Gress
Chief Financial Officer (Principal Financial and Accounting
Officer) of Life Storage, Inc. and Life Storage Holdings, Inc.,
general partner of Life Storage LP
February 24, 2023
/s/ Stephen R. Rusmisel
Stephen R. Rusmisel
Director of Life Storage, Inc.
February 24, 2023
/s/ Arthur L. Havener, Jr.
Arthur L. Havener, Jr.
Director of Life Storage, Inc.
February 24, 2023
/s/ Dana Hamilton
Dana Hamilton
Director of Life Storage, Inc.
February 24, 2023
/s/ Edward J. Pettinella
Edward J. Pettinella
Director of Life Storage, Inc.
February 24, 2023
/s/ David L. Rogers
David L. Rogers
Director of Life Storage, Inc.
February 24, 2023
/s/ Susan S. Harnett
Susan S. Harnett
Director of Life Storage, Inc.
February 24, 2023
77
78
Life Storage, Inc. and Life Storage LP
Schedule III
Combined Real Estate and Accumulated Depreciation
(in thousands)
December 31, 2022
Initial Cost to Company
Cost
Capitalized
Subsequent
to
Acquisition
Gross Amount at Which
Carried at Close of Period
Life on
which
depreciation
Building,
Building,
Building,
in latest
Equipment
Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts.
Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Charleston
SC
$
416
$
1,516
$
2,566
$
416
$
4,082
$
4,498
$
2,196
1985
6/26/1995
5 to 40 years
Lakeland
FL
397
1,424
1,808
397
3,232
3,629
1,795
1985
6/26/1995
5 to 40 years
Charlotte
NC
308
1,102
3,788
747
4,451
5,198
1,946
1986
6/26/1995
5 to 40 years
Youngstown
OH
239
1,110
2,656
239
3,766
4,005
1,870
1980
6/26/1995
5 to 40 years
Cleveland
OH
701
1,659
3,888
1,036
5,212
6,248
2,210
1987/15
6/26/1995
5 to 40 years
Pt. St. Lucie
FL
395
1,501
3,667
779
4,784
5,563
1,774
1985/2019
6/26/1995
5 to 40 years
Orlando - Deltona
FL
483
1,752
2,444
483
4,196
4,679
2,440
1984
6/26/1995
5 to 40 years
NY Metro-Middletown
NY
224
808
4,560
224
5,368
5,592
1,680
1988/17
6/26/1995
5 to 40 years
Buffalo
NY
423
1,531
4,274
497
5,731
6,228
2,799
1981
6/26/1995
5 to 40 years
Rochester
NY
395
1,404
3,460
395
4,864
5,259
1,306
1981
6/26/1995
5 to 40 years
Jacksonville
FL
152
728
3,965
687
4,158
4,845
1,698
1985
6/26/1995
5 to 40 years
Boston
MA
363
1,679
1,028
363
2,707
3,070
1,688
1980
6/26/1995
5 to 40 years
Rochester
NY
230
847
2,371
234
3,214
3,448
1,370
1980
6/26/1995
5 to 40 years
Boston
MA
680
1,616
1,040
680
2,656
3,336
1,611
1986
6/26/1995
5 to 40 years
Savannah
GA
463
1,684
8,765
1,445
9,467
10,912
3,366
1981/2022
6/26/1995
5 to 40 years
Raleigh-Durham
NC
649
2,329
1,712
649
4,041
4,690
2,400
1985
6/26/1995
5 to 40 years
Hartford-New Haven
CT
387
1,402
4,066
387
5,468
5,855
2,305
1985
6/26/1995
5 to 40 years
Atlanta
GA
844
2,021
1,220
844
3,241
4,085
1,986
1988
6/26/1995
5 to 40 years
Atlanta
GA
302
1,103
795
303
1,897
2,200
1,198
1988
6/26/1995
5 to 40 years
Buffalo
NY
315
745
4,159
517
4,702
5,219
2,129
1984
6/26/1995
5 to 40 years
Raleigh-Durham
NC
321
1,150
3,538
321
4,688
5,009
1,731
1985
6/26/1995
5 to 40 years
Columbia
SC
189
719
4,784
189
5,503
5,692
1,092
1989/2020
6/26/1995
5 to 40 years
Atlanta
GA
430
1,579
4,909
602
6,316
6,918
2,124
1988/2022
6/26/1995
5 to 40 years
Orlando
FL
513
1,930
958
513
2,888
3,401
1,917
1988
6/26/1995
5 to 40 years
Sharon
PA
194
912
736
194
1,648
1,842
1,026
1975
6/26/1995
5 to 40 years
Ft. Lauderdale
FL
1,503
3,619
2,135
1,503
5,754
7,257
3,090
1985
6/26/1995
5 to 40 years
West Palm
FL
398
1,035
818
398
1,853
2,251
1,093
1985
6/26/1995
5 to 40 years
Atlanta
GA
423
1,015
3,471
424
4,485
4,909
1,281
1989
6/26/1995
5 to 40 years
Atlanta
GA
483
1,166
1,417
483
2,583
3,066
1,475
1988
6/26/1995
5 to 40 years
Atlanta
GA
308
1,116
1,181
308
2,297
2,605
1,348
1986
6/26/1995
5 to 40 years
Atlanta
GA
170
786
1,043
174
1,825
1,999
1,089
1981
6/26/1995
5 to 40 years
Atlanta
GA
413
999
995
413
1,994
2,407
1,354
1975
6/26/1995
5 to 40 years
Baltimore
MD
154
555
1,590
306
1,993
2,299
1,145
1984
6/26/1995
5 to 40 years
Baltimore
MD
479
1,742
3,315
479
5,057
5,536
2,612
1988
6/26/1995
5 to 40 years
Melbourne
FL
883
2,104
5,511
883
7,615
8,498
2,713
1986/2019
6/26/1995
5 to 40 years
Newport News
VA
316
1,471
1,220
316
2,691
3,007
1,681
1988
6/26/1995
5 to 40 years
Pensacola
FL
632
2,962
2,068
651
5,011
5,662
3,230
1983
6/26/1995
5 to 40 years
Hartford
CT
715
1,695
1,506
715
3,201
3,916
1,966
1988
6/26/1995
5 to 40 years
Atlanta
GA
304
1,118
3,071
619
3,874
4,493
2,245
1988
6/26/1995
5 to 40 years
Alexandria
VA
1,375
3,220
3,304
1,376
6,523
7,899
3,960
1984
6/26/1995
5 to 40 years
Pensacola
FL
244
901
800
244
1,701
1,945
1,057
1986
6/26/1995
5 to 40 years
Melbourne
FL
834
2,066
3,606
1,591
4,915
6,506
2,244
1986/15
6/26/1995
5 to 40 years
Hartford
CT
234
861
3,677
612
4,160
4,772
1,879
1992
6/26/1995
5 to 40 years
Atlanta
GA
256
1,244
2,615
256
3,859
4,115
2,086
1988
6/26/1995
5 to 40 years
Norfolk
VA
313
1,462
2,919
313
4,381
4,694
2,128
1984
6/26/1995
5 to 40 years
Birmingham
AL
307
1,415
1,990
385
3,327
3,712
1,910
1990
6/26/1995
5 to 40 years
79
Initial Cost to Company
Cost
Capitalized
Subsequent
to
Acquisition
Gross Amount at Which
Carried at Close of Period
Life on
which
depreciation
Building,
Building,
Building,
in latest
Equipment
Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts.
Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Birmingham
AL
730
1,725
3,095
730
4,820
5,550
2,287
1990
6/26/1995
5 to 40 years
Montgomery
AL
863
2,041
1,658
863
3,699
4,562
2,197
1982
6/26/1995
5 to 40 years
Jacksonville
FL
326
1,515
1,476
326
2,991
3,317
1,652
1987
6/26/1995
5 to 40 years
Pensacola
FL
369
1,358
3,694
369
5,052
5,421
2,664
1986
6/26/1995
5 to 40 years
Pensacola
FL
244
1,128
2,969
720
3,621
4,341
1,743
1990
6/26/1995
5 to 40 years
Pensacola
FL
226
1,046
1,014
226
2,060
2,286
1,271
1990
6/26/1995
5 to 40 years
Tampa
FL
1,088
2,597
1,934
1,088
4,531
5,619
2,688
1989
6/26/1995
5 to 40 years
Clearwater
FL
526
1,958
1,735
526
3,693
4,219
2,177
1985
6/26/1995
5 to 40 years
Clearwater-Largo
FL
672
2,439
1,254
672
3,693
4,365
2,288
1988
6/26/1995
5 to 40 years
Providence
RI
345
1,268
2,195
486
3,322
3,808
1,692
1984
6/26/1995
5 to 40 years
Norfolk - Virginia Beach
VA
1,142
4,998
3,739
1,142
8,737
9,879
4,510
1989/93/95/16
6/26/1995
5 to 40 years
Richmond
VA
443
1,602
1,340
443
2,942
3,385
1,815
1987
8/25/1995
5 to 40 years
Orlando
FL
1,161
2,755
3,169
1,162
5,923
7,085
3,023
1986/15
9/29/1995
5 to 40 years
Syracuse
NY
470
1,712
1,833
472
3,543
4,015
2,085
1987
12/27/1995
5 to 40 years
Ft. Myers
FL
205
912
915
206
1,826
2,032
1,059
1988
12/28/1995
5 to 40 years
Ft. Myers
FL
412
1,703
1,045
413
2,747
3,160
1,773
1991/94
12/28/1995
5 to 40 years
Harrisburg
PA
360
1,641
3,425
360
5,066
5,426
1,635
1983
12/29/1995
5 to 40 years
Harrisburg
PA
627
2,224
5,837
692
7,996
8,688
3,115
1985
12/29/1995
5 to 40 years
Newport News
VA
442
1,592
1,599
442
3,191
3,633
2,010
1988/93
1/5/1996
5 to 40 years
Montgomery
AL
353
1,299
1,286
353
2,585
2,938
1,442
1984
1/23/1996
5 to 40 years
Charleston
SC
237
858
1,143
245
1,993
2,238
1,225
1985
3/1/1996
5 to 40 years
Tampa
FL
766
1,800
1,249
766
3,049
3,815
1,792
1985
3/28/1996
5 to 40 years
Dallas-Ft.Worth
TX
442
1,767
477
442
2,244
2,686
1,508
1987
3/29/1996
5 to 40 years
Dallas-Ft.Worth
TX
408
1,662
1,627
408
3,289
3,697
1,931
1986
3/29/1996
5 to 40 years
Dallas-Ft.Worth
TX
328
1,324
4,827
328
6,151
6,479
621
2018
3/29/1996
5 to 40 years
San Antonio
TX
436
1,759
1,761
436
3,520
3,956
2,070
1986
3/29/1996
5 to 40 years
San Antonio
TX
289
1,161
2,542
289
3,703
3,992
942
2012
3/29/1996
5 to 40 years
Montgomery
AL
279
1,014
1,636
433
2,496
2,929
1,413
1988
5/21/1996
5 to 40 years
West Palm
FL
345
1,262
705
345
1,967
2,312
1,208
1986
5/29/1996
5 to 40 years
Ft. Myers
FL
229
884
2,978
383
3,708
4,091
1,394
1986
5/29/1996
5 to 40 years
Syracuse
NY
481
1,559
2,752
671
4,121
4,792
2,437
1983
6/5/1996
5 to 40 years
Lakeland
FL
359
1,287
1,457
359
2,744
3,103
1,769
1988
6/26/1996
5 to 40 years
Boston - Springfield
MA
251
917
2,641
297
3,512
3,809
2,060
1986
6/28/1996
5 to 40 years
Ft. Myers
FL
344
1,254
784
310
2,072
2,382
1,284
1987
6/28/1996
5 to 40 years
Cincinnati
OH
557
1,988
1,069
688
2,926
3,614
1,401
1988
7/23/1996
5 to 40 years
Baltimore
MD
777
2,770
1,072
777
3,842
4,619
2,346
1990
7/26/1996
5 to 40 years
Jacksonville
FL
568
2,028
1,970
568
3,998
4,566
2,320
1987
8/23/1996
5 to 40 years
Jacksonville
FL
436
1,635
1,253
436
2,888
3,324
1,724
1985
8/26/1996
5 to 40 years
Jacksonville
FL
535
2,033
794
538
2,824
3,362
1,829
1987/92
8/30/1996
5 to 40 years
Charlotte
NC
487
1,754
827
487
2,581
3,068
1,573
1995
9/16/1996
5 to 40 years
Charlotte
NC
315
1,131
691
315
1,822
2,137
1,130
1995
9/16/1996
5 to 40 years
Orlando
FL
314
1,113
1,572
314
2,685
2,999
1,594
1975
10/30/1996
5 to 40 years
Rochester
NY
704
2,496
3,262
707
5,755
6,462
2,870
1990
12/20/1996
5 to 40 years
Youngstown
OH
600
2,142
2,861
693
4,910
5,603
2,548
1988
1/10/1997
5 to 40 years
Cleveland
OH
751
2,676
4,658
751
7,334
8,085
3,542
1986
1/10/1997
5 to 40 years
Cleveland
OH
725
2,586
2,841
725
5,427
6,152
2,999
1978
1/10/1997
5 to 40 years
80
Initial Cost to Company
Cost
Capitalized
Subsequent
to
Acquisition
Gross Amount at Which
Carried at Close of Period
Life on
which
depreciation
Building,
Building,
Building,
in latest
Equipment
Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts.
Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Cleveland
OH
637
2,918
2,592
701
5,446
6,147
3,554
1979
1/10/1997
5 to 40 years
Cleveland
OH
495
1,781
4,275
495
6,056
6,551
2,386
1979/17
1/10/1997
5 to 40 years
Cleveland
OH
761
2,714
2,060
761
4,774
5,535
3,003
1977
1/10/1997
5 to 40 years
Cleveland
OH
418
1,921
3,133
418
5,054
5,472
2,711
1970
1/10/1997
5 to 40 years
Cleveland
OH
606
2,164
1,754
606
3,918
4,524
2,201
1982
1/10/1997
5 to 40 years
San Antonio
TX
346
1,236
740
346
1,976
2,322
1,212
1985
1/30/1997
5 to 40 years
San Antonio
TX
432
1,560
2,319
432
3,879
4,311
2,289
1995
1/30/1997
5 to 40 years
Houston-Beaumont
TX
634
2,565
5,087
634
7,652
8,286
3,105
1993/95/16
3/26/1997
5 to 40 years
Houston-Beaumont
TX
566
2,279
640
566
2,919
3,485
1,837
1995
3/26/1997
5 to 40 years
Houston-Beaumont
TX
293
1,357
746
293
2,103
2,396
1,245
1995
3/26/1997
5 to 40 years
Chesapeake
VA
260
1,043
4,972
260
6,015
6,275
2,479
1988/95
3/31/1997
5 to 40 years
Orlando-W 25th St
FL
289
1,160
2,667
616
3,500
4,116
1,514
1984
3/31/1997
5 to 40 years
Savannah
GA
296
1,196
792
296
1,988
2,284
1,152
1988
5/8/1997
5 to 40 years
Delray
FL
921
3,282
1,340
921
4,622
5,543
2,744
1980
5/21/1997
5 to 40 years
Cleveland-Avon
OH
301
1,214
2,490
304
3,701
4,005
2,013
1989
6/4/1997
5 to 40 years
Atlanta-Alpharetta
GA
1,033
3,753
997
1,033
4,750
5,783
2,910
1994
7/24/1997
5 to 40 years
Atlanta-Marietta
GA
769
2,788
866
825
3,598
4,423
2,208
1996
7/24/1997
5 to 40 years
Atlanta-Doraville
GA
735
3,429
826
735
4,255
4,990
2,595
1995
8/21/1997
5 to 40 years
Baton Rouge-Airline
LA
396
1,831
1,331
421
3,137
3,558
1,861
1982
10/9/1997
5 to 40 years
Baton Rouge-Airline2
LA
282
1,303
745
282
2,048
2,330
1,206
1985
11/21/1997
5 to 40 years
Harrisburg-Peiffers
PA
635
2,550
914
637
3,462
4,099
2,273
1984
12/3/1997
5 to 40 years
Tampa-E. Hillsborough
FL
709
3,235
1,202
709
4,437
5,146
2,744
1985
2/4/1998
5 to 40 years
NY Metro-Middletown
NY
843
3,394
4,815
843
8,209
9,052
3,203
1989/95
2/4/1998
5 to 40 years
Chesapeake-Military
VA
542
2,210
3,324
542
5,534
6,076
2,281
1996/2019
2/5/1998
5 to 40 years
Chesapeake-Volvo
VA
620
2,532
1,668
620
4,200
4,820
2,400
1995
2/5/1998
5 to 40 years
Norfolk-Naval Base
VA
1,243
5,019
1,226
1,243
6,245
7,488
3,803
1975
2/5/1998
5 to 40 years
Boston-Northbridge
MA
441
1,788
1,292
694
2,827
3,521
1,302
1988
2/9/1998
5 to 40 years
Titusville
FL
492
1,990
6,062
688
7,856
8,544
1,807
1986/90/2020
2/25/1998
5 to 40 years
Boston-Salem
MA
733
2,941
11,138
733
14,079
14,812
4,943
1979/2022
3/3/1998
5 to 40 years
Providence
RI
702
2,821
4,538
702
7,359
8,061
3,412
1984/88
3/26/1998
5 to 40 years
Chattanooga-Lee Hwy
TN
384
1,371
728
384
2,099
2,483
1,356
1987
3/27/1998
5 to 40 years
Chattanooga-Hwy 58
TN
296
1,198
2,419
414
3,499
3,913
1,848
1985
3/27/1998
5 to 40 years
Ft. Oglethorpe
GA
349
1,250
1,926
464
3,061
3,525
1,569
1989
3/27/1998
5 to 40 years
Birmingham-Walt
AL
544
1,942
1,440
544
3,382
3,926
2,069
1984
3/27/1998
5 to 40 years
Salem-Policy
NH
742
2,977
756
742
3,733
4,475
2,237
1980
4/7/1998
5 to 40 years
Raleigh-Durham
NC
775
3,103
4,126
775
7,229
8,004
2,216
1988/91/2019
4/9/1998
5 to 40 years
Youngstown-Warren
OH
522
1,864
1,696
569
3,513
4,082
1,997
1986
4/22/1998
5 to 40 years
Youngstown-Warren
OH
512
1,829
3,007
633
4,715
5,348
2,273
1986/16
4/22/1998
5 to 40 years
Houston-Katy
TX
419
1,524
4,555
419
6,079
6,498
2,528
1994
5/20/1998
5 to 40 years
Melbourne
FL
662
2,654
3,813
662
6,467
7,129
2,500
1985/07/15
6/2/1998
5 to 40 years
Vero Beach
FL
489
1,813
2,005
584
3,723
4,307
1,685
1997
6/12/1998
5 to 40 years
Houston-Humble
TX
447
1,790
3,140
740
4,637
5,377
2,189
1986
6/16/1998
5 to 40 years
Houston-Webster
TX
635
2,302
892
635
3,194
3,829
1,700
1997
6/19/1998
5 to 40 years
San Marcos
TX
324
1,493
2,552
324
4,045
4,369
1,972
1994
6/30/1998
5 to 40 years
Hollywood-Sheridan
FL
1,208
4,854
1,224
1,208
6,078
7,286
3,523
1988
7/1/1998
5 to 40 years
Pompano Beach-Atlantic
FL
944
3,803
970
944
4,773
5,717
3,270
1985
7/1/1998
5 to 40 years
81
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Pompano Beach-Sample
FL
903
3,643
972
903
4,615
5,518
2,645
1988
7/1/1998
5 to 40 years
Boca Raton-18th St
FL
1,503
6,059
(1,453)
851
5,258
6,109
3,022
1991
7/1/1998
5 to 40 years
Hollywood-N.21st
FL
840
3,373
703
840
4,076
4,916
2,511
1987
8/3/1998
5 to 40 years
Dallas-Fort Worth
TX
550
1,998
987
550
2,985
3,535
1,679
1996
9/29/1998
5 to 40 years
Dallas-Fort Worth
TX
670
2,407
1,962
670
4,369
5,039
2,452
1996
10/9/1998
5 to 40 years
Cincinnati-Batavia
OH
390
1,570
4,215
376
5,799
6,175
1,783
1988/2020
11/19/1998
5 to 40 years
Providence
RI
447
1,776
1,148
447
2,924
3,371
1,681
1986/94
2/2/1999
5 to 40 years
Lafayette-Ambassador
LA
314
1,095
5,957
314
7,052
7,366
638
2019
2/17/1999
5 to 40 years
Phoenix-Glendale
AZ
565
2,596
927
565
3,523
4,088
2,054
1997
5/18/1999
5 to 40 years
Phoenix-Mesa
AZ
330
1,309
2,913
733
3,819
4,552
1,731
1986
5/18/1999
5 to 40 years
Phoenix-Mesa
AZ
339
1,346
1,167
339
2,513
2,852
1,282
1986
5/18/1999
5 to 40 years
Phoenix-Mesa
AZ
291
1,026
1,546
291
2,572
2,863
1,238
1976
5/18/1999
5 to 40 years
Phoenix-Mesa
AZ
354
1,405
935
354
2,340
2,694
1,245
1986
5/18/1999
5 to 40 years
Phoenix-Bell
AZ
872
3,476
3,958
872
7,434
8,306
3,470
1984
5/18/1999
5 to 40 years
Phoenix-35th Ave
AZ
849
3,401
1,250
849
4,651
5,500
2,703
1996
5/21/1999
5 to 40 years
Portland
ME
410
1,626
2,195
410
3,821
4,231
1,983
1988
8/2/1999
5 to 40 years
Space Coast-Cocoa
FL
667
2,373
1,327
667
3,700
4,367
2,348
1982
9/29/1999
5 to 40 years
Dallas-Fort Worth
TX
335
1,521
1,031
335
2,552
2,887
1,334
1985
11/9/1999
5 to 40 years
NY Metro-Middletown
NY
276
1,312
4,653
276
5,965
6,241
1,761
1998/2019
2/2/2000
5 to 40 years
Boston-N. Andover
MA
633
2,573
1,299
633
3,872
4,505
2,031
1989
2/15/2000
5 to 40 years
Houston-Seabrook
TX
633
2,617
5,887
583
8,554
9,137
1,751
1996/2020
3/1/2000
5 to 40 years
Ft. Lauderdale
FL
384
1,422
1,207
384
2,629
3,013
1,336
1994
5/2/2000
5 to 40 years
Birmingham-Bessemer
AL
254
1,059
3,516
332
4,497
4,829
1,615
1998
11/15/2000
5 to 40 years
NY Metro-Brewster
NY
1,716
6,920
2,025
1,981
8,680
10,661
3,608
1991/97
12/27/2000
5 to 40 years
Austin-Lamar
TX
837
2,977
3,889
966
6,737
7,703
2,383
1996/99
2/22/2001
5 to 40 years
Houston
TX
733
3,392
1,438
841
4,722
5,563
2,110
1993/97
3/2/2001
5 to 40 years
Ft.Myers
FL
787
3,249
1,361
902
4,495
5,397
1,988
1997
3/13/2001
5 to 40 years
Boston-Dracut
MA
1,035
3,737
6,083
1,104
9,751
10,855
2,178
1986/2020
12/1/2001
5 to 40 years
Boston-Methuen
MA
1,024
3,649
1,003
1,091
4,585
5,676
2,366
1984
12/1/2001
5 to 40 years
Myrtle Beach
SC
552
1,970
3,367
589
5,300
5,889
1,745
1984/2019
12/1/2001
5 to 40 years
Maine-Saco
ME
534
1,914
5,016
938
6,526
7,464
1,679
1988/2019
12/3/2001
5 to 40 years
Boston-Plymouth
MA
1,004
4,584
2,583
1,004
7,167
8,171
3,380
1996
12/19/2001
5 to 40 years
Boston-Sandwich
MA
670
3,060
753
714
3,769
4,483
1,920
1984
12/19/2001
5 to 40 years
Syracuse
NY
294
1,203
1,303
327
2,473
2,800
1,164
1987
2/5/2002
5 to 40 years
Dallas-Fort Worth
TX
734
2,956
1,170
784
4,076
4,860
2,025
1984
2/13/2002
5 to 40 years
San Antonio-Hunt
TX
381
1,545
6,864
618
8,172
8,790
2,504
1980/17
2/13/2002
5 to 40 years
Houston-Humble
TX
919
3,696
1,209
852
4,972
5,824
2,309
1998/02
6/19/2002
5 to 40 years
Houston-Pasadena
TX
612
2,468
560
612
3,028
3,640
1,549
1999
6/19/2002
5 to 40 years
Houston-Montgomery
TX
817
3,286
2,898
1,119
5,882
7,001
2,535
1998
6/19/2002
5 to 40 years
Houston-S. Hwy 6
TX
407
1,650
956
407
2,606
3,013
1,172
1997
6/19/2002
5 to 40 years
Houston-Beaumont
TX
817
3,287
3,787
817
7,074
7,891
2,396
1996/17
6/19/2002
5 to 40 years
The Hamptons
NY
2,207
8,866
4,930
2,207
13,796
16,003
6,026
1989/95/2021
12/16/2002
5 to 40 years
The Hamptons
NY
1,131
4,564
720
1,131
5,284
6,415
2,637
1998
12/16/2002
5 to 40 years
The Hamptons
NY
635
2,918
540
635
3,458
4,093
1,723
1997
12/16/2002
5 to 40 years
The Hamptons
NY
1,251
5,744
1,097
1,252
6,840
8,092
3,255
1994/98
12/16/2002
5 to 40 years
Dallas-Fort Worth
TX
1,039
4,201
595
1,039
4,796
5,835
2,251
1995/99
8/26/2003
5 to 40 years
82
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Dallas-Fort Worth
TX
827
3,776
877
827
4,653
5,480
2,126
1998/01
10/1/2003
5 to 40 years
Stamford
CT
2,713
11,013
993
2,713
12,006
14,719
5,790
1998
3/17/2004
5 to 40 years
Houston-Tomball
TX
773
3,170
2,043
773
5,213
5,986
2,397
2000
5/19/2004
5 to 40 years
Houston-Conroe
TX
1,195
4,877
530
1,195
5,407
6,602
2,556
2001
5/19/2004
5 to 40 years
Houston-Spring
TX
1,103
4,550
1,286
1,103
5,836
6,939
2,583
2001
5/19/2004
5 to 40 years
Houston-Bissonnet
TX
1,061
4,427
3,282
1,061
7,709
8,770
3,372
2003
5/19/2004
5 to 40 years
Houston-Alvin
TX
388
1,640
1,165
388
2,805
3,193
1,266
2003
5/19/2004
5 to 40 years
Clearwater
FL
1,720
6,986
579
1,720
7,565
9,285
3,573
2001
6/3/2004
5 to 40 years
Houston-Missouri City
TX
1,167
4,744
4,239
1,566
8,584
10,150
3,449
1998
6/23/2004
5 to 40 years
Chattanooga-Hixson
TN
1,365
5,569
2,350
1,365
7,919
9,284
3,594
1998/02
8/4/2004
5 to 40 years
Austin-Round Rock
TX
2,047
5,857
1,083
1,976
7,011
8,987
3,277
2000
8/5/2004
5 to 40 years
Long Island-Bayshore
NY
1,131
4,609
353
1,131
4,962
6,093
2,198
2003
3/15/2005
5 to 40 years
Syracuse - Cicero
NY
527
2,121
3,420
527
5,541
6,068
1,907
1988/02/16
3/16/2005
5 to 40 years
Boston-Springfield
MA
612
2,501
1,102
612
3,603
4,215
1,406
1965/75
4/12/2005
5 to 40 years
Stamford
CT
1,612
6,585
501
1,612
7,086
8,698
3,223
2002
4/14/2005
5 to 40 years
Montgomery-Richard
AL
1,906
7,726
637
1,906
8,363
10,269
3,731
1997
6/1/2005
5 to 40 years
Houston-Jones
TX
1,214
4,949
1,915
1,215
6,863
8,078
2,550
1997/99
6/6/2005
5 to 40 years
Boston-Oxford
MA
470
1,902
4,655
470
6,557
7,027
1,831
2002
6/23/2005
5 to 40 years
Austin-290E
TX
537
2,183
6,192
491
8,421
8,912
1,864
2003/17
7/12/2005
5 to 40 years
San Antonio-Marbach
TX
556
2,265
1,042
556
3,307
3,863
1,411
2003
7/12/2005
5 to 40 years
Austin-South 1st
TX
754
3,065
637
754
3,702
4,456
1,616
2003
7/12/2005
5 to 40 years
Atlanta-Marietta
GA
811
3,397
705
811
4,102
4,913
1,827
2003
9/15/2005
5 to 40 years
Baton Rouge
LA
719
2,927
2,811
719
5,738
6,457
2,131
1984/94
11/15/2005
5 to 40 years
San Marcos-Hwy 35S
TX
628
2,532
3,541
982
5,719
6,701
1,685
2001/16
1/10/2006
5 to 40 years
Houston-Baytown
TX
596
2,411
752
596
3,163
3,759
1,248
2002
1/10/2006
5 to 40 years
Houston-Cypress
TX
721
2,994
2,619
721
5,613
6,334
2,211
2003
1/13/2006
5 to 40 years
Rochester
NY
937
3,779
364
937
4,143
5,080
1,780
2002/06
2/1/2006
5 to 40 years
Houston-Jones Rd 2
TX
707
2,933
3,100
707
6,033
6,740
2,485
2000
3/9/2006
5 to 40 years
Manchester
NH
832
3,268
339
832
3,607
4,439
1,509
2000
4/26/2006
5 to 40 years
Clearwater-Largo
FL
1,270
5,037
810
1,270
5,847
7,117
2,384
1998
6/22/2006
5 to 40 years
Clearwater-Pinellas Park
FL
929
3,676
743
929
4,419
5,348
1,739
2000
6/22/2006
5 to 40 years
Clearwater-Tarpon
Spring
FL
696
2,739
522
696
3,261
3,957
1,316
1999
6/22/2006
5 to 40 years
New Orleans
LA
1,220
4,805
477
1,220
5,282
6,502
2,223
2000
6/22/2006
5 to 40 years
St Louis-Meramec
MO
1,113
4,359
2,768
1,113
7,127
8,240
2,129
1999/2019
6/22/2006
5 to 40 years
St Louis-Charles Rock
MO
766
3,040
1,558
766
4,598
5,364
1,711
1999
6/22/2006
5 to 40 years
St Louis-Shackelford
MO
828
3,290
329
828
3,619
4,447
1,545
1999
6/22/2006
5 to 40 years
St Louis-W.Washington
MO
734
2,867
2,754
734
5,621
6,355
2,015
1980/01/15
6/22/2006
5 to 40 years
St Louis-Howdershell
MO
899
3,596
403
899
3,999
4,898
1,693
2000
6/22/2006
5 to 40 years
St Louis-Lemay Ferry
MO
890
3,552
590
890
4,142
5,032
1,739
1999
6/22/2006
5 to 40 years
St Louis-Manchester
MO
697
2,711
282
697
2,993
3,690
1,276
2000
6/22/2006
5 to 40 years
Dallas-Fort Worth
TX
1,256
4,946
903
1,256
5,849
7,105
2,417
1998/03
6/22/2006
5 to 40 years
Dallas-Fort Worth
TX
605
2,434
545
605
2,979
3,584
1,156
2004
6/22/2006
5 to 40 years
Dallas-Fort Worth
TX
607
2,428
456
607
2,884
3,491
1,177
2004
6/22/2006
5 to 40 years
Dallas-Fort Worth
TX
1,073
4,276
259
1,073
4,535
5,608
1,880
2003
6/22/2006
5 to 40 years
Dallas-Fort Worth
TX
549
2,180
1,293
549
3,473
4,022
1,352
1998
6/22/2006
5 to 40 years
Dallas-Fort Worth
TX
644
2,542
450
644
2,992
3,636
1,192
1999
6/22/2006
5 to 40 years
83
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
San Antonio-Blanco
TX
963
3,836
398
963
4,234
5,197
1,817
2004
6/22/2006
5 to 40 years
San Antonio-Broadway
TX
773
3,060
6,937
773
9,997
10,770
2,498
2000/22
6/22/2006
5 to 40 years
San Antonio-Huebner
TX
1,175
4,624
581
1,175
5,205
6,380
2,162
1998
6/22/2006
5 to 40 years
Nashua
NH
617
2,422
801
617
3,223
3,840
1,318
1989
6/29/2006
5 to 40 years
Chattanooga-Lee Hwy II
TN
619
2,471
337
619
2,808
3,427
1,196
2002
8/7/2006
5 to 40 years
Montgomery-E.S.Blvd
AL
1,158
4,639
1,450
1,158
6,089
7,247
2,531
1996/97
9/28/2006
5 to 40 years
Auburn-Pepperell Pkwy
AL
590
2,361
762
590
3,123
3,713
1,309
1998
9/28/2006
5 to 40 years
Auburn-Gatewood Dr
AL
694
2,758
520
694
3,278
3,972
1,335
2002/03
9/28/2006
5 to 40 years
Columbus-Williams Rd
GA
736
2,905
551
736
3,456
4,192
1,449
2002/04/06
9/28/2006
5 to 40 years
Columbus-Miller Rd
GA
975
3,854
1,537
975
5,391
6,366
1,954
1995
9/28/2006
5 to 40 years
Columbus-Armour Rd
GA
—
3,680
434
—
4,114
4,114
1,725
2004/05
9/28/2006
5 to 40 years
Columbus-Amber Dr
GA
439
1,745
497
439
2,242
2,681
978
1998
9/28/2006
5 to 40 years
Concord
NH
813
3,213
2,208
813
5,421
6,234
2,097
2000
10/31/2006
5 to 40 years
Houston-Beaumont
TX
929
3,647
637
930
4,283
5,213
1,658
2002/04
3/8/2007
5 to 40 years
Houston-Beaumont
TX
1,537
6,018
1,126
1,537
7,144
8,681
2,796
2003/06
3/8/2007
5 to 40 years
Buffalo-Langner Rd
NY
532
2,119
3,848
532
5,967
6,499
1,857
1993/07/15
3/30/2007
5 to 40 years
Buffalo-Transit Rd
NY
437
1,794
3,337
437
5,131
5,568
1,080
1998/2021
3/30/2007
5 to 40 years
Buffalo-Lake Ave
NY
638
2,531
3,059
638
5,590
6,228
1,763
1997/06
3/30/2007
5 to 40 years
Buffalo-Union Rd
NY
348
1,344
3,860
348
5,204
5,552
1,101
1998/2019
3/30/2007
5 to 40 years
Buffalo-NF Blvd
NY
323
1,331
276
323
1,607
1,930
690
1998
3/30/2007
5 to 40 years
Buffalo-Young St
NY
315
2,185
4,493
881
6,112
6,993
1,530
1999/00/20
3/30/2007
5 to 40 years
Buffalo-Sheridan Dr
NY
961
3,827
2,850
961
6,677
7,638
2,364
1999
3/30/2007
5 to 40 years
Bufrfalo-Transit Rd
NY
375
1,498
1,010
375
2,508
2,883
921
1990/95
3/30/2007
5 to 40 years
Rochester-Phillips Rd
NY
1,003
4,002
230
1,003
4,232
5,235
1,691
1999
3/30/2007
5 to 40 years
San Antonio-Foster
TX
676
2,685
589
676
3,274
3,950
1,368
2003/06
5/21/2007
5 to 40 years
Huntsville-Memorial
Pkwy
AL
1,607
6,338
1,228
1,677
7,496
9,173
2,989
1989/06
6/1/2007
5 to 40 years
Huntsville-Madison 1
AL
1,016
4,013
530
1,017
4,542
5,559
1,869
1993/07
6/1/2007
5 to 40 years
Bilox-Gulfport
MS
1,423
5,624
385
1,423
6,009
7,432
2,400
1998/05
6/1/2007
5 to 40 years
Huntsville-Hwy 72
AL
1,206
4,775
565
1,206
5,340
6,546
2,174
1998/06
6/1/2007
5 to 40 years
Mobile-Airport Blvd
AL
1,216
4,819
3,351
1,216
8,170
9,386
2,297
2000/07/22
6/1/2007
5 to 40 years
Bilox-Gulfport
MS
1,345
5,325
218
1,301
5,587
6,888
2,231
2002/04
6/1/2007
5 to 40 years
Huntsville-Madison 2
AL
1,164
4,624
423
1,164
5,047
6,211
2,033
2002/06
6/1/2007
5 to 40 years
Foley-Hwy 59
AL
1,346
5,474
5,156
1,347
10,629
11,976
2,917
2003/06/15
6/1/2007
5 to 40 years
Pensacola 6-Nine Mile
FL
1,029
4,180
3,307
1,029
7,487
8,516
2,096
2003/06/19
6/1/2007
5 to 40 years
Auburn-College St
AL
686
2,732
371
686
3,103
3,789
1,279
2003/20
6/1/2007
5 to 40 years
Biloxi-Gulfport
MS
1,811
7,152
268
1,811
7,420
9,231
2,911
2004/06
6/1/2007
5 to 40 years
Pensacola 7-Hwy 98
FL
732
3,015
3,407
732
6,422
7,154
1,519
2006/20
6/1/2007
5 to 40 years
Montgomery-Arrowhead
AL
1,075
4,333
491
1,076
4,823
5,899
1,915
2006
6/1/2007
5 to 40 years
Montgomery-McLemore
AL
885
3,586
362
885
3,948
4,833
1,581
2006
6/1/2007
5 to 40 years
Houston-Beaumont
TX
742
3,024
412
742
3,436
4,178
1,335
2002/05
11/14/2007
5 to 40 years
Biloxi-Ginger
MS
384
1,548
244
384
1,792
2,176
668
2000
12/19/2007
5 to 40 years
Foley-7905 St Hwy 59
AL
437
1,757
210
437
1,967
2,404
758
2000
12/19/2007
5 to 40 years
Cincinnati-Robertson
OH
852
3,409
414
852
3,823
4,675
1,366
2003/04
12/31/2008
5 to 40 years
Richmond-Bridge Rd
VA
1,047
5,981
2,842
1,047
8,823
9,870
2,767
2009/16
10/1/2009
5 to 40 years
Raleigh-Durham
NC
846
4,095
375
846
4,470
5,316
1,438
2000
12/28/2010
5 to 40 years
Charlotte-Wallace
NC
961
3,702
1,506
961
5,208
6,169
1,511
2008/16
12/29/2010
5 to 40 years
84
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Raleigh-Durham
NC
574
3,975
405
575
4,379
4,954
1,364
2008
12/29/2010
5 to 40 years
Charlotte-Westmoreland
NC
513
5,317
219
513
5,536
6,049
1,682
2009
12/29/2010
5 to 40 years
Charlotte-Matthews
NC
1,129
4,767
309
1,129
5,076
6,205
1,599
2009
12/29/2010
5 to 40 years
Raleigh-Durham
NC
381
3,575
210
381
3,785
4,166
1,191
2008
12/29/2010
5 to 40 years
Charlotte-Zeb Morris
NC
965
3,355
296
965
3,651
4,616
1,129
2007
12/29/2010
5 to 40 years
Fair Lawn
NJ
796
9,467
641
796
10,108
10,904
3,012
1999
7/14/2011
5 to 40 years
Elizabeth
NJ
885
3,073
983
885
4,056
4,941
1,159
1988
7/14/2011
5 to 40 years
Saint Louis-High Ridge
MO
197
2,132
151
197
2,283
2,480
824
2007
7/28/2011
5 to 40 years
Atlanta-Decatur
GA
1,043
8,252
291
1,043
8,543
9,586
2,495
2006
8/17/2011
5 to 40 years
Houston-Humble
TX
825
4,201
640
825
4,841
5,666
1,490
1993
9/22/2011
5 to 40 years
Dallas-Fort Worth
TX
693
3,552
536
693
4,088
4,781
1,232
2001
9/22/2011
5 to 40 years
Houston-Hwy 6N
TX
1,243
3,106
290
1,243
3,396
4,639
1,125
2000
9/22/2011
5 to 40 years
Houston-Katy
TX
691
4,435
2,603
691
7,038
7,729
1,982
2000/15
9/22/2011
5 to 40 years
Houston-Deer Park
TX
1,012
3,312
597
1,012
3,909
4,921
1,139
1998
9/22/2011
5 to 40 years
Houston-W.Little York
TX
575
3,557
530
575
4,087
4,662
1,284
1998
9/22/2011
5 to 40 years
Houston-Friendswood
TX
1,168
2,315
1,070
1,168
3,385
4,553
887
1994/2021
9/22/2011
5 to 40 years
Houston-Spring
TX
2,152
3,027
508
2,152
3,535
5,687
1,176
1993
9/22/2011
5 to 40 years
Houston-W.Sam Houston
TX
402
3,602
576
402
4,178
4,580
1,240
1999
9/22/2011
5 to 40 years
Austin-Pond Springs Rd
TX
1,653
4,947
662
1,653
5,609
7,262
1,735
1984
9/22/2011
5 to 40 years
Austin-Round Rock
TX
177
3,223
362
177
3,585
3,762
1,121
1999
9/22/2011
5 to 40 years
Houston-Silverado Dr
TX
1,438
4,583
355
1,438
4,938
6,376
1,546
2000
9/22/2011
5 to 40 years
Houston-Sugarland
TX
272
3,236
343
272
3,579
3,851
1,151
2001
9/22/2011
5 to 40 years
Houston-Wilcrest Dr
TX
1,478
4,145
355
1,478
4,500
5,978
1,375
1999
9/22/2011
5 to 40 years
Houston-Woodlands
TX
1,315
6,142
407
1,315
6,549
7,864
1,920
1997
9/22/2011
5 to 40 years
Houston-Woodlands
TX
3,189
3,974
264
3,189
4,238
7,427
1,293
2000
9/22/2011
5 to 40 years
Houston-Katy Freeway
TX
1,049
5,175
701
1,049
5,876
6,925
1,801
1999
9/22/2011
5 to 40 years
Houston-Webster
TX
795
2,054
2,138
3,272
2,054
5,410
7,464
1,254
1982/17
9/22/2011
5 to 40 years
Newport News-Brick
Kiln
VA
2,848
5,892
180
2,848
6,072
8,920
1,870
2004
9/29/2011
5 to 40 years
Penasacola-Palafox
FL
197
4,281
10,524
197
14,805
15,002
5,095
1996
11/15/2011
5 to 40 years
Miami
FL
2,960
12,077
617
2,960
12,694
15,654
3,458
2005
5/16/2012
5 to 40 years
Chicago - Lake Forest
IL
1,932
11,606
371
1,932
11,977
13,909
3,234
1996/04
6/6/2012
5 to 40 years
Chicago - Schaumburg
IL
1,940
4,880
561
1,940
5,441
7,381
1,516
1998
6/6/2012
5 to 40 years
Norfolk - E. Little Creek
VA
911
5,862
197
911
6,059
6,970
1,677
2007
6/20/2012
5 to 40 years
Atlanta-14th St.
GA
1,560
6,766
159
1,560
6,925
8,485
1,915
2009
7/18/2012
5 to 40 years
Jacksonville - Middleburg
FL
644
5,719
207
644
5,926
6,570
1,595
2008
9/18/2012
5 to 40 years
Jacksonville - Orange
Park
FL
772
3,882
387
772
4,269
5,041
1,116
2007
9/18/2012
5 to 40 years
Jacksonville - St.
Augustine
FL
739
3,858
348
739
4,206
4,945
1,173
2007
9/18/2012
5 to 40 years
Atlanta - NE Expressway
GA
1,384
9,266
188
1,384
9,454
10,838
2,538
2009
9/18/2012
5 to 40 years
Atlanta - Kennesaw
GA
856
4,315
232
856
4,547
5,403
1,215
2008
9/18/2012
5 to 40 years
Atlanta - Lawrenceville
GA
855
3,838
209
855
4,047
4,902
1,097
2007
9/18/2012
5 to 40 years
Atlanta - Woodstock
GA
1,342
4,692
4,684
1,342
9,376
10,718
1,360
2009/22
9/18/2012
5 to 40 years
Raleigh-Durham
NC
2,337
4,901
358
2,337
5,259
7,596
1,464
2002
9/19/2012
5 to 40 years
Chicago - Lindenhurst
IL
1,213
3,129
337
1,213
3,466
4,679
993
1999/06
9/27/2012
5 to 40 years
Chicago - Orland Park
IL
1,050
5,894
291
1,050
6,185
7,235
1,690
2007
12/10/2012
5 to 40 years
Phoenix-83rd
AZ
910
3,656
561
910
4,217
5,127
1,131
2008
12/18/2012
5 to 40 years
Chicago-North Austin
IL
2,593
5,029
3,301
2,593
8,330
10,923
1,554
2005/20/21
12/20/2012
5 to 40 years
85
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Chicago-North Western
IL
1,718
6,466
861
1,798
7,247
9,045
1,819
2005
12/20/2012
5 to 40 years
Chicago-West Pershing
IL
395
3,226
526
395
3,752
4,147
910
2008
12/20/2012
5 to 40 years
Chicago - North
Broadway
IL
2,373
9,869
298
2,373
10,167
12,540
2,570
2011
12/20/2012
5 to 40 years
Brandenton
FL
1,501
3,775
608
1,501
4,383
5,884
1,124
1997
12/21/2012
5 to 40 years
Ft. Myers-Cleveland
FL
515
2,280
301
515
2,581
3,096
701
1998
12/21/2012
5 to 40 years
Clearwater-Drew St.
FL
1,234
4,018
667
1,234
4,685
5,919
1,207
2000
12/21/2012
5 to 40 years
Clearwater-N. Myrtle
FL
1,555
5,978
284
1,555
6,262
7,817
1,659
2000
12/21/2012
5 to 40 years
Austin-Round Rock
TX
774
3,327
348
774
3,675
4,449
1,008
2004
12/27/2012
5 to 40 years
Austin-Round Rock
TX
632
1,985
342
632
2,327
2,959
685
2007
12/27/2012
5 to 40 years
Chicago-Aurora
IL
269
3,126
637
269
3,763
4,032
932
2010
12/31/2012
5 to 40 years
San Antonio - Marbach
TX
337
2,005
490
337
2,495
2,832
659
2005
2/11/2013
5 to 40 years
Long Island - Lindenhurst
NY
2,122
8,735
647
2,122
9,382
11,504
2,317
2002
3/22/2013
5 to 40 years
Boston - Somerville
MA
1,553
7,186
243
1,506
7,476
8,982
1,849
2008
3/22/2013
5 to 40 years
Long Island - Deer Park
NY
1,096
8,276
233
1,096
8,509
9,605
2,076
2009
8/29/2013
5 to 40 years
Long Island - Amityville
NY
2,224
10,102
253
2,224
10,355
12,579
2,494
2009
8/29/2013
5 to 40 years
Colorado Springs -
Scarlet
CO
629
5,201
255
629
5,456
6,085
1,298
2006
9/30/2013
5 to 40 years
Toms River - Route 37 W
NJ
1,843
6,544
558
1,843
7,102
8,945
1,641
2007
11/26/2013
5 to 40 years
Lake Worth - S Military
FL
868
5,306
970
868
6,276
7,144
1,471
2000
12/4/2013
5 to 40 years
Austin-Round Rock
TX
1,547
5,226
468
1,547
5,694
7,241
1,438
2008
12/27/2013
5 to 40 years
Hartford-Bristol
CT
1,174
8,816
236
1,174
9,052
10,226
2,055
2004
12/30/2013
5 to 40 years
Piscataway - New
Brunswick
NJ
1,639
10,946
198
1,639
11,144
12,783
2,534
2006
12/30/2013
5 to 40 years
Fort Lauderdale - 3rd Ave
FL
7,629
11,918
1,195
7,629
13,113
20,742
3,014
1998
1/9/2014
5 to 40 years
West Palm - Mercer
FL
15,680
17,520
1,597
15,680
19,117
34,797
4,446
2000
1/9/2014
5 to 40 years
Austin - Manchaca
TX
3,999
4,297
1,188
3,999
5,485
9,484
1,327
1998/02
1/17/2014
5 to 40 years
San Antonio
TX
2,235
6,269
442
2,235
6,711
8,946
1,594
2012
2/10/2014
5 to 40 years
Portland
ME
2,146
6,418
364
2,146
6,782
8,928
1,561
2000
2/11/2014
5 to 40 years
Portland-Topsham
ME
493
5,234
6,581
985
11,323
12,308
1,239
2006/22
2/11/2014
5 to 40 years
Chicago - St. Charles
IL
1,837
6,301
2,562
1,837
8,863
10,700
1,776
2004/13/20
3/31/2014
5 to 40 years
Chicago - Ashland
IL
598
4,789
508
598
5,297
5,895
1,211
2014
5/5/2014
5 to 40 years
San Antonio - Walzem
TX
2,000
3,749
3,755
2,000
7,504
9,504
1,351
1997/2019
5/13/2014
5 to 40 years
St. Louis - Woodson
MO
2,444
5,966
5,272
2,444
11,238
13,682
1,772
1998/2022
5/22/2014
5 to 40 years
St. Louis - Mexico
MO
638
3,518
1,902
638
5,420
6,058
1,212
1998/16
5/22/2014
5 to 40 years
St. Louis - Vogel
MO
2,010
3,544
2,063
2,010
5,607
7,617
1,113
2000
5/22/2014
5 to 40 years
St. Louis - Manchester
MO
508
2,042
482
508
2,524
3,032
621
1996
5/22/2014
5 to 40 years
St. Louis - North
Highway
MO
1,989
4,045
2,533
1,989
6,578
8,567
1,390
1997
5/22/2014
5 to 40 years
St. Louis - Dunn
MO
1,538
4,510
2,922
1,538
7,432
8,970
1,520
2000
5/22/2014
5 to 40 years
Trenton-Hamilton
Twnship
NJ
5,161
7,063
1,274
5,161
8,337
13,498
1,874
1980
6/5/2014
5 to 40 years
NY Metro-Fishkill
NY
1,741
6,006
600
1,741
6,606
8,347
1,480
2005
6/11/2014
5 to 40 years
Atlanta-Peachtree City
GA
2,263
4,931
608
2,263
5,539
7,802
1,344
2007
6/12/2014
5 to 40 years
Wayne - Willowbrook
NJ
—
2,292
325
—
2,617
2,617
1,410
2000
6/12/2014
5 to 40 years
Asbury Park - 1st Ave
NJ
819
4,734
1,055
819
5,789
6,608
1,302
2003
6/18/2014
5 to 40 years
Farmingdale - Tinton
Falls
NJ
1,097
5,618
732
1,097
6,350
7,447
1,420
2004
6/18/2014
5 to 40 years
Lakewood - Route 70
NJ
626
4,549
406
626
4,955
5,581
1,126
2003
6/18/2014
5 to 40 years
Matawan - Highway 34
NJ
1,512
9,707
1,241
1,512
10,948
12,460
2,460
2005
7/10/2014
5 to 40 years
St. Petersburg - Gandy
FL
2,958
6,904
477
2,958
7,381
10,339
1,650
2007
8/28/2014
5 to 40 years
Chesapeake -
Campostella
VA
2,349
3,875
388
2,349
4,263
6,612
948
2000
9/5/2014
5 to 40 years
86
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
San Antonio-Castle Hills
TX
2,658
8,190
590
4,544
6,894
11,438
1,538
2002
9/10/2014
5 to 40 years
Chattanooga - Broad St
TN
759
5,608
322
759
5,930
6,689
1,279
2014
9/18/2014
5 to 40 years
New Orleans-Kenner
LA
5,771
10,375
570
5,771
10,945
16,716
2,384
2008
10/10/2014
5 to 40 years
Orlando-Celebration
FL
6,091
4,641
493
6,091
5,134
11,225
1,142
2006
10/21/2014
5 to 40 years
Austin-Cedar Park
TX
4,196
8,374
1,082
4,196
9,456
13,652
2,022
2003
10/28/2014
5 to 40 years
Chicago - Pulaski
IL
889
4,700
1,966
889
6,666
7,555
1,300
2014
11/14/2014
5 to 40 years
Houston - Gessner
TX
1,599
5,813
3,596
1,599
9,409
11,008
1,795
2006/17
12/18/2014
5 to 40 years
New England - Danbury
CT
9,747
18,374
314
9,747
18,688
28,435
3,766
1999
2/2/2015
5 to 40 years
New England - Milford
CT
9,642
23,352
198
9,642
23,550
33,192
4,731
1999
2/2/2015
5 to 40 years
Long Island - Hicksville
NY
5,153
27,401
217
5,153
27,618
32,771
5,544
2002
2/2/2015
5 to 40 years
Long Island -
Farmingdale
NY
4,931
20,415
448
4,931
20,863
25,794
4,171
2000
2/2/2015
5 to 40 years
Chicago - Alsip
IL
2,579
4,066
3,670
2,579
7,736
10,315
1,356
1986/17
2/5/2015
5 to 40 years
Chicago - N. Pulaski
IL
1,719
6,971
956
1,719
7,927
9,646
1,558
2015
3/9/2015
5 to 40 years
Fort Myers - Tamiami
Trail
FL
1,793
4,382
351
1,793
4,733
6,526
998
2004
4/1/2015
5 to 40 years
Dallas - Allen
TX
3,864
4,777
439
3,864
5,216
9,080
1,116
2002
4/16/2015
5 to 40 years
Jacksonville - Beach
Blvd.
FL
2,118
6,501
120
2,118
6,621
8,739
1,318
2013
4/21/2015
5 to 40 years
Space Coast - Vero Beach
FL
1,169
4,409
505
1,169
4,914
6,083
976
1997
5/1/2015
5 to 40 years
Port St. Lucie - Federal
Hwy.
FL
4,957
6,045
406
4,957
6,451
11,408
1,321
2001
5/1/2015
5 to 40 years
West Palm - N. Military
FL
3,372
4,206
390
3,372
4,596
7,968
946
1985
5/1/2015
5 to 40 years
Ft. Myers - Bonita
Springs
FL
2,687
5,012
461
2,687
5,473
8,160
1,101
2000
5/1/2015
5 to 40 years
Phoenix - Tatum Blvd.
AZ
852
7,052
340
852
7,392
8,244
1,537
2015
6/16/2015
5 to 40 years
Boston - Lynn
MA
2,110
8,182
484
2,110
8,666
10,776
1,700
2015
6/16/2015
5 to 40 years
Syracuse - Ainsely Dr.
NY
2,711
3,795
2,261
2,711
6,056
8,767
1,003
2000/19
8/25/2015
5 to 40 years
Syracuse - Cicero
NY
668
1,957
287
668
2,244
2,912
449
2002
8/25/2015
5 to 40 years
Syracuse - Camillus
NY
473
5,368
141
473
5,509
5,982
1,053
2005/11
8/25/2015
5 to 40 years
Syracuse - Manlius
NY
834
1,705
2,945
834
4,650
5,484
545
2000/17/21
8/25/2015
5 to 40 years
Charlotte - Brookshire
Blvd.
NC
718
2,977
1,010
718
3,987
4,705
822
2000
9/1/2015
5 to 40 years
Charleston III
SC
7,604
9,086
563
7,604
9,649
17,253
1,889
2005
9/1/2015
5 to 40 years
Myrtle Beach II
SC
2,511
6,147
3,896
2,511
10,043
12,554
1,619
1999/2019
9/1/2015
5 to 40 years
Hilton Head - Bluffton
SC
3,084
3,192
269
3,084
3,461
6,545
725
1998
9/1/2015
5 to 40 years
Philadelphia - Eagleville
PA
1,926
4,498
1,666
1,926
6,164
8,090
1,096
2010
12/30/2015
5 to 40 years
Orlando - University
FL
882
5,756
337
882
6,093
6,975
1,115
2001
1/6/2016
5 to 40 years
Orlando - N. Powers
FL
2,567
2,838
400
2,567
3,238
5,805
626
1997
1/6/2016
5 to 40 years
Sarasota - North Port
FL
4,884
10,014
(142 )
4,278
10,478
14,756
1,800
2001/06
1/6/2016
5 to 40 years
Los Angeles - E.
Commercial
CA
6,512
12,352
581
6,512
12,933
19,445
2,441
2004
1/21/2016
5 to 40 years
Los Angeles - E. Slauson
CA
3,998
13,547
350
3,998
13,897
17,895
2,467
2012
1/21/2016
5 to 40 years
Los Angeles -
Westminster
CA
4,636
14,826
463
4,636
15,289
19,925
2,690
2006
1/21/2016
5 to 40 years
Los Angeles - Calabasas
CA
13,274
10,419
903
13,274
11,322
24,596
2,082
2004/14
1/21/2016
5 to 40 years
Portsmouth - Kingston
NH
1,713
2,709
153
1,713
2,862
4,575
522
2003
1/21/2016
5 to 40 years
Portsmouth - Danville
NH
1,615
3,333
2,125
1,615
5,458
7,073
678
2003/21
1/21/2016
5 to 40 years
Portsmouth - Hampton
Falls
NH
2,445
6,295
270
2,445
6,565
9,010
1,151
2005
1/21/2016
5 to 40 years
Portsmouth - Lee
NH
3,078
2,861
1,418
3,078
4,279
7,357
633
2000/20
1/21/2016
5 to 40 years
Portsmouth - Heritage
NH
4,430
26,040
708
4,430
26,748
31,178
4,708
1985/99
1/21/2016
5 to 40 years
Boston - Salisbury
MA
4,880
6,342
264
4,880
6,606
11,486
1,183
2003
1/21/2016
5 to 40 years
Dallas - Frisco
TX
6,191
5,088
363
6,191
5,451
11,642
1,003
2003
1/21/2016
5 to 40 years
Dallas - McKinney
TX
8,097
7,047
268
8,097
7,315
15,412
1,359
2003
1/21/2016
5 to 40 years
87
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Dallas - McKinney
TX
5,508
6,462
285
5,508
6,747
12,255
1,215
2002
1/21/2016
5 to 40 years
Phoenix - 48th
AZ
988
8,224
91
988
8,315
9,303
1,537
2015
2/1/2016
5 to 40 years
Miami
FL
2,294
8,980
306
2,294
9,286
11,580
1,697
2016
2/12/2016
5 to 40 years
Philadelphia - Glenolden
PA
1,768
3,879
808
1,768
4,687
6,455
802
1970
2/17/2016
5 to 40 years
Denver - Thornton
CO
4,528
7,915
188
4,528
8,103
12,631
1,474
2011
2/29/2016
5 to 40 years
Los Angeles - Costa
Mesa
CA
17,976
25,145
1,004
17,976
26,149
44,125
4,568
2005
3/16/2016
5 to 40 years
Los Angeles - Irving
CA
—
6,318
1,311
—
7,629
7,629
2,655
1985
3/16/2016
5 to 40 years
Los Angeles - Durante
CA
4,671
13,908
157
4,671
14,065
18,736
2,440
2015
3/16/2016
5 to 40 years
Los Angeles - Wildomar
CA
6,728
10,340
7,436
6,728
17,776
24,504
2,576
2005/19
3/17/2016
5 to 40 years
Los Angeles - Torrance
CA
17,445
18,839
606
17,445
19,445
36,890
3,441
2003
4/11/2016
5 to 40 years
New Haven -
Wallingford
CT
3,618
5,286
352
3,618
5,638
9,256
1,003
2000
4/14/2016
5 to 40 years
New Haven - Waterbury
CT
2,524
5,618
240
2,524
5,858
8,382
1,051
2001
4/14/2016
5 to 40 years
New York - Mahopac
NY
3,620
2,373
5,089
425
2,373
5,514
7,887
955
1991/94
4/26/2016
5 to 40 years
New York - Mount
Vernon
NY
3,337
13,112
369
3,337
13,481
16,818
2,307
2013
4/26/2016
5 to 40 years
Pt. St. Lucie
FL
3,566
4,140
7,176
723
4,305
7,734
12,039
1,525
2002
5/2/2016
5 to 40 years
Dallas - Lewisville
TX
2,333
8,302
579
2,333
8,881
11,214
1,564
2007
5/5/2016
5 to 40 years
Buffalo - Cayuga
NY
499
5,198
2,513
499
7,711
8,210
1,115
2006
5/19/2016
5 to 40 years
Buffalo - Lackawanna
NY
215
2,323
551
215
2,874
3,089
490
2006
5/19/2016
5 to 40 years
Austin - W Braker
TX
1,210
14,833
360
1,210
15,193
16,403
2,529
2003
7/15/2016
5 to 40 years
Austin - Highway 290
TX
930
12,269
417
930
12,686
13,616
2,115
1999
7/15/2016
5 to 40 years
Austin - Killeen
TX
3,070
20,782
486
3,070
21,268
24,338
3,839
2005
7/15/2016
5 to 40 years
Austin - Round Rock
TX
830
6,129
333
830
6,462
7,292
1,126
1986
7/15/2016
5 to 40 years
Austin - Georgetown
TX
1,530
10,647
787
1,530
11,434
12,964
1,980
2001/15
7/15/2016
5 to 40 years
Austin - Pflugerville
TX
750
9,238
398
750
9,636
10,386
1,620
2005
7/15/2016
5 to 40 years
Chicago - Algonquin
IL
1,430
14,958
153
1,430
15,111
16,541
2,526
2006
7/15/2016
5 to 40 years
Chicago - Carpentersville
IL
350
4,710
50
350
4,760
5,110
794
2004
7/15/2016
5 to 40 years
Chicago - W. Addison
IL
2,770
25,112
308
2,770
25,420
28,190
4,230
2007
7/15/2016
5 to 40 years
Chicago - State St.
IL
1,190
19,159
865
1,190
20,024
21,214
3,198
2009
7/15/2016
5 to 40 years
Chicago -W. Grand
IL
1,720
10,628
266
1,720
10,894
12,614
1,793
2007
7/15/2016
5 to 40 years
Chicago - Libertyville
IL
3,670
26,660
375
3,670
27,035
30,705
4,444
2009
7/15/2016
5 to 40 years
Chicago - Aurora
IL
1,090
20,033
1,355
2,114
20,364
22,478
3,394
2009
7/15/2016
5 to 40 years
Chicago - Morton Grove
IL
1,610
14,914
850
1,610
15,764
17,374
2,585
2009
7/15/2016
5 to 40 years
Chicago - Bridgeview
IL
3,770
19,990
731
3,770
20,721
24,491
3,540
2008
7/15/2016
5 to 40 years
Chicago - Addison
IL
1,340
11,881
566
1,340
12,447
13,787
2,068
2008
7/15/2016
5 to 40 years
Chicago - W Diversey
IL
1,670
10,811
167
1,670
10,978
12,648
1,796
2010
7/15/2016
5 to 40 years
Chicago - Elmhurst
IL
670
18,729
185
670
18,914
19,584
3,104
2008
7/15/2016
5 to 40 years
Chicago - Elgin
IL
1,130
12,584
389
1,130
12,973
14,103
2,163
2003
7/15/2016
5 to 40 years
Chicago - N. Paulina St.,
IL
5,600
12,721
236
5,600
12,957
18,557
2,175
2006
7/15/2016
5 to 40 years
Chicago - Matteson
IL
1,590
12,053
288
1,590
12,341
13,931
2,140
2007
7/15/2016
5 to 40 years
Chicago - S. Heights
IL
1,050
4,960
202
1,050
5,162
6,212
907
2006
7/15/2016
5 to 40 years
Chicago - W. Grand
IL
1,780
8,928
258
1,780
9,186
10,966
1,527
2007
7/15/2016
5 to 40 years
Chicago - W 30th St
IL
600
15,574
779
600
16,353
16,953
2,645
2008
7/15/2016
5 to 40 years
Chicago - Mokena
IL
3,230
18,623
2,152
3,230
20,775
24,005
3,278
2008/21
7/15/2016
5 to 40 years
Chicago - Barrington
IL
1,890
9,395
816
1,890
10,211
12,101
1,711
2015
7/15/2016
5 to 40 years
Chicago - Naperville
IL
2,620
11,933
250
2,620
12,183
14,803
2,123
2015
7/15/2016
5 to 40 years
Chicago - Forest Park
IL
1,100
10,087
864
1,100
10,951
12,051
1,819
2015
7/15/2016
5 to 40 years
88
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment
Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts.
Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Chicago - La Grange
IL
960
13,019
556
960
13,575
14,535
2,249
2015
7/15/2016
5 to 40 years
Chicago - Glenview
IL
3,210
8,519
172
3,210
8,691
11,901
1,503
2014/15
7/15/2016
5 to 40 years
Dallas - Richardson
TX
630
10,282
258
630
10,540
11,170
1,807
2001
7/15/2016
5 to 40 years
Dallas - Arlington
TX
790
12,785
529
790
13,314
14,104
2,210
2007
7/15/2016
5 to 40 years
Dallas - Plano
TX
1,370
10,166
410
1,370
10,576
11,946
1,740
1998
7/15/2016
5 to 40 years
Dallas - Mesquite
TX
620
8,771
307
620
9,078
9,698
1,490
2016
7/15/2016
5 to 40 years
Dallas - S Good Latimer
TX
4,030
8,029
193
4,030
8,222
12,252
1,401
2016
7/15/2016
5 to 40 years
Boulder - Arapahoe
CO
3,690
12,074
928
3,690
13,002
16,692
2,119
1992
7/15/2016
5 to 40 years
Boulder - Odell
CO
2,650
15,304
382
2,650
15,686
18,336
2,670
1998
7/15/2016
5 to 40 years
Boulder - Arapahoe
CO
11,540
15,571
339
11,540
15,910
27,450
2,720
1984
7/15/2016
5 to 40 years
Boulder - Broadway
CO
2,670
5,623
467
2,670
6,090
8,760
1,025
1992
7/15/2016
5 to 40 years
Houston - Westpark
TX
2,760
8,288
745
2,760
9,033
11,793
1,541
1996
7/15/2016
5 to 40 years
Houston - C. Jester
TX
8,080
10,114
2,949
8,080
13,063
21,143
1,934
2008/20
7/15/2016
5 to 40 years
Houston - Bay Pointe
TX
1,960
9,585
496
1,960
10,081
12,041
1,692
1972
7/15/2016
5 to 40 years
Houston - FM 529
TX
680
3,951
163
680
4,114
4,794
735
2005
7/15/2016
5 to 40 years
Houston - Jones
TX
1,260
2,382
291
1,260
2,673
3,933
507
1994
7/15/2016
5 to 40 years
Las Vegas - Spencer
NV
1,020
25,152
405
1,020
25,557
26,577
4,267
2000
7/15/2016
5 to 40 years
Las Vegas - Maule
NV
2,510
11,822
3,605
1,310
16,627
17,937
2,071
2005/22
7/15/2016
5 to 40 years
Las Vegas - Wigwam
NV
590
16,838
180
590
17,018
17,608
2,813
2008
7/15/2016
5 to 40 years
Las Vegas - Stufflebeam
NV
350
6,977
525
350
7,502
7,852
1,266
1996
7/15/2016
5 to 40 years
Las Vegas - Ft. Apache
NV
1,470
11,047
389
1,470
11,436
12,906
1,942
2004
7/15/2016
5 to 40 years
Las Vegas - North
NV
390
7,042
248
390
7,290
7,680
1,239
2005
7/15/2016
5 to 40 years
Las Vegas - Warm Springs
NV
1,340
5,141
3,948
1,340
9,089
10,429
1,480
2004/22
7/15/2016
5 to 40 years
Las Vegas - Conestoga
NV
1,420
10,295
334
1,420
10,629
12,049
1,862
2007
7/15/2016
5 to 40 years
Las Vegas - Warm Springs
NV
1,080
16,436
234
1,080
16,670
17,750
2,773
2007
7/15/2016
5 to 40 years
Las Vegas - Nellis
NV
790
5,233
776
790
6,009
6,799
1,083
1995
7/15/2016
5 to 40 years
Las Vegas - Cheyenne
NV
1,470
17,366
411
1,470
17,777
19,247
3,073
2004
7/15/2016
5 to 40 years
Las Vegas - Dean Martin
NV
3,050
23,333
255
3,050
23,588
26,638
4,300
2005
7/15/2016
5 to 40 years
Las Vegas - Flamingo
NV
980
13,451
291
980
13,742
14,722
2,303
2007
7/15/2016
5 to 40 years
Las Vegas - North
NV
330
15,651
229
330
15,880
16,210
2,649
2007
7/15/2016
5 to 40 years
Las Vegas - Henderson
NV
570
12,676
477
570
13,153
13,723
2,254
2005
7/15/2016
5 to 40 years
Las Vegas - North
NV
520
10,105
223
520
10,328
10,848
1,761
2002
7/15/2016
5 to 40 years
Las Vegas - Farm
NV
1,510
9,388
126
1,510
9,514
11,024
1,596
2008
7/15/2016
5 to 40 years
Los Angeles - Torrance
CA
5,250
32,363
418
5,250
32,781
38,031
5,431
2004
7/15/2016
5 to 40 years
Los Angeles - Irvine
CA
2,520
18,402
324
2,520
18,726
21,246
3,167
2002
7/15/2016
5 to 40 years
Los Angeles - Palm Desert
CA
2,660
16,589
399
2,660
16,988
19,648
2,892
2002
7/15/2016
5 to 40 years
Milwaukee - Green Bay
WI
750
14,720
189
750
14,909
15,659
2,489
2005
7/15/2016
5 to 40 years
Orlando - Winter Garden
FL
640
6,688
111
640
6,799
7,439
1,157
2006
7/15/2016
5 to 40 years
Orlando - Longwood
FL
1,230
9,586
171
1,230
9,757
10,987
1,642
2000
7/15/2016
5 to 40 years
Orlando - Overland
FL
1,080
3,713
358
1,080
4,071
5,151
691
2000
7/15/2016
5 to 40 years
Sacramento - Calvine
CA
2,280
17,069
161
2,280
17,230
19,510
2,890
2004
7/15/2016
5 to 40 years
Sacramento - Folsom
CA
1,200
22,150
158
1,200
22,308
23,508
3,657
2005
7/15/2016
5 to 40 years
Sacremento - Pell
CA
540
8,874
603
932
9,085
10,017
1,596
2004
7/15/2016
5 to 40 years
Sacremento - Goldenland
CA
2,010
8,944
6,483
2,010
15,427
17,437
1,843
2005/21
7/15/2016
5 to 40 years
Sacremento - Woodland
CA
860
10,569
154
860
10,723
11,583
1,775
2003
7/15/2016
5 to 40 years
Sacramento - El Camino
CA
1,450
12,239
199
1,450
12,438
13,888
2,102
2002
7/15/2016
5 to 40 years
89
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Sacramento - Bayou
CA
1,640
21,603
249
1,640
21,852
23,492
3,646
2005
7/15/2016
5 to 40 years
Sacramento - Calvine
CA
2,120
24,650
208
2,120
24,858
26,978
4,176
2003
7/15/2016
5 to 40 years
Sacramento - El Dorado
Hills
CA
1,610
24,829
183
1,610
25,012
26,622
4,180
2007
7/15/2016
5 to 40 years
Sacramento - Fruitridge
CA
1,480
15,695
375
1,480
16,070
17,550
2,810
2007
7/15/2016
5 to 40 years
San Antonio - US 281
TX
1,380
8,457
322
1,380
8,779
10,159
1,469
2003
7/15/2016
5 to 40 years
Austin - San Marcos
TX
990
7,323
133
990
7,456
8,446
1,279
2016
7/15/2016
5 to 40 years
Charleston
SC
920
7,700
88
920
7,788
8,708
1,342
2016
7/29/2016
5 to 40 years
Denver - Westminster
CO
5,062
3,679
489
5,062
4,168
9,230
694
2000
8/4/2016
5 to 40 years
Chicago - Arlington
Hgts.
IL
370
8,513
167
370
8,680
9,050
1,377
2016
11/17/2016
5 to 40 years
Orlando - Curry Ford
FL
3,268
6,378
363
3,268
6,741
10,009
1,060
2016
12/20/2016
5 to 40 years
Chicago - Lombard
IL
771
9,318
30
771
9,348
10,119
1,401
2017
2/23/2017
5 to 40 years
Austin - Mary St.
TX
1,358
13,041
44
1,358
13,085
14,443
1,093
2017
4/3/2017
5 to 40 years
Charlotte - Morehead St..
NC
1,110
11,439
93
1,110
11,532
12,642
1,507
2017
12/14/2017
5 to 40 years
Londonderry - Smith Ln.
NH
1,257
4,276
77
1,257
4,353
5,610
526
2016
9/4/2018
5 to 40 years
Sacramento - Main Ave.
CA
2,089
11,551
2,400
2,089
13,951
16,040
1,471
2016/18/19
9/18/2018
5 to 40 years
Carmel - Old Rt. 6
NY
3,358
4,536
114
3,358
4,650
8,008
509
1998/2000
10/2/2018
5 to 40 years
Chamblee - Peachtree
Blvd.
GA
1,665
12,479
60
1,666
12,538
14,204
1,376
2018
11/1/2018
5 to 40 years
West Sacramento -
Jefferson
CA
1,331
8,131
65
1,331
8,196
9,527
875
2013/2018
12/7/2018
5 to 40 years
Orlando - Semoran Blvd.
FL
2,014
7,534
565
2,014
8,099
10,113
851
2015
12/11/2018
5 to 40 years
Riverhead - Flanders Rd.
NY
3,969
3,138
3,190
3,970
6,327
10,297
501
1995/2020
12/20/2018
5 to 40 years
Saint Louis - Manchester
Ave.
MO
1,633
7,620
78
1,633
7,698
9,331
789
2017
12/27/2018
5 to 40 years
Long Island City
NY
30,094
26,927
88
30,094
27,015
57,109
2,689
2017
1/16/2019
5 to 40 years
Tampa - MLK Jr. Blvd.
FL
1,817
7,377
94
1,817
7,471
9,288
773
2017
3/8/2019
5 to 40 years
Cleveland - Wickliffe
OH
690
6,784
178
690
6,962
7,652
678
1997
4/30/2019
5 to 40 years
Cleveland - Highland
Heights
OH
1,036
9,518
161
1,036
9,679
10,715
941
2000
4/30/2019
5 to 40 years
Cleveland - Westlake
OH
379
14,354
151
379
14,505
14,884
1,355
2008
4/30/2019
5 to 40 years
Jacksonville
FL
662
9,208
82
662
9,290
9,952
885
2018
6/11/2019
5 to 40 years
Wake Forest
NC
803
10,954
81
803
11,035
11,838
1,010
2017
7/12/2019
5 to 40 years
Chantilly
VA
2,723
12,298
84
2,723
12,382
15,105
1,121
2018
7/12/2019
5 to 40 years
Chattanooga
TN
1,266
8,250
123
1,266
8,373
9,639
788
2017
7/12/2019
5 to 40 years
Tampa - Lutz
FL
663
9,665
114
663
9,779
10,442
934
2018
7/12/2019
5 to 40 years
Summerville
SC
2,250
5,344
87
2,250
5,431
7,681
528
2017
7/12/2019
5 to 40 years
Charleston - Summerville
SC
2,824
10,634
118
2,824
10,752
13,576
987
2018
7/12/2019
5 to 40 years
Dumfries
VA
891
7,700
107
891
7,807
8,698
733
2017
7/12/2019
5 to 40 years
Greenville
SC
1,421
10,303
72
1,421
10,375
11,796
972
2017
7/12/2019
5 to 40 years
Cumming
GA
753
9,804
82
753
9,886
10,639
910
2018
7/12/2019
5 to 40 years
Glen Allen
VA
4,296
11,029
68
4,296
11,097
15,393
1,021
2018
7/12/2019
5 to 40 years
Tampa - Trout Creek
Drive
FL
1,083
10,691
64
1,083
10,755
11,838
992
2017
7/12/2019
5 to 40 years
Midlothian
VA
1,726
6,695
89
1,726
6,784
8,510
643
2018
7/12/2019
5 to 40 years
Las Vegas - Boulder
Hwy
NV
4,586
7,853
826
4,586
8,679
13,265
733
1979/1993
8/29/2019
5 to 40 years
Seattle - Auburn
WA
8,576
3,261
16,051
277
3,261
16,328
19,589
1,341
1986/2000
9/24/2019
5 to 40 years
Seattle - Yancy Street
WA
7,712
10,629
8,570
157
10,629
8,727
19,356
721
1994
9/24/2019
5 to 40 years
Seattle - 114th Street
WA
5,881
6,995
10,257
178
6,995
10,435
17,430
861
1995
9/24/2019
5 to 40 years
Baltimore - Pulaski Hwy
MD
4,070
6,878
85
4,070
6,963
11,033
584
1984
9/26/2019
5 to 40 years
Baltimore - North Point
Road
MD
1,995
7,634
116
1,995
7,750
9,745
664
1990
9/26/2019
5 to 40 years
Baltimore - Fontana Lane
MD
2,097
7,658
116
2,097
7,774
9,871
661
1989
9/26/2019
5 to 40 years
90
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building, Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Baltimore - Jessup
MD
13,411
9,622
105
13,411
9,727
23,138
821
1987
9/26/2019
5 to 40 years
Baltimore - Windsor Mill
Road
MD
2,195
6,646
38
2,195
6,684
8,879
564
1989
9/26/2019
5 to 40 years
Norwood
NJ
1,875
16,910
199
1,875
17,109
18,984
1,377
2006
10/23/2019
5 to 40 years
Ocean Township
NJ
4,058
14,014
731
4,058
14,745
18,803
1,154
1994/2019
12/12/2019
5 to 40 years
Elk Grove
CA
2,873
14,977
28
2,873
15,005
17,878
1,090
2000
3/9/2020
5 to 40 years
Norco
CA
3,532
19,613
32
3,532
19,645
23,177
1,416
2011
3/9/2020
5 to 40 years
Rohnert Park
CA
2,546
13,242
196
2,546
13,438
15,984
951
1984
3/9/2020
5 to 40 years
San Jose
CA
7,887
20,042
70
7,887
20,112
27,999
1,435
1999
3/9/2020
5 to 40 years
Palmdale
CA
1,939
16,039
3,459
1,939
19,498
21,437
1,266
2005/2021
3/9/2020
5 to 40 years
Lancaster
CA
1,529
17,822
132
1,529
17,954
19,483
1,294
2001
3/9/2020
5 to 40 years
Tampa - E Fletcher Ave
FL
2,576
7,101
14
2,576
7,115
9,691
432
1980/83/96
9/29/2020
5 to 40 years
Tampa - W Hillsborough
Ave
FL
1,389
6,280
26
1,389
6,306
7,695
373
1985/86/2000
9/29/2020
5 to 40 years
San Antonio - Culebra
Rd
TX
888
4,391
97
888
4,488
5,376
265
2008
9/29/2020
5 to 40 years
Columbus - Cleveland
Ave
OH
962
5,218
46
962
5,264
6,226
306
2000
9/29/2020
5 to 40 years
Columbus - Evanswood
Dr
OH
1,342
6,932
32
1,342
6,964
8,306
401
2000
9/29/2020
5 to 40 years
San Antonio - Jackson
Keller Rd
TX
1,482
9,148
105
1,482
9,253
10,735
535
1984
9/29/2020
5 to 40 years
Whitehall
OH
807
4,380
13
807
4,393
5,200
254
2000
9/29/2020
5 to 40 years
Dallas - S Buckner Blvd
TX
2,040
4,902
45
2,040
4,947
6,987
290
1985
9/29/2020
5 to 40 years
Garland
TX
1,565
5,465
76
1,565
5,541
7,106
322
1984
9/29/2020
5 to 40 years
Dallas - N Buckner Blvd
TX
1,782
4,990
64
1,782
5,054
6,836
294
1985
9/29/2020
5 to 40 years
Columbus - W
Henderson Rd
OH
1,304
11,847
83
1,304
11,930
13,234
688
2000
9/29/2020
5 to 40 years
Miami - SW 28th Ln
FL
2,568
16,912
103
2,568
17,015
19,583
963
1999
9/29/2020
5 to 40 years
Decatur
GA
2,110
8,486
213
2,110
8,699
10,809
497
1972/1998
9/29/2020
5 to 40 years
Columbus - E Broad St
OH
975
7,804
65
975
7,869
8,844
454
2000
9/29/2020
5 to 40 years
Dublin
OH
1,061
9,710
45
1,037
9,779
10,816
564
2000
9/29/2020
5 to 40 years
North Brunswick
NJ
1,280
13,637
85
1,280
13,722
15,002
791
1986
9/29/2020
5 to 40 years
Hillsborough
NJ
1,077
10,560
39
1,077
10,599
11,676
608
1993
9/29/2020
5 to 40 years
Lodi
NJ
2,108
17,758
598
2,108
18,356
20,464
1,068
1998
9/29/2020
5 to 40 years
Flemington
NJ
855
15,942
560
1,277
16,080
17,357
935
1993
9/29/2020
5 to 40 years
East Windsor
NJ
929
16,063
171
929
16,234
17,163
928
1993
9/29/2020
5 to 40 years
Ottsville
PA
1,032
14,481
57
1,032
14,538
15,570
854
2001
9/29/2020
5 to 40 years
East Stroudsburg
PA
676
9,593
113
676
9,706
10,382
566
2000
9/29/2020
5 to 40 years
Doylestown
PA
741
11,560
83
741
11,643
12,384
670
2001
9/29/2020
5 to 40 years
Monmouth Junction
NJ
1,005
20,947
97
1,005
21,044
22,049
1,194
2006
9/29/2020
5 to 40 years
King of Prussia
PA
—
13,736
44
—
13,780
13,780
794
2005
9/29/2020
5 to 40 years
Trenton
NJ
6,108
2,158
11,497
114
2,158
11,611
13,769
649
2008
11/5/2020
5 to 40 years
Miami - Coral Way
FL
2,032
9,325
155
2,032
9,480
11,512
528
2018
11/25/2020
5 to 40 years
Dardenne Prairie
MO
1,312
6,070
38
1,312
6,108
7,420
333
2017
12/9/2020
5 to 40 years
Brandon
FL
1,747
8,863
95
1,747
8,958
10,705
490
2014
12/14/2020
5 to 40 years
Sarasota - South Tamiami
Trail
FL
1,240
14,063
77
1,240
14,140
15,380
750
2007
12/14/2020
5 to 40 years
Murrells Inlet
SC
671
8,771
35
671
8,806
9,477
465
2019
12/22/2020
5 to 40 years
Loomis
CA
3,528
12,127
105
3,528
12,232
15,760
626
1998
12/23/2020
5 to 40 years
Buffalo - Kenmore Ave
NY
507
16,195
653
507
16,848
17,355
848
2016/2022
12/28/2020
5 to 40 years
Palm Desert
CA
1,588
9,787
89
1,588
9,876
11,464
502
2000
12/30/2020
5 to 40 years
Myrtle Beach
SC
812
7,153
29
812
7,182
7,994
383
2018
1/4/2021
5 to 40 years
Woodland
CA
1,322
16,830
56
1,322
16,886
18,208
856
2019
1/21/2021
5 to 40 years
91
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Jamaica - Merrick
NY
10,591
37,020
22
10,591
37,042
47,633
1,730
2018
3/4/2021
5 to 40 years
Sarasota - Fruitville
FL
1,461
15,830
186
1,461
16,016
17,477
761
2006
3/11/2021
5 to 40 years
Ruskin
FL
709
3,219
328
709
3,547
4,256
188
1990/2016
3/11/2021
5 to 40 years
North Port
FL
1,329
11,103
184
1,329
11,287
12,616
537
2006
3/11/2021
5 to 40 years
Venice - Center Rd
FL
3,239
19,038
200
3,239
19,238
22,477
904
2013/15/16/17
3/11/2021
5 to 40 years
Sarasota - Apex
FL
1,012
4,350
103
1,012
4,453
5,465
228
1976
3/11/2021
5 to 40 years
Venice - Englewood
FL
2,324
5,316
290
2,324
5,606
7,930
295
1991/2017
3/11/2021
5 to 40 years
Venice - S Tamiami
FL
2,205
5,789
202
2,205
5,991
8,196
295
1996
3/11/2021
5 to 40 years
Wimauma
FL
1,101
5,893
155
1,101
6,048
7,149
304
1999
3/11/2021
5 to 40 years
Tucson - Orange Grove
AZ
1,894
20,846
19
1,894
20,865
22,759
943
2017
3/24/2021
5 to 40 years
Oro Valley
AZ
1,200
21,192
31
1,200
21,223
22,423
958
2019
3/24/2021
5 to 40 years
Queen Creek
AZ
4,034
17,282
70
4,034
17,352
21,386
790
2015
3/24/2021
5 to 40 years
Covington
WA
3,499
15,784
78
3,499
15,862
19,361
722
2018
3/25/2021
5 to 40 years
Auburn
WA
2,667
17,253
116
2,667
17,369
20,036
789
2017
3/25/2021
5 to 40 years
Saint Augustine
FL
1,658
14,739
67
1,658
14,806
16,464
655
2019
5/3/2021
5 to 40 years
Wall
NJ
3,112
16,738
317
3,112
17,055
20,167
718
1987/1989
5/12/2021
5 to 40 years
Jackson
NJ
885
18,344
303
885
18,647
19,532
799
2003/2018
5/12/2021
5 to 40 years
Farmingdale
NJ
1,788
14,737
277
1,788
15,014
16,802
646
2003
5/12/2021
5 to 40 years
South Robbinsville
NJ
3,418
10,691
483
3,418
11,174
14,592
499
1998
5/12/2021
5 to 40 years
Hillsborough
NJ
2,354
17,607
273
2,354
17,880
20,234
780
1999
5/12/2021
5 to 40 years
Charlotte - West Mallard
Creek
NC
1,312
10,700
87
1,312
10,787
12,099
443
2017
6/1/2021
5 to 40 years
Winston-Salem -
Robinhood
NC
898
13,694
74
898
13,768
14,666
565
2018
6/1/2021
5 to 40 years
Plano - Jupiter Rd
TX
1,815
9,673
42
1,815
9,715
11,530
411
2018
6/10/2021
5 to 40 years
Austin - E Parmer Lane
TX
3,250
6,129
50
3,250
6,179
9,429
275
2017
6/10/2021
5 to 40 years
Round Rock - N Red Bud
Land
TX
2,890
10,590
54
2,890
10,644
13,534
458
2017
6/10/2021
5 to 40 years
Lewisville
TX
1,207
8,354
43
1,207
8,397
9,604
359
2017
6/10/2021
5 to 40 years
Saint Petersburg - Tyrone
Blvd
FL
2,601
11,525
50
2,601
11,575
14,176
457
2017
6/16/2021
5 to 40 years
Gastonia
NC
15,384
20,523
403
15,384
20,926
36,310
816
2001
6/22/2021
5 to 40 years
Oakland Park
FL
2,830
14,157
136
2,830
14,293
17,123
547
2002 / 2013
6/22/2021
5 to 40 years
Salem
NH
887
5,071
122
887
5,193
6,080
210
2012
6/22/2021
5 to 40 years
Derry - Linlew Dr
NH
656
13,695
46
656
13,741
14,397
535
2019
6/23/2021
5 to 40 years
Derry - Rockingham Dr
NH
5,422
4,657
35
5,422
4,692
10,114
181
2014
7/29/2021
5 to 40 years
Goffstown
NH
849
11,086
38
849
11,124
11,973
405
2012
7/29/2021
5 to 40 years
Orlando - Eastmar
Commons
FL
2,884
11,790
104
2,884
11,894
14,778
417
2018
8/17/2021
5 to 40 years
Huntsville - Blake
Bottom
AL
517
6,960
73
517
7,033
7,550
241
2001/2006
8/19/2021
5 to 40 years
Madison - County Line
AL
879
8,065
33
879
8,098
8,977
277
2006/2013
8/19/2021
5 to 40 years
Huntsville - Oakwood
Ave
AL
409
5,084
33
409
5,117
5,526
176
1986
8/19/2021
5 to 40 years
Huntsville - Martin
AL
415
6,080
77
415
6,157
6,572
211
2002
8/19/2021
5 to 40 years
Madison - Slaughter Rd
AL
801
7,666
69
801
7,735
8,536
265
1996
8/19/2021
5 to 40 years
Huntsville - Leeman
Ferry
AL
487
9,103
84
487
9,187
9,674
312
1999/2016
8/19/2021
5 to 40 years
Huntsville - Highway 72
AL
806
11,868
50
806
11,918
12,724
410
2018
8/19/2021
5 to 40 years
Brighton - Baseline Place
CO
640
6,057
75
640
6,132
6,772
215
2001
8/19/2021
5 to 40 years
Tampa - N Rome Ave
FL
1,467
9,787
36
1,467
9,823
11,290
338
2017
8/19/2021
5 to 40 years
Tampa - S West Shore
Blvd
FL
1,796
14,034
43
1,796
14,077
15,873
483
2018
8/19/2021
5 to 40 years
Cumming
GA
1,573
7,859
140
1,573
7,999
9,572
279
2003
8/19/2021
5 to 40 years
Dunwoody
GA
1,984
12,949
71
1,984
13,020
15,004
450
2015
8/19/2021
5 to 40 years
92
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building, Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Alpharetta
GA
1,785
12,051
169
1,785
12,220
14,005
418
1997
8/19/2021
5 to 40 years
Jonesboro
GA
1,724
8,195
91
1,724
8,286
10,010
283
2012
8/19/2021
5 to 40 years
Louisville - E Market St
KY
1,336
7,655
38
1,336
7,693
9,029
267
1915 / 2016
8/19/2021
5 to 40 years
Columbus - West Broad St
OH
879
6,589
97
879
6,686
7,565
232
2000
8/19/2021
5 to 40 years
Oklahoma City - NW
122nd
OK
734
5,054
33
734
5,087
5,821
192
2017
8/19/2021
5 to 40 years
Edmond
OK
732
4,268
112
732
4,380
5,112
172
2017
8/19/2021
5 to 40 years
Greenville - Dunbar
SC
817
12,949
45
817
12,994
13,811
448
2015
8/19/2021
5 to 40 years
Mount Pleasant
SC
794
11,579
(185)
794
11,394
12,188
401
2016
8/19/2021
5 to 40 years
Austin - Airport Blvd
TX
1,440
18,543
(51)
1,440
18,492
19,932
635
2020
8/19/2021
5 to 40 years
Round Rock - University
Blvd
TX
1,160
11,288
145
1,160
11,433
12,593
403
2018
8/19/2021
5 to 40 years
Gilbert
AZ
1,034
15,974
40
1,034
16,014
17,048
554
2020
8/25/2021
5 to 40 years
Atlanta - Decatur St
GA
3,407
19,086
129
3,407
19,215
22,622
650
2013
9/1/2021
5 to 40 years
Marietta - Johnson Ferry
GA
600
14,408
69
600
14,477
15,077
487
2014
9/1/2021
5 to 40 years
Cumming - Atlanta Hwy
GA
1,563
11,954
11
1,563
11,965
13,528
413
2015
9/1/2021
5 to 40 years
Round Rock - Double
Creek
TX
2,746
10,690
287
2,746
10,977
13,723
358
2006
10/1/2021
5 to 40 years
San Antonio - Wurzbach
TX
1,557
9,747
206
1,557
9,953
11,510
329
2007
10/1/2021
5 to 40 years
San Antonio -
Nacogdoches
TX
2,338
12,939
223
2,338
13,162
15,500
430
2007
10/1/2021
5 to 40 years
Leander
TX
2,766
15,265
62
2,766
15,327
18,093
500
2014
10/1/2021
5 to 40 years
Miami - SW 81st Terrace
FL
9,831
17,891
61
9,831
17,952
27,783
538
2019
10/20/2021
5 to 40 years
Miami - NW 37th Ave
FL
3,316
26,389
117
3,316
26,506
29,822
788
2018
10/20/2021
5 to 40 years
Charlotte - E 7th Street
NC
2,737
26,328
72
2,737
26,400
29,137
785
2018
10/21/2021
5 to 40 years
Durham - Petty
NC
516
19,358
52
516
19,410
19,926
575
2017
10/21/2021
5 to 40 years
Greenville - Laurens
SC
1,666
7,512
72
1,666
7,584
9,250
232
2015
10/21/2021
5 to 40 years
Greenville - Pleasantburg
SC
1,506
10,605
74
1,506
10,679
12,185
324
2017
10/21/2021
5 to 40 years
Nashville - 26th Avenue
TN
4,425
16,979
147
4,425
17,126
21,551
516
2018
10/21/2021
5 to 40 years
Savannah - E Victory
GA
1,127
21,213
76
1,127
21,289
22,416
631
2018
10/21/2021
5 to 40 years
Stanley
NC
1,792
12,343
80
1,792
12,423
14,215
380
2017
10/21/2021
5 to 40 years
Henrico - Cox Rd
VA
341
13,963
-
341
13,963
14,304
384
2016
11/16/2021
5 to 40 years
Portland - Riverside
ME
1,669
18,203
35
1,669
18,238
19,907
511
2020
12/2/2021
5 to 40 years
New Lenox - West Haven
IL
1,705
17,136
30
1,705
17,166
18,871
485
2020
12/8/2021
5 to 40 years
Orlando - E Colonial
FL
2,746
9,661
56
2,746
9,717
12,463
272
2002 / 2016
12/10/2021
5 to 40 years
Largo - Belcher
FL
1,715
16,833
121
1,715
16,954
18,669
468
2001
12/13/2021
5 to 40 years
Tampa - Gunn Highway
FL
2,113
15,166
79
2,113
15,245
17,358
427
2001
12/13/2021
5 to 40 years
Tampa - E Fletcher Ave
FL
2,076
13,699
136
2,076
13,835
15,911
390
2001
12/13/2021
5 to 40 years
Lakeland - Robin Rd
FL
1,103
11,522
44
1,103
11,566
12,669
319
2007
12/13/2021
5 to 40 years
Lutz - State Rd 54
FL
1,597
12,502
134
1,597
12,636
14,233
351
2001
12/13/2021
5 to 40 years
Tampa - Bruce D Downs
Blvd
FL
1,276
13,061
165
1,276
13,226
14,502
369
2007
12/13/2021
5 to 40 years
Riverview - Boyete
FL
1,154
11,202
82
1,154
11,284
12,438
319
2002
12/13/2021
5 to 40 years
Seffner
FL
1,377
16,929
89
1,377
17,018
18,395
475
2000
12/13/2021
5 to 40 years
Spring Hill
FL
954
12,895
45
954
12,940
13,894
358
2004
12/13/2021
5 to 40 years
Largo - Starkey
FL
1,692
16,864
102
1,692
16,966
18,658
468
1990
12/13/2021
5 to 40 years
Wesley Chapel
FL
1,664
17,377
163
1,664
17,540
19,204
490
2008
12/13/2021
5 to 40 years
Tampa - W Fletcher Ave
FL
2,277
12,550
120
2,277
12,670
14,947
358
2003
12/13/2021
5 to 40 years
Decatur - Covington
GA
2,452
13,126
114
2,452
13,240
15,692
366
1999
12/13/2021
5 to 40 years
Lithia Springs
GA
2,057
8,978
92
2,057
9,070
11,127
254
1996 / 2014
12/13/2021
5 to 40 years
Lithonia
GA
3,006
19,232
257
3,006
19,489
22,495
533
1999
12/13/2021
5 to 40 years
93
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts. Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Norcross
GA
1,572
8,064
127
1,572
8,191
9,763
227
1994
12/13/2021
5 to 40 years
Roswell
GA
2,134
6,447
78
2,134
6,525
8,659
181
1998
12/13/2021
5 to 40 years
Shady Springs
GA
2,688
11,397
57
2,688
11,454
14,142
314
1999
12/13/2021
5 to 40 years
Stockbridge
GA
3,275
17,738
95
3,275
17,833
21,108
489
1998
12/13/2021
5 to 40 years
Stone Mountain
GA
2,961
12,119
86
2,961
12,205
15,166
341
2001
12/13/2021
5 to 40 years
Batavia
IL
1,881
17,160
126
1,881
17,286
19,167
475
1990
12/13/2021
5 to 40 years
Chicago - N Des Plaines
IL
5,276
19,420
189
5,276
19,609
24,885
538
2003
12/13/2021
5 to 40 years
Lake Zurich
IL
887
13,438
94
887
13,532
14,419
372
2002
12/13/2021
5 to 40 years
Sanford - W SR 46
FL
2,989
10,924
53
2,989
10,977
13,966
311
2015
12/15/2021
5 to 40 years
Broomfield
CO
2,652
13,159
65
2,652
13,224
15,876
346
2017
12/16/2021
5 to 40 years
Loveland
CO
1,074
15,781
71
1,074
15,852
16,926
408
2017
12/16/2021
5 to 40 years
Palmetto - 96th St E
FL
737
19,623
30
737
19,653
20,390
513
2020
12/20/2021
5 to 40 years
Southington
CT
1,111
7,913
47
1,111
7,960
9,071
209
2019
12/28/2021
5 to 40 years
Milford
CT
2,613
16,328
76
2,613
16,404
19,017
424
2018
12/28/2021
5 to 40 years
Meriden
CT
1,123
9,205
123
1,123
9,328
10,451
237
2008
12/28/2021
5 to 40 years
Glastonbury
CT
1,556
9,575
56
1,556
9,631
11,187
245
2006
12/28/2021
5 to 40 years
Plainville
CT
2,166
10,137
67
2,166
10,204
12,370
260
2006
12/28/2021
5 to 40 years
West Hartford - New
Park Ave
CT
1,892
12,111
122
1,892
12,233
14,125
313
2008
12/28/2021
5 to 40 years
San Marcos
CA
5,177
24,367
107
5,177
24,474
29,651
616
1984
1/4/2022
5 to 40 years
Riverside
CA
3,269
35,291
76
3,269
35,367
38,636
891
1997
1/4/2022
5 to 40 years
Beaumont
CA
3,011
36,149
74
3,011
36,223
39,234
916
2007
1/4/2022
5 to 40 years
Moreno Valley
CA
1,954
19,652
69
1,954
19,721
21,675
498
1994
1/4/2022
5 to 40 years
Pomona
CA
2,781
12,332
53
2,781
12,385
15,166
314
1974
1/4/2022
5 to 40 years
Capistrano Beach
CA
4,129
15,453
36
4,129
15,489
19,618
390
1998
1/4/2022
5 to 40 years
Charleston - Grand Oaks
Blvd
SC
1,544
14,354
73
1,544
14,427
15,971
310
2021
3/11/2022
5 to 40 years
Winston Salem
NC
928
15,781
70
928
15,851
16,779
336
2021
3/11/2022
5 to 40 years
Savannah
GA
1,453
14,165
61
1,453
14,226
15,679
303
2020
3/11/2022
5 to 40 years
Chicago - N Broadway
IL
3,108
10,010
107
3,108
10,117
13,225
230
1920
3/15/2022
5 to 40 years
Plano
TX
1,086
8,667
5
1,086
8,672
9,758
189
2019
3/15/2022
5 to 40 years
Little Elm
TX
1,892
17,260
42
1,892
17,302
19,194
379
2018
3/15/2022
5 to 40 years
Garland
TX
1,103
9,288
45
1,103
9,333
10,436
204
2019
3/15/2022
5 to 40 years
Flower Mound
TX
2,080
15,313
50
2,080
15,363
17,443
339
2018
3/15/2022
5 to 40 years
Durham
NC
1,010
8,723
42
1,010
8,765
9,775
188
2015
3/15/2022
5 to 40 years
Raleigh
NC
1,018
11,979
42
1,018
12,021
13,039
256
2015
3/15/2022
5 to 40 years
Spring Lake
NC
995
21,199
54
995
21,253
22,248
450
2014
3/15/2022
5 to 40 years
Baltimore
MD
1,640
19,856
68
1,640
19,924
21,564
384
2019
3/28/2022
5 to 40 years
Brooklyn - McDonald
Ave
NY
10,287
25,281
4
10,287
25,285
35,572
482
2019
4/4/2022
5 to 40 years
Clearwater
FL
3,344
13,510
29
3,344
13,539
16,883
231
2008
4/19/2022
5 to 40 years
Tampa
FL
2,331
16,165
39
2,331
16,204
18,535
276
2018
4/19/2022
5 to 40 years
Tampa
FL
2,219
14,139
30
2,219
14,169
16,388
247
2017
4/19/2022
5 to 40 years
Jonesboro
GA
1,333
14,903
4
1,333
14,907
16,240
261
2019
4/22/2022
5 to 40 years
Worchester
MA
810
19,040
56
810
19,096
19,906
330
2017
4/25/2022
5 to 40 years
Tampa
FL
3,712
13,307
65
3,712
13,372
17,084
231
2017
5/10/2022
5 to 40 years
Lake Worth
FL
5,101
31,079
27
5,101
31,106
36,207
528
2020
5/12/2022
5 to 40 years
Niagara Falls
NY
574
17,792
95
574
17,887
18,461
267
2014
5/17/2022
5 to 40 years
Orchard Park
NY
951
12,802
81
951
12,883
13,834
192
1996
5/17/2022
5 to 40 years
94
Cost
Capitalized
Subsequent
Life on
to
Gross Amount at Which
which
Initial Cost to Company
Acquisition
Carried at Close of Period
depreciation
Building,
Building,
Building,
in latest
Equipment Equipment
Equipment
income
New
Encum
and
and
and
Accum.
Date of
Date
statement
Description
ST
brance
Land
Impvmts.
Impvmts.
Land
Impvmts.
Total
Deprec.
Const.
Acquired
is computed
Houston
TX
1,273
15,614
61
1,273
15,675
16,948
249
2007
5/17/2022
5 to 40 years
Miami - SW 39th Ave
FL
3,563
18,171
55
3,563
18,226
21,789
270
2020
5/31/2022
5 to 40 years
Westminster
CA
5,967
6,571
46
5,967
6,617
12,584
84
1987
6/21/2022
5 to 40 years
Cornelius
NC
428
19,428
16
428
19,444
19,872
263
2018
7/6/2022
5 to 40 years
Hamburg
NY
729
3,312
0
729
3,312
4,041
36
2022
8/5/2022
5 to 40 years
North Las Vegas
NV
2,354
26,511
14
2,354
26,525
28,879
289
2021
8/12/2022
5 to 40 years
Bruckner
NY
8,079
20,734
0
8,079
20,734
28,813
176
2019
8/12/2022
5 to 40 years
Riverside
CA
1,324
9,292
23
1,324
9,315
10,639
79
2009
8/23/2022
5 to 40 years
Gilbert
AZ
3,959
26,255
31
3,959
26,286
30,245
232
2018
8/24/2022
5 to 40 years
Machester
MO
1,503
11,841
29
1,503
11,870
13,373
101
2019
9/14/2022
5 to 40 years
St. Louis - Chippewa
MO
1,514
11,577
27
1,514
11,604
13,118
97
2010
9/14/2022
5 to 40 years
St. Louis - Big Bend
MO
1,638
15,142
39
1,638
15,181
16,819
128
2015
9/14/2022
5 to 40 years
Kirkwood
MO
1,822
25,402
26
1,822
25,428
27,250
221
2020
9/14/2022
5 to 40 years
St. Louis - Manchester
MO
1,736
19,739
27
1,736
19,766
21,502
166
2015
9/14/2022
5 to 40 years
Wareham
MA
640
15,820
3
640
15,823
16,463
100
2003
9/21/2022
5 to 40 years
East Naples
FL
1,830
15,369
31
1,830
15,400
17,230
103
2022
9/22/2022
5 to 40 years
Phoenix - E Indian
School
AZ
2,917
26,234
6
2,917
26,240
29,157
166
1992
10/13/2022
5 to 40 years
Phoenix - N 16th
AZ
2,183
21,629
4
2,183
21,633
23,816
137
2004
10/13/2022
5 to 40 years
Tempe
AZ
1,898
11,085
7
1,898
11,092
12,990
71
1996
10/13/2022
5 to 40 years
Phoenix - E Thunderbird
AZ
1,958
16,995
6
1,958
17,001
18,959
108
1998
10/13/2022
5 to 40 years
Cave Creek
AZ
1,321
27,102
6
1,321
27,108
28,429
171
2003
10/13/2022
5 to 40 years
San Tan Valley
AZ
930
14,717
5
929
14,723
15,652
95
2007
10/13/2022
5 to 40 years
Burnsville
MN
2,622
9,229
7
2,622
9,236
11,858
63
1977
10/13/2022
5 to 40 years
Construction in Progress
—
—
43,231
—
43,231
43,231
—
2022
Corporate Office
NY
—
68
49,689
1,633
48,124
49,757
29,602
2000
5/1/2000
5 to 40 years
$ 36,258
$ 1,292,431
$ 5,984,846
$ 894,529
$ 1,307,425
$ 6,864,381
$ 8,171,806
$ 1,170,520
95
(dollars in thousands)
December 31,
December 31,
December 31,
2022
2021
2020
Cost:
Balance at beginning of period
$
7,090,457
$
5,330,323
$
4,749,473
Additions during period:
Acquisitions through foreclosure
—
—
—
Other acquisitions
992,613
1,675,366
523,922
Improvements, etc.
102,496
85,515
57,437
1,095,109
1,760,881
581,359
Deductions during period:
Cost of assets disposed
(13,760)
(747)
(509)
Impairment write-down
—
—
—
Casualty loss
—
—
—
(13,760)
(747)
(509)
Balance at close of period
$
8,171,806
$
7,090,457
$
5,330,323
Accumulated Depreciation:
Balance at beginning of period
$
1,007,650
$
873,178
$
756,333
Additions during period:
Depreciation expense
172,717
134,773
117,168
172,717
134,773
117,168
Deductions during period:
Accumulated depreciation of assets disposed
(9,847)
(301)
(323)
Accumulated depreciation on impaired asset
—
—
—
Accumulated depreciation on casualty loss
—
—
—
(9,847)
(301)
(323)
Balance at close of period
$
1,170,520
$
1,007,650
$
873,178
The aggregate cost of real estate for U.S. federal income tax purposes is $7,974,006 at December 31, 2022.
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OFFICERS AND DIRECTORS
CORPORATE INFORMATION
Investor Relations
Brent J. Maedl
(716) 328-9756 • bmaedl@lifestorage.com
invest.lifestorage.com
Independent Auditors
Ernst & Young LLP
Suite 2900 • 1 W. Seneca Street • Buffalo, New York 14203
Corporate Counsel
Phillips Lytle LLP
One Canalside
125 Main Street • Buffalo, New York 14203
Registrar and Transfer Agent
American Stock Transfer & Trust Company LLC
6201 15th Avenue • Brooklyn, New York 11219
(800) 937-5449
Annual Meeting
May 18, 2023
www.virtualshareholdermeeting.com/LSI2023
9:00 a.m. (e.d.t.)
Exchange
New York Stock Exchange Listing Symbol: LSI
Average Daily Volume in 2022: 585,753
The Chief Executive Officer has previously filed with
the New York Stock Exchange (NYSE) the annual CEO
certification for 2022 as required by section
303A.12(a) of the NYSE listed company manual.
As of December 31, 2022, there were approximately
577 shareholders of record of the common stock.
Stephen R. Rusmisel
Director
Principal - V1 Funding LP
Arthur L. Havener, Jr.
Director
Principal - Stampede Capital LLC
Mark G. Barberio
Director
Principal - Markapital, LLC
Dana Hamilton
Director
Senior Managing Director -
Pretium Partners, LLC
Edward Pettinella
Director
CEO (Retired) - Home Properties, Inc.
David Rogers
Director
CEO (Retired) - Life Storage, Inc
Susan Harnett
Director
COO (Retired) - QBE North America
Joseph V. Saffire
Director
Chief Executive Officer
Alex Gress
Chief Financial Officer
and Corporate Secretary
David Dodman
Chief Operating Officer
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