Public Storage
Annual Report 2023

Plain-text annual report

PUBLIC STORAGE 2 0 2 3 A N N U A L R E P O R T WA 107 OR 45 NV 33 CA 444 HIHH 2122 ID 7 UT 13 AZ 60 CO 87 MN 68 IA 1 MO 44 LA 14 NE 10 KS 24 OK 48 TX 455 WI 15 IMII 61 IL IN OH 137 54 65 KY 17 TN 52 AL 31 GA 127 MS 5 HHNHH 2222 NY 73 PA 37 VA 120 NC 110 SC 81 MA RI CT 29 4 15 NJ DE MD 67 5 105 SWEDENENN N 39 DENMARKKK NNMANN NMANMAR 10 FL 3 33 360 UNITED UNITED UUNITED KINGDOM KINGDOM KINGDOM 43 NETHERRERREREHHERRRLALALLLAALALALLLALAARRRRRR NNNDSNDAAAAA 67 BELBELBELELELLLELELGGGIUGIUUUMU 21 GERMANNNYNY 30 FRANCE 65 P R O P E RT I E S (as of December 31, 2023) Number of Properties Net Rentable Square Feet Number of Properties Net Rentable Square Feet Public Storage Alabama Arizona California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maryland Massachusetts Michigan Minnesota Mississippi Missouri Nebraska Nevada New Hampshire New Jersey New York North Carolina 31 60 444 87 15 5 360 127 12 7 137 54 1 24 17 14 105 29 61 68 5 44 10 33 2 67 73 110 1,457,000 4,275,000 31,419,000 6,468,000 985,000 324,000 25,038,000 8,555,000 890,000 669,000 8,930,000 3,585,000 59,000 1,538,000 1,009,000 1,011,000 7,782,000 2,052,000 4,387,000 5,425,000 449,000 2,919,000 882,000 2,305,000 132,000 4,651,000 5,122,000 8,110,000 Public Storage (cont.) Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina Tennessee Texas Utah Virginia Washington Wisconsin 65 48 45 37 4 81 52 455 13 120 107 15 4,415,000 3,502,000 2,618,000 2,685,000 248,000 5,031,000 3,228,000 38,668,000 800,000 7,894,000 7,586,000 968,000 3,044 218,071,000 Shurgard Self Storage Limited Belgium Denmark France Germany Netherlands Sweden United Kingdomg 21 10 65 30 67 39 43 275 1,260,000 572,000 3,495,000 1,585,000 3,624,000 2,105,000 2,327,000 14,968,000 Total 3,319 233,039,000 CHAIRMAN’S LETTER Fellow Stakeholders, In 2023, our businesses performed well amidst an uncertain macroeconomic environment after two years of record self-storage industry growth. Both individually and collectively, Public Storage and Shurgard (Euronext Brussels: SHUR) achieved record revenues and net operating income in their core self-storage and ancillary businesses (primarily tenant reinsurance). Below are the key figures for these businesses. At year-end 2023, Public Storage owned 35% of Shurgard, the largest owner and operator of self-storage properties in Europe. While our interest is significant, Shurgard is a separate company with its own management and Board of Directors, the majority of which are independent. The figures below are presented on a combined basis to help you better understand our performance. Combined Revenues1 (Amounts in millions) U.S. self-storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ European self-storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ancillary businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,260 342 298 $ 3,946 316 275 $ 3,204 283 250 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,900 $ 4,537 $ 3,737 2023 2022 2021 Combined Net Operating Income1 (Amounts in millions) 2023 2022 2021 U.S. self-storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ European self-storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ancillary businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,198 212 207 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,617 Public Storage’s share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,456 $ $ $ 2,966 195 196 3,357 3,209 $ $ $ 2,352 171 175 2,698 2,566 1. See accompanying schedule “Supplemental Non-GAAP Disclosures.” The combined revenues of Public Storage and Shurgard increased by $363 million, to a record $4.9 billion, and the combined NOI increased to a record $3.6 billion in 2023. Our share of the combined NOI was $3.5 billion. By design, each company is positioned to execute across all macro environments. The shared characteristics of operational innovation and excellence, multi-factor external growth, prudent balance sheet management, and manageable new supply from competitors are driving growth and 1 value creation, as detailed by Public Storage CEO Joe Russell and Shurgard CEO Marc Oursin in their respective shareholder letters. Both management teams are inspiring motivated workforces to capitalize on the formidable competitive advantages we have developed over decades. These advantages are built for and magnified in times like these. I want to thank Public Storage’s Board of Trustees and Shurgard’s Board of Directors for their support and leadership in guiding such talented teams. I’d also like to express particular gratitude to John Sambuco, a widely skilled executive who retired after more than 30 years of leadership at Public Storage and Shurgard. John led various teams across many aspects of our businesses (asset management most recently), helping create the foundation for who we are today. We thank John for his invaluable contributions and wish him the best in his well- deserved retirement. With industry-leading brands, increasingly efficient operating platforms, high-quality properties located in growing markets, and growth-oriented balance sheets underpinned by low leverage, we are in a position of strength in 2024 and poised to deliver solid returns to shareholders for years to come. Ronald L. Havner, Jr. Chairman of the Board of Trustees February 29, 2024 2 CHIEF EXECUTIVE OFFICER’S LETTER Fellow Stakeholders, Public Storage succeeded in 2023 by strengthening our industry-leading platform and achieving record net operating income. The Public Storage team innovated across the business and enhanced the portfolio significantly. Once again, we created growth and value for our stakeholders while bolstering our industry-leading brand and platform. To highlight 2023, we reached several milestones and achievements including: • Expanding the owned portfolio to more than 3,000 properties, 218 million square feet, and approximately two million customers; • Reaching $21.38 same store rent per available square foot (REVPAF);1 • Achieving a nearly 80% same store direct operating margin; • Delivering $4.5 billion and $3.4 billion in consolidated revenue and NOI, respectively; • Growing our high-growth, non-same store portfolio to 705 properties and 63 million square feet, comprising 29% of our owned portfolio; • Expanding our pipeline to more than $765 million in property development and redevelopment; • Acquiring and integrating the 90,000 customer, $2.2 billion Simply Self Storage portfolio, the largest private portfolio transaction in our decades-long growth history; and • Being named a Nareit “Leader in the Light” for outstanding sustainability practices, receiving a second-consecutive Great Place to Work® award, and achieving top scoring among U.S. self-storage REITs across the leading sustainability benchmarks. I am proud of the Public Storage team for these accomplishments and many more. 1. Realized annual rent per available square foot is computed by dividing annualized rental income by total available rentable square footage. 1 2023 Business Results We have two principal businesses: (i) self-storage, conducted under the Public Storage® brand, and (ii) ancillary businesses, primarily the reinsurance of policies offered to our self-storage customers under the Orange Door® brand. Below are the revenues and NOI for each business. Revenues (Amounts in millions) Self-storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ Ancillary businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,260 258 $ 3,946 236 $ 3,204 212 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,518 $ 4,182 $ 3,416 2023 2022 2021 Net Operating Income1 (Amounts in millions) Self-storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ Ancillary businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,198 172 $ 2,966 163 $ 2,352 143 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,370 $ 3,129 $ 2,495 2023 2022 2021 In 2023, the NOI of these businesses increased by $241 million, or 8%, to a record $3.4 billion. As a result, our core funds from operations and free cash flow per diluted common share increased to record levels as well: Earnings per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 11.06 Core FFO per share1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 16.89 14.44 Free cash flow per share1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ $ $ 23.50 15.92 13.56 $ $ $ 9.87 12.93 11.55 2023 2022 2021 1. See accompanying schedule “Supplemental Non-GAAP Disclosures.” How We Measure Our Results We measure operating results by segmenting our portfolio into two categories: (i) stabilized properties in the same store pool and (ii) unstabilized properties in the non-same store pool. The same store pool allows us and investors to assess the health of our self-storage business by only including properties with stabilized revenues (i.e., rent and occupancy) and operating expenses that reflect organic growth on an “apples-to-apples” basis. 2 Our approach differs from other self-storage REITs, which include high-growth, unstabilized lease-up properties in their same store pools. They also allocate certain property operating expenses to general and administrative expense rather than cost of operations, enhancing their reported performance under metrics used by investors, including same store NOI growth, operating margin, and NAV (net asset value). We report the way we would want our performance to be reported if we were in your position. Same store NOI increased by 4.7% in 2023, compared to an 18.5% increase in 2022. Same Store Properties (Dollar amounts in millions, except occupancy and REVPAF) Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Costs of operations Net operating income1 . . . . . . . . . . . . . . . . . . . . . Net rentable square feet . . . . . . . . . . . . . . . . . . . . Average occupancy . . . . . . . . . . . . . . . . . . . . . . . . Year-end occupancy . . . . . . . . . . . . . . . . . . . . . . . REVPAF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2023 3,428 802 2,626 154.9 93.3% 91.6% 21.38 $ $ $ 2022 3,274 766 2,508 154.9 94.8% 92.3% 20.45 $ $ $ 2021 2,842 725 2,117 154.9 96.2% 94.7% 17.79 $ $ $ We exclude our 705 unstabilized non-same store properties from the same store pool because their year-over-year performance is not comparable to stabilized assets. Given self-storage’s stabilization period (typically 3-5 years for occupancy and rents), this group primarily comprises properties developed or redeveloped since 2018 and acquired since 2021. It consists of 63.2 million square feet, or 29% of our total portfolio, as we enter 2024. The cost to acquire and build these properties totaled $10 billion. At stabilization, we estimate their market value will approximate $12 billion, resulting in approximately $2 billion of value creation. We have significant upside tied to this growing pool of high-growth assets. Our non-same store NOI increased significantly during 2023 due to strong lease-up and the addition of new acquisition and development properties, providing an engine of growth to offset broader deceleration in the self-storage industry. Non-Same Store Properties (Amounts in millions, except occupancy and REVPAF) 2023 2022 2021 Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Costs of operations Net operating income1 . . . . . . . . . . . . . . . . . . . . . Net rentable square feet . . . . . . . . . . . . . . . . . . . . Average occupancy . . . . . . . . . . . . . . . . . . . . . . . . REVPAF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ $ $ 832 260 572 63.2 84.8% 14.67 $ $ $ 672 214 458 49.3 85.6% 14.11 $ $ $ 362 127 235 43.4 84.8% 12.10 1. See accompanying schedule “Supplemental Non-GAAP Disclosures.” 3 2023 Business Review The competitive advantages unique to Public Storage, including our leading operating platform, multi-factor external growth strategy, and strong balance sheet, comprise a wide moat relative to our competition. We entered 2023 with a “One Team” theme to enhance our people and platforms on an even more holistic basis. As “One Team,” we have focused on the following as we continually strengthen our business: • Driving revenues and controlling expenses against the evolving operating backdrop; • Advancing our industry-leading digital platform and further transforming our operating model; • • Partnering with industry peers through third-party management and our new Savvy Self Storage Insurance and lending programs; Investing in our people, culture, and communities; • Enhancing the size and quality of our property portfolio; and • Utilizing our growth-oriented balance sheet. The macro environment remained in transition during 2023, with inflationary pressure ranging from high to moderate and the Fed’s response bringing higher interest rates and GDP growth contraction. The impact on businesses and consumers, including a slow housing market, was evident despite the avoidance of recession. Following two consecutive years of record growth (including 50% cumulative Core FFO per share growth for Public Storage), the self-storage industry was at newfound heights entering this macro dislocation. An ensuing mix of normalization from record performance, slowing move-in customer demand, and competitive move-in pricing behavior among property owners drove growth deceleration for the industry in 2023 (including Public Storage’s Core FFO per share growth declining from 23% in 2022 to 6% in 2023). With healthy behavior exhibited by our existing customers, the environment for new move-in customers was the primary source of pressure for the industry. The number of customers seeking self-storage was down some, but property owners exacerbated the impact by offering significant reductions in rents offered to new customers. This competitive pricing behavior began in the second half of 2022 when many operators were caught off guard by the return of seasonality in our business. It then continued through 2023 as many operators were surprised by a lower level of seasonal demand, primarily attributable to the slower housing market. Despite this backdrop, the Public Storage team capitalized on our competitive advantages to drive industry-leading performance, including achieving an operating margin that was 380 to 880 basis points higher than our self-storage REIT peer group in 2023. Bucking the industry-wide trend, the team impressively achieved higher move-in volumes by calibrating the appropriate mixes of marketing, pricing, promotions, and customer experience offerings. This outperformance has driven 4 improving occupancy trends and created a fresher customer base to support revenue growth over the next few years. Our new tenants are exhibiting strong behavior as they learn to value the convenience that Public Storage’s unique customer experience affords. Advancing Our Industry-Leading Digital Platform and Further Transforming Our Operating Model Under the leadership of Natalia Johnson, our Chief Administrative Officer who oversees technology, data science, human capital, and customer care, Public Storage has integrated its entire platform by developing and implementing the industry’s first comprehensive and centralized digital operating ecosystem. The ecosystem includes our one-of-a-kind customer experience, field operations led by Steven Lentin, industry-leading revenue management led by Richard Craig, advanced data science led by Philip Kim, asset management, and broader corporate functions. The team works together to deliver the best customer experience in the industry. Due to our efforts led by Mike Braine in technology and Dilhara Kaluarachchi in the customer care center, we now provide the same level of digital enablement that makes many other important things easier, faster, and more self-service across our customers’ daily lives. Adoption has been swift, with self-selected digital options now comprising 80% of our customer transactions, a significant increase from just 30% in 2019. The Public Storage Digital Customer Experience ® DIGITAL LEASES RENT BY PHONE DIGITAL PROPERTY ACCESS ENHANCED SECURITY TEXTING SERVICE CUSTOMER DEMAND BASED STAFFING FULL SERVICE KIOSK AUTO-ENROLL INSURANCE CENTRALIZED SERVICE PS APP PROPERTY MANAGER APPOINTMENT SUPPORT Our broader proprietary digital ecosystem is a critical element of our operating model transformation. Real-time data, which provides insight into how and when customers use our 5 properties, enables digital property management and a shift to flexible staffing based on customer demand, instead of the traditional “9 to 5” model. We have implemented digital property management across the country. Customers utilize our website, Public Storage App, and remote customer care platform to rent units, manage their accounts, and receive live video customer care. We monitor for safety and security through our digital cameras and property access systems. Cleaning, repairs, and maintenance are led by our multi-property local teams. The result is even-higher customer satisfaction as we’ve aligned the self- storage experience with the digital expectations customers now have across their daily lives. Investing in Our People, Culture, and Communities Nathan Tan leads our human capital management and development. Our brand and platform strength is driven by our people, who embody a culture of integrity, innovation, entrepreneurship, development, diversity, inclusion, and community. Highlights of our people-centric approach in 2023 included: • Receiving the Great Place to Work® award for a second consecutive year, an award based entirely on employees’ experiences working at Public Storage; • Launching “Preparing the Path,” our diversity leadership accelerator program; • Completing year two of “Community Connects,” our corporate volunteering and giving program; and • Being named among ten out of approximately 215 Nareit member companies to receive the prestigious “Leader in the Light” award for outstanding sustainability practices. The quality and dedication of our people drive our success. I am honored to lead such a strong team and am committed to ongoing advancement to ensure our people are positioned to excel professionally and personally within our communities. Enhancing the Size and Quality of Our Property Portfolio Tom Boyle, our Chief Financial and Investment Officer, leads our capital allocation strategies. We have a multi-dimensional approach to portfolio growth centered on acquisitions, development, redevelopment, and third-party property management. We are the largest owner and developer of self-storage properties in the world. Our more than 3,000 owned properties consist of more than 218 million square feet located across 40 states. There are significant benefits of coverage and scale in our business, including operating expense and overhead efficiencies. Our scale, combined with our people, operating platform, innovation, and brand, afford meaningful advantages that result in superior operating margins and cash flow. 6 Acquisitions, Development, Redevelopment, and Third-Party Management We expanded our portfolio by adding 175 properties comprising 14 million square feet of space through acquisition, development, and redevelopment in 2023. The 705 non-same store properties now comprise 29% of our total portfolio square footage, but only 18% of our NOI (due to 85% average occupancy and rents that are below market), providing meaningful embedded growth through lease-up over the next few years. Total Owned Portfolio By Property Type 218 million square feet Stabilized Same Store Properties 71% Non-Same Store Lease-Up Properties: 18% Acquisitions 4% Development 7% Redevelopment High growth lease-up properties are 29% of the total portfolio and growing Led by Mike McGowan and Paul Spittle, we acquired 164 properties comprising 12.1 million square feet for $2.7 billion during the year. The acquisition of Simply Self Storage for $2.2 billion drove this elevated volume. Simply is the largest private portfolio acquisition in Public Storage’s long-standing history and the largest private self-storage portfolio to trade hands in 2023. ($ millions) $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 $430 2019 $796 2020 Acquisitions $5,115 2021 7 $2,675 2023 $731 2022 We have a differentiated acquisition strategy grounded in big data and analytics, and a reputation as a preferred buyer that offers speed and certainty to close. Through this, we are acquiring and driving outsized growth as we lease up properties over the next few years. Acquisition Yields 4Q23 Annualized Yield in 2022 Yield in 2023 5.2% 3.0% 4.1% 8% 6% 4% 2% 0% Acquired in: 2023 Occupancy / Growth (yoy): Rent Growth (yoy): Volume ($000s): Square Feet (000s): n/a n/a $2,674,840 12,067 2022 82% (+4%) 14% $730,957 4,740 4.7% 5.0% 2021 82% (-2%) 5% $5,115,276 22,009 Self-storage property development has always been a difficult business. Recently, the confluence of normalizing operations, higher costs and interest rates, and municipal roadblocks (e.g., NIMBY-ism) have made it even more difficult. As a result, we expect new industry-wide development deliveries to fall below 3% of existing stock over the next couple years after peaking at more than 5% in 2019. The size and skill of our development platform are unmatched. We have the only in-house, nationwide program in the industry, led by Andres Friedman and Phil Williams. Building directly is a major competitive advantage because, when and where it makes sense, we can develop new properties at costs below the level at which existing properties are trading in the marketplace. Property development is a long-term business that allows us to achieve superior returns when combined with our industry-leading NOI generation. We remain disciplined and are confident in our ability to grow the development pipeline to continue achieving attractive returns. We are uniquely positioned to deliver new properties at an opportune time when others can’t. To that end, despite ongoing challenges, we plan to deliver a record $450 million of development in 2024. 8 21% 18% 15% 12% 9% 6% 3% 0% -3% Delivered in: -0.6% 2023 Occupancy / Growth (yoy): Rent Growth (yoy): n/a n/a Development Yields 4Q23 Annualized Yield in 2022 Yield in 2023 14.3% 12.9% 6.4% 6.0% 6.2% 0.3% 8.8% 8.1% 10.6% 10.9% 2022 2021 2020 2019 2018 78% (+0%) 82% (-1%) 89% (-5%) 85% (-3%) 87% (-1%) Volume ($000s): $193,766 $100,089 $115,632 Square Feet (000s): 1,098 631 681 17% 10% 5% $42,063 347 4% 2% $150,387 $262,187 1,057 2,069 We re-entered the third-party management business in 2018 under the leadership of Pete Panos. Through this platform, we manage properties for independent private owners as if they were our own. We are happy to share our competitive advantages as a lever to increase our market coverage and scale, while benefiting from a proprietary acquisition pipeline when our partners choose to sell. We achieved record third-party management growth in 2023, expanding the program by 132 properties to 324 properties in total. With wide-ranging competitive advantages, our external growth outlook is favorable. We anticipate that additional economic and interest rate clarity will lead to greater industry transaction volume in 2024. As other developers continue to ease back, we remain confident in finding new development and redevelopment opportunities, with a pipeline of more than $765 million at year-end. The momentum of our third-party management business is also building as our partners see the economic and reputational benefits of Public Storage’s platform and brand, in addition to the ease and certainty of execution when they decide to sell. Property of Tomorrow We are investing capital in properties as we upgrade visual and physical branding across the portfolio through the Property of Tomorrow program. This program is led by Robbie Williams from our asset management team, who succeeded John Sambuco upon retiring from the company after more than 30 years of critical and wide-ranging leadership, as Ron Havner discusses in his letter. 9 This multi-year program comprises over $600 million of investment that makes economic, environmental, and branding sense, including LED lighting, solar power generation, heat pumps, low-water irrigation, higher-efficiency offices, enhanced digital security, and plenty of easily recognized orange signage. In 2023, the team enhanced more than 730 properties, reaching 85% completion across the total portfolio by revenues. We will technically complete Property of Tomorrow in 2024, but the many learnings afforded by the program help align key opportunities to holistically enhance our competitive advantages going forward. Tenant Reinsurance Our Orange Door® tenant reinsurance program offers customers peace of mind and protection from loss or damage to their belongings at our owned and third-party managed properties. Orange Door® leads the self-storage tenant reinsurance industry under the direction of Marshann Varley. The program generated $161 million of NOI in 2023, up 7% from $151 million in 2022, and is positioned for growth as we continue expanding the portfolio and innovating to ensure best-in-class protection for our customers. In 2023, we expanded our offering by launching the Savvy Storage Insurance Program®. Savvy allows owners outside of our third-party management program to offer insurance at their properties, thereby increasing their ancillary income. The benefits to our owner partners include advantaged compensation and significantly higher customer adoption rates facilitated by a comprehensive digital platform. We have initially partnered with Storable, a leading provider of comprehensive end-to-end technology and business solutions for the self-storage industry, in offering Savvy to owners that use their property management software programs. Sustainability Sustainability is an integral part of our long-term and resilience-focused strategy. Nathan Vitan, our Chief Legal Officer, leads our efforts in addition to legal, compliance, and risk management. In 2023, Nareit named us a “Leader in the Light,” an award honoring companies that demonstrate outstanding sustainability practices. In our first year participating, we were pleased to be among ten out of approximately 215 Nareit members to receive the award. We are executing an ambitious environmental program. A 20% average reduction in carbon, water, and waste from 2018 to 2022 has resulted in our impact being approximately 88% below other property types. Furthermore, our impact is below our self-storage REIT peers despite owning similar building structures. We are committed to reducing our footprint further, including increasing our solar power capability from approximately 500 properties today to over 1,000 properties by 2025. We are also expanding our solar program to benefit local communities and the environment while generating rental income on previously unused rooftop space. In 2023, we announced a partnership that will add community solar to 133 Public Storage properties across Maryland, New Jersey, and Illinois. The partnership will provide affordable renewable energy to approximately 10,000 low- and moderate-income households within our local communities. 10 Combined, our long-term strategy, low-impact environmental footprint, people-focused approach, and strong governance are increasingly reflected in the various analytical frameworks. We are in the top 6% of the Sustainalytics global coverage universe (15,900+ companies) and lead the U.S. self- storage REIT peer group across the major sustainability benchmarks. Utilizing Our Growth-Oriented Balance Sheet Public Storage’s balance sheet is calibrated to enable strong, sustainable growth over full economic cycles. We are the only U.S. REIT with A2 and A credit ratings from Moody’s and S&P, respectively. We seek to fund external growth with retained cash flow and unsecured notes at attractive pricing on a relative basis given the low-leverage nature of our balance sheet, significant cash flow generation, and stable operating profile. Since 2015, we have issued $9.2 billion of debt at a 3.1% blended rate to fund our growth. We have also reduced the cost of our perpetual preferred equity capital by 130 basis points to 4.5% by refinancing approximately $6 billion of preferred equity. In 2023, we tripled the size of our revolving credit facility to provide additional flexibility in funding our growth moving forward. With significant cash on-hand and low variable rate debt, Tom Boyle, Nick Kangas, and the finance team once again did an admirable job on our balance sheet and financing activities. We began the year with $775 million of cash. After issuing $2.2 billion of unsecured notes and allocating capital primarily towards $2.9 billion of external growth, we ended the year with $370 million of cash. We did so by generating approximately $480 million of retained cash flow. Our operating strategies and balance sheet, including industry-leading access to and cost of capital, meaningfully benefited Public Storage this year. With 3.9x net debt and preferred equity to EBITDA, considerable retained cash flow generation, and a strong operating profile, we have advantageous access to capital and significant capacity to fund further growth. Outlook We are extremely well-positioned moving into 2024 with improving macroeconomic clarity and the potential for a “soft landing.” The competitive move-in pricing dynamics remain, but are showing signs of abating. Existing customers, including those who moved in last year, are exhibiting healthy behavior including longer lengths of stays. Additionally, the delivery of new competitor properties is declining from its 2019 peak, a trend we expect will continue over the next couple years given the myriad obstacles to new property development. The strength of our people, platform, balance sheet, and strategies allow us to execute on opportunity through economic cycles. The Public Storage team is poised to advance our competitive advantages further in 2024 and beyond. Joseph D. Russell, Jr. President and Chief Executive Officer February 29, 2024 11 CUMULATIVE TOTAL RETURN Public Storage, S&P 500 Index and NAREIT Equity Index December 31, 2007 - December 31, 2023 $900 $800 $700 $600 $500 $400 $300 $200 $100 $0 12/31/07 12/31/08 12/31/09 12/31/10 12/31/11 12/31/12 12/31/13 12/31/14 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 12/31/22 12/31/23 PSA S&P 500 Index NAREIT Equity Index 12/31/07 12/31/08 12/31/09 12/31/10 12/31/11 12/31/12 12/31/13 12/31/14 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 12/31/22 12/31/23 PSA $100.00 $112.37 $118.95 $152.89 $209.09 $232.71 $249.95 $317.02 $438.55 $408.30 $396.50 $398.99 $434.79 $489.40 $815.45 $650.63 $739.16 S&P 500 Index NAREIT Equity Index $100.00 $ 63.00 $ 79.66 $ 91.66 $ 93.59 $108.55 $143.69 $163.34 $165.58 $185.36 $225.81 $215.88 $283.83 $336.02 $432.39 $354.01 $446.97 $100.00 $ 62.27 $ 79.70 $101.98 $110.42 $132.18 $135.95 $174.06 $178.98 $194.42 $211.28 $202.74 $260.85 $247.49 $349.70 $262.45 $292.26 The graph set forth above compares the yearly change in the Company’s cumulative total shareholder return on its Common Shares for the 16-year period ended December 31, 2023 to the cumulative total return of the Standard & Poor’s 500 Stock Index (“S&P 500 Index”) and the FTSE NAREIT All Equity REITs Index (“NAREIT Equity Index”) for the same period (total shareholder return equals price appreciation plus dividends). The stock price performance graph assumes that the value of the investment in the Company’s Common Shares and each index was $100 on December 31, 2007 and that all dividends were reinvested. The share price performance shown in the graph is not necessarily indicative of future price performance. Supplemental Non-GAAP Disclosures (unaudited) Core funds from operations per share (“Core FFO”) represents diluted net income per share (“EPS”) before the impact of i) depreciation expense and disposition gains or losses and ii) foreign currency gains and losses, the application of preferred share redemption charges, and certain other items. Free cash flow per share (“Free Cash Flow”) represents Core FFO, less per share capital expenditures and non-cash stock based compensation and other expense. Core FFO and Free Cash Flow are not substitutes for EPS and may not be comparable with other REITs due to calculation differences; however, we believe they are helpful measures for investors and REIT analysts to understand our performance. Net Operating Income (“NOI”) represents revenues less pre-depreciation cost of operations earned directly at our properties, and we believe is a useful performance measure that we and the investment community use to evaluate performance and real estate values. Each of these non-GAAP measures exclude the impact of depreciation, which is based upon historical cost and assumes the value of buildings diminish ratably over time, while we believe that real estate values fluctuate due to market conditions. We also present supplemental measures of our revenues and NOI including Shurgard on a combined basis, to provide a measure of the performance of the businesses we have a significant interest in. However, the inclusion of these entities in these supplemental measures does not substitute for “equity in earnings of unconsolidated real estate entities” on our income statement. Reconciliation of Core FFO and Free Cash Flow per Share For the year ended December 31, 2023 2022 2021 $ 11.06 $ 23.50 $ 9.87 EPS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Eliminate noncore items (including our equity share): Depreciation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Real estate gain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gain on sale of equity investment in PS Business Parks, Inc. . . . . . . . . . . . . . . Foreign currency, preferred share redemption charges, and other noncore 5.64 (0.10) — items . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.29 Core FFO per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Deduct capital expenditures and adjust non-cash comp/other . . . . . . . . . . . . . . . . $ 16.89 (2.45) Free Cash Flow per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 14.44 5.27 (0.31) (12.00) (0.54) 15.92 (2.36) 13.56 $ $ 4.44 (0.95) — (0.43) $ 12.93 (1.38) $ 11.55 Reconciliation of Revenues (Amounts in millions) Consolidated revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Shurgard Europe’s revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,518 382 Combined revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,900 2023 2022 4,182 355 4,537 $ $ 2021 $ 3,416 321 $ 3,737 For the year ended December 31, Reconciliation of NOI (Amounts in millions) Net income on our income statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Eliminate: Depreciation, real estate acquisition and development expense, G&A, interest expense, interest and other income, equity in earnings, currency exchange gains (losses), gains on real estate sales and PSB, and income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Add - Shurgard Europe NOI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Combined net operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Less - NOI of Shurgard Europe allocable to others . . . . . . . . . . . . . . . . . . . . . For the year ended December 31, 2023 2022 2021 $ 2,160 $ 4,366 $ 1,960 1,210 247 3,617 (161) (1,237) 228 3,357 (148) 535 203 2,698 (132) Public Storage’s share of NOI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,456 $ 3,209 $ 2,566 [THIS PAGE INTENTIONALLY LEFT BLANK] 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, 2023. 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: 001-33519 PUBLIC STORAGE (Exact name of Registrant as specified in its charter) Maryland 93-2834996 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number) 701 Western Avenue, Glendale, California 91201-2349 (Address of principal executive offices) (Zip Code) (818) 244-8080 (Registrant's telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Title of Class Common Shares, $0.10 par value Depositary Shares Each Representing 1/1,000 of a 5.150% Cum Pref Share, Series F, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 5.050% Cum Pref Share, Series G, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 5.600% Cum Pref Share, Series H, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 4.875% Cum Pref Share, Series I, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 4.700% Cum Pref Share, Series J, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 4.750% Cum Pref Share, Series K, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 4.625% Cum Pref Share, Series L, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 4.125% Cum Pref Share, Series M, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 3.875% Cum Pref Share, Series N, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 3.900% Cum Pref Share, Series O, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 4.000% Cum Pref Share, Series P, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 3.950% Cum Pref Share, Series Q, $0.01 par value Depositary Shares Each Representing 1/1,000 of a 4.000% Cum Pref Share, Series R, $0.01 par value Trading Symbol Name of exchange on which registered PSA New York Stock Exchange PSAPrF New York Stock Exchange PSAPrG New York Stock Exchange PSAPrH New York Stock Exchange PSAPrI New York Stock Exchange PSAPrJ New York Stock Exchange PSAPrK New York Stock Exchange PSAPrL New York Stock Exchange PSAPrM New York Stock Exchange PSAPrN New York Stock Exchange PSAPrO New York Stock Exchange PSAPrP New York Stock Exchange PSAPrQ New York Stock Exchange PSAPrR New York Stock Exchange Title of Class Depositary Shares Each Representing 1/1,000 of a 4.100% Cum Pref Share, Series S, $0.01 par value Guarantee of 0.875% Senior Notes due 2032 issued by Public Storage Operating Company Guarantee of 0.500% Senior Notes due 2030 issued by Public Storage Operating Company Trading Symbol Name of exchange on which registered PSAPrS New York Stock Exchange PSA/32 New York Stock Exchange PSA/30 New York Stock Exchange 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. 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. 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. 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). 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. 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. ☐ 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. ☒ 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. ☒ Relates to an immaterial correction having no impact on our net income within the statements of income, nor any impact to our balance sheet, statements of comprehensive income, statements of equity and redeemable noncontrolling interests, or statements of cash flows as of and for the years ended December 31, 2022 and 2021. Refer to Note 2 of our Consolidated Financial Statements. 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). ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒ The aggregate market value of the voting and non-voting common shares held by non-affiliates of the Registrant as of June 30, 2023: Common Shares, $0.10 par value per share – $43,990,689,000 (computed on the basis of $291.88 per share, which was the reported closing sale price of the Company's Common Shares on the New York Stock Exchange (the “NYSE”) on June 30, 2023). As of February 13, 2024, there were 175,691,404 outstanding Common Shares, $0.10 par value per share. DOCUMENTS INCORPORATED BY REFERENCE Portions of the definitive proxy statement to be filed in connection with the Annual Meeting of Shareholders to be held in 2024 are incorporated by reference into Part III of this Annual Report on Form 10-K to the extent described therein. (This Page Intentionally Left Blank) Public Storage Form 10-K For the Fiscal Year Ended December 31, 2023 TABLE OF CONTENTS Business Risk Factors Unresolved Staff Comments Cybersecurity Properties Legal Proceedings Mine Safety Disclosures Part I Part II Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities [Reserved] Management’s Discussion and Analysis of Financial Condition and Results of Operations Item 1. Item 1A. Item 1B. Item 1C. Item 2. Item 3. Item 4. Item 5. Item 6. Item 7. Item 7A. Quantitative and Qualitative Disclosures about Market Risk Item 8. Item 9. Item 9A. Item 9B. Item 9C. Item 10. Item 11. Item 12. Item 13. Item 14. Financial Statements and Supplementary Data Changes in and Disagreements With Accountants on Accounting and Financial Disclosure Controls and Procedures Other Information Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Trustees, Executive Officers and Corporate Governance Executive Compensation Part III Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters Certain Relationships and Related Transactions and Trustee Independence Principal Accountant Fees and Services Item 15. Exhibits and Financial Statement Schedules Part IV Page 1 7 18 18 21 22 22 23 23 23 52 52 52 52 55 55 56 56 56 57 57 58 (This Page Intentionally Left Blank) ITEM 1. Business Cautionary Statement Regarding Forward-Looking Statements PART I This Annual Report on Form 10-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements relating to our 2024 outlook and all underlying assumptions; our expected acquisition, disposition, development, and redevelopment activity; supply and demand for our self-storage facilities; information relating to operating trends in our markets; expectations regarding operating expenses, including property tax changes; expectations regarding the impacts from inflation and a potential future recession; our strategic priorities; expectations with respect to financing activities, rental rates, cap rates, and yields; leasing expectations; our credit ratings; and all other statements other than statements of historical fact. Such statements are based on management’s beliefs and assumptions made based on information currently available to management and may be identified by the use of the words “expects,” “believes,” “anticipates,” “should,” “estimates,” and similar expressions. These forward-looking statements involve known and unknown risks and uncertainties, which may cause our actual results and performance to be materially different from those expressed or implied in the forward-looking statements. Risks and uncertainties that may impact future results and performance include, but are not limited to, those described in Part 1, Item 1A, “Risk Factors” of this report and in our other filings with the Securities and Exchange Commission (the “SEC”). These include changes in demand for our facilities; impacts of natural disasters; adverse changes in laws and regulations including governing property tax, evictions, rental rates, minimum wage levels, and insurance; adverse economic effects from public health emergencies, international military conflicts, or similar events impacting public health and/or economic activity; increases in the costs of our primary customer acquisition channels; adverse impacts to us and our customers from high interest rates, inflation, unfavorable foreign currency rate fluctuations, or changes in federal or state tax laws related to the taxation of REITs; security breaches, including ransomware; or a failure of our networks, systems, or technology. These forward-looking statements speak only as of the date of this report or as of the dates indicated in the statements. All of our forward-looking statements, including those in this report, are qualified in their entirety by this cautionary statement. We expressly disclaim any obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, new estimates, or other factors, events, or circumstances after the date of these forward-looking statements, except when expressly required by law. Given these risks and uncertainties, you should not rely on any forward-looking statements in this report, or which management may make orally or in writing from time to time, neither as predictions of future events nor guarantees of future performance. General Discussion of our Business Public Storage is a Maryland real estate investment trust (“REIT”) engaged in the ownership, development, and operation of self-storage facilities and other related operations including tenant reinsurance and third-party self-storage management. We are the industry leading owner of self-storage properties, with the most recognized brand in the self- storage industry, including our ubiquitous orange color. On August 14, 2023, we completed a reorganization that resulted in us holding the interests in our facilities through an operating partnership, Public Storage OP, L.P. and its subsidiaries including Public Storage Operating Company, formerly known as Public Storage, which was organized in 1980. This structure is commonly referred to as an umbrella partnership REIT, or UPREIT. Subsequent to the reorganization, the primary assets of the parent entity, Public Storage, are general partner and limited partner interests in Public Storage OP, L.P. Unless stated otherwise or the context otherwise requires, references to “Public Storage” or the “Company” mean Public Storage, references to “PSA OP” mean Public Storage OP, L.P., and references to “PSOC” mean Public Storage Operating Company. References to "we," "us," and "our" mean collectively Public Storage, PSA OP, PSOC and those entities/subsidiaries owned or controlled by Public Storage, PSA OP, and PSOC. 1 Self-storage Operations: We acquire, develop, own, and operate self-storage facilities, which offer storage spaces for lease on a month-to- month basis, for personal and business use. We are the largest owner of self-storage facilities in the United States (“U.S.”), with physical presence in most major markets and 40 states. We believe our scale, brand name, and technology platform afford us competitive advantages. At December 31, 2023, we held interests in and consolidated 3,044 self-storage facilities (an aggregate of 218 million net rentable square feet of space) operating under the Public Storage® name. Other Operations: We manage insurance programs whereby customers at our facilities, including those we manage for third parties, have the option of purchasing insurance from a non-affiliated insurance company to cover certain losses to their stored goods. A wholly-owned, consolidated subsidiary of Public Storage fully reinsures these policies and thereby assumes all risk of losses under the policies. This subsidiary receives from the non-affiliated insurance company reinsurance premiums substantially equal to the premiums collected from our tenants. These policies cover claims for losses related to specified events up to a maximum limit of $5,000 per storage unit. We reinsure all risks in this program but purchase insurance from an independent third party insurer to cover this exposure for a limit of $15.0 million for losses in excess of $5.0 million per occurrence. At December 31, 2023, there were approximately 1.3 million certificates of insurance held by our self-storage customers, representing aggregate coverage of approximately $6.2 billion. At December 31, 2023, we managed 210 facilities for third parties, and were under contract to manage 114 additional facilities including 105 facilities that are currently under construction. In addition, we sell merchandise, primarily locks and cardboard boxes, at our self-storage facilities. We hold a 35% interest in Shurgard Self Storage Limited (“Shurgard”). Shurgard is a public company traded on Euronext Brussels under the “SHUR” symbol. At December 31, 2023, Shurgard owned and operated 275 self-storage facilities (15 million net rentable square feet) located in seven countries in Western Europe under the Shurgard® name. For all periods presented herein, we have elected to be treated as a REIT, as defined in the Internal Revenue Code of 1986, as amended (the “Code”). For each taxable year in which we qualify for taxation as a REIT, we will not be subject to U.S. federal corporate income tax on our “REIT taxable income” (generally, taxable income subject to specified adjustments, including a deduction for dividends paid and excluding our net capital gain) that is distributed to our shareholders. We believe we met these requirements in all periods presented herein and we expect to continue to qualify as a REIT. We file annually with the SEC annual reports on Form 10-K, which include consolidated financial statements certified by our independent registered public accountants. We also file quarterly with the SEC quarterly reports on Form 10-Q, which include unaudited consolidated financial statements. We expect to continue such reporting. On our website, www.publicstorage.com, we make available, free of charge, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, definitive proxy statements, and other reports required to be filed with or furnished to the SEC, as well as all supplements and amendments to those filings, as soon as reasonably practicable after the filings, supplements, and amendments are electronically filed with or furnished to the SEC. The information contained on our website is not a part of, or incorporated by reference into, this Annual Report on Form 10-K. Competition Ownership and operation of self-storage facilities is highly fragmented. As the largest owner of self-storage facilities, we believe that we own approximately 9% of the self-storage square footage in the U.S. and that collectively the four largest self-storage owners in the U.S. own approximately 20%, with the remaining 80% owned by regional and local operators. We believe our Public Storage® brand awareness, as well as the innovative improvements we have made to the customer experience described below, provide us with a competitive advantage in acquiring and retaining customers relative to other self-storage operators. 2 The high level of ownership fragmentation in the industry is partially attributable to the relative simplicity of managing a local self-storage facility, such that small-scale owners can operate self-storage facilities at a basic level of profitability without significant managerial or operational infrastructure. Our facilities compete with nearby self-storage facilities owned by other operators, who use marketing channels, including Internet advertising, signage, and banners, and offer services similar to ours. As a result, competition is significant and affects the occupancy levels, rental rates, rental income, and operating expenses of our facilities. However, we believe that the economies of scale inherent in this business result in our being able to operate self-storage facilities at a materially higher level of cash flow per square foot than other operators without our scale. Technology We believe technology enables revenue optimization and cost efficiencies. Over the past few years, we have invested in additional technologies that we believe have enabled us to operate and compete more effectively by providing customers with an enhanced digital experience. Convenient shopping experience: Customers can conveniently shop for available storage space, reviewing attributes such as facility location, size, amenities (such as climate-control), and pricing through the following marketing channels: • • • Our Website: The online marketing channel is a key source of customers. Approximately 81% of our move-ins in 2023 were sourced through our website, and we believe that many of our other customers who reserved directly through our customer care center or arrived at a facility and moved in without a reservation reviewed our pricing and availability online through our website. We seek to update the structure, layout, and content of our website regularly to enhance our placement in “unpaid” search in Google and related websites, to improve the efficiency of our bids in “paid” search campaigns, and to maximize users’ likelihood of reserving space on our website. Our Customer Care Center: Our customer care center is staffed by skilled sales specialists and customer service representatives. Customers can reach our customer care center and complete their rental over the phone by calling our advertised toll-free telephone numbers provided on search engines, from our website, the Public Storage App, or from our in-store kiosks. We believe giving customers the option to interact with a live agent, despite the higher marginal cost relative to a reservation made on our website, enhances our ability to close sales with potential customers and results in greater satisfaction. We also have live Internet chat augmented with ChatBot capability as another channel for our customers to engage our agents, cost effectively improving customer responsiveness. Our Properties: Customers can also shop for available space at any one of our facilities. Property managers access the same information that is available on our website and to our customer care center agents and can inform the customer of available space at that site or at our other nearby storage facilities. Property managers are trained to maximize the conversion of such “walk in” shoppers into customers. We are expanding the use of in-store kiosks to give customers the options of a full self-service experience or a two-way video assisted service via our existing customer care center. eRental® move-in process: To further enhance the move-in experience, we offer our eRental® process whereby prospective tenants (including those who initially reserved a space) are able to execute their rental agreement from their smartphone or computer and then go directly to their space on the move-in date. Approximately 60% of customers utilized our eRental® and Rent by Phone process during 2023. Public Storage App: We maintain an industry leading customer smartphone application. The Public Storage App provides our customers with digital access to our properties, as well as payment and other account management functions. Centralized information network: Our centralized reporting and information network enables us to identify changing market conditions and operating trends and analyze customer data. Our network allows us to quickly change each of our individual property’s pricing and promotions, and drive marketing spending, such as the relative level of bidding for various paid search terms on paid search engines. 3 Growth and Investment Strategies Our ongoing growth strategies consist of: (i) improving the operating performance of our existing self-storage facilities, (ii) acquiring and developing facilities, and (iii) growing ancillary business activities including tenant reinsurance and third-party management services. While our long-term strategy includes each of these elements, in the short term the level of growth in our asset base in any period is dependent upon the cost and availability of capital, as well as the relative attractiveness of available investment alternatives. Improve the operating performance of existing facilities: We regularly update and enhance our strategies to increase the net cash flow of our existing self-storage facilities through maximizing revenues and controlling operating costs. We maximize revenues through striking the appropriate balance between occupancy and rates to new and existing tenants by regularly adjusting (i) our promotional and other discounts, (ii) the rental rates we charge to new and existing customers, and (iii) our marketing spending and intensity. We adjust these pricing and marketing decisions by observing their impact on web and customer care center traffic, reservations, move-ins, move-outs, tenant length of stay, and other indicators of response. The size and scope of our operations have enabled us to achieve high operating margins and a low level of administrative costs relative to revenues through the centralization of many functions, such as facility maintenance, employee compensation and benefits programs, revenue management, and the development and documentation of standardized operating procedures. Acquire existing properties: We seek to capitalize on the fragmentation of the self-storage industry through acquiring attractively priced, well-located existing self-storage facilities. We believe our presence in and knowledge of substantially all of the major markets in the U.S. enhance our ability to identify attractive acquisition opportunities. Data on the rental rates and occupancy levels of our existing facilities provide us an advantage in evaluating the potential of acquisition opportunities. Our aggressiveness in bidding for particular marketed facilities depends upon many factors including the potential for future growth, the quality of construction and location, the cash flow we expect from the facility when operated on our platform, how well the facility fits into our current geographic footprint, and our return on capital expectations. Develop new self-storage facilities and expand existing facilities: The development of new self-storage locations and the expansion of existing facilities have been an important source of our growth. Our operating experience in major markets and experience in stabilizing new properties provide us advantages in developing new facilities. We plan to increase our development activity when we identify attractive risk adjusted return profiles with yields above those of acquisitions. However, our level of development is dependent upon many factors, including the cost and availability of land, the cost and availability of construction materials and labor, zoning and permitting limitations, our cost of capital, the cost of acquiring facilities relative to developing new facilities, and local demand and economic conditions. Grow ancillary business activities: We pursue growth initiatives aimed at increasing our insurance offering coverage for tenants who choose to protect their stored items against loss and desire to maximize their experience. As we grow our self-storage portfolio through acquisition, development and third-party management, we have the opportunity to increase the growth profile of our tenant reinsurance business. We recently launched the Savvy Storage Insurance Program (“Savvy”), a program to provide other owner operators of self-storage facilities a tenant insurance offering for their tenants. We believe this offering will provide owners and their tenants simplified onboarding and implementation, experienced and dedicated support, and significantly higher customer adoption rates than the offerings available in the market today. Our third party management business enables us to generate revenues through management fees, expand our presence, increase our economies of scale, promote our brand, and enhance our ability to acquire additional facilities over the medium and long-term as a result of strategic relationships forged with third-party owners. Compliance with Government Regulations We are subject to various laws, ordinances, and regulations, including various federal, state, and local regulations that apply generally to the ownership of real property and the operation of self-storage facilities. These include various laws and regulations concerning environmental matters, labor matters, and employee safety and health matters. Further, our insurance activities are subject to state insurance laws and regulations as determined by the particular insurance commission for each state in accordance with certain federal regulations. 4 into the environment and the remediation of We are committed to a long-term environmental stewardship program that reduces emissions of hazardous materials including environmentally-friendly capital initiatives and building and operating properties with high structural resilience and low obsolescence. We accrue environmental assessments and estimated remediation costs when it is probable that such efforts will be required and the related costs can be reasonably estimated. Our current practice is to conduct environmental investigations in connection with property acquisitions. Although there can be no assurance, we are not aware of any environmental contamination of any of our facilities that individually or in the aggregate would be material to our overall business, financial condition, or results of operations. identified existing environmental concerns, Refer to Item 1A, “Risk Factors” below for a discussion of certain risks related to government regulations, including risks related to environmental regulations, emergency regulations adopted in response to wildfires, flooding, or public health crises that restrict access to our facilities or the rents we can charge our customers, wage regulations, income tax regulations including relating to REIT qualification, and property tax regulations. Aside from the regulations discussed therein, we are not aware of any government regulations that have resulted or that we expect will result in compliance costs that had or will have a material effect on our capital expenditures, earnings, or competitive position. (cid:25)(cid:65)(cid:57)(cid:45)(cid:58) (cid:20)(cid:45)(cid:60)(cid:53)(cid:64)(cid:45)(cid:56) (cid:35)(cid:49)(cid:63)(cid:59)(cid:65)(cid:62)(cid:47)(cid:49)(cid:63) Our employees are the foundation of our business and fundamental to our ability to execute our corporate strategies and create long-term value for our stakeholders. Our human capital management strategy focuses on attracting, developing, and retaining the highest quality talent. We achieve these objectives by committing to our employees to regular and transparent communication, competitive provide a diverse and welcoming working environment, compensation, comprehensive benefits, and opportunities for career growth and development. We believe that this approach, together with the core principles of our corporate culture, doing the right thing and upholding integrity in all that we do, promotes employee engagement and a commitment to Public Storage. We have approximately 6,200 employees, including 5,380 customer facing roles (such as property level and customer care center personnel), 390 field management employees, and 430 employees in our corporate operations. The following is an overview of our key programs and initiatives focused on attracting, developing, and retaining the highest quality talent. For detailed information regarding such programs and initiatives, including our sustainability efforts, strategies, commitments, and progress, please refer to our 2023 Sustainability Report, which is available on our website at publicstorage.com. The information contained on our website is not a part of, or incorporated by reference into, this Annual Report on Form 10-K. (cid:11)(cid:35)(cid:47)(cid:31)(cid:43)(cid:44)(cid:35)(cid:45)(cid:50) (cid:27)(cid:39)(cid:30) (cid:16)(cid:39)(cid:29)(cid:37)(cid:46)(cid:44)(cid:35)(cid:40)(cid:39) We are committed to creating a workplace that values diversity and inclusion, where every employee feels valued, included, and able to be their authentic self as part of our best-in-class team. Public Storage hires based on skills, personality, and experience, without regard to age, gender, race, ethnicity, religion, sexual orientation, or other protected characteristic. We maintain policies regarding diversity, equal opportunity, pay-for-performance, discrimination, harassment, and labor (including opposition to child and compulsory labor). We also maintain a policy of requiring that diverse candidates be considered for all director-level positions and above. Our commitments to excellence and hiring “the best” have fostered an inclusive team that reflects the diversity of the customers we serve. Our diversity is evident at all levels of the organization. The data in the table below reflects our employee diversity as of December 31, 2023. Executive Team All Employees People of Color Female 50% 25% 53% 65% All Employees People of Color Black or African American Hispanic or Latino Asian Other 25% 18% 4% 6% 5 We publicly disclose our annual Consolidated EEO-1 report, which reflects the race, ethnicity, and gender composition of our workforce, on the Investor Relations section of our website. Communication and Engagement Given the geographically dispersed nature of our business, regular and clear communication is critical to ensuring that our employees feel informed, included, valued, and engaged. We use various communication channels, including emails, newsletters, videos, virtual and in-person meetings, and town halls, to provide updates on company strategy, performance, employee recognition, and other information, as well as the opportunity to ask questions of our leadership. To better understand the effectiveness of our engagement strategies, we conduct various surveys to evaluate employee commitment, motivation, and engagement, and to seek employee feedback. We use this feedback to refine and enhance our policies and programs for our employees. This includes the creation of additional career advancement opportunities and development programs. We believe that the success of our engagement strategies can also be seen through third party surveys and recognition. Among other recognitions, we are proud again to be named a Great Place to Work® in 2023. We have also been recognized by Comparably, Inc. as a “Choice Employer” with an “A+” Culture Score based on employee responses across 18 culture metrics, among other recognitions. Compensation, Health, Wellness, and Safety Public Storage maintains compensation and benefits programs designed to incentivize, reward, and support our employees. We believe that employee compensation should align with our short- and long-term performance goals and provide the competitive compensation and incentives needed to attract, motivate, and retain employees who are crucial to our success. We tailor our compensation programs to each employee group to ensure market competitiveness and enhance overall employee engagement. We offer affordable health plans and programs to virtually all of our employees. Full-time employees are eligible to participate in our comprehensive employee benefit offerings, which include medical, dental, vision, flexible and health savings accounts, discount programs, income protection plans, and our 401(k) plan. Additionally, we maintain various employee support programs, including access to counseling, life planning tools, and discount programs for fitness, legal services, and home, auto, and pet insurance. Finally, we offer educational resources and tools, including a dedicated health and wellness website, to encourage employees to maintain a healthy and balanced lifestyle. We periodically consider employee feedback received through our engagement processes in the composition and design of our compensation and benefits programs. We are committed to providing safe self-storage facilities for our customers and employees. We conduct monthly safety trainings at all of our properties and an annual safety training at our headquarters. We publicly disclose our employee health and safety data in our annual Sustainability Report. Training and Development At Public Storage, we offer comprehensive training and development programs at every level of the organization. These programs are intended to provide our employees with the skills, tools, and knowledge they need to be successful in their roles and to contribute to the value of the organization. They are also intended to foster individual growth and strong employee engagement. The majority of our new hires join Public Storage as property managers without prior experience in the self- storage industry. We provide a hands-on new employee training program that includes coaching and development. For those new hires in leadership roles, we provide property-level training that exposes our leaders to daily property operations and is intended to provide them with an understanding of the fundamentals of our business and operations. We also offer numerous career development opportunities for existing employees across Public Storage, including management training programs. Many of our training and career development programs use our online learning platform of training courses and reference materials. In addition to formal training programs, we also offer one-on-one coaching, job shadowing, and mentoring opportunities. In 2023, we introduced a leadership accelerator program specifically for high potential women and diverse employees. This program includes individual mentorship and practical experiences designed to further enhance our bench of high potential leaders, thereby supporting management succession planning. 6 Performance Management and Succession Planning Our performance management processes are designed to encourage collaboration between employees and their managers. Employees and managers work together to plan, monitor, and review the employee’s objectives and career aspirations and to establish and hold employees accountable to short- and long-term goals aligned with the Company’s strategy. This is a continuous process intended to provide regular opportunities for employees and their managers to share and receive feedback. Succession planning is a priority for management and our Board, and is viewed as critical to ensuring business continuity and providing for the Company’s long-term growth and success. Periodically throughout each year, the executive team meets to review and assess the Company’s succession bench strength, evaluate talent, and provide recommendations for developing and preparing future leaders within the organization. This collaborative approach to talent management works to ensure that employees are given opportunities to grow beyond their current roles and responsibilities. Climate Change and Environmental Stewardship We are committed to managing climate-related risks and opportunities. This commitment is a key component of our recognition that we must operate in a responsible and sustainable manner that aligns with our long-term corporate strategy and promotes our best interests along with those of our stakeholders, including our customers, investors, employees, and the communities in which we do business. Our management Environmental, Social, and Governance Steering Committee (our “Sustainability Committee”) guides our commitment to sustainability and has primary responsibility for climate-related activities. The Sustainability Committee reports to our Board and its committees, which oversee all of our sustainability initiatives. We consider potential environmental impacts—both positive and negative—in our decision making across the business. We measure and monitor our environmental impact and leverage sustainability measures to reduce this impact while achieving cost efficiencies in our operations by implementing a range of energy, water, and waste management initiatives. Many of these initiatives are integrated into our ongoing Property of Tomorrow capital investment program. Regarding climate, we assess risks and opportunities in conjunction with ongoing operating and risk management processes across the company. We give primary consideration to physical, regulatory, legal, market, and reputational risks. Examples of these risks include heat/water stress, natural disasters, pandemics, temperature change, and regulatory compliance. We are addressing potential heat stress risks (e.g., higher energy costs, more frequent power outages, and impacts on our customers and workforce) through initiatives such as converting to LED lighting, solar power generation installation, and analyzing battery storage and microgrids. We are addressing potential water stress risks (e.g., increased costs and decreased availability) through initiatives such as efficient plumbing systems, low-water use irrigation systems, drought tolerant and native landscaping, water run-off controls, and storm water retention. We address the remaining risks primarily through natural disaster resilient development, redevelopment, and capital expenditures. We will continue to utilize our unique competitive advantages in furthering our environmental stewardship efforts and addressing the effects of climate change. Please refer to our Sustainability Report for further information. Seasonality We experience minor seasonal fluctuations in the demand for self-storage space, with demand and rental rates generally higher in the summer months than in the winter months. We believe that these fluctuations result in part from increased moving activity during the summer months. 7 ITEM 1A. Risk Factors In addition to the other information in our Annual Report on Form 10-K, you should consider the risks described below that we believe may be material to investors in evaluating the Company. This section contains forward-looking statements, and in considering these statements, you should refer to the qualifications and limitations on our forward- looking statements that are described in Item 1, “Business.” Risks Related to Our Properties and Our Business Natural disasters, terrorist attacks, civil unrest, or other events that could damage or otherwise disrupt our ability to operate our facilities could adversely impact our business and financial results. Natural disasters, such as earthquakes, fires, hurricanes, and floods, terrorist attacks, civil unrest, and other events that damage our facilities or our customers’ property, or that make our facilities temporarily unavailable, have in the past and may in the future adversely impact our business and financial results. Damage and business interruption losses could exceed the aggregate limits of our insurance coverage. In addition, because we self-insure a portion of our risks, losses below a certain level may not be covered by insurance. See Note 15 to our December 31, 2023 consolidated financial statements for a description of the risks of losses that are not covered by third-party insurance contracts. Our exposure to these types of events is increased by potential tenant claims associated with our tenant reinsurance business. In addition, customer perceptions about the risk of property loss from these events could negatively impact self-storage demand. We are subject to risks from the consequences of climate change, including severe weather events, as well as the transition to a low-carbon economy and other steps taken to prevent or mitigate climate change. Our self-storage facilities are located in areas that may be subject to the direct impacts of climate change, such as increased destructive weather events like floods, fires, drought, and prolonged periods of extreme temperature or other extreme weather, which could result in significant damage to our facilities, increased capital expenditures, increased expenses, reduced revenues, or reduced demand for our facilities. Indirect impacts of climate change could also adversely impact our business, including through increased costs, such as insurance costs or regulatory compliance costs. In addition, the ongoing transition to a low-carbon economy presents certain risks for us and our customers, including stranded assets, increased costs, lower profitability, lower property values, lower household wealth, and macroeconomic risks related to high energy costs and energy shortages, among other things. Governmental, political, and societal pressures, including expectations of institutional and activist investors and other interest groups, could require us to accelerate our initiatives and, with it, the costs of their implementation. These same potential governmental, political, and social pressures could in the future result in (i) costly changes to newly developed facilities or retrofits of our existing facilities to reduce carbon emissions through multiple avenues, including changes to insulation, space configuration, lighting, heating, and air conditioning, (ii) increased energy costs as a result of transitioning to less carbon-intensive, but more expensive, sources of energy to operate our facilities, and (iii) consumers reducing their individual carbon footprints by owning fewer durable material consumer goods and other such items requiring storage, resulting in a reduced demand for our self-storage space. For example, beginning in 2026, we expect to be required to disclose our Scope 1, 2, and 3 emissions data and certain climate-related risk matters under California SB 253 and SB 261, which we expect to result in increased compliance costs. In addition, our reputation and investor relationships could be damaged as a result of our involvement with activities perceived to be causing or exacerbating climate change, as well as any decisions we make to continue to conduct or change our activities in response to considerations relating to climate change. Operating costs, including property taxes, could increase. We could be subject to increases in property or other taxes, repair and maintenance costs, payroll, utility costs, insurance premiums, workers compensation, and other operating expenses due to various factors such as inflation, labor shortages, commodity and energy price increases, weather, increases to minimum wage rates, supply chain disruptions, and changes to governmental safety and real estate use limitations and other governmental actions. Our property tax expense, which totaled approximately $413.2 million during the year ended December 31, 2023, generally depends upon the assessed value of our real estate facilities as determined by assessors and government agencies and, accordingly, could be subject to substantial increases if such agencies change their valuation approaches or opinions or if new laws are enacted, especially if new approaches are adopted or laws are enacted that result in increased property tax assessments in states or geographies where we have a high concentration of facilities. See also “We have exposure to increased property tax in California” below. 8 The acquisition of existing properties or self-storage operating companies is subject to risks that may adversely affect our growth and financial results. We have acquired self-storage facilities and self-storage operating companies in the past, and we expect to continue to do so in the future. We face significant competition for suitable acquisition properties and companies from other real estate investors, including operating companies and private equity funds. As a result, we may be unable to acquire the companies or additional properties we desire or the purchase price for desirable companies or properties may be significantly increased. Failures or unexpected circumstances in integrating facilities or companies that we acquire, or circumstances we did not detect or anticipate during due diligence, such as environmental matters, needed repairs or deferred maintenance, customer collection issues, assumed liabilities, turnover of critical personnel involved in acquired operating companies, or the effects of increased property tax following reassessment of a newly-acquired property, as well as the general risks of real estate investment and mergers and acquisitions, could jeopardize realization of the anticipated earnings from an acquisition. Our development program subjects us to risks. At December 31, 2023, we had a pipeline of development projects totaling $766.2 million (subject to contingencies), and we expect to continue to seek additional development projects. There are significant risks involved in developing self-storage facilities, such as delays, cost increases, or inability to complete development projects due to changes in or failure to meet government or regulatory requirements, failure of revenue to meet our underwriting estimates, delays caused by weather issues, unforeseen site conditions, or personnel problems. Self-storage space is generally not pre- leased, and rent-up of newly developed space can be delayed or ongoing cash flow yields can be reduced due to competition, reductions in storage demand, or other factors. There is significant competition among self-storage operators and from other storage alternatives. Our self-storage facilities generate most of our revenue and earnings. Significant competition from self-storage operators, property developers, and other storage alternatives may adversely impact our ability to attract and retain customers and may negatively impact our ability to generate revenue. Competition in the local market areas in which many of our properties are located is significant and affects our occupancy levels, rental rates, and operating expenses. There is also an increasing influx of capital from outside financing sources driving more money, development, and supply into the industry. Development of self-storage facilities may increase, which may intensify competition as newly developed facilities are opened. Development of self-storage facilities by other operators could increase, due to increases in availability of funds for investment or other reasons, and further intensify competition. Demand for self-storage facilities may be affected by customer perceptions and factors outside of our control. Significantly lower logistics costs could introduce new competitors, such as valet-style storage services, which may reduce the demand for traditional self-storage. Customer preferences and/or needs for self-storage could change, decline, or shift to other product types, thereby impacting our business model and ability to grow and/or generate revenues. Shifts in population and demographics could cause the geographical distribution of our portfolio to be suboptimal and affect our ability to maintain occupancy and attract new customers. Security incidents could result in the perception that our properties are not safe. If our customers do not feel our properties are safe, they may select competitors for their self- storage needs, or if there is an industry perception of inadequate security generally, customer use of self-storage could be negatively impacted. Our newly developed and expanded facilities, and facilities that we manage for third party owners, may negatively impact the revenues of our legacy facilities. We continue to develop new self-storage facilities and expand our existing self-storage facilities. In addition, we are seeking to increase the number of self-storage facilities that we manage for third party owners in exchange for a fee, many of which are in the process of stabilization and are near our existing stabilized self-storage facilities. In order to hasten the fill-up of these new facilities, we aggressively price such space during the fill-up period. While we believe that this aggressive pricing allows us to increase our market share relative to our competitors and increase the cash flows of these properties, such pricing and the added capacity may also negatively impact our existing stabilized self-storage facilities that are near these unstabilized facilities. 9 We may incur significant liabilities from environmental contamination or moisture infiltration. Existing or future laws impose or may impose liability on us to clean up environmental contamination on or around properties that we currently or previously owned or operated, even if we were not responsible for or aware of the environmental contamination or even if such environmental contamination occurred prior to our involvement with the property. We have conducted preliminary environmental assessments on most of our properties, which have not identified any material liabilities. These assessments, commonly referred to as “Phase 1 Environmental Assessments,” include an investigation (excluding soil or groundwater sampling or analysis) and a review of publicly available information regarding the site and other nearby properties. We are also subject to potential liability relating to moisture infiltration, which can result in mold or other damage to our or our customers’ property, as well as potential health concerns. When we receive a complaint or otherwise become aware that an air quality concern exists, we implement corrective measures and seek to work proactively with our customers to resolve issues, subject to our contractual limitations on liability for such claims. We are not aware of any environmental contamination or moisture infiltration related liabilities at any of our properties that could be material to our overall business, financial condition, or results of operation. However, we may not have detected all material liabilities, we could acquire properties with material undetected liabilities, or new conditions could arise or develop at our properties, any of which could result in a cash settlement or adversely affect our ability to sell, lease, operate, or encumber affected facilities. Recent significant increases in interest rates could adversely impact us and our tenants. In response to high inflation, the Federal Reserve has significantly increased the benchmark federal funds rate since early 2022. These actions have significantly increased interest rates. As a result, if we issued new debt or preferred shares or refinanced our indebtedness, our debt service costs or preferred share dividend yields would be, based on current interest rates, significantly higher than current financing costs. These interest rate increases have also adversely impacted the relative attractiveness of the dividend yield on our common shares. Increases in our cost of capital impact our assessment of the yields we consider appropriate to support pursuing property acquisition and development opportunities and thus can impact our external growth prospects. The degree and pace of these changes have had and may continue to have adverse macroeconomic effects that have and may continue to have adverse impacts on our tenants, including as a result of economic recession, increased unemployment, and increased financing costs. For more information on interest rate risk, see Part II, “Item 7A. Quantitative and Qualitative Disclosures About Market Risk”. Economic conditions can adversely affect our business, financial condition, growth, and access to capital. Economic downturns or adverse economic or industry conditions, including those related to high levels of inflation, could adversely impact our financial results, growth, and access to capital. Our revenues and operating cash flow can be negatively impacted by reductions in employment and population levels, household and disposable income, and other general economic factors that lead to a reduction in demand for self-storage space in each of the markets in which we operate. Our ability to raise capital on attractive terms to fund our activities may be adversely affected by challenging market conditions, including high interest rates resulting from government efforts to manage inflation. In periods when the capital and credit markets experience significant volatility, the amounts, sources, and cost of capital available to us may be adversely affected. If we were unable to raise capital at reasonable rates, prospective earnings growth through expanding our asset base could be limited. We have exposure to European operations through our ownership in Shurgard. We own approximately 35% of the common shares of Shurgard, and this investment has a $390.2 million book value and a $1.7 billion market value (based upon the closing trading price of Shurgard’s common stock) at December 31, 2023. We recognized $27.9 million in equity in earnings and received $39.0 million in dividends in 2023 with respect to Shurgard. 10 Shurgard, as an owner, operator, and developer of self-storage facilities, is subject to many of the same risks we are with respect to self-storage. However, through our investment in Shurgard, we are exposed to additional risks unique to the various European markets in which Shurgard operates, which may adversely impact our business and financial results, and many of which are referred to in Shurgard’s public filings. These risks include the following: • • • • • • • Currency risks: Currency fluctuations can impact the fair value of our investment in Shurgard, our equity earnings, our ongoing dividends, and any other related repatriations of cash. Legislative, tax, and regulatory risks: Shurgard is subject to a variety of local, national, and pan-European laws and regulations related to permitting and land use, the environment, labor, and other areas, as well as income, property, sales, and value added and employment tax. These laws and regulations can be difficult to apply or interpret, can vary in each country or locality, and are subject to unexpected changes in their form and application due to regional, national, or local political uncertainty and other factors. Such changes, or Shurgard’s failure to comply with these laws, could subject it to penalties or other sanctions, adverse changes in business processes, and, potentially, adverse income tax, property tax, or other tax burdens. Impediments to capital repatriation could negatively impact the realization of our investment in Shurgard: Laws in Europe and the U.S. may create, impede, or increase our cost to repatriate distributions received from Shurgard or proceeds from the sale of Shurgard shares. Risks of collective bargaining: Collective bargaining, which is prevalent in certain areas in Europe, could negatively impact Shurgard’s labor costs or operations. Many of Shurgard’s employees participate in various national unions. Potential operating and individual country risks: Economic slowdowns or extraordinary political or social change in the countries in which it operates have posed, and could continue to pose, challenges or result in future reductions of Shurgard’s operating cash flows. Liquidity of our ownership stake: We have no plans to liquidate our interest in Shurgard. However, while Shurgard is a publicly held entity, if we chose to, our ability to liquidate our shares in Shurgard in an efficient manner could be limited by the level of Shurgard’s public “float” relative to any ownership stake we sought to sell. Our existing relationship with our legacy joint venture partner may place further contractual limitations on our ability to sell all of the shares we own if we desired to do so. Impediments of Shurgard’s public ownership structure: Shurgard’s strategic decisions, involving activities such as borrowing money, capital contributions, raising capital from third parties, and selling or acquiring significant assets, are determined by its board of directors. As a result, Shurgard may be precluded from taking advantage of opportunities that we would find attractive but that we may not be able to pursue separately, or it could take actions that we do not agree with. Public health and other crises have adversely impacted, and may in the future adversely impact, our business. Our business is subject to risks from public health and other crises like the COVID-19 pandemic, including, among others: • • • • • risk of illness or death of our employees or customers; negative impacts on economic conditions in our markets, which may reduce the demand for self-storage; risk that there could be an out-migration of population from major markets where we operate; government restrictions that (i) limit or prevent use of our facilities, (ii) limit our ability to increase rent or otherwise limit the rent we can charge, (iii) limit our ability to collect rent or evict delinquent tenants, or (iv) limit our ability to complete development and redevelopment projects; risk that we could experience a change in the move-out patterns of our long-term customers due to economic uncertainty and increases in unemployment, which could lead to lower occupancies and rent “roll down” as long-term customers are replaced with new customers at lower rates; and 11 • risk of negative impacts on the cost and availability of debt and equity capital, which could have a material impact upon our capital and growth plans. We have been and may in the future be adversely impacted by emergency regulations adopted in response to significant events, such as natural disasters or public health crises, that could adversely impact our operations. In response to significant events, local, state, and federal governments have and may in the future adopt regulations that could impact our operations. For example, in response to wildfires in 2018 and 2019 and floods in 2023, the State of California and some localities in California adopted temporary regulations that imposed certain limits on the rents we could charge at certain of our facilities and the extent to which we could increase rents to existing tenants. Similarly, in response to the COVID-19 pandemic, certain localities adopted restrictions on the use of certain of our facilities, limited our ability to increase rents, limited our ability to collect rent or evict delinquent tenants, and limited our ability to complete development and redevelopment projects. Similar restrictions could be imposed in the future in response to significant events and these restrictions could adversely impact our operations. Our marketing and pricing strategies may fail to be effective or may be constrained by factors outside of our control. Marketing initiatives, including our increasing dependence on Google to source customers, may fail to be effective and could negatively impact financial performance. Approximately 65% of our new storage customers in 2023 were sourced directly or indirectly through “unpaid” search and “paid” search campaigns on Google. We believe that the vast majority of customers searching for self-storage use Google at some stage in their shopping experience. Google is providing tools to allow smaller and less sophisticated operators to bid for search terms, increasing competition for self- storage search terms. The predominance of Google in the shopping experience, as well as Google’s enabling of additional competitors to bid for placements in self-storage search terms, may reduce the number of new customers that we can procure, and/or increase our costs to obtain new customers. In addition, the inability to utilize our pricing methodology due to regulatory or market constraints could also significantly impact our financial results. We are exposed to ongoing litigation and other legal and regulatory actions, which may divert management’s time and attention, require us to pay damages and expenses or restrict the operation of our business. We have approximately 6,200 employees and 1.9 million customers, and we conduct business at facilities in 40 states. As a result, we are subject to the risk of legal claims and proceedings (including class actions) and regulatory enforcement actions across many jurisdictions in the ordinary course of our business and otherwise, and we could incur significant liabilities and substantial legal fees as a result of these actions. Resolution of these claims and actions may divert time and attention by our management and could involve payment of damages or expenses by us, all of which may be significant, and could damage our reputation and our brand. In addition, any such resolution could involve our agreement to terms that restrict the operation of our business. The results of legal proceedings cannot be predicted with certainty. We cannot guarantee that losses incurred in connection with any current or future legal or regulatory proceedings or actions will not exceed any provisions we may have set aside in respect of such proceedings or actions or any available insurance coverage. Any such legal claims, proceedings, and regulatory enforcement actions could negatively impact our operating results, cash flow available for distribution or reinvestment, and/or the price of our common shares. In addition, through exercising their authority to regulate our activities, governmental agencies can otherwise negatively impact our business by increasing costs or decreasing revenues. 12 Our use of or failure to adopt advancements in information technology may hinder or prevent us from achieving strategic objectives or otherwise harm our business. Our use of or inability to adopt and deliver new technological capabilities and enhancements in line with strategic objectives, including artificial intelligence and machine learning, may put us at a competitive disadvantage; cause us to miss opportunities to innovate, achieve efficiencies, or improve the customer experience; or adversely impact our business, reputation, results of operations, and financial condition. Legislative activity in the privacy area may also result in new laws that are applicable to us and that may hinder our business, including by restricting our use of customer data or otherwise regulating the use of algorithms and automated processing in ways that could materially affect our business or lead to significant increases in the cost of compliance. In addition, the use of emerging technologies entails risks including risks relating to the possibility of intellectual property infringement or misappropriation; data privacy; new or enhanced governmental or regulatory scrutiny, requirements, litigation, or other liability; ethical concerns; negative consumer perceptions as to automation and artificial intelligence; or other complications or liabilities that could adversely affect our business, reputation, results of operations, or financial results. The failure or disruption of our computer and communications systems, on which we are heavily dependent, could significantly harm our business. We are heavily dependent upon automated information technology and Internet commerce, with more than half of our new customers coming from the telephone or over the Internet. 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, system, network, internet and telecommunications failures, hackers, including through a ransomware attack, computer worms, viruses, and other destructive or disruptive cybersecurity incidents, and catastrophic events. Such incidents could also result in significant costs to repair or replace such networks or information systems, as well as actual monetary losses in case of a cybersecurity incident that resulted in fraudulent payments or other cash transactions. Our operations could be severely impacted by a natural disaster, terrorist attack, attack by hackers, acts of vandalism, data theft, misplaced or lost data, programming or human error, or other circumstance that results in a significant outage of our systems or those of our third party providers, despite our use of back up and redundancy measures. While we may be entitled to damages if our third-party providers fail to satisfy their security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such award. If our confidential information is compromised or corrupted, including as a result of a cybersecurity incident, our reputation and business relationships could be damaged and our financial condition and operating results could be adversely affected. In the ordinary course of our business we acquire and store sensitive data, including personally identifiable information of our prospective and current customers and our employees. The secure processing and maintenance of this information is critical to our operations and business strategy. Although we believe we have taken commercially reasonable steps to protect the security of our confidential information, information security risks have generally increased in recent years due to the rise in new technologies and the increased sophistication and activities of perpetrators of cyberattacks. Despite our security measures, we face cybersecurity threats, including system, network, or Internet failures; cyberattacks, ransomware, and other malware; social engineering; and phishing schemes. In these cases, our information technology and infrastructure could be vulnerable and our or our customers’ or employees’ confidential information could be compromised or misappropriated. Any such cybersecurity incident, including those impacting personal information, could result in serious and harmful consequences for us or our customers. A cybersecurity incident could also interfere with our ability to comply with financial reporting requirements. Additionally, future or past business transactions (such as acquisitions or integrations) could expose us to additional cybersecurity risks and threats, as our systems could be negatively affected by vulnerabilities present in acquired or integrated entities’ systems and technologies. Furthermore, we may discover security issues that were not found during due diligence of such acquired or integrated entities, and it may be difficult to integrate companies into our information technology environment and security program. 13 Our confidential information may also be compromised due to programming or human error, negligence, or fraud. Although we and our third-party service providers make efforts to maintain the security and integrity of our information, including the implementation of security measures, required employee awareness training, and the existence of a disaster recovery plan, there is no guarantee that they will be adequate to safeguard against all cybersecurity incidents or misuses of data. In addition, as the regulatory environment related to information security, data collection and use, and privacy becomes increasingly rigorous, with new and changing requirements applicable to our business from multiple regulatory agencies at the local, state, federal, or international level, compliance with those requirements could also result in additional costs, or we could fail to comply with those requirements due to various reasons. Any such access, disclosure, or other loss of information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, regulatory penalties, disruption to our operations and the services we provide to customers, or damage to our reputation, any of which could adversely affect our results of operations, reputation, and competitive position. In addition, our customers could lose confidence in our ability to protect their personal information, which could cause them to discontinue leasing our self-storage facilities. Such events could lead to lost future revenues and adversely affect our results of operations, or result in remedial and other costs, fines, or lawsuits, which could exceed any available insurance that we have procured. We have identified and expect to continue to identify cyberattacks and cybersecurity incidents on our systems and those of third parties, but none of the cyberattacks and incidents we have identified to date has had a material impact on our business or operations. While we have purchased cybersecurity insurance, there are no assurances that the coverage would be adequate in relation to any incurred losses. Moreover, as cyberattacks increase in frequency and magnitude, we may be unable to obtain cybersecurity insurance in amounts and on terms we view as adequate for our operations. Further information relating to cybersecurity risk management is discussed in Item 1C. “Cybersecurity” in this report. Ineffective succession planning for our CEO and executive management, as well as for our other key employees, may impact the execution of our strategic plan. We may not effectively or appropriately identify ready-now succession candidates for our CEO and executive management team, which may negatively impact our ability to meet key strategic goals. Failure to implement succession plans for other key employees may leave us vulnerable to retirements and turnover. We may fail to protect our intellectual property adequately. We maintain a portfolio of trademarks and trade dress that we believe are fundamental to the success of the Public Storage® brand. While we actively seek to enforce and expand our rights, failure to adequately protect our rights could lead to loss of such trademark and trade dress protection. We also own and seek to protect other intellectual property, such as propriety systems, processes, data, and other trade secrets that we have collected and developed in the course of operating our business and that we believe provides us with various competitive advantages. Our protections could be inadequate or we could lose rights to our other intellectual property and trade secrets. Competitor use of our trademarks and trade names could lead to likelihood of confusion, tarnishment of our brand, and loss of legal protection for our marks. Risks Related to Our Ownership, Organization and Structure Takeover attempts or changes in control could be thwarted, even if beneficial to shareholders. In certain circumstances, shareholders might desire a change in control or acquisition of us in order to realize a premium over the then-prevailing market price of our shares or for other reasons. However, the following could prevent, deter, or delay such a transaction: • Provisions of Maryland law may impose limitations that may make it more difficult for a third party to negotiate or effect a business combination transaction or control share acquisition with Public Storage. Currently, our Board has opted not to subject the Company to these provisions of Maryland law, but it could choose to do so in the future without shareholder approval. 14 • • To protect against the loss of our REIT status due to concentration of ownership levels, our declaration of trust generally limits the ability of a person, other than the Hughes family or “designated investment entities” (each as defined in our declaration of trust), to own, actually or constructively, more than 3% of our outstanding common shares or 9.9% of the outstanding shares of any class or series of preferred or equity shares. Our Board may grant, and has previously granted, a specific exemption. These limits could discourage, delay, or prevent a transaction involving a change in control of the Company not approved by our Board. Similarly, current provisions of our declaration of trust and powers of our Board could have the same effect, including (1) limitations on removal of trustees, (2) restrictions on the acquisition of our shares of beneficial interest, (3) the power to issue additional common shares, preferred shares, or equity shares on terms approved by our Board without obtaining shareholder approval, (4) the advance notice provisions of our bylaws, and (5) our Board’s ability under Maryland law, without obtaining shareholder approval, to implement takeover defenses that we may not yet have and to take, or refrain from taking, other actions that could have the effect of delaying, deterring, or preventing a transaction or a change in control. Holders of our preferred shares have dividend, liquidation, and other rights that are senior to the rights of the holders of our common shares. Holders of our preferred shares are entitled to cumulative dividends before any dividends may be declared or set aside on our common shares. Upon liquidation, holders of our preferred shares will receive a liquidation preference of $25,000 per share (or $25.00 per depositary share) plus any accrued and unpaid distributions before any payment is made to the common shareholders. These preferences may limit the amount received by our common shareholders either from ongoing distributions or upon liquidation. In addition, our preferred shareholders have the right to elect two additional directors to our Board whenever dividends are in arrears in an aggregate amount equivalent to six or more quarterly dividends, whether or not consecutive. Public Storage is a holding company with no direct operations, and it relies on funds received from PSA OP and PSOC to pay its obligations and make distributions to shareholders Public Storage is a holding company with no direct operations. All of Public Storage’s property ownership, development, and related business operations are conducted through PSOC (which is wholly-owned by PSA OP) and Public Storage has no material assets or liabilities other than its investment in PSA OP. As a result, Public Storage relies on distributions from PSA OP, which in turn relies on distributions from PSOC, to make common and preferred share dividend payments. Although Public Storage currently wholly-owns (directly or indirectly) PSA OP and PSOC, and therefore exercises exclusive control over PSA OP and PSOC, including the authority to cause PSA OP and PSOC to make distributions, in connection with our future acquisition activities or otherwise, PSA OP may issue additional units of limited partnership to third parties, and these limited partners may negotiate for certain rights. In addition, because Public Storage is a holding company, shareholder claims are structurally subordinated to all existing and future liabilities of PSA OP and PSOC and their subsidiaries. Therefore, in the event of a bankruptcy, insolvency, liquidation or reorganization of PSA OP or PSOC, or their subsidiaries, assets of PSA OP or PSOC or the applicable subsidiary will be available to satisfy any claims of our shareholders only after such liabilities and obligations have been satisfied in full. Holders of our Preferred Shares are subject to certain risks. Holders of our preferred shares have preference rights over our common shareholders with respect to liquidation and distributions, which give them some assurance of continued payment of their stated dividend rate, and receipt of their principal upon liquidation of the Company or redemption of their securities. However, holders of our Preferred Shares should consider the following risks: • • The Company has in the past, and could in the future, issue or assume additional debt. Preferred shareholders would be subordinated to the interest and principal payments of such debt, which would increase the risk that there would not be sufficient funds to pay distributions or liquidation amounts to the preferred shareholders. The Company has in the past, and could in the future, issue additional preferred shares that, while pari passu to the existing preferred shares, increases the risk that there would not be sufficient funds to pay distributions to the preferred shareholders. 15 • While the Company has no plans to do so, if the Company were to lose its REIT status or no longer elect REIT status, it would no longer be required to distribute its taxable income to maintain REIT status. If, in such a circumstance, the Company ceased paying dividends, unpaid distributions to the preferred shareholders would continue to accumulate. The preferred shareholders would have the ability to elect two additional members to serve on our Board until the arrearage was cured. The preferred shareholders would not receive any compensation (such as interest) for the delay in the receipt of distributions, and it is possible that the arrearage could accumulate indefinitely. • Holders of our Preferred Shares have limited rights in the event the Company ceases to pay dividends to shareholders and have no rights with respect to a Company decision to discontinue listing the Preferred Shares on a national securities exchange or file reports with the SEC, including following a change of control transaction. Risks Related to Government Regulations and Taxation We would incur adverse tax consequences if we failed to qualify as a REIT, and we would have to pay substantial U.S. federal corporate income taxes. REITs are subject to a range of complex organizational and operational requirements. A qualifying REIT does not generally incur U.S. federal corporate income tax on its “REIT taxable income” (generally, taxable income subject to specified adjustments, including a deduction for dividends paid and excluding net capital gain) that it distributes to its shareholders. Our REIT status is also dependent upon the REIT qualification of PS Business Parks, Inc. (“PSB”) through the end of its taxable year ended December 31, 2022, as a result of our substantial ownership interest in it prior to the closing of the PSB merger with an unaffiliated third party. We believe we have qualified as a REIT and we intend to continue to maintain our REIT status. However, there can be no assurance that we qualify or will continue to qualify as a REIT, because of the highly technical nature of the REIT rules, the ongoing importance of factual determinations, the possibility of unidentified issues in prior periods, or changes in our circumstances, as well as share ownership limits in our declaration of trust that may fail to ensure that our shareholder base is sufficiently diverse for us to qualify as a REIT. For any year we fail to qualify as a REIT, unless certain relief provisions apply (the granting of such relief could nonetheless result in significant excise or penalty taxes), we would not be allowed a deduction for dividends paid, we would be subject to U.S. federal corporate income tax on our taxable income, and generally we would not be allowed to elect REIT status until the fifth year after such a disqualification. In addition, for tax years beginning after December 31, 2022, we could also be subject to certain taxes enacted by the Inflation Reduction Act of 2022 that are applicable to non-REIT corporations, including the corporate alternative minimum tax and nondeductible one percent excise tax on certain stock repurchases. Any taxes, interest, and penalties incurred would reduce our cash available for distributions to shareholders and could negatively affect our stock price. However, for years in which we failed to qualify as a REIT, we would not be subject to REIT rules that require us to distribute substantially all of our taxable income to our shareholders. Dividends payable by REITs do not qualify for the preferential tax rates available for some dividends. Dividends payable by REITs may be taxed at higher rates than dividends of non-REIT corporations. The maximum U.S. federal income tax rate for qualified dividends paid by domestic non-REIT corporations to U.S. stockholders that are individuals, trusts, or estates is generally 20%. Dividends paid by REITs to such stockholders are generally not eligible for that rate, but under current tax law, such stockholders may deduct up to 20% of ordinary dividends (i.e., dividends not designated as capital gain dividends or qualified dividend income) received from a REIT for taxable years beginning before January 1, 2026. Although this deduction reduces the effective tax rate applicable to certain dividends paid by REITs, such tax rate may still be higher than the tax rate applicable to regular corporate qualified dividends. This may cause investors to view REIT investments as less attractive than investments in non-REIT corporations, which in turn may adversely affect the value of the stock of REITs, including our stock. Changes in tax laws could negatively impact us. The United States Treasury Department and Congress frequently review federal income tax legislation, regulations and other guidance. We cannot predict whether, when, or to what extent new federal tax laws, regulations, interpretations or rulings will be adopted, but these changes might include, in particular, increases in the U.S. federal income tax rates that apply to us or our shareholders in certain circumstances, possibly with retroactive effect. 16 We may pay some taxes, reducing cash available for shareholders. Even if we qualify as a REIT for U.S. federal corporate income tax purposes, we may be subject to some federal, foreign, state, and local taxes on our income and property. Certain consolidated corporate subsidiaries of the Company have elected to be treated as taxable REIT subsidiaries (“TRSs”) for U.S. federal corporate income tax purposes and are taxable as regular corporations and subject to certain limitations on intercompany transactions. If tax authorities determine that amounts paid by our TRSs to us are not reasonable compared to similar arrangements among unrelated parties, we could be subject to a 100% penalty tax on the excess payments, and ongoing intercompany arrangements could have to change, resulting in higher ongoing tax payments. To the extent the Company is required to pay federal, foreign, state, or local taxes, or federal penalty taxes due to existing laws or changes thereto, we will have less cash available for distribution to shareholders. In addition, certain local and state governments have imposed taxes on self-storage rent. While in most cases those taxes are paid by our customers, they increase the cost of self-storage rental to our customers and can negatively impact our revenues. Other local and state governments may impose self-storage rent taxes in the future. If PSA OP were to fail to maintain its status as a partnership for U.S. federal income tax purposes, our financial results would be adversely impacted. We believe PSA OP qualifies as a partnership for U.S. federal income tax purposes. As a partnership, PSA OP is generally not subject to U.S. federal income tax on its income. Instead, each of the partners is allocated its share of PSA OP’s income. There is no assurance, however, that the IRS will not challenge the status of PSA OP as a partnership for U.S. federal income tax purposes. If the IRS were to successfully challenge the status of PSA OP as a partnership, it would be taxable as a corporation. In such event, this would reduce the amount of distributions that PSA OP could make. The treatment of PSA OP as a corporation would also cause us to fail to qualify as a REIT. This would substantially reduce our cash available to pay distributions and the return on a shareholder's investment. We have exposure to increased property tax in California. Approximately $821.2 million of our 2023 net operating income is from our properties in California, and we incurred approximately $49.1 million in related property tax expense. Due to the impact of Proposition 13, which generally limits increases in assessed values to 2% per year, the assessed value and resulting property tax we pay is less than it would be if the properties were assessed at current estimated market values. From time to time, proposals have been made to reduce the beneficial impact of Proposition 13, most recently in the November 2020 ballot. While this ballot initiative failed, there can be no assurance that future initiatives or other legislative actions will not eliminate or reduce the benefit of Proposition 13 with respect to our properties. If the beneficial effect of Proposition 13 were ended for our properties, our property tax expense could increase substantially, adversely affecting our cash flow from operations and net income. We are subject to new and changing legislation and regulations, including the California Privacy Rights Act (CPRA). We are subject to new and changing legislation and regulations, including the Americans with Disabilities Act of 1990 and legislation regarding property taxes, income taxes, REIT status, labor and employment, privacy, and lien sales at the city, county, state, and federal level, which could materially impact our business and operations. Failure to comply with applicable laws, regulations, and policies may subject us to increased litigation and regulatory actions and negatively affect our business and operations or reputation. 17 On November 3, 2020, Californians passed a ballot measure that creates the California Privacy Rights Act (“CPRA”). The CPRA amends and expands the California Consumer Privacy Act (CCPA), which went into effect on January 1, 2020. The CPRA, which went into effect on January 1, 2023, provides new rights and amends existing rights found in the CCPA. It also creates a new privacy enforcement authority, the California Privacy Protection Agency (“CalPPA”). The CPRA grants the Attorney General and the CalPPA the authority to issue regulations on a wide range of topics. It therefore remains unclear what, if any, modifications will be made to the CPRA or how it will be interpreted. While we believe we have developed processes to comply with current privacy requirements, a regulatory agency may not agree with certain of our implementation decisions, which could subject us to litigation, regulatory actions, or changes to our business practices that could increase costs or reduce revenues. Other states have also enacted or are considering enacting privacy laws similar to those passed in California. Similar laws may be implemented in other jurisdictions in which we do business and in ways that may be more restrictive than those in California, increasing the cost of compliance, as well as the risk of noncompliance, on our business. Our tenant reinsurance business is subject to governmental regulation, which could reduce our profitability or limit our growth. We hold limited lines self-service storage insurance agent licenses from a number of individual state departments of insurance and are subject to state governmental regulation and supervision. Our continued ability to maintain these limited lines self-service storage insurance agent licenses in the jurisdictions in which we are licensed depends on our compliance with related rules and regulations. The regulatory authorities in each jurisdiction 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 agents. As a result of regulatory 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, or subject to an adverse judgment, which could reduce our net income. ITEM 1B. Unresolved Staff Comments None. ITEM 1C. Cybersecurity Public Storage devotes significant resources to protecting and continuing to improve the security of its computer systems, software, networks, and other technology assets. Our security efforts are designed to preserve the confidentiality, integrity, and continued availability of information owned by, or in the care of, the Company and protect against, among other things, cybersecurity attacks by unauthorized parties attempting to obtain access to confidential information, destroy data, disrupt or degrade service, sabotage systems, or cause other damage. Management and Board Oversight Our risk management processes include a comprehensive enterprise risk management framework focused on (i) evaluating the risks facing the Company and aligning the Company’s efforts to mitigate those risks with its strategy and risk appetite; (ii) communicating and improving the Company’s understanding of its key risks and responsive actions; and (iii) providing the Board with a defined, rated risk inventory and framework against which the Board can direct its responsibilities to oversee the Company’s risk assessment and risk management efforts. Our cybersecurity program is a key component of our overall enterprise risk management framework. A dedicated team of technology professionals monitors and manages cybersecurity risks. They are led by our Chief Technology Officer (CTO), who has served in senior leadership positions with responsibility for cybersecurity and IT risk management for over 10 years, and our Vice President, Management Information Systems (VPMIS), who has been a Certified Information Systems Security Professional (CISSP) since 2016. Their teams are responsible for leading enterprise-wide cyber resilience strategy, policy, standards, architecture, and processes. Our CTO and VPMIS regularly engage with our Chief Administrative Officer. They also report monthly on cybersecurity matters to our entire executive management team. 18 In the event of an incident that jeopardizes the confidentiality, integrity, or availability of the information technology systems we use, we utilize a regularly updated information security incident response plan (IRP). The IRP is overseen by our executive Incident Response Committee (IRC), which consists of our Chief Financial and Investment Officer, Chief Administrative Officer, Chief Legal Officer, and CTO. The IRP guides our internal response to cybersecurity incidents. Pursuant to our IRP and its escalation protocols, designated personnel are responsible for assessing the severity of the incident and associated threat, containing the threat, remediating the threat, including recovery of data and access to systems, analyzing the reporting obligations associated with the incident, and performing post-incident analysis and program improvements. While the particular personnel assigned to an incident response team will depend on the particular facts and circumstances, the response team is generally led by the IRC with support from internal personnel and external counsel or other experts. Our Board considers cybersecurity risk one of the most significant risks to our business. The Board has delegated to the Audit Committee oversight of cybersecurity, data privacy, and other information technology risks affecting the Company. The Audit Committee periodically evaluates our cybersecurity strategy to ensure its effectiveness. Our CTO and VPMIS provide quarterly reports to the Audit Committee, which also provides quarterly reports on its activities to the Board. Annually, the Board receives a comprehensive update regarding the Company’s cybersecurity efforts, which may include a cybersecurity tabletop exercise, presentation by third party cybersecurity experts, or similar events. Several members of our Board and Audit Committee have cybersecurity, data privacy, or related experience from their principal occupation or other professional experience. Processes for Assessing, Identifying and Managing Material Risks from Cybersecurity Threats Our cybersecurity program focuses on (i) preventing and preparing for cybersecurity incidents, (ii) detecting and analyzing cybersecurity incidents, and (iii) containing, eradicating, recovering from, and reporting cybersecurity events. Prevention and Preparation We identify and address information security risks by employing a defense-in-depth methodology, consisting of both proactive and reactive elements, which provides multiple, redundant defensive measures and prescribes actions to take in case a security control fails or a vulnerability is exploited. We leverage internal resources, along with strategic external partnerships, to mitigate cybersecurity threats to the Company. We have partnerships for security operations center (SOC) services, penetration testing, incident response, and various third-party assessments. We deploy both commercially available solutions and proprietary systems to actively manage threats to our information technology environment. We assess our cybersecurity program against various frameworks. Our information security program is certified for compliance with the Payment Card Industry Data Security Standard for the safe handling and protection of credit card data. Annually, we are assessed, either internally or by an independent third party, against the National Institute of Standards and Technology (NIST) Cybersecurity Framework. We also utilize reports prepared by our external partners to assess our cyber proficiency on a standalone basis and comparatively against peers and other companies, and we regularly engage external resources regarding emerging threats. We have policies and procedures to oversee and identify the cybersecurity risks associated with our use of third-party service providers, including contractual mechanisms, as well as the regular review of SOC reports, relevant cyber attestations, and other independent cyber ratings. We employ a robust information security and training program for our employees, including mandatory computer- based training, regular internal communications, and ongoing end-user testing to measure the effectiveness of our information security program. As part of this commitment, we require our employees to complete a Cybersecurity Awareness eCourse and acknowledge our Information Security policy each year. In addition, we have an established schedule and process for regular phishing awareness campaigns that are designed to imitate real-world contemporary threats and provide immediate feedback (and, if necessary, additional training or remedial action) to employees. As discussed above, we maintain an IRP that guides our response to a cybersecurity incident. Annually, we test the IRP’s response procedures, including through disaster response and business continuity plan exercises. These exercises are intended to challenge and validate our information security response and resources through simulated cybersecurity incidents, including engagement of outside cybersecurity legal counsel, other third-party partners, key internal personnel, executive management, and our Board. 19 Detection and Analysis Cybersecurity incidents may be detected through a variety of means, which may include, but are not limited to, automated event-detection notifications, employee notifications, notification from external parties (e.g., our third-party information technology provider), and proactive threat hunting in conjunction with our external partners. Once a potential cybersecurity incident is identified, including a third-party cybersecurity event, the incident response team designated pursuant to the IRP follows the procedures set forth in the plan to investigate the potential incident, including determining the nature of the event (e.g. ransomware or personal data breach) and assessing the severity of the event and sensitivity of any compromised data. Containment, Eradication, Recovery, and Reporting In the event of a cybersecurity incident, our first priority is to contain the cybersecurity incident as quickly as possible consistent with the procedures in our IRP. Once a cybersecurity incident is contained, our focus shifts to remediation and recovery. These activities depend on the nature of the cybersecurity incident and may include rebuilding systems and/or hosts, replacing compromised files with clean versions, validation of files or data that may have been affected, increased network monitoring or logging to identify recurring attacks, monitoring dark or deep web forums, reconfiguring administrative account access, hardening network security such as firewall configurations, and employee re-training. We also maintain cybersecurity insurance providing coverage for certain costs related to security failures and specified cybersecurity-related incidents that interrupt our network or networks of our vendors, in all cases up to specified limits and subject to certain exclusions. Our IRP provides clear communication protocols, including with respect to members of executive management, internal and external counsel, the Audit Committee and our Board. These protocols include a framework for assessing our SEC and other regulatory reporting obligations related to a cybersecurity incident. Following the conclusion of an incident, the incident response team will generally assess the effectiveness of the cybersecurity program and IRP and make adjustments as appropriate. Cybersecurity Risks As of December 31, 2023, we are not aware of any material cybersecurity incidents in the last three years. However, we routinely face risks of potential incidents, whether through cyber-attacks or cyber intrusions over the Internet, ransomware and other forms of malware, computer viruses, attachment to emails, phishing attempts, extortion or other scams that we have been able to prevent or sufficiently mitigate harm from. Although we make efforts to maintain the security and integrity of the third-party networks and systems we use, these systems and the proprietary, confidential and personal information that resides on or is transmitted through them, are subject to the risk of a security incident or disruption, and there can be no assurance that our security efforts and measures, and those of our third-party providers. See “Item 1A–Risk Factors–If our confidential including as a result of a cybersecurity incident, our reputation and business relationships could be damaged, which could adversely affect our financial condition and operating results.” information is compromised or corrupted, 20 ITEM 2. Properties At December 31, 2023, we had controlling ownership interests in 3,044 self-storage facilities located in 40 states within the U.S.: Texas California Florida Illinois Georgia North Carolina Virginia Maryland Washington Colorado Minnesota New York South Carolina New Jersey Ohio Michigan Arizona Indiana Oklahoma Tennessee Missouri Pennsylvania Oregon Nevada Massachusetts Kansas Other states (14 states) Total (a) At December 31, 2023 Number of Storage Facilities Net Rentable Square Feet (in thousands) 455 444 360 137 127 110 120 105 107 87 68 73 81 67 65 61 60 54 48 52 44 37 45 33 29 24 151 3,044 38,668 31,419 25,038 8,930 8,555 8,110 7,894 7,782 7,586 6,468 5,425 5,122 5,031 4,651 4,415 4,387 4,275 3,585 3,502 3,228 2,919 2,685 2,618 2,305 2,052 1,538 9,883 218,071 (a) See Schedule III: Real Estate and Accumulated Depreciation in our consolidated financial statements included in this Annual Report on Form 10-K, for a summary of land, building, accumulated depreciation, square footage, and number of properties by market. At December 31, 2023, two of our facilities with a net book value of $11.7 million were encumbered by an aggregate of $1.8 million in mortgage notes payable. 21 The configuration of self-storage facilities has evolved over time. The oldest facilities are comprised generally of multiple single-story buildings, and have on average approximately 500 primarily “drive up” spaces per facility, and a small rental office. The most prevalent recently constructed facilities have higher density footprints with large, multi-story buildings with climate control and typically 1,000 or more self-storage spaces, a more imposing and visible retail presence, and a prominent and large rental office designed to appeal to customers as an attractive and retail-focused “store.” Our self- storage portfolio includes facilities with characteristics of the oldest facilities, characteristics of the most recently constructed facilities, and those with characteristics of both older and recently constructed facilities. Most spaces have between 25 and 400 square feet and an interior height of approximately eight to 12 feet. ITEM 3. Legal Proceedings For a description of the Company’s legal proceedings, see “Note 15. Commitments and Contingencies” to our consolidated financial statements included in this Annual Report on Form 10-K. ITEM 4. Mine Safety Disclosures Not applicable. 22 PART II ITEM 5. Equity Securities Market for Registrant’s Common Equity, Related Shareholder Matters and Issuer Purchases of Our common shares of beneficial interest (NYSE: PSA) have been listed on the NYSE since October 19, 1984. As of February 13, 2024, there were approximately 9,586 holders of record of our common shares. Our Board has authorized management to repurchase up to 35,000,000 of our common shares on the open market or in privately negotiated transactions. From the inception of the repurchase program through February 20, 2024, we have repurchased a total of 23,721,916 common shares (all purchased prior to 2010) at an aggregate cost of approximately $679.1 million. Our common share repurchase program does not have an expiration date and there are 11,278,084 common shares that may yet be repurchased under our repurchase program as of December 31, 2023. We have no current plans to repurchase shares; however, future levels of common share repurchases will be dependent upon our available capital, investment alternatives, and the trading price of our common shares. Refer to Item 12. “Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters” for information about our equity compensation plans. ITEM 6. [Reserved] ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with our consolidated financial statements and notes thereto. Critical Accounting Estimates The preparation of consolidated financial statements and related disclosures in conformity with U.S. generally accepted accounting principles (“GAAP”) requires us to make judgments, assumptions, and estimates that affect the amounts reported. On an ongoing basis, we evaluate our estimates and assumptions. These estimates and assumptions are based on current facts, historical experience, and various other factors that we believe are reasonable under the circumstances to determine reported amounts of assets, liabilities, revenues, and expenses that are not readily apparent from other sources. We believe the following are our critical accounting estimates, because they are reasonably likely to have a material impact on the portrayal of our financial condition and results, and they require us to make judgments and estimates about matters that involve a significant level of uncertainty. Impairment of Long-Lived Assets: The analysis of impairment of our long-lived assets, including our real estate facilities, involves identification of indicators of impairment, including unfavorable operational results and significant cost overruns on construction, projections of future operating cash flows, and estimates of fair values, all of which require significant judgment and subjectivity. In particular, these estimates are sensitive to significant assumptions, such as the projections of future rental rates, stabilized occupancy level, future profit margin, discount rates, and capitalization rates, all of which could be affected by our expectations about future market or economic conditions. Others could come to materially different conclusions. 23 Allocating Purchase Price for Acquired Real Estate Facilities: We estimate the fair values of the assets and liabilities of acquired real estate facilities, which consist principally of land, buildings and acquired customers in place, for purposes of allocating the aggregate purchase price of acquired real estate facilities. We estimate the fair value of land based upon price per square foot derived from observable transactions involving comparable land in similar locations as adjusted for location quality, parcel size, and date of sale associated with the acquired facilities. The fair value estimate of land is sensitive to the adjustments made to the land market transactions used in the estimate, particularly when there is a lack of recent comparable land market data. For large portfolio acquisitions, we estimate the fair value of buildings primarily using the income approach by estimating the fair value of hypothetical vacant acquired facilities and adjusting for the estimated fair value of land. For individual and small portfolio acquisitions, we estimate the fair value of buildings primarily based upon the estimated current replacement cost, which we calculate by estimating the replacement cost of new purpose-built self-storage facilities in similar geographic regions and adjusting for age, quality, amenities, and configuration associated with the buildings acquired. The fair value estimate of buildings is sensitive to assumptions used in both the income approach, such as lease-up period, future stabilized operating cash flows, capitalization rate and discount rate, and in the replacement cost approach, such as current cost adjustment, soft cost and developer profit estimates. We estimate the fair value of acquired customers in place using the income approach by estimating the foregone rent over the presumed period of time to absorb the occupied spaces as if they were vacant at the time of acquisition. The fair value estimate of the acquired customers in place is sensitive to the assumptions used in the income approach, such as market rent, lease-up period and discount rate. Others could come to materially different conclusions as to the estimated fair values of land, buildings and acquired customers in place, which would result in different depreciation and amortization expense, gains and losses on sale of real estate assets, as well as the level of land and buildings on our consolidated balance sheet. Overview Our self-storage operations generate most of our net income, and our earnings growth is impacted by the levels of growth within our Same Store Facilities (as defined below) as well as within our Acquired Facilities and Newly Developed and Expanded Facilities (both as defined below). Accordingly, a significant portion of management’s time is devoted to maximizing cash flows from our existing self-storage facility portfolio. During 2023, revenues generated by our Same Store Facilities increased by 4.7% ($154.0 million), as compared to 2022, while Same Store cost of operations increased by 4.7% ($35.9 million). Demand and operating trends softened in the second half of 2022 continuing through 2023 as compared to what we experienced in 2020 and 2021, and we expect this to continue in 2024. We have grown and plan to continue to grow through the acquisition and development of new facilities and expansion of our existing self-storage facilities. Since the beginning of 2021, we acquired a total of 470 facilities with 38.8 million net rentable square feet for $8.5 billion. Additionally, within our non-same store portfolio, our developed and expanded facilities include a total of 145 self-storage facilities of 17.1 million net rentable square feet. For development and expansions completed by December 31, 2023, we incurred a total cost of $1.6 billion. During 2023, combined net operating income generated by our Acquired Facilities and Newly Developed and Expanded Facilities increased 28.7% ($109.4 million), as compared to 2022. On September 13, 2023, we acquired BREIT Simply Storage LLC, a self-storage company that owns and operates 127 self-storage facilities (9.4 million square feet) and manages 25 self-storage facilities for third parties, for a purchase price of $2.2 billion in cash (the “Simply Acquisition”). The 127 wholly-owned facilities are geographically diversified across 18 states and located in submarkets with strong demand drivers and other desirable characteristics. In connection with the Simply Acquisition, on July 26, 2023, we completed a public offering of $2.2 billion aggregate principal amount of unsecured senior notes in various tranches and maturities. We have experienced recent inflationary impacts on our cost of operations including labor, utilities, and repairs and maintenance, and costs of development and expansion activities, and we may continue to experience such impacts in the future. We have implemented various initiatives to manage the adverse impacts, such as enhancements in operational processes and investments in technology to reduce payroll hours, achievement of economies of scale from recent acquisitions with supervisory payroll and centralized management costs allocated over a broader number of self-storage facilities, and investments in solar power and LED lights to lower utility usage. 24 In order to enhance the competitive position of certain of our facilities relative to local competitors (including newly developed facilities), we have embarked on our multi-year Property of Tomorrow program to (i) rebrand our properties with more pronounced, attractive, and clearly identifiable color schemes and signage, (ii) enhance the energy efficiency of our properties, and (iii) upgrade the configuration and layout of the offices and other customer zones to improve the customer experience. We expect to complete the program in 2024. We spent approximately $160 million on the program in 2023 and expect to spend approximately $150 million in 2024 on this effort. We have also embarked on a solar program under which we plan to install solar panels on over 1,000 of our self-storage facilities. We have completed the installations on 534 facilities through 2023. We spent approximately $51 million on the program in 2023 and expect to spend $100 million in 2024 on this effort. Results of Operations Operating Results for 2023 and 2022 In 2023, net income allocable to our common shareholders was $1.9 billion or $11.06 per diluted common share, compared to $4.1 billion or $23.50 per diluted common share in 2022, representing a decrease of $2.2 billion or $12.44 per diluted common share. The decrease is due primarily to (i) a $2.1 billion gain on sale of our equity investment in PS Business Parks, Inc. (“PSB”) in July 2022, (ii) a $149.5 million increase in foreign currency exchange losses primarily associated with our Euro denominated notes payable, (iii) a $79.1 million decrease in equity in earnings of unconsolidated real estate entities due to our sale of PSB in July 2022, and (iv) a $64.8 million increase in interest expense, partially offset by (v) a $231.8 million increase in self-storage net operating income and (vi) a $45.0 million increase in interest and other income. The $231.8 million increase in self-storage net operating income in 2023 as compared to 2022 is a result of a $118.2 million increase attributable to our Same Store Facilities and a $113.6 million increase attributable to our non-same store facilities. Revenues for the Same Store Facilities increased 4.7% or $154.0 million in 2023 as compared to 2022, due primarily to higher realized annual rent per occupied square foot, partially offset by a decline in occupancy. Cost of operations for the Same Store Facilities increased by 4.7% or $35.9 million in 2023 as compared to 2022, due primarily to increased property tax expense, marketing expense, and other direct property costs. The increase in net operating income of $113.6 million for the non-same store facilities is due primarily to the impact of facilities acquired in 2021, 2022, and 2023 and the fill-up of recently developed and expanded facilities. Operating Results for 2022 and 2021 In 2022, net income allocable to our common shareholders was $4.1 billion or $23.50 per diluted common share, compared to $1.7 billion or $9.87 per diluted common share in 2021, representing an increase of $2.4 billion or $13.63 per diluted common share. The increase is due primarily to (i) a $2.1 billion gain on sale of our equity investment in PSB and (ii) a $614.3 million increase in self-storage net operating income, partially offset by (iii) a $174.7 million increase in depreciation and amortization expense, (iv) a $125.1 million decrease in equity in earnings of unconsolidated real estate entities due to the sale of our equity investment in PSB, and (v) a $45.5 million increase in interest expense. The $614.3 million increase in self-storage net operating income in 2022 as compared to 2021 is a result of a $390.6 million increase in our Same Store Facilities and a $223.7 million increase in our non-same store facilities. Revenues for the Same Store Facilities increased 15.2% or $432.2 million in 2022 as compared to 2021, due primarily to higher realized annual rent per available square foot, partially offset by a decline in occupancy. Cost of operations for the Same Store Facilities increased by 5.7% or $41.7 million in 2022 as compared to 2021, due primarily to increased property tax expense, marketing expense, other direct property costs, and centralized management costs. The increase in net operating income of $223.7 million for the non-same store facilities is due primarily to the impact of facilities acquired in 2021 and the fill-up of recently developed and expanded facilities. 25 Funds from Operations and Core Funds from Operations Funds from Operations (“FFO”) and FFO per share are non-GAAP measures defined by Nareit. We believe that FFO and FFO per share are useful to REIT investors and analysts in measuring our performance because Nareit’s definition of FFO excludes items included in net income that do not relate to or are not indicative of our operating and financial performance. FFO represents net income before real estate-related depreciation and amortization, which is excluded because it is based upon historical costs and assumes that building values diminish ratably over time, while we believe that real estate values fluctuate due to market conditions. FFO also excludes gains or losses on sale of real estate assets and real estate impairment charges, which are also based upon historical costs and are impacted by historical depreciation. FFO and FFO per share are not a substitute for net income or earnings per share. FFO is not a substitute for net cash flow in evaluating our liquidity or ability to pay dividends, because it excludes investing and financing activities presented on our consolidated statements of cash flows. In addition, other REITs may compute these measures differently, so comparisons among REITs may not be helpful. For the year ended December 31, 2023, FFO was $16.60 per diluted common share as compared to $16.46 and $13.36 per diluted common share for the years ended December 31, 2022 and 2021, respectively, representing an increase in 2023 of 0.9%, or $0.14 per diluted common share, as compared to 2022. We also present “Core FFO” and “Core FFO per share” non-GAAP measures that represent FFO and FFO per share excluding the impact of (i) foreign currency exchange gains and losses, (ii) charges related to the redemption of preferred securities, and (iii) certain other non-cash and/or nonrecurring income or expense items primarily representing, with respect to the periods presented below, the impact of loss contingency accruals and resolutions, casualties, due diligence costs incurred in pursuit of strategic transactions, unrealized gain on private equity investments, UPREIT reorganization costs, Simply integration costs, amortization of acquired non real estate-related intangibles from the Simply Acquisition and our equity share of deferred tax benefits of a change in tax status, merger transaction costs, severance of a senior executive, lease termination income, and casualties from our equity investees. We review Core FFO and Core FFO per share to evaluate our ongoing operating performance and we believe they are used by investors and REIT analysts in a similar manner. However, Core FFO and Core FFO per share are not substitutes for net income and net income per share. Because other REITs may not compute Core FFO or Core FFO per share in the same manner as we do, may not use the same terminology or may not present such measures, Core FFO and Core FFO per share may not be comparable among REITs. 26 The following table reconciles net income to FFO and Core FFO and reconciles diluted earnings per share to FFO per share and Core FFO per share: Year Ended December 31, Year Ended December 31, 2023 2022 Percentage Change 2022 2021 Percentage Change (Amounts in thousands, except per share data) Reconciliation of Net Income to FFO and Core FFO: Net income allocable to common shareholders $ 1,948,741 $ 4,142,288 (53.0)% $ 4,142,288 $ 1,732,444 139.1 % Eliminate items excluded from FFO: Real estate-related depreciation and amortization 962,703 881,569 881,569 709,349 Real estate-related depreciation from unconsolidated real estate investments Real estate-related depreciation allocated to noncontrolling interests and restricted share unitholders Gains on sale of real estate investments, 36,769 54,822 54,822 73,729 (6,635) (6,622) (6,622) (4,415) including our equity share from investments (17,290) (54,403) (54,403) (165,272) Gain on sale of equity investment in PS Business Parks, Inc. — (2,116,839) (2,116,839) — FFO allocable to common shares $ 2,924,288 $ 2,900,815 0.8 % $ 2,900,815 $ 2,345,835 23.7 % Eliminate the impact of items excluded from Core FFO, including our equity share from investments: Foreign currency exchange loss (gain) 51,197 (98,314) (98,314) (111,787) Preferred share redemption charge Property losses and tenant claims due to casualties Other items — — 447 — 4,817 (338) — 31,604 4,817 (338) 4,909 (543) Core FFO allocable to common shares $ 2,975,932 $ 2,806,980 6.0 % $ 2,806,980 $ 2,270,018 23.7 % Reconciliation of Diluted Earnings per Share to FFO per Share and Core FFO per Share: Diluted earnings per share $ 11.06 $ 23.50 (52.9)% $ 23.50 $ 9.87 138.1 % Eliminate amounts per share excluded from FFO: Real estate-related depreciation and amortization 5.64 5.27 5.27 4.44 Gains on sale of real estate investments, including our equity share from investments (0.10) (0.31) (0.31) (0.95) Gain on sale of equity investment in PS Business Parks, Inc. FFO per share — (12.00) (12.00) — $ 16.60 $ 16.46 0.9 % $ 16.46 $ 13.36 23.2 % Eliminate the per share impact of items excluded from Core FFO, including our equity share from investments: Foreign currency exchange loss (gain) Preferred share redemption charge Property losses and tenant claims due to casualties Other items Core FFO per share 0.29 — — — (0.57) — 0.03 — (0.57) — 0.03 — (0.64) 0.18 0.03 — $ 16.89 $ 15.92 6.1 % $ 15.92 $ 12.93 23.1 % Diluted weighted average common shares 176,143 176,280 176,280 175,568 27 Analysis of Net Income — Self-Storage Operations Our self-storage operations are analyzed in four groups: (i) the 2,339 facilities that we have owned and operated on a stabilized basis since January 1, 2021 (the “Same Store Facilities”), (ii) 470 facilities we acquired since January 1, 2021 (the “Acquired Facilities”), (iii) 145 facilities that have been newly developed or expanded, or that had commenced expansion by December 31, 2023 (the “Newly Developed and Expanded Facilities”), and (iv) 90 other facilities, which are otherwise not stabilized with respect to occupancies or rental rates since January 1, 2021 (the “Other Non-same Store Facilities”). See Note 14 to our December 31, 2023 consolidated financial statements “Segment Information,” for a reconciliation of the amounts in the tables below to our total net income. 28 Self-Storage Operations Summary Revenues: Same Store Facilities Acquired Facilities Newly Developed and Expanded Facilities Other Non-Same Store Facilities Cost of operations: Same Store Facilities Acquired Facilities Newly Developed and Expanded Facilities Other Non-Same Store Facilities Net operating income (a): Same Store Facilities Acquired Facilities Newly Developed and Expanded Facilities Other Non-Same Store Facilities Total net operating income Depreciation and amortization expense: Same Store Facilities Acquired Facilities Newly Developed and Expanded Facilities Other Non-Same Store Facilities Total depreciation and amortization expense Net income (loss): Year Ended December 31, Year Ended December 31, 2023 2022 Percentage Change 2022 2021 Percentage Change (Dollar amounts and square footage in thousands) $ 3,427,867 450,653 262,450 118,643 4,259,613 $ 3,273,823 327,245 230,999 113,961 3,946,028 4.7 % $ 3,273,823 327,245 37.7 % 230,999 13.6 % 4.1 % 113,961 7.9 % 3,946,028 $ 2,841,598 106,474 167,119 88,375 3,203,566 802,269 144,498 78,531 36,652 1,061,950 2,625,598 306,155 183,919 81,991 3,197,663 766,405 109,744 67,805 36,255 980,209 2,507,418 217,501 163,194 77,706 2,965,819 4.7 % 31.7 % 15.8 % 1.1 % 8.3 % 766,405 109,744 67,805 36,255 980,209 724,748 32,705 58,890 35,687 852,030 4.7 % 2,507,418 217,501 40.8 % 163,194 12.7 % 77,706 5.5 % 7.8 % 2,965,819 2,116,850 73,769 108,229 52,688 2,351,536 528,121 323,796 61,421 56,718 501,139 280,871 54,115 52,021 5.4 % 15.3 % 13.5 % 9.0 % 501,139 280,871 54,115 52,021 483,219 131,998 47,549 50,662 15.2 % 207.3 % 38.2 % 29.0 % 23.2 % 5.7 % 235.6 % 15.1 % 1.6 % 15.0 % 18.5 % 194.8 % 50.8 % 47.5 % 26.1 % 3.7 % 112.8 % 13.8 % 2.7 % 970,056 888,146 9.2 % 888,146 713,428 24.5 % Same Store Facilities Acquired Facilities Newly Developed and Expanded Facilities Other Non-Same Store Facilities 2,097,477 (17,641) 122,498 25,273 2,006,279 (63,370) 109,079 25,685 4.5 % 2,006,279 (63,370) 109,079 25,685 (72.2)% 12.3 % (1.6)% 1,633,631 (58,229) 60,680 2,026 Total net income $ 2,227,607 $ 2,077,673 7.2 % $ 2,077,673 $ 1,638,108 Number of facilities at period end: Same Store Facilities Acquired Facilities Newly Developed and Expanded Facilities Other Non-Same Store Facilities Net rentable square footage at period end: Same Store Facilities Acquired Facilities Newly Developed and Expanded Facilities Other Non-Same Store Facilities 2,339 470 145 90 3,044 154,874 38,816 17,101 7,280 218,071 2,339 306 134 90 2,869 154,874 26,634 15,366 7,343 204,217 — % 53.6 % 8.2 % — % 6.1 % — % 45.7 % 11.3 % (0.9)% 6.8 % 2,339 306 134 90 2,869 154,874 26,634 15,366 7,343 204,217 2,339 232 126 90 2,787 154,874 21,830 14,273 7,342 198,319 22.8 % 8.8 % 79.8 % 1167.8 % 26.8 % — % 31.9 % 6.3 % — % 2.9 % — % 22.0 % 7.7 % — % 3.0 % 29 (a) Net operating income or “NOI” is a non-GAAP financial measure that excludes the impact of depreciation and amortization expense, which is based upon historical real estate costs and assumes that building values diminish ratably over time, while we believe that real estate values fluctuate due to market conditions. We utilize NOI in determining current property values, evaluating property performance, and evaluating property operating trends. We believe that investors and analysts utilize NOI in a similar manner. NOI is not a substitute for net income, operating cash flow, or other related financial measures, in evaluating our operating results. See Note 14 to our December 31, 2023 consolidated financial statements for a reconciliation of NOI to our total net income for all periods presented. Same Store Facilities The Same Store Facilities consist of facilities we have owned and operated on a stabilized level of occupancy, revenues, and cost of operations since January 1, 2021. The composition of our Same Store Facilities allows us more effectively to evaluate the ongoing performance of our self-storage portfolio in 2021, 2022, and 2023 and exclude the impact of fill-up of unstabilized facilities, which can significantly affect operating trends. We believe investors and analysts use Same Store Facilities information in a similar manner. However, because other REITs may not compute Same Store Facilities in the same manner as we do, may not use the same terminology or may not present such a measure, Same Store Facilities may not be comparable among REITs. The following table summarizes the historical operating results (for all periods presented) of these 2,339 facilities (154.9 million net rentable square feet) that represent approximately 71% of the aggregate net rentable square feet of our U.S. consolidated self-storage portfolio at December 31, 2023. It includes various measures and detail that we do not include in the analysis of the developed, acquired, and other non-same store facilities, due to the relative magnitude and importance of the Same Store Facilities relative to our other self-storage facilities. 30 Selected Operating Data for the Same Store Facilities (2,339 facilities) Year Ended December 31, Year Ended December 31, 2023 2022 Percentage Change 2022 2021 Percentage Change (Dollar amounts in thousands, except for per square foot data) Revenues (a): Rental income $3,312,597 $3,169,132 4.5% $ 3,169,132 $ 2,756,752 Late charges and administrative fees 115,270 104,691 10.1% 104,691 84,846 Total revenues 3,427,867 3,273,823 4.7% 3,273,823 2,841,598 Direct cost of operations (a): Property taxes On-site property manager payroll Repairs and maintenance Utilities Marketing Other direct property costs 300,505 126,830 64,565 44,775 69,158 90,990 290,605 123,372 60,317 45,578 47,863 83,615 Total direct cost of operations 696,823 651,350 3.4% 2.8% 7.0% (1.8)% 44.5% 8.8% 7.0% 290,605 123,372 60,317 45,578 47,863 83,615 279,142 118,085 54,359 42,417 41,446 75,959 651,350 611,408 Direct net operating income (b) 2,731,044 2,622,473 4.1% 2,622,473 2,230,190 15.0% 23.4% 15.2% 4.1% 4.5% 11.0% 7.5% 15.5% 10.1% 6.5% 17.6% Indirect cost of operations (a): Supervisory payroll Centralized management costs Share-based compensation (33,846) (60,861) (10,739) (36,327) (64,053) (14,675) (6.8)% (5.0)% (26.8)% (36,327) (64,053) (14,675) (38,487) (57,021) (5.6)% 12.3% (17,832) (17.7)% Net operating income 2,625,598 2,507,418 4.7% 2,507,418 2,116,850 Depreciation and amortization expense (528,121) (501,139) 5.4% (501,139) (483,219) Net income $2,097,477 $2,006,279 4.5% $ 2,006,279 $ 1,633,631 18.5% 3.7% 22.8% Gross margin (before indirect costs, depreciation and amortization expense) Gross margin (before depreciation and amortization expense) Weighted average for the period: 79.7% 80.1% (0.5)% 80.1% 78.5% 2.0% 76.6% 76.6% —% 76.6% 74.5% 2.8% Square foot occupancy 93.3% 94.8% (1.6)% 94.8% 96.2% (1.5)% Realized annual rental income per (c): Occupied square foot Available square foot At December 31: Square foot occupancy $ $ 22.93 $ 21.38 $ 21.58 20.45 6.3% $ 4.5% $ 21.58 $ 20.45 $ 18.49 17.79 16.7% 15.0% 91.6% 92.3% (0.8)% 92.3% 94.7% (2.5)% Annual contract rent per occupied square foot (d) $ 23.04 $ 22.88 0.7% $ 22.88 $ 19.81 15.5% 31 (a) Revenues and cost of operations do not include tenant reinsurance and merchandise sale revenues and expenses generated at the facilities. See “Ancillary Operations” below for more information. (b) Direct net operating income (“Direct NOI”), a subtotal within NOI, is a non-GAAP financial measure that excludes the impact of supervisory payroll, centralized management costs, and share-based compensation in addition to depreciation and amortization expense. We utilize direct net operating income in evaluating property performance and in evaluating property operating trends as compared to our competitors. (c) Realized annual rent per occupied square foot is computed by dividing rental income, before late charges and administrative fees, by the weighted average occupied square feet for the period. Realized annual rent per available square foot (“REVPAF”) is computed by dividing rental income, before late charges and administrative fees, by the total available net rentable square feet for the period. These measures exclude late charges and administrative fees in order to provide a better measure of our ongoing level of revenue. Late charges are dependent upon the level of delinquency, and administrative fees are dependent upon the level of move- ins. In addition, the rates charged for late charges and administrative fees can vary independently from rental rates. These measures take into consideration promotional discounts, which reduce rental income. (d) Annual contract rent represents the agreed upon monthly rate that is paid by our tenants in place at the time of measurement. Contract rates are initially set in the lease agreement upon move-in, and we adjust them from time to time with notice. Contract rent excludes other fees that are charged on a per-item basis, such as late charges and administrative fees, does not reflect the impact of promotional discounts, and does not reflect the impact of rents that are written off as uncollectible. Analysis of Same Store Revenue We believe a balanced occupancy and rate strategy maximizes our revenues over time. We regularly adjust rental rates and promotional discounts offered (generally, “$1.00 rent for the first month”), as well as our marketing efforts to maximize revenue from new tenants to replace tenants that vacate. We typically increase rental rates to our long-term tenants (generally, those who have been with us for at least a year) every six to twelve months. As a result, the number of long-term tenants we have in our facilities is an important factor in our revenue growth. The level of rate increases to long-term tenants is based upon evaluating the additional revenue from the increase against the negative impact of incremental move-outs, by considering customers’ in-place rent and prevailing market rents, among other factors. Revenues generated by our Same Store Facilities increased 4.7% and 15.2% in 2023 and 2022, respectively, in each case as compared to the previous year. The increase in 2023 is due primarily to (i) a 6.3% increase in realized annual rent per occupied square foot for 2023 as compared to 2022, partially offset by (ii) a 1.6% decrease in average occupancy for 2023 as compared to 2022. The increase in 2022 is due primarily to (i) a 16.7% increase in realized annual rent per occupied square foot for 2022 as compared to 2021, partially offset by (ii) a 1.5% decrease in average occupancy for 2022 as compared to 2021. The increase in realized annual rent per occupied square foot in 2023 as compared to 2022 was due to cumulative rate increases to existing long-term tenants over the past twelve months, partially offset by a 13.9% decrease in average rates per square foot charged to new tenants moving in who replaced tenants moving out with higher rental rates. The growth rate in realized annual rent per occupied square foot has decelerated since the second half of 2022 from lower move-in rates and increased promotion discounts offered in order to replace tenants that vacate. At December 31, 2023, annual contract rent per occupied square foot was 0.7% higher as compared to December 31, 2022. Occupancy levels have gradually declined since the second half of 2022 and are returning to 2019 levels as move- out activity increased and customer demand softened. The weighted average square foot occupancy for our Same Store Facilities was 93.3% for 2023, representing a decrease of 1.6%, as compared to 2022. During 2023, we lowered move-in rental rates and increased promotional activity and advertising spending to increase move-in activity at our facilities, which led to a year-over-year 8.8% increase in move-in volumes that more than offset the year-over-year 5.9% increase in move- out volumes. Move-in volumes net of move-out volumes were higher in 2023 as compared to 2022, which reduced the year-over-year decline in occupancy levels between December 31, 2022 and December 31, 2023. Move-out activities from our tenants were higher in 2023 as compared to 2022, returning to 2019 levels, which were not impacted by the COVID-19 pandemic. Average length of stay of our tenants remained at similar high levels in 2023 as compared to 2022, which supported our revenue growth by contributing to the number of tenants eligible for rental rate increases. 32 Demand in the summer months of 2023 was impacted by the lower home-moving activities due to limited housing market transaction volumes leading to less seasonality than we typically experience. Typical seasonal demand patterns returned in the second half of 2023 with decreased demand during the fall and winter months. Demand fluctuates due to various local and regional factors, including the overall economy. Demand for our facilities is also impacted by new supply of self-storage space and alternatives to self-storage. Industry-wide demand from new customers for storage space at the beginning of 2024 is below the level at the beginning of 2023. We will mitigate this lower demand by continuing to support new customer move-ins with increased marketing expense, lower rental rates to new customers, and increased promotional discounting. We expect industry-wide demand from new customers to stabilize during the year due to improving macroeconomic conditions. We also anticipate fewer completions of new self-storage facilities nationally, reducing the competitive impact of new supply on customer acquisition. As a result of stabilizing new customer demand during the year, stable existing customer behavior, and lower impact from new competitive supply, we anticipate same store revenues in 2024 will be similar to those earned in 2023. Late Charges and Administrative Fees Late charges and administrative fees increased 10.1% and 23.4% in 2023 and 2022, in each case as compared to the previous year. The increase in 2023 is due to (i) higher late charges collected on delinquent accounts driven by more delinquent accounts and to a lesser extent (ii) higher administrative fees resulting from higher move-in volumes. The increase in 2022 is due to (i) higher late charges collected on delinquent accounts driven by more delinquent accounts compared to 2021 and to a lesser extent (ii) higher administrative fees charged per move-in combined with higher move-in volumes. Delinquency levels at our Same Store Facilities remain below 2019 levels at December 31, 2023. Selected Key Statistical Data The following table sets forth average annual contract rent per square foot and total square footage for tenants moving in and moving out during the years ended December 31, 2023, 2022, and 2021. It also includes promotional discounts, which vary based upon the move-in contractual rates, move-in volume, and percentage of tenants moving in who receive the discount. Year Ended December 31, Year Ended December 31, 2023 2022 Change 2022 2021 Change (Amounts in thousands, except for per square foot amounts) Tenants moving in during the period: Average annual contract rent per square foot $ 15.61 $ 18.12 (13.9)% $ 18.12 $ 17.08 Square footage 110,958 101,956 8.8% 101,956 97,487 Contract rents gained from move-ins $1,732,054 $1,847,443 (6.2)% $1,847,443 $1,665,078 Promotional discounts given $ 57,778 $ 52,114 10.9% $ 52,114 $ 43,433 Tenants moving out during the period: Average annual contract rent per square foot $ 21.34 $ 20.63 3.4% $ 20.63 $ 17.47 Square footage 111,882 105,663 5.9% 105,663 96,234 Contract rents lost from move-outs $2,387,562 $2,179,828 9.5% $2,179,828 $1,681,208 6.1% 4.6% 11.0% 20.0% 18.1% 9.8% 29.7% 33 Analysis of Same Store Cost of Operations Cost of operations (excluding depreciation and amortization) increased 4.7% and 5.7% in 2023 and 2022, respectively, in each case as compared to the previous year. The increase in 2023 is due primarily to increased property tax expense, marketing expense, and other direct property costs, while the increase in 2022 is due primarily to increased property tax expense, marketing expense, other direct property costs, and centralized management costs. Property tax expense increased 3.4% and 4.1% in 2023 and 2022, respectively, in each case as compared to the previous year, as a result of higher assessed values. Marketing expense includes Internet advertising and the operating costs of our telephone reservation center. Internet advertising expense, comprising keyword search fees assessed on a “per click” basis, varies based upon demand for self-storage space, the quantity of people inquiring about self-storage through online search, occupancy levels, the number and aggressiveness of bidding competitors, and other factors. These factors are volatile; accordingly, Internet advertising can increase or decrease significantly in the short-term. We increased marketing expense by 44.5% and 15.5% in 2023 and 2022, respectively, in each case as compared to the previous year, by utilizing a higher volume of online paid search programs to attract new tenants. We plan to continue to use internet advertising and other advertising channels to support move-in volumes in 2024. Other direct property costs include administrative expenses specific to each self-storage facility, such as property loss, telephone and data communication lines, business license costs, bank charges related to processing the facilities’ cash receipts, tenant mailings, credit card fees, eviction costs, and the cost of operating each property’s rental office. These costs increased 8.8% in 2023 as compared to 2022 and 10.1% in 2022 as compared to 2021. These increases were due primarily to an increase in credit card fees as a result of year-over-year increases in revenues, combined with a long-term trend of more customers paying with credit cards rather than cash, checks, or other methods of payment with lower transaction costs. Centralized management costs represents administrative and cash compensation expenses for shared general corporate functions to the extent their efforts are devoted to self-storage operations. Such functions include information technology support, hardware, and software, as well as centralized administration of payroll, benefits, training, repairs and maintenance, customer service, pricing and marketing, operational accounting and finance, legal costs, and costs from field management executives. Centralized management costs decreased 5.0% in 2023 as compared to 2022 and increased 12.3% in 2022 as compared to 2021. The decrease in 2023 was primarily driven by achievement of economies of scale from recent acquisitions with centralized management costs allocated over a broader number of self-storage facilities including non-same store facilities. The increase in 2022 was due primarily to an increase in technology and data team costs that support property operations. 34 % 2 . 9 % 7 . 2 % 2 . 4 % 8 . 4 % 3 . 2 % 6 . 3 % 2 . 5 % 4 . 4 % 2 . 1 % 8 . 5 % 5 . 6 % 2 . 1 % 3 . 3 % 3 . 2 % 3 . 5 % 6 . 3 % 5 . 4 8 3 . 1 3 8 7 . 9 2 8 7 . 8 2 6 8 . 6 2 7 5 . 3 2 4 7 . 3 2 1 2 . 6 1 4 0 . 8 1 8 1 . 6 1 7 7 . 4 1 2 2 . 7 1 5 7 . 9 1 6 9 . 3 2 4 9 . 7 1 4 2 . 4 1 3 8 . 6 1 5 4 . 0 2 $ 8 2 . 4 3 $ % ) 5 . 1 ( 9 5 . 0 3 9 9 . 9 2 6 1 . 8 2 1 1 . 4 2 0 6 . 4 2 5 0 . 7 1 3 8 . 8 1 7 3 . 6 1 2 6 . 5 1 4 3 . 8 1 9 9 . 9 1 5 7 . 4 2 5 3 . 8 1 0 0 . 5 1 3 4 . 7 1 % ) 8 . 0 ( % ) 1 . 1 ( % ) 1 . 2 ( % ) 6 . 1 ( % ) 7 . 0 ( % ) 3 . 2 ( % ) 6 . 0 ( % ) 0 . 3 ( % ) 6 . 1 ( % ) 7 . 2 ( % ) 5 . 1 ( % ) 3 . 2 ( % ) 4 . 3 ( % ) 1 . 2 ( % ) 5 . 1 ( $ 8 3 . 1 2 $ % ) 6 . 1 ( % 9 . 6 9 % 2 . 5 9 % 3 . 4 9 % 6 . 5 9 % 1 . 4 9 % 4 . 3 9 % 4 . 4 9 % 6 . 3 9 % 7 . 3 9 % 5 . 3 9 % 9 . 5 9 % 4 . 4 9 % 8 . 5 9 % 1 . 5 9 % 0 . 5 9 % 7 . 4 9 % 8 . 4 9 % 4 . 5 9 % 4 . 4 9 % 3 . 3 9 % 6 . 3 9 % 6 . 2 9 % 7 . 2 9 % 2 . 2 9 % 0 . 3 9 % 9 . 0 9 % 0 . 2 9 % 3 . 3 9 % 0 . 3 9 % 6 . 3 9 % 9 . 1 9 % 0 . 3 9 % 3 . 3 9 % 3 . 3 9 % 9 . 0 1 % 6 . 3 % 3 . 5 % 2 . 7 % 0 . 4 % 4 . 4 % 8 . 7 % 0 . 5 % 3 . 4 % 6 . 7 % 4 . 9 % 7 . 2 % 8 . 5 % 8 . 5 % 6 . 7 % 1 . 5 % 3 . 6 0 4 . 2 3 8 2 . 1 3 1 5 . 0 3 9 0 . 8 2 6 0 . 5 2 2 4 . 5 2 6 1 . 7 1 7 2 . 9 1 6 2 . 7 1 9 7 . 5 1 6 9 . 7 1 2 9 . 0 2 1 0 . 5 2 7 8 . 8 1 9 9 . 4 1 7 7 . 7 1 8 5 . 1 2 $ 2 9 . 5 3 $ 5 . 5 1 1 4 . 2 3 3 1 . 2 3 0 1 . 0 3 5 0 . 6 2 5 5 . 6 2 9 4 . 8 1 4 2 . 0 2 1 0 . 8 1 9 9 . 6 1 5 6 . 9 1 8 4 . 1 2 5 4 . 6 2 7 9 . 9 1 3 1 . 6 1 8 6 . 8 1 9 . 7 8 . 6 2 . 6 0 . 6 5 . 5 6 . 7 2 . 8 7 . 6 5 . 7 4 . 4 5 . 3 8 . 2 5 . 3 9 . 3 9 . 8 5 $ 3 9 . 2 2 $ 9 . 4 5 1 4 1 2 9 2 1 2 9 6 8 9 8 0 9 1 1 1 0 3 1 2 0 1 1 0 1 9 6 6 5 9 3 3 5 2 5 6 2 9 9 3 3 , 2 r e p t n e R d e z i l a e R t o o F e r a u q S e l b a l i a v A , 1 3 r e b m e c e D d e d n E r a e Y y c n a p u c c O e g a r e v A r e p t n e R d e z i l a e R t o o F e r a u q S d e i p u c c O e g n a h C 2 2 0 2 3 2 0 2 e g n a h C 2 2 0 2 3 2 0 2 e g n a h C 2 2 0 2 3 2 0 2 3 2 0 2 , 1 3 r e b m e c e D f o s A e r a u q S t e e F r e b m u N f o ) s n o i l l i m ( s e i t i l i c a F o c s i c n a r F n a S s e l e g n A s o L k r o Y w e N i m a i M a m o c a T - e l t t a e S C D n o t g n i h s a W h t r o W . t F - s a l l a D o g a c i h C a t n a l t A n o t s u o H a n o t y a D - o d n a l r O a i h p l e d a l i h P h c a e B m l a P t s e W s t e k r a m r e h t o l l A s l a t o T e t t o l r a h C a p m a T : s e i t i l i c a F e r o t S e m a S r u o n i s d n e r t t e k r a m d e t c e l e s h t r o f t e s s e l b a t g n i w o l l o f e h T t e k r a M y b s d n e r T g n i t a r e p O s e i t i l i c a F e r o t S e m a S s d n e r T t e k r a M f o s i s y l a n A 5 3 % 6 . 9 % 3 . 2 % 5 . 4 % 8 . 3 % 1 . 1 % 1 . 4 % 2 . 7 % 9 . 4 % 4 . 1 % 0 . 9 % 5 . 6 % 9 . 1 % 2 . 1 % 4 . 0 % 6 . 4 % 6 . 3 % 7 . 4 5 9 1 , 2 2 4 $ 5 8 7 , 2 6 4 $ % ) 9 . 7 ( 4 1 8 , 1 1 $ 6 7 8 , 0 1 $ % 0 . 1 1 2 5 0 , 4 6 $ 1 0 1 , 1 7 $ % 4 . 9 1 6 0 , 8 9 4 $ 2 6 7 , 4 4 5 $ , 1 3 r e b m e c e D d e d n E r a e Y ' ) s 0 0 0 $ ( e m o c n I g n i t a r e p O t e N ' ) s 0 0 0 $ ( s e s n e p x E t c e r i d n I ' ) s 0 0 0 $ ( s e s n e p x E t c e r i D ' ) s 0 0 0 $ ( s e u n e v e R e g n a h C 2 2 0 2 3 2 0 2 e g n a h C 2 2 0 2 3 2 0 2 e g n a h C 2 2 0 2 3 2 0 2 e g n a h C 2 2 0 2 3 2 0 2 ) d e u n i t n o C ( t e k r a M y b s d n e r T g n i t a r e p O s e i t i l i c a F e r o t S e m a S 7 1 0 , 8 9 1 4 9 9 , 6 4 1 6 6 3 , 6 3 1 7 1 1 , 7 1 1 3 9 4 , 3 0 1 3 5 8 , 4 9 8 1 6 , 9 8 4 9 5 , 6 8 1 7 9 , 8 7 2 5 2 , 0 6 5 9 1 , 4 5 3 5 2 , 3 5 5 4 3 , 9 4 9 5 2 , 6 4 3 6 5 , 2 0 2 % ) 1 . 1 1 ( 3 9 5 , 3 5 1 % ) 3 . 4 1 ( 2 0 6 , 1 4 1 5 3 4 , 8 1 1 4 3 7 , 7 0 1 9 9 6 , 1 0 1 9 9 9 , 3 9 8 3 8 , 7 8 9 9 0 , 6 8 3 7 1 , 4 6 8 4 2 , 5 5 8 0 9 , 3 5 7 4 5 , 9 4 6 8 3 , 8 4 % ) 5 . 4 ( % ) 5 . 6 ( % ) 7 . 2 ( % ) 8 . 5 ( % ) 5 . 7 ( % ) 6 . 6 ( % ) 1 . 8 ( % ) 0 . 9 ( % ) 4 . 8 ( % ) 0 . 2 ( % ) 1 . 5 ( % ) 1 . 4 1 ( 0 8 6 , 6 6 6 5 , 5 1 1 2 , 4 7 9 0 , 4 0 4 1 , 4 4 4 8 , 4 6 5 9 , 5 5 9 7 , 4 7 3 6 , 4 7 8 4 , 3 7 1 7 , 2 2 2 0 , 2 8 7 4 , 2 3 1 4 , 2 6 3 9 , 5 1 7 7 , 4 3 2 0 , 4 1 3 8 , 3 9 2 0 , 4 3 6 5 , 4 2 1 5 , 5 9 7 4 , 4 2 6 2 , 4 2 7 1 , 3 9 8 4 , 2 2 8 9 , 1 2 5 3 , 2 3 7 0 , 2 6 9 8 , 9 6 7 9 8 9 , 7 9 7 % ) 1 . 9 ( 8 9 1 , 5 4 6 9 0 , 1 4 % 0 . 8 % 3 . 6 % 7 . 2 1 % 3 . 9 % 9 . 3 % 5 . 1 % 5 . 5 % 2 . 4 % 3 . 0 % 4 . 0 1 % 2 . 1 % 3 . 2 1 % 2 . 1 1 % 3 . 5 1 % 7 . 6 1 0 4 , 5 3 9 8 1 , 7 4 4 8 3 , 0 3 0 1 7 , 4 2 0 5 8 , 7 2 1 7 7 , 8 2 5 8 2 , 7 5 4 7 4 , 2 2 4 3 5 , 1 3 3 8 8 , 4 1 5 8 6 , 5 1 7 4 8 , 3 1 4 7 5 , 3 1 2 5 7 , 9 5 4 2 , 8 3 3 8 1 , 0 5 3 4 2 , 4 3 6 9 9 , 6 2 3 2 9 , 8 2 9 8 1 , 9 2 8 4 4 , 0 6 0 1 4 , 3 2 0 2 6 , 1 3 9 2 4 , 6 1 4 7 8 , 5 1 1 5 5 , 5 1 7 9 0 , 5 1 6 4 2 , 1 1 9 5 9 , 3 1 2 8 6 2 , 8 2 2 % 8 . 2 % 4 . 4 % 2 . 5 % 3 . 2 % 8 . 3 % 4 . 5 % 6 . 4 % 6 . 1 % 9 . 5 % 6 . 6 % 4 . 1 % 4 . 3 % 4 . 2 % 6 . 5 % 7 . 3 8 9 0 , 0 4 2 9 4 7 , 9 9 1 1 6 9 , 0 7 1 4 2 9 , 5 4 1 3 8 4 , 5 3 1 8 6 4 , 8 2 1 9 5 8 , 2 5 1 3 6 8 , 3 1 1 2 4 1 , 5 1 1 2 2 6 , 8 7 7 9 5 , 2 7 2 2 1 , 9 6 7 9 3 , 5 6 4 2 4 , 8 5 4 4 7 , 6 4 2 7 4 5 , 8 0 2 8 6 8 , 9 7 1 2 6 2 , 9 4 1 6 8 6 , 0 4 1 1 5 4 , 5 3 1 9 5 9 , 9 5 1 7 2 7 , 5 1 1 1 8 9 , 1 2 1 4 7 7 , 3 8 1 1 6 , 3 7 1 4 4 , 1 7 6 9 9 , 6 6 5 0 7 , 1 6 8 1 4 , 7 0 5 , 2 $ 8 9 5 , 5 2 6 , 2 $ % ) 4 . 8 ( 5 5 0 , 5 1 1 $ 6 4 4 , 5 0 1 $ % 0 . 7 0 5 3 , 1 5 6 $ 3 2 8 , 6 9 6 $ % 7 . 4 3 2 8 , 3 7 2 , 3 $ 7 6 8 , 7 2 4 , 3 $ s l a t o T 6 3 3 5 0 , 9 2 0 , 1 3 5 3 , 7 6 0 , 1 s t e k r a m r e h t o l l A o c s i c n a r F n a S s e l e g n A s o L k r o Y w e N i m a i M a m o c a T - e l t t a e S C D n o t g n i h s a W h t r o W . t F - s a l l a D o g a c i h C a t n a l t A n o t s u o H a n o t y a D - o d n a l r O a i h p l e d a l i h P h c a e B m l a P t s e W e t t o l r a h C a p m a T % 7 . 7 1 % 8 . 9 % 8 . 9 % 8 . 3 2 % 4 . 3 1 % 0 . 0 1 % 0 . 7 1 % 5 . 3 1 % 4 . 7 1 % 1 . 7 1 % 0 . 1 2 % 6 . 9 % 9 . 8 1 % 4 . 0 2 % 7 . 9 1 % 2 . 4 1 % 0 . 5 1 6 6 . 6 2 3 1 . 7 2 0 2 . 6 2 0 7 . 1 2 9 7 . 0 2 8 5 . 1 2 6 8 . 3 1 0 9 . 5 1 8 7 . 3 1 1 6 . 2 1 3 2 . 4 1 2 0 . 8 1 5 1 . 0 2 0 9 . 4 1 0 9 . 1 1 4 7 . 4 1 9 7 . 7 1 $ 8 3 . 1 3 $ % ) 2 . 1 ( 8 7 . 9 2 8 7 . 8 2 6 8 . 6 2 7 5 . 3 2 4 7 . 3 2 1 2 . 6 1 4 0 . 8 1 8 1 . 6 1 7 7 . 4 1 2 2 . 7 1 5 7 . 9 1 6 9 . 3 2 4 9 . 7 1 4 2 . 4 1 3 8 . 6 1 % ) 1 . 2 ( % ) 9 . 1 ( % ) 4 . 1 ( % ) 2 . 1 ( % ) 0 . 2 ( % ) 3 . 1 ( % ) 2 . 2 ( % ) 4 . 2 ( % ) 7 . 0 ( % 2 . 0 % ) 8 . 2 ( % ) 1 . 1 ( % ) 1 . 1 ( % ) 9 . 0 ( % ) 5 . 1 ( $ 5 4 . 0 2 $ % ) 5 . 1 ( % 1 . 8 9 % 2 . 7 9 % 1 . 6 9 % 0 . 7 9 % 2 . 5 9 % 3 . 5 9 % 6 . 5 9 % 7 . 5 9 % 0 . 6 9 % 2 . 4 9 % 7 . 5 9 % 1 . 7 9 % 9 . 6 9 % 2 . 6 9 % 9 . 5 9 % 1 . 6 9 % 2 . 6 9 % 9 . 6 9 % 2 . 5 9 % 3 . 4 9 % 6 . 5 9 % 1 . 4 9 % 4 . 3 9 % 4 . 4 9 % 6 . 3 9 % 7 . 3 9 % 5 . 3 9 % 9 . 5 9 % 4 . 4 9 % 8 . 5 9 % 1 . 5 9 % 0 . 5 9 % 7 . 4 9 % 8 . 4 9 % 2 . 9 1 % 0 . 2 1 % 0 . 2 1 % 6 . 5 2 % 7 . 4 1 % 2 . 2 1 % 3 . 8 1 % 0 . 6 1 % 3 . 0 2 % 0 . 8 1 % 8 . 0 2 % 8 . 2 1 % 2 . 0 2 % 8 . 1 2 % 8 . 0 2 % 8 . 5 1 % 7 . 6 1 7 1 . 7 2 3 9 . 7 2 5 2 . 7 2 7 3 . 2 2 4 8 . 1 2 5 6 . 2 2 1 5 . 4 1 1 6 . 6 1 5 3 . 4 1 8 3 . 3 1 7 8 . 4 1 5 5 . 8 1 0 8 . 0 2 9 4 . 5 1 1 4 . 2 1 4 3 . 5 1 9 4 . 8 1 $ 0 4 . 2 3 $ 5 . 5 1 8 2 . 1 3 1 5 . 0 3 9 0 . 8 2 6 0 . 5 2 2 4 . 5 2 6 1 . 7 1 7 2 . 9 1 6 2 . 7 1 9 7 . 5 1 6 9 . 7 1 2 9 . 0 2 1 0 . 5 2 7 8 . 8 1 9 9 . 4 1 7 7 . 7 1 9 . 7 8 . 6 2 . 6 0 . 6 5 . 5 6 . 7 2 . 8 7 . 6 5 . 7 4 . 4 5 . 3 8 . 2 5 . 3 9 . 3 9 . 8 5 $ 8 5 . 1 2 $ 9 . 4 5 1 4 1 2 9 2 1 2 9 6 8 9 8 0 9 1 1 1 0 3 1 2 0 1 1 0 1 9 6 6 5 9 3 3 5 2 5 6 2 9 9 3 3 , 2 r e p t n e R d e z i l a e R t o o F e r a u q S e l b a l i a v A , 1 3 r e b m e c e D d e d n E r a e Y y c n a p u c c O e g a r e v A r e p t n e R d e z i l a e R t o o F e r a u q S d e i p u c c O e g n a h C 1 2 0 2 2 2 0 2 e g n a h C 1 2 0 2 2 2 0 2 e g n a h C 1 2 0 2 2 2 0 2 3 2 0 2 , 1 3 r e b m e c e D f o s A e r a u q S t e e F r e b m u N f o ) s n o i l l i m ( s e i t i l i c a F o c s i c n a r F n a S s e l e g n A s o L k r o Y w e N i m a i M a m o c a T - e l t t a e S C D n o t g n i h s a W h t r o W . t F - s a l l a D o g a c i h C a t n a l t A n o t s u o H a n o t y a D - o d n a l r O a i h p l e d a l i h P h c a e B m l a P t s e W s t e k r a m r e h t o l l A s l a t o T e t t o l r a h C a p m a T ) d e u n i t n o C ( t e k r a M y b s d n e r T g n i t a r e p O s e i t i l i c a F e r o t S e m a S 7 3 % 2 . 0 2 % 8 . 1 1 % 1 . 2 1 % 9 . 8 2 % 5 . 6 1 % 1 . 2 1 % 5 . 1 2 % 7 . 7 1 % 4 . 9 1 % 5 . 5 2 % 1 . 5 2 % 5 . 2 1 % 9 . 1 2 % 8 . 4 2 % 1 . 5 2 % 0 . 8 1 % 5 . 8 1 1 6 1 , 1 5 3 $ 5 9 1 , 2 2 4 $ % 1 . 6 8 3 1 , 1 1 $ 4 1 8 , 1 1 $ % 2 . 7 1 5 7 , 9 5 $ 2 5 0 , 4 6 $ % 0 . 8 1 0 5 0 , 2 2 4 $ 1 6 0 , 8 9 4 $ , 1 3 r e b m e c e D d e d n E r a e Y ' ) s 0 0 0 $ ( e m o c n I g n i t a r e p O t e N ' ) s 0 0 0 $ ( s e s n e p x E t c e r i d n I ' ) s 0 0 0 $ ( s e s n e p x E t c e r i D ' ) s 0 0 0 $ ( s e u n e v e R e g n a h C 1 2 0 2 2 2 0 2 e g n a h C 1 2 0 2 2 2 0 2 e g n a h C 1 2 0 2 2 2 0 2 e g n a h C 1 2 0 2 2 2 0 2 ) d e u n i t n o C ( t e k r a M y b s d n e r T g n i t a r e p O s e i t i l i c a F e r o t S e m a S 4 7 0 , 7 7 1 6 4 1 , 1 3 1 1 3 8 , 5 0 1 2 6 5 , 0 0 1 2 9 2 , 2 9 7 3 0 , 8 7 3 4 1 , 6 7 9 3 5 , 2 7 9 1 9 , 2 6 5 5 1 , 8 4 5 6 1 , 8 4 4 8 6 , 3 4 5 3 5 , 9 3 6 8 9 , 6 3 7 1 0 , 8 9 1 4 9 9 , 6 4 1 6 6 3 , 6 3 1 7 1 1 , 7 1 1 % ) 4 . 2 ( % ) 4 . 2 ( % ) 4 . 4 ( % ) 1 . 4 ( 3 9 4 , 3 0 1 % 5 . 1 3 5 8 , 4 9 8 1 6 , 9 8 4 9 5 , 6 8 1 7 9 , 8 7 2 5 2 , 0 6 5 9 1 , 4 5 3 5 2 , 3 5 5 4 3 , 9 4 9 5 2 , 6 4 % ) 6 . 2 ( % 1 . 2 % ) 6 . 2 ( % ) 8 . 2 ( % 2 . 6 % ) 5 . 0 ( % ) 6 . 4 ( % ) 7 . 0 ( % 4 . 5 % 0 . 4 7 4 8 , 6 5 0 7 , 5 5 0 4 , 4 1 7 2 , 4 9 7 0 , 4 2 7 9 , 4 4 3 8 , 5 3 2 9 , 4 0 7 7 , 4 4 8 2 , 3 0 3 7 , 2 9 1 1 , 2 5 9 4 , 2 9 8 2 , 2 0 8 6 , 6 6 6 5 , 5 1 1 2 , 4 7 9 0 , 4 0 4 1 , 4 4 4 8 , 4 6 5 9 , 5 5 9 7 , 4 7 3 6 , 4 7 8 4 , 3 7 1 7 , 2 2 2 0 , 2 8 7 4 , 2 3 1 4 , 2 9 7 4 , 3 4 8 9 1 , 5 4 % 6 . 3 % 1 . 5 % 7 . 8 % 3 . 4 % 0 . 5 % 2 . 8 % 3 . 9 % 8 . 6 1 % 5 . 4 % 9 . 9 % 8 . 3 % 3 . 3 1 % 7 . 0 1 % 1 . 3 % 2 . 5 4 8 1 , 4 3 0 9 8 , 4 4 8 4 9 , 7 2 4 8 6 , 3 2 1 3 5 , 6 2 8 9 5 , 6 2 5 1 4 , 2 5 6 3 2 , 9 1 9 7 1 , 0 3 3 4 5 , 3 1 5 0 1 , 5 1 8 1 2 , 2 1 9 5 2 , 2 1 0 6 4 , 9 1 0 4 , 5 3 9 8 1 , 7 4 4 8 3 , 0 3 0 1 7 , 4 2 0 5 8 , 7 2 1 7 7 , 8 2 5 8 2 , 7 5 4 7 4 , 2 2 4 3 5 , 1 3 3 8 8 , 4 1 5 8 6 , 5 1 7 4 8 , 3 1 4 7 5 , 3 1 2 5 7 , 9 7 0 4 , 3 0 2 9 5 9 , 3 1 2 % 1 . 0 1 % 9 . 9 % 7 . 3 2 % 5 . 3 1 % 2 . 0 1 % 2 . 7 1 % 7 . 3 1 % 8 . 7 1 % 7 . 7 1 % 0 . 1 2 % 0 . 0 1 % 1 . 9 1 % 5 . 0 2 % 9 . 9 1 % 4 . 4 1 5 0 1 , 8 1 2 1 4 7 , 1 8 1 4 8 1 , 8 3 1 7 1 5 , 8 2 1 2 0 9 , 2 2 1 7 0 6 , 9 0 1 2 9 3 , 4 3 1 8 9 6 , 6 9 8 6 8 , 7 9 2 8 9 , 4 6 0 0 0 , 6 6 1 2 0 , 8 5 9 8 2 , 4 5 5 3 7 , 8 4 8 9 0 , 0 4 2 9 4 7 , 9 9 1 1 6 9 , 0 7 1 4 2 9 , 5 4 1 3 8 4 , 5 3 1 8 6 4 , 8 2 1 9 5 8 , 2 5 1 3 6 8 , 3 1 1 2 4 1 , 5 1 1 2 2 6 , 8 7 7 9 5 , 2 7 2 2 1 , 9 6 7 9 3 , 5 6 4 2 4 , 8 5 1 2 6 , 2 5 6 6 9 8 , 9 6 7 7 0 5 , 9 9 8 3 5 0 , 9 2 0 , 1 s t e k r a m r e h t o l l A 0 5 8 , 6 1 1 , 2 $ 8 1 4 , 7 0 5 , 2 $ % 5 . 1 0 4 3 , 3 1 1 $ 5 5 0 , 5 1 1 $ % 5 . 6 8 0 4 , 1 1 6 $ 0 5 3 , 1 5 6 $ % 2 . 5 1 8 9 5 , 1 4 8 , 2 $ 3 2 8 , 3 7 2 , 3 $ s l a t o T 8 3 o c s i c n a r F n a S s e l e g n A s o L k r o Y w e N i m a i M a m o c a T - e l t t a e S C D n o t g n i h s a W h t r o W . t F - s a l l a D o g a c i h C a t n a l t A n o t s u o H a n o t y a D - o d n a l r O a i h p l e d a l i h P h c a e B m l a P t s e W e t t o l r a h C a p m a T Acquired Facilities The Acquired Facilities represent 470 facilities that we acquired in 2021, 2022, and 2023. As a result of the stabilization process and timing of when these facilities were acquired, year-over-year changes can be significant. The following table summarizes operating data with respect to the Acquired Facilities: ACQUIRED FACILITIES Year Ended December 31, Year Ended December 31, 2023 2022 Change (a) 2022 2021 Change (a) ($ amounts in thousands, except for per square foot amounts) Revenues (b): 2021 Acquisitions 2022 Acquisitions 2023 Acquisitions Total revenues Cost of operations (b): 2021 Acquisitions 2022 Acquisitions 2023 Acquisitions Total cost of operations Net operating income: 2021 Acquisitions 2022 Acquisitions 2023 Acquisitions Net operating income Depreciation and amortization expense Net (loss) income At December 31: Square foot occupancy: 2021 Acquisitions 2022 Acquisitions 2023 Acquisitions Annual contract rent per occupied square foot: 2021 Acquisitions 2022 Acquisitions 2023 Acquisitions Number of facilities: 2021 Acquisitions 2022 Acquisitions 2023 Acquisitions Net rentable square feet (in thousands): 2021 Acquisitions (c) 2022 Acquisitions 2023 Acquisitions $ 345,061 $ 312,300 $ 50,105 55,487 450,653 14,945 — 327,245 32,761 $ 312,300 $ 106,474 $ 205,826 14,945 35,160 — 55,487 220,771 123,408 — — 106,474 14,945 — 327,245 104,665 19,911 19,922 144,498 101,859 7,885 — 109,744 2,806 12,026 19,922 34,754 101,859 7,885 — 109,744 32,705 — — 32,705 69,154 7,885 — 77,039 240,396 30,194 35,565 306,155 (323,796) 210,441 7,060 — 217,501 (280,871) 29,955 23,134 35,565 88,654 (42,925) 210,441 7,060 — 217,501 (280,871) 73,769 — — 73,769 (131,998) $ (17,641) $ (63,370) $ 45,729 $ (63,370) $ (58,229) $ 136,672 7,060 — 143,732 (148,873) (5,141) 81.5% 82.2% 83.1% 82.1% $ $ 18.72 $ 13.06 16.78 17.41 $ 232 74 164 470 22,009 4,740 12,067 38,816 83.1% 79.4% —% 82.5% 17.81 11.48 — 16.73 232 74 — 306 21,908 4,726 — 26,634 (1.9)% 3.5% —% (0.5)% 83.1% 79.4% —% 82.5% 5.1% $ 13.8% —% 4.1% $ 17.81 $ 11.48 — 16.73 $ — — 164 164 101 14 12,067 12,182 232 74 — 306 21,908 4,726 — 26,634 79.9% —% —% 79.9% 15.62 — — 15.62 232 — — 232 21,830 — — 21,830 4.0% —% —% 3.3% 14.0% —% —% 7.1% — 74 — 74 78 4,726 — 4,804 39 ACQUIRED FACILITIES (Continued) Costs to acquire (in thousands): 2021 Acquisitions (c) 2022 Acquisitions 2023 Acquisitions (d) As of December 31, 2023 $ $ 5,115,276 730,957 2,674,840 8,521,073 (a) Represents the percentage change with respect to square foot occupancy and annual contract rent per occupied square foot, and the absolute nominal change with respect to all other items. (b) Revenues and cost of operations do not include tenant reinsurance and merchandise sale revenues and expenses generated at the facilities. See “Ancillary Operations” below for more information. (c) We have completed the expansion projects on facilities acquired in 2021 for $26.9 million, adding 179,000 net rentable square feet of storage space as of December 31, 2023. (d) The amount includes the costs allocated to land, buildings and intangible assets associated with the 127 self-storage facilities from the Simply Acquisition. We have been active in acquiring facilities in recent years. Since the beginning of 2021, we acquired a total of 470 facilities with 38.8 million net rentable square feet for $8.5 billion. During 2023, these facilities contributed net operating income of $306.2 million, consistent with our original underwritten expectations. During 2023, we acquired BREIT Simply Storage LLC, a self-storage company that owns and operates 127 self- storage facilities (9.4 million square feet) and manages 25 self-storage facilities (1.8 million square feet) for third parties, for a purchase price of $2.2 billion in cash. Included in the 2023 Acquisition results in the table above are the Simply portfolio self-storage revenues of $44.4 million, NOI of $29.4 million (including Direct NOI of $31.2 million), and average square footage occupancy of 87.7% for 2023 since the acquisition on September 13, 2023. During 2021, we acquired the ezStorage portfolio, consisting of 48 properties (4.1 million net rentable square feet) for acquisition cost of $1.8 billion. As of December 31, 2023, we have completed the expansion projects on four properties of this portfolio for $26.5 million, adding 169,000 net rentable square feet of storage space. Included in the 2021 Acquisition results in the table above are ezStorage portfolio revenues of $105.1 million, NOI of $82.2 million (including Direct NOI of $84.5 million), and average square footage occupancy of 86.3% for 2023. During 2021, we acquired the All Storage portfolio, consisting of 56 properties (7.5 million net rentable square feet) for $1.5 billion. Included in the 2021 Acquisition results in the table above are All Storage portfolio revenues of $89.1 million, NOI of $59.0 million (including Direct NOI of $61.8 million), and average square footage occupancy of 77.9% for 2023. We remain active in seeking to acquire additional self-storage facilities. Future acquisition volume is likely to be impacted by increasing cost of capital requirements and overall macro-economic uncertainties. 40 Developed and Expanded Facilities The developed and expanded facilities include 57 facilities that were developed on new sites since January 1, 2018, and 88 facilities expanded to increase their net rentable square footage. Of these expansions, 61 were completed before 2022, 22 were completed in 2022 or 2023, and five are currently in process at December 31, 2023. The following table summarizes operating data with respect to the Developed and Expanded Facilities: DEVELOPED AND EXPANDED FACILITIES Year Ended December 31, Year Ended December 31, 2023 2022 Change (a) 2022 2021 Change (a) ($ amounts in thousands, except for per square foot amounts) Revenues (b): Developed in 2018 Developed in 2019 Developed in 2020 Developed in 2021 Developed in 2022 Developed in 2023 Expansions completed before 2022 Expansions completed in 2022 or 2023 Expansions in process Total revenues $ 40,206 $ 18,081 7,621 11,134 6,893 1,032 138,629 27,698 11,156 262,450 36,789 $ 16,444 6,838 8,333 687 — 127,290 20,914 13,704 230,999 3,417 $ 1,637 783 2,801 6,206 1,032 11,339 6,784 (2,548) 31,451 36,789 $ 16,444 6,838 8,333 687 — 127,290 20,914 13,704 230,999 28,308 $ 11,921 3,405 1,602 — — 88,168 20,400 13,315 167,119 Cost of operations (b): Developed in 2018 Developed in 2019 Developed in 2020 Developed in 2021 Developed in 2022 Developed in 2023 Expansions completed before 2022 Expansions completed in 2022 or 2023 Expansions in process Total cost of operations Net operating income (loss): 11,662 5,608 1,884 3,849 3,563 1,638 38,885 9,644 1,798 78,531 10,742 5,622 1,702 3,539 738 — 37,502 5,805 2,155 67,805 Developed in 2018 Developed in 2019 Developed in 2020 Developed in 2021 Developed in 2022 Developed in 2023 Expansions completed before 2022 Expansions completed in 2022 or 2023 Expansions in process Net operating income Depreciation and amortization expense Net income 28,544 12,473 5,737 7,285 3,330 (606) 99,744 18,054 9,358 183,919 (61,421) 26,047 10,822 5,136 4,794 (51) — 89,788 15,109 11,549 163,194 (54,115) $ 122,498 $ 109,079 $ 920 (14) 182 310 2,825 1,638 1,383 3,839 (357) 10,726 2,497 1,651 601 2,491 3,381 (606) 9,956 2,945 (2,191) 20,725 (7,306) 13,419 10,742 5,622 1,702 3,539 738 — 37,502 5,805 2,155 67,805 9,983 5,240 1,679 1,546 — — 32,945 5,370 2,127 58,890 26,047 10,822 5,136 4,794 (51) — 89,788 15,109 11,549 163,194 (54,115) $ 109,079 $ 18,325 6,681 1,726 56 — — 55,223 15,030 11,188 108,229 (47,549) 60,680 $ 8,481 4,523 3,433 6,731 687 — 39,122 514 389 63,880 759 382 23 1,993 738 — 4,557 435 28 8,915 7,722 4,141 3,410 4,738 (51) — 34,565 79 361 54,965 (6,566) 48,399 41 DEVELOPED AND EXPANDED FACILITIES (Continued) As of December 31, 2022 Change (a) 2023 As of December 31, 2021 Change (a) 2022 ($ amounts in thousands, except for per square foot amounts) Square foot occupancy: Developed in 2018 Developed in 2019 Developed in 2020 Developed in 2021 Developed in 2022 Developed in 2023 Expansions completed before 2022 Expansions completed in 2022 or 2023 Expansions in process Annual contract rent per occupied square foot: Developed in 2018 Developed in 2019 Developed in 2020 Developed in 2021 Developed in 2022 Developed in 2023 Expansions completed before 2022 Expansions completed in 2022 or 2023 Expansions in process Number of facilities: Developed in 2018 Developed in 2019 Developed in 2020 Developed in 2021 Developed in 2022 Developed in 2023 Expansions completed before 2022 Expansions completed in 2022 or 2023 Expansions in process Net rentable square feet (in thousands): Developed in 2018 Developed in 2019 Developed in 2020 Developed in 2021 Developed in 2022 Developed in 2023 Expansions completed before 2022 Expansions completed in 2022 or 2023 Expansions in process 86.7% 84.6% 89.4% 81.5% 77.7% 27.9% 86.4% 70.4% 63.4% 79.3% $ 21.32 $ 18.83 22.73 19.78 16.20 9.61 18.36 18.88 28.66 $ 18.67 $ 18 11 3 6 8 11 61 22 5 87.5% 87.3% 94.3% 82.4% 43.6% —% 87.0% 71.4% 86.2% 83.4% 20.84 18.19 21.75 18.04 13.84 — 17.89 18.72 30.93 18.37 18 11 3 6 8 — 61 22 5 145 134 2,069 1,057 347 681 631 1,098 8,390 2,353 475 2,069 1,057 347 681 631 — 8,382 1,771 428 88.6% 87.3% 88.9% 48.8% —% —% 85.0% 84.8% 96.5% 84.4% 17.08 14.58 17.67 15.41 — — 14.92 18.19 28.29 15.65 18 11 3 6 — — 61 22 5 (0.9)% (3.1)% (5.2)% (1.1)% 78.2% —% (0.7)% (1.4)% (26.5)% (4.9)% 87.5% 87.3% 94.3% 82.4% 43.6% —% 87.0% 71.4% 86.2% 83.4% 2.3% $ 20.84 $ 3.5% 4.5% 9.6% 17.1% —% 2.6% 0.9% (7.3)% 18.19 21.75 18.04 13.84 — 17.89 18.72 30.93 1.6% $ 18.37 $ — — — — — 11 — — — 11 — — — — — 1,098 8 582 47 18 11 3 6 8 — 61 22 5 134 126 2,069 1,057 347 681 631 — 8,382 1,771 428 2,069 1,057 347 681 — — 8,413 1,216 490 (1.2)% —% 6.1% 68.9% —% —% 2.4% (15.8)% (10.7)% (1.2)% 22.0% 24.8% 23.1% 17.1% —% —% 19.9% 2.9% 9.3% 17.4% — — — — 8 — — — — 8 — — — — 631 — (31) 555 (62) 17,101 15,366 1,735 15,366 14,273 1,093 42 Costs to develop (in thousands): Developed in 2018 Developed in 2019 Developed in 2020 Developed in 2021 Developed in 2022 Developed in 2023 Expansions completed before 2022 (c) Expansions completed in 2022 or 2023 (c) As of December 31, 2023 $ 262,187 150,387 42,063 115,632 100,089 193,766 506,594 268,449 $ 1,639,167 (a) Represents the percentage change with respect to square foot occupancy and annual contract rent per occupied square foot, and the absolute nominal change with respect to all other items. (b) Revenues and cost of operations do not include tenant reinsurance and merchandise sales generated at the facilities. See “Ancillary Operations” below for more information. (c) These amounts only include the direct cost incurred to expand and renovate these facilities, and do not include (i) the original cost to develop or acquire the facility or (ii) the lost revenue on space demolished during the construction and fill-up period. Our Developed and Expanded Facilities includes a total of 145 self-storage facilities of 17.1 million net rentable square feet. For development and expansions completed by December 31, 2023, we incurred a total cost of $1.6 billion. During 2023, Developed and Expanded Facilities contributed net operating income of $183.9 million. It typically takes at least three to four years for a newly developed or expanded self-storage facility to stabilize with respect to revenues. Physical occupancy can be achieved as early as two to three years following completion of the development or expansion through offering lower rental rates during fill-up. As a result, even after achieving high occupancy, there can still be a period of elevated revenue growth as the tenant base matures and higher rental rates are achieved. We believe that our development and redevelopment activities generate favorable risk-adjusted returns over the long run. However, in the short run, our earnings are diluted during the construction and stabilization period due to the cost of capital to fund the development cost, the related construction and development overhead expenses included in general and administrative expense, and the net operating loss from newly developed facilities undergoing fill-up. We typically underwrite new developments to stabilize at approximately an 8.0% NOI yield on cost. Our developed facilities have thus far leased up as expected and are at various stages of their revenue stabilization periods. The actual annualized yields that we may achieve on these facilities upon stabilization will depend on many factors, including local and current market conditions in the vicinity of each property and the level of new and existing supply. The facilities under “expansions completed” represent those facilities where the expansions have been completed at December 31, 2023. We incurred a total of $775.0 million in direct cost to expand these facilities, demolished a total of 1.3 million net rentable square feet of storage space, and built a total of 6.8 million net rentable square feet of new storage space. At December 31, 2023, we had 23 additional facilities in development, which will have a total of 2.3 million net rentable square feet of storage space and have an aggregate development cost totaling approximately $461.4 million. We expect these facilities to open over the next 18 to 24 months. The facilities under “expansion in process” represent those facilities where construction is in process at December 31, 2023, and together with additional future expansion activities primarily related to our Same Store Facilities at December 31, 2023, we expect to add a total of 1.3 million net rentable square feet of storage space by expanding existing self-storage facilities for an aggregate direct development cost of $304.8 million. 43 Other Non-Same Store Facilities The “Other Non-Same Store Facilities” represent facilities which, while not newly acquired, developed, or expanded, are not fully stabilized since January 1, 2021, including facilities undergoing fill-up as well as facilities damaged in casualty events such as hurricanes, floods, and fires. The Other Non-Same Store Facilities have an aggregate of 7.3 million net rentable square feet, including 1.3 million in Texas, 0.5 million in Pennsylvania, 0.4 million in each of California, Florida, Illinois, Michigan, Minnesota, Ohio, and Washington, 0.3 million in each of Arizona, Georgia, and South Carolina, 0.2 million in each of Alabama, Colorado, Missouri, and Virginia, and 1.0 million in other states. During 2023, 2022, and 2021, the average occupancy for these facilities totaled 88.1%, 90.2%, and 84.8%, respectively, and the realized rent per occupied square foot totaled $18.51, $17.10, and $13.96, respectively. Depreciation and amortization expense Depreciation and amortization expense for Self-Storage Operations increased $81.9 million in 2023 as compared to 2022 and increased $174.7 million in 2022 as compared to 2021, due to elevated levels of capital expenditures and new facilities that are recently acquired and developed. We expect continued increases in depreciation expense in 2024 as a result of elevated levels of capital expenditures and new facilities that are acquired, developed or expanded in 2024. 44 The following discussion and analysis of the components of net income, including Ancillary Operations and certain items not allocated to segments, present a comparison for the year ended December 31, 2023 to the year ended December 31, 2022. The results of these components for the years ended December 31, 2022 compared to December 31, 2021 was included in our Annual Report on Form 10-K for the year ended December 31, 2022 on page 22, under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which was filed with the SEC on February 21, 2023. Ancillary Operations Ancillary revenues and expenses include amounts associated with the reinsurance of policies against losses to goods stored by tenants in our self-storage facilities, sale of merchandise at our self-storage facilities, and management of property owned by unrelated third parties. The following table sets forth our ancillary operations: Revenues: Tenant reinsurance premiums Merchandise Third party property management Total revenues Cost of operations: Tenant reinsurance Merchandise Third party property management Total cost of operations Net operating income: Tenant reinsurance Merchandise Third party property management Total net operating income Year Ended December 31, 2023 2022 Change (Amounts in thousands) $ 203,503 $ 188,201 $ 27,511 27,063 258,077 42,366 17,137 26,493 85,996 161,137 10,374 570 28,303 19,631 236,135 36,830 17,113 18,755 72,698 151,371 11,190 876 $ 172,081 $ 163,437 $ 15,302 (792) 7,432 21,942 5,536 24 7,738 13,298 9,766 (816) (306) 8,644 Tenant reinsurance operations: Tenant reinsurance premium revenue increased $15.3 million or 8.1% in 2023 over 2022, as a result of an increase in our tenant base with respect to acquired, newly developed, and expanded facilities and the third party properties we manage, as well as the increase of tenant insurance participation at our same store facilities. Tenant reinsurance premium revenue generated from tenants at our Same-Store Facilities were $149.8 million and $144.4 million in 2023 and 2022, respectively, representing a 3.7% year over year increase in 2023. We expect future growth will come primarily from customers of newly acquired and developed facilities and the increase of tenant insurance participation at our same store facilities. Cost of operations primarily includes claims paid as well as claims adjustment expenses. Claims expenses vary based upon the number of insured tenants and the volume of events that drive covered customer losses, such as burglary, as well as catastrophic weather events affecting multiple properties such as hurricanes and floods. Tenant reinsurance cost of operations increased $5.5 million in 2023, as compared to 2022, primarily due to increased claim expenses related to burglary events. Third-party property management: At December 31, 2023, in our third-party property management program, we managed 210 facilities for unrelated third parties, and were under contract to manage 114 additional facilities including 105 facilities that are currently under construction. During 2023, we added 152 facilities to the program (including 25 third- party facilities from the Simply Acquisition), acquired two facilities from the program, and had 18 properties exit the program. While we expect this business to increase in scope and size, we do not expect any significant changes in overall profitability of this business in the near term as we seek new properties to manage and are in the earlier stages of fill-up for newly managed properties. 45 Analysis of items not allocated to segments Equity in earnings of unconsolidated real estate entities We account for the equity investments in Shurgard and PSB (prior to the sale of our investment in PSB) using the equity method and record our pro-rata share of the net income of these entities. The following table, and the discussion below, sets forth our equity in earnings of unconsolidated real estate entities: Equity in earnings: Shurgard PSB Total equity in earnings Year Ended December 31, 2023 2022 Change (Amounts in thousands) $ $ 27,897 $ — 27,897 $ 26,385 $ 80,596 106,981 $ 1,512 (80,596) (79,084) Investment in Shurgard: For purposes of recording our equity in earnings from Shurgard, the Euro was translated at exchange rates of approximately 1.104 U.S. Dollars per Euro at December 31, 2023 (1.070 at December 31, 2022), and average exchange rates of 1.081 for 2023 and 1.054 for 2022. Included in our equity earnings from Shurgard for the year ended December 31, 2022 is our equity share of gains on sale of real estate totaling $3.5 million (none for 2023). Also included were $36.8 million and $33.4 million of our share of depreciation and amortization expense for 2023 and 2022, respectively. Investment in PSB: On July 20, 2022, in connection with the closing of the merger of PSB with affiliates of Blackstone Real Estate, we completed the sale of our 41% common equity interest in PSB in its entirety. At the close of the merger transaction, we received a total of $2.7 billion of cash proceeds and recognized a gain of $2.1 billion during the third quarter of 2022. Included in our equity earnings from PSB for 2022 is our equity share of gains on sale of real estate totaling $49.1 million. Our equity share of earnings from PSB contributed $57.7 million to Core FFO in 2022. Since the sale of PSB in July 2022, we no longer recognize equity in earnings from PSB. Real estate acquisition and development expense: In 2023, 2022 and 2021, we incurred a total of $26.5 million, $28.7 million, and $12.9 million, respectively, of internal and external expenses related to our acquisition and development of real estate facilities. These amounts are net of $18.0 million, $17.4 million and $14.6 million in 2023, 2022 and 2021, respectively, in development costs that were capitalized to newly developed and redeveloped self-storage facilities. During 2023 and 2022, we wrote off $11.7 million and $7.0 million, respectively, of accumulated development costs for cancelled development and redevelopment projects. During 2023, 2022 and 2021, we recognized a total of $1.2 million, $11.2 million, and $4.0 million, respectively, of share-based compensation expense related to real estate management personnel. The year-over-year changes in 2023 and 2022 were due primarily to the absence of comparable accelerated compensation expense recognized for awards granted to real estate management personnel who are eligible for immediate vesting of their outstanding awards upon retirement. 46 General and administrative expense: The following table sets forth our general and administrative expense: Year Ended December 31, Year Ended December 31, 2023 2022 Change 2022 2021 Change (Amounts in thousands) Share-based compensation expense $ 25,399 $ 26,661 $ (1,262) $ 26,661 $ 33,729 $ Legal costs Corporate management costs Other costs Total 3,304 25,708 26,221 4,014 21,808 19,189 (710) 3,900 7,032 4,014 21,808 19,189 6,194 18,594 17,449 $ 80,632 $ 71,672 $ 8,960 $ 71,672 $ 75,966 $ (4,294) (7,068) (2,180) 3,214 1,740 General and administrative expense increased $9.0 million in 2023, as compared to 2022 due primarily to an increase in other costs driven by higher spending in IT applications and software development and costs incurred for our UPREIT reorganization and an increase in corporate management costs driven by higher payroll costs. General and administrative expense decreased $4.3 million in 2022, as compared to 2021 due primarily to a decrease in share-based compensation expense driven by lower accelerated compensation expense recognized for awards granted to corporate management personnel who are eligible for immediate vesting of their outstanding awards upon retirement, partially offset by an increase in corporate management cost driven by higher payroll cost. Interest and other income: The following table sets forth our interest and other income: Interest earned on cash balances Commercial operations Unrealized gain on private equity investments Other Total Year Ended December 31, 2023 2022 Change (Amounts in thousands) 64,819 $ 20,824 $ 9,531 2,817 8,423 9,846 4,685 5,212 85,590 $ 40,567 $ $ $ 43,995 (315) (1,868) 3,211 45,023 Interest earned on cash balances increased $44.0 million in 2023 over 2022 due primarily to higher average cash balances resulting from temporary cash held from the issuance of $2.2 billion unsecured senior notes on July 26, 2023 until the funding of the Simply Acquisition on September 13, 2023 and higher interest rates in the financial markets in 2023 as compared to 2022. Interest expense: For 2023 and 2022, we incurred $210.4 million and $142.4 million, respectively, of interest on our outstanding notes payable. In determining interest expense, these amounts were offset by capitalized interest of $9.3 million and $6.0 million during 2023 and 2022, respectively, associated with our development activities. The increase of interest expense in 2023 as compared to 2022 is due to the issuance of $2.2 billion of notes payable in July 2023 and the increase of Compounded SOFR on our $700.0 million variable rate unsecured notes issued in April 2021, partially offset by the interest savings on the $500.0 million unsecured notes redeemed in August 2022. At December 31, 2023, we had $9.1 billion of notes payable outstanding, with a weighted average interest rate of approximately 3.1%. Foreign currency exchange (loss) gain: For 2023, we recorded foreign currency losses of $51.2 million, representing primarily the changes in the U.S. Dollar equivalent of our Euro-denominated unsecured notes due to fluctuations in exchange rates (gains of $98.3 million for 2022). The Euro was translated at exchange rates of approximately 1.104 U.S. Dollars per Euro at December 31, 2023 and 1.070 at December 31, 2022. Future gains and losses on foreign currency will be dependent upon changes in the relative value of the Euro to the U.S. Dollar and the level of Euro-denominated notes payable outstanding. 47 Gain on sale of real estate: During 2023, we completed a real estate transaction with a third-party, through which we sold an operating self-storage facility with a net book value of $7.1 million for gross proceeds of $40.0 million and acquired a nearby land parcel for $13.5 million. At the close of the transaction, we entered into a leaseback of the self- storage facility until we complete development of the acquired land into a self-storage facility, no later than December 31, 2026. Of the $40.0 million in gross proceeds, $24.3 million was allocated to the sale of the property based on its estimated fair value, resulting a net gain on sale of real estate of $17.1 million after direct transaction costs, and $15.7 million was classified as a reduction of costs to develop the acquired land included in construction in process. During 2023, we also sold a land parcel for $0.1 million in cash and recorded a related gain on sale of real estate of $0.1 million. In 2022, we recorded gains totaling $1.5 million, in connection with the partial sale of real estate facilities pursuant to eminent domain proceedings. Income tax expense: We operate as a REIT for U.S. federal income tax purposes. As a REIT, we are generally not subject to U.S. federal income taxes on our taxable income distributed to stockholders. In 2023, 2022, and 2021, we recorded income tax expense totaling $10.8 million, $14.3 million and $12.4 million, respectively, related to our taxable REIT subsidiaries and in the state and local jurisdictions in which we operate. The year-over-year changes of income tax expense in 2023 and 2022 were primarily driven by changes in state income tax, due to fluctuations of taxable income in certain states where there are differences between federal and state tax laws. 48 Liquidity and Capital Resources Overview and our Sources of Capital While operating as a REIT allows us to minimize the payment of U.S. federal corporate income tax expense, we are required to distribute at least 90% of our taxable income to our shareholders. Notwithstanding this requirement, our annual operating retained cash flow increased from $200 million to $300 million per year in recent years to approximately $700 million in 2021, $1 billion in 2022 and $480 million for 2023 after a 50% increase in annual dividend in 2023. Retained operating cash flow represents our expected cash flow provided by operating activities (including property operating costs and interest payments described below), less shareholder distributions and capital expenditures. We expect retained cash flow of approximately $450 million for 2024. Capital needs in excess of retained cash flow are met with: (i) medium and long-term debt, (ii) preferred equity, (iii) limited partnership interests, and (iv) common equity. We select among these sources of capital based upon relative cost, availability, the desire for leverage, and considering potential constraints caused by certain features of capital sources, such as debt covenants. We view our line of credit, as well as any short-term bank loans, as bridge financing. is important Because raising capital to our growth, we endeavor to maintain a strong financial profile characterized by strong credit metrics, including low leverage relative to our total capitalization and operating cash flows. We are one of the highest rated REITs, as rated by major rating agencies Moody’s and Standard & Poor’s. Our senior notes payable have an “A” credit rating by Standard & Poor’s and “A2” by Moody’s. Our credit ratings on each of our series of preferred shares are “A3” by Moody’s and “BBB+” by Standard & Poor’s. Our credit profile enables us to effectively access both the public and private capital markets to raise capital. On June 12, 2023, we amended our revolving line of credit, increasing the borrowing limit from $500 million to $1.5 billion. We increased the size of the revolving line of credit and its associated lender base given our increased levels of debt maturities in coming years and to serve as temporary “bridge” financing until we are able to raise longer term capital. As of December 31, 2023 and February 20, 2024, there were no borrowings outstanding on the revolving line of credit; however, we do have approximately $14.6 million of outstanding letters of credit, which limits our borrowing capacity to $1,485.4 million as of February 20, 2024. Our line of credit matures on June 12, 2027. We believe that we have significant financial flexibility to adapt to changing conditions and opportunities, and we have significant access to sources of capital including debt and preferred equity. While the costs of financing have increased recently, based on our strong credit profile and our substantial current liquidity relative to our capital requirements noted below, we would not expect any potential capital market dislocations to have a material impact upon our expected capital and growth plans over the next 12 months. However, if capital market conditions deteriorate significantly for a long period of time, our access to or cost of debt and preferred equity capital could be negatively impacted and potentially affect future investment activities. Our current and expected capital resources include: (i) $370.0 million of cash as of December 31, 2023 and (ii) approximately $450 million of expected retained operating cash flow over the next twelve months. Additionally, we have $1,485.4 million available borrowing capacity on our revolving line of credit, which can be used as temporary “bridge” financing until we are able to raise longer term capital. We believe that our cash provided by our operating activities will continue to be sufficient to enable us to meet our ongoing cash requirements for interest payments on debt, maintenance capital expenditures, and distributions to our shareholders for the foreseeable future. As described below, our current committed cash requirements consist of (i) $420.7 million of remaining spending on our current development pipeline, which will be incurred primarily in the next 18 to 24 months and (ii) $810 million in scheduled principal repayments on our unsecured notes in the next twelve months, which we plan to refinance as they come due in April 2024. Our cash requirements may increase over the next year as we add projects to our development pipeline and acquire additional properties. Additional potential cash requirements could result from various activities including the redemption of outstanding preferred securities, repurchases of common stock, or merger and acquisition activities, as and to the extent we determine to engage in such activities. Over the long term, to the extent that our cash requirements exceed our capital resources, we believe we have a variety of possibilities to raise additional capital including issuing common or preferred securities, debt, and limited partnership interests, or entering into joint venture arrangements to acquire or develop facilities. 49 Cash Requirements The following summarizes our expected material cash requirements, which comprise (i) contractually obligated expenditures, including payments of principal and interest, (ii) other essential expenditures, including property operating expenses, maintenance capital expenditures and dividends paid in accordance with REIT distribution requirements, and (iii) opportunistic expenditures, including acquisitions and developments and repurchases of our securities. We expect to satisfy these cash requirements through operating cash flow and opportunistic debt and equity financings. Required Debt Repayments: As of December 31, 2023, totaled approximately $9.2 billion, consisting of $7.5 billion of U.S. Dollar denominated unsecured notes payable, $1.7 billion of Euro-denominated unsecured notes payable, and $1.8 million of mortgage notes payable. Approximate principal maturities and interest payments (including $62.8 million in estimated interest on our $1.1 billion variable rate unsecured notes based on rates in effect at December 31, 2023) are as follows (amounts in thousands): the principal outstanding on our debt 2024 2025 2026 2027 2028 Thereafter Principal Interest Total $ 810,496 $ 250,656 $ 1,061,152 667,247 1,150,138 500,146 1,200,129 4,825,634 222,674 196,588 184,643 163,152 1,103,883 889,921 1,346,726 684,789 1,363,281 5,929,517 $ 9,153,790 $ 2,121,596 $ 11,275,386 We have $700 million of our U.S. Dollar denominated unsecured notes that mature on April 23, 2024 and €100 million of our Euro denominated unsecured notes that mature on April 12, 2024. We plan to refinance these unsecured notes as they come due in April 2024. Capital Expenditure Requirements: Capital expenditures include general maintenance, major repairs, or replacements to elements of our facilities to keep our facilities in good operating condition and maintain their visual appeal. Capital expenditures do not include costs relating to the development of new facilities or redevelopment of existing facilities to increase their available rentable square footage. We spent $237 million of capital expenditures to maintain real estate facilities in 2023 and expect to spend approximately $180 million in 2024. In addition to standard capital repairs of building elements reaching the end of their useful lives, our capital expenditures in recent years have included incremental expenditures to enhance the competitive position of certain of our facilities relative to local competitors pursuant to a multi-year program. Such investments include development of more pronounced, attractive, and clearly identifiable color schemes and signage and upgrades to the configuration and layout of the offices and other customer zones to improve the customer experience. We spent approximately $160 million in 2023 and expect to spend $150 million in 2024 on this effort. In addition, we have spent $65 million in LED lighting and the installation of solar panels in 2023 and we expect to spend $120 million in 2024. We believe that the attractiveness and competitiveness of our facilities to new and existing customers and, in the case of LED lighting and solar panels, reduce operating costs. improve customer these incremental satisfaction, investments Requirement to Pay Distributions: For all periods presented herein, we have elected to be treated as a REIT, as defined in the Internal Revenue Code. For each taxable year in which we qualify for taxation as a REIT, we will not be subject to U.S. federal corporate income tax on our “REIT taxable income” (generally, taxable income subject to specified adjustments, including a deduction for dividends paid and excluding our net capital gain) that is distributed to our shareholders. We believe we have met these requirements in all periods presented herein, and we expect to continue to qualify as a REIT. Our consistent, long-term dividend policy has been to distribute our taxable income. Future quarterly distributions with respect to the common shares will continue to be determined based upon our REIT distribution requirements after taking into consideration distributions to the preferred shareholders and will be funded with cash flows from operating activities. 50 The annual distribution requirement with respect to our preferred shares outstanding at December 31, 2023 is approximately $194.7 million per year. Real Estate Investment Activities: We continue to seek to acquire additional self-storage facilities from third parties. However, future acquisition volume will depend upon whether additional owners will be motivated to market their facilities, which will in turn depend upon factors such as economic conditions and the level of seller confidence. As of December 31, 2023, we had development and expansion projects at a total cost of approximately $766.2 million. Costs incurred through December 31, 2023 were $345.5 million, with the remaining cost to complete of $420.7 million expected to be incurred primarily in the next 18 to 24 months. Some of these projects are subject to contingencies such as entitlement approval. We expect to continue to seek to add projects to maintain and increase our robust pipeline. Our ability to do so continues to be challenged by various constraints such as difficulty in finding projects that meet our risk-adjusted yield expectations and challenges in obtaining building permits for self-storage facilities in certain municipalities. Property Operating Expenses: The direct and indirect cost of our operations impose significant cash requirements. Direct operating costs include property taxes, on-site property manager payroll, repairs and maintenance, utilities, and marketing. Indirect operating costs include supervisory payroll and centralized management costs. The cash requirements from these operating costs will vary year to year based on, among other things, changes in the size of our portfolio and changes in property tax rates and assessed values, wage rates, and marketing costs in our markets. Redemption of Preferred Securities: Historically, we have taken advantage of refinancing higher coupon preferred securities with lower coupon preferred securities. In the future, we may also elect to finance the redemption of preferred securities with proceeds from the issuance of debt. As of February 20, 2024, we have three series of preferred securities that are eligible for redemption, at our option and with 30 days’ notice: our 5.150% Series F Preferred Shares ($280.0 million), 5.050% Series G Preferred Shares ($300.0 million), and 5.600% Series H Preferred Shares ($285.0 million). See Note 10 to our December 31, 2023 consolidated financial statements for the redemption dates of all of our series of preferred shares. Redemption of such preferred shares will depend upon many factors, including the rate at which we could issue replacement preferred securities. None of our preferred securities are redeemable at the option of the holders. Repurchases of Common Shares: Our Board has authorized management to repurchase up to 35,000,000 of our common shares on the open market or in privately negotiated transactions. During 2023, we did not repurchase any of our common shares. From the inception of the repurchase program through February 20, 2024, we have repurchased a total of 23,721,916 common shares at an aggregate cost of approximately $679.1 million. We have no current plans to repurchase shares; however future levels of common share repurchases will be dependent upon our available capital, investment alternatives and the trading price of our common shares. 51 ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk To limit our exposure to market risk, we are capitalized primarily with preferred and common equity. Our preferred shares are redeemable at our option generally five years after issuance, but the holder has no redemption option. Our debt, which totals approximately $9.1 billion at December 31, 2023, is the only market-risk sensitive portion of our capital structure. The fair value of our debt at December 31, 2023 is approximately $8.6 billion. The table below summarizes the annual maturities of our debt, which had a weighted average effective rate of 3.1% at December 31, 2023. See Note 8 to our December 31, 2023 consolidated financial statements for further information regarding our debt (amounts in thousands). 2024 2025 2026 2027 2028 Thereafter Total Debt $ 810,496 $ 667,247 $ 1,150,138 $ 500,146 $ 1,200,129 $ 4,825,634 $ 9,153,790 We have foreign currency exposure at December 31, 2023 related to (i) our investment in Shurgard, with a book value of $390.2 million, and a fair value of $1.7 billion based upon the closing price of Shurgard’s stock on December 31, 2023, and (ii) €1.5 billion ($1.7 billion) of Euro-denominated unsecured notes payable, providing a natural hedge against the fair value of our investment in Shurgard. ITEM 8. Financial Statements and Supplementary Data The financial statements and supplementary data appearing on pages F-3 to F-35 are incorporated herein by reference. ITEM 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure Not applicable. ITEM 9A. Controls and Procedures Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in reports we file and submit under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized, and reported within the time periods specified in accordance with SEC guidelines, and that such information is communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure based on the definition “of disclosure controls and procedures” in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures in reaching that level of reasonable assurance. We also have investments in certain unconsolidated real estate entities, and, because we do not control these entities, our disclosure controls and procedures with respect to such entities are substantially more limited than those we maintain with respect to our consolidated subsidiaries. As of December 31, 2023, we carried out an evaluation, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2023, at a reasonable assurance level. 52 Management’s Report on Internal Control Over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control- Integrated Framework issued by the Committee on Sponsoring Organizations of the Treadway Commission (2013 Framework). Based on our evaluation under the framework in Internal Control-Integrated Framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2023. The effectiveness of internal control over financial reporting as of December 31, 2023, has been audited by Ernst & Young LLP, an independent registered public accounting firm. Ernst & Young LLP’s report on our internal control over financial reporting appears below. Changes in Internal Control Over Financial Reporting There have not been any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fourth quarter of 2023 to which this report relates that have materially affected, or are reasonable likely to materially affect, our internal control over financial reporting. 53 Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Trustees of Public Storage Opinion on Internal Control Over Financial Reporting We have audited Public Storage’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Public Storage (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2023 and 2022, the related consolidated statements of income, comprehensive income, equity and redeemable noncontrolling interests and cash flows for each of the three years in the period ended December 31, 2023 and the related notes and financial statement schedule listed in the Index at Item 15(a) and our report dated February 20, 2024 expressed an unqualified opinion thereon. Basis for Opinion The 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 Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the 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 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 Los Angeles, California February 20, 2024 54 ITEM 9B. Other Information During the three months ended December 31, 2023, no trustee or officer of the Company, nor the Company itself, adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K. ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 55 ITEM 10. Trustees, Executive Officers and Corporate Governance The following is a biographical summary of the current executive officers of the Company: PART III Joseph D. Russell, Jr., age 64, has served as Chief Executive Officer since January 1, 2019, and as President since July 2016. Prior to joining Public Storage, Mr. Russell was President and Chief Executive Officer of PS Business Parks, Inc. from August 2002 to July 2016. Mr. Russell has also served as a trustee of Public Storage since January 1, 2019. H. Thomas Boyle, age 40, has served as Chief Financial Officer since January 1, 2019 and Chief Investment Officer since January 1, 2023. Previously, Mr. Boyle was Vice President and Chief Financial Officer, Operations, from November 2016, when he joined the Company, until January 2019. Prior to joining Public Storage, Mr. Boyle served in roles of increasing responsibilities with Morgan Stanley since 2005, from analyst to his last role as Executive Director, Equity and Debt Capital Markets. Mr. Boyle has served as a director of Shurgard since May 2023. Natalia N. Johnson, age 46, has served as Chief Administrative Officer since August 4, 2020. Previously, Ms. Johnson was Senior Vice President, Chief Human Resources Officer from April 2018 until August 2020, and prior to that was Senior Vice President of Human Resources, a position she held since joining the Company in July 2016. Prior to joining Public Storage, Ms. Johnson held a variety of senior management positions at Bank of America, including Chief Operating Officer for Mortgage Technology and Human Resources Executive for the Mortgage Business, and worked for Coca-Cola Andina and San Cristόbal Insurance. Ms. Johnson has served as a director of WillScot Mobile Mini Holdings Corp. since August 2023 and is a member of the Audit and Compensation committees. Nathaniel A. Vitan, age 50, has served as Senior Vice President, Chief Legal Officer and Corporate Secretary since April 20, 2019, and was previously Vice President and Chief Counsel–Litigation and Operations since joining the Company in June 2016 until April 2019. Prior to joining Public Storage, Mr. Vitan was Assistant General Counsel for Altria Client Services LLC from 2008 to 2016, and before then was a Trial and Appellate Practice attorney at Latham & Watkins LLP. Other information required by this item is hereby incorporated by reference to the material appearing in the Company’s Notice and Proxy Statement for its 2024 Annual Meeting of Shareholders, to be filed pursuant to Regulation 14A under the Exchange Act. ITEM 11. Executive Compensation The information required by this item is hereby incorporated by reference to the material appearing in the Company’s Notice and Proxy Statement for its 2024 Annual Meeting of Shareholders, to be filed pursuant to Regulation 14A under the Exchange Act. 56 ITEM 12. Matters Security Ownership of Certain Beneficial Owners and Management and Related Shareholder The following table sets forth information, as of December 31, 2023 on the Company’s equity compensation plans: Equity Compensation Plan Information 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 under equity compensation plans (excluding securities reflected in column (A)) Plan Category Equity compensation plans approved by security holders (a) (A) (B) (C) 3,724,762 (b) $ 220.18 (c) 1,364,578 Equity compensation plans not approved by security holders (d) — — — Total 3,724,762 (b) $ 220.18 (c) 1,364,578 a) b) c) d) The Company’s equity compensation plans are described more fully in Note 12 to the December 31, 2023 financial statements. All plans have been approved by the Company’s shareholders. Includes (i) stock options to purchase 3,244,606 common shares, including performance-based stock options as to which the performance period had not ended or the Compensation Committee had not certified performance as of December 31, 2023, which stock options are reflected in the table above assuming a maximum payout, (ii) 469,387 restricted share units, including performance-based restricted share units as to which the performance period had not ended as of December 31, 2023, which restricted share units are reflected in the table above assuming a maximum payout, and (iii) 10,769 fully vested deferred share units. All restricted share units, if and when vested, and all deferred share units will be settled in common shares on a one-for-one basis. Represents the weighted average exercise price of stock options to purchase 2,857,836 common shares, excluding the performance-based stock options described in footnote (b), above. The 469,387 restricted share units would vest for no consideration. There were no securities outstanding or available for future issuance under equity compensation plans not approved by the Company’s shareholders. Other information required by this item is hereby incorporated by reference to the material appearing in the Company’s Notice and Proxy Statement for its 2024 Annual Meeting of Shareholders, to be filed pursuant to Regulation 14A under the Exchange Act. ITEM 13. Certain Relationships and Related Transactions and Trustee Independence The information required by this item is hereby incorporated by reference to the material appearing in the Company’s Notice and Proxy Statement for its 2024 Annual Meeting of Shareholders, to be filed pursuant to Regulation 14A under the Exchange Act. ITEM 14. Principal Accountant Fees and Services The information required by this item is hereby incorporated by reference to the material appearing in the Company’s Notice and Proxy Statement for its 2024 Annual Meeting of Shareholders, to be filed pursuant to Regulation 14A under the Exchange Act of 1934. 57 ITEM 15. Exhibits and Financial Statement Schedules a. 1. Financial Statements PART IV The financial statements listed in the accompanying Index to Consolidated Financial Statements and Schedules hereof are filed as part of this report. 2. Financial Statement Schedules The financial statements schedules listed in the accompanying Index to Consolidated Financial Statements and Schedules are filed as part of this report. 3. Exhibits See Index to Exhibits contained herein. b. Exhibits: See Index to Exhibits contained herein. c. Financial Statement Schedules Not applicable. 58 2.1 3.1 3.2 3.3 3.4 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 PUBLIC STORAGE INDEX TO EXHIBITS (1) (Items 15(a)(3) and 15(c)) Agreement and Plan of Merger, dated August 2, 2023, by and among Old PSA, New PSA and Merger Sub. Filed as Exhibit 2.1 to the Company’s Current Report on For 8-K dated August 2, 2023 and incorporated herein by reference. Amended and Restated Declaration of Trust of Public Storage, a Maryland real estate investment trust, dated August 14, 2023. Filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K dated August 14, 2023 and incorporated herein by reference. Amended and Restated Bylaws of Public Storage. Filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K dated November 13, 2023 and incorporated herein by reference. Articles of Merger. Filed as Exhibit 3.3 to the Company’s Current Report on Form 8-K dated August 14, 2023 and incorporated herein by reference. Articles Supplementary of Public Storage, dated August 2, 2023. Filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K dated August 2, 2023 and incorporated herein by reference. Description of the Company’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. Filed herewith. Master Deposit Agreement, dated as of May 31, 2007. Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated June 6, 2007 and incorporated herein by reference. Amended and Restated Indenture, dated as of August 14, 2023, among Public Storage, Public Storage Operating Company and Computershare Trust Company, N.A. (as successor to Wells Fargo Bank, National Association), as trustee. Filed as Exhibit A to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated August 14, 2023 and incorporated herein by reference. First Supplemental Indenture, dated as of September 18, 2017, between Public Storage and Wells Fargo Bank, National Association, as trustee, including the form of Global Note representing the 2022 Notes and the form of Global Note representing the 2027 Notes. Filed as Exhibit 4.2 to the Company’s Current Report on Form 8- K dated September 18, 2017 and incorporated herein by reference. Second Supplemental Indenture, dated as of April 12, 2019, between Public Storage and Wells Fargo Bank, National Association, as trustee, including the form of Global Note representing the 2029 Notes. Filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K dated April 12, 2019 and incorporated herein by reference. Third Supplemental Indenture, dated as of January 24, 2020, between Public Storage and Wells Fargo Bank, National Association, as trustee, including the form of Global Note representing the 2032 Notes. Filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K dated January 24, 2020 and incorporated herein by reference. Fourth Supplemental Indenture, dated as of January 19, 2021, between Public Storage and Wells Fargo Bank, National Association, as trustee, including the form of Global Note representing the 2026 Notes. Filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K dated January 14, 2021 and incorporated herein by reference. Fifth Supplemental Indenture, dated as of April 23, 2021, between Public Storage and Wells Fargo Bank, National Association, as trustee, including the form of Global Note representing the Floating Rate Notes. Filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K dated April 23, 2021 and incorporated herein by reference. Sixth Supplemental Indenture, dated as of April 23, 2021, between Public Storage and Wells Fargo Bank, National Association, as trustee, including the form of Global Note representing the 2028 Notes. Filed as Exhibit 4.3 to the Company’s Current Report on Form 8-K dated April 23, 2021 and incorporated herein by reference. 59 4.10 4.11 4.12 4.13 4.14 4.15 4.16 4.17 4.18 4.19 10.1 10.2 10.3 10.4 Seventh Supplemental Indenture, dated as of April 23, 2021, between Public Storage and Wells Fargo Bank, National Association, as trustee, including the form of Global Note representing the 2031 Notes. Filed as Exhibit 4.4 to the Company’s Current Report on Form 8-K dated April 23, 2021 and incorporated herein by reference. Eighth Supplemental Indenture, dated as of September 9, 2021, between Public Storage and Wells Fargo Bank, National Association, as trustee, including the form of Global Note representing the 2030 Notes. Filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K dated September 9, 2021 and incorporated herein by reference. Ninth Supplemental Indenture, dated as of November 9, 2021, between Public Storage and Computershare Trust Company, N.A. (as successor to Wells Fargo Bank, National Association), as trustee, including the form of Global Note representing the 2026 Notes. Filed as Exhibit 4.2 to the Company’s Current Report on Form 8- K dated November 9, 2021 and incorporated herein by reference. Tenth Supplemental Indenture, dated as of November 9, 2021, between Public Storage and Computershare Trust Company, N.A. (as successor to Wells Fargo Bank, National Association), as trustee, including the form of Global Note representing the 2028 Notes. Filed as Exhibit 4.3 to the Company’s Current Report on Form 8- K dated November 9, 2021 and incorporated herein by reference. Eleventh Supplemental Indenture, dated as of November 9, 2021, between Public Storage and Computershare Trust Company, N.A. (as successor to Wells Fargo Bank, National Association), as trustee, including the form of Global Note representing the 2031 Notes. Filed as Exhibit 4.4 to the Company’s Current Report on Form 8- K dated November 9, 2021 and incorporated herein by reference. Twelfth Supplemental Indenture, dated as of July 26, 2023, between Public Storage and Computershare Trust Company, N.A. (as successor to Wells Fargo Bank, National Association), as trustee, including the form of Global Note representing the 2033 Notes. Filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K dated July 26, 2023 and incorporated herein by reference. Thirteenth Supplemental Indenture, dated as of July 26, 2023, between Public Storage and Computershare Trust Company, N.A. (as successor to Wells Fargo Bank, National Association), as trustee, including the form of Global Note representing the 2029 Notes. Filed as Exhibit 4.3 to the Company’s Current Report on Form 8- K dated July 26, 2023 and incorporated herein by reference. Fourteenth Supplemental Indenture, dated as of July 26, 2023, between Public Storage and Computershare Trust Company, N.A. (as successor to Wells Fargo Bank, National Association), as trustee, including the form of Global Note representing the 2033 Notes. Filed as Exhibit 4.4 to the Company’s Current Report on Form 8- K dated July 26, 2023 and incorporated herein by reference. Fifteenth Supplemental Indenture, dated as of July 26, 2023, between Public Storage and Computershare Trust Company, N.A. (as successor to Wells Fargo Bank, National Association), as trustee, including the form of Global Note representing the 2053 Notes. Filed as Exhibit 4.5 to the Company’s Current Report on Form 8-K dated July 26, 2023 and incorporated herein by reference. Sixteenth Supplemental Indenture, dated August 14, 2023, by and among Public Storage Operating Company, Public Storage and Computershare Trust Company, N.A. Filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated August 14, 2023 and incorporated herein by reference. Note Purchase Agreement, dated as of November 3, 2015, by and among Public Storage and the signatories thereto. Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated November 3, 2015 and incorporated herein by reference. Note Purchase Agreement, dated as of April 12, 2016, by and among Public Storage and the signatories thereto. Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated April 12, 2016 and incorporated herein by reference. Amendment No. 1 to 2015 Note Purchase Agreement, dated as of July 28, 2023, by and among Public Storage and the signatories thereto. Filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023 and incorporated herein by reference. Amendment No. 1 to 2016 Note Purchase Agreement, dated as of July 28, 2023, by and among Public Storage and the signatories thereto. Filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023 and incorporated herein by reference. 60 10.5 10.6 10.7 10.8* 10.9* 10.10* 10.11* 10.12* 10.13* 10.14* 10.15* 10.16* 10.17* 10.18* 10.19* 10.20* 10.21* Third Amended and Restated Credit Agreement, dated as of June 12, 2023, by and among the Company, the financial institutions party thereto, Wells Fargo Securities, LLC, BofA Securities, Inc. and JPMorgan Chase Bank, N.A., as Joint Bookrunners, Wells Fargo Securities, LLC, BofA Securities, Inc., JPMorgan Chase Bank, N.A., The Bank of Nova Scotia, BNP Paribas and Sumitomo Mitsui Banking Corporation, as Joint Lead Arrangers, Wells Fargo Bank, National Association, as Agent, Bank of America, N.A. and JPMorgan Chase Bank, N.A., as Co-Syndication Agents, and PNC Bank, National Association, TD Bank, N.A., The Bank of Nova Scotia, BNP Paribas and Sumitomo Mitsui Banking Corporation, as Documentation Agents. Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated June 12, 2023 and incorporated herein by reference. Parent Guarantee, dated as of August 14, 2023, by Public Storage. Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated August 14, 2023 and incorporated herein by reference. Form of Trustee and Officer Indemnification Agreement. Filed as Exhibit 10.19 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 and incorporated herein by reference. Public Storage 2007 Equity and Performance-Based Incentive Compensation Plan, as Amended (2007 Plan). Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated May 1, 2014 and incorporated herein by reference. Public Storage 2016 Equity and Performance-Based Incentive Compensation Plan (2016 Plan). Filed as Exhibit 10.6 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 and incorporated herein by reference. Public Storage 2021 Equity and Performance-Based Incentive Compensation Plan (2021 Plan). Filed as Exhibit 10.7 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 and incorporated herein by reference. Form of 2007 Plan Restricted Stock Unit Agreement. Filed as Exhibit 10.11 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 and incorporated herein by reference. Form of 2007 Plan Restricted Stock Unit Agreement (deferral of receipt of shares). Filed as Exhibit 10.12 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 and incorporated herein by reference. Form of 2007 Plan Stock Option Agreement. Filed as Exhibit 10.13 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 and incorporated herein by reference. Form of 2007 Plan Trustee Stock Option Agreement. Filed as Exhibit 10.14 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 and incorporated herein by reference. Form of 2016 Plan Restricted Stock Unit Agreement (deferral of receipt of shares). Filed as Exhibit 10.16 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 and incorporated herein by reference. Form of 2016 Plan Trustee Non-Qualified Stock Option Agreement. Filed as Exhibit 10.18 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2016 and incorporated herein by reference. Form of 2016 Plan Restricted Stock Unit Agreement (deferral of receipt of shares) (2018). Filed as Exhibit 10.26 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 and incorporated herein by reference. Form of 2016 Plan Trustee Deferred Stock Unit Agreement (2018). Filed as Exhibit 10.29 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 and incorporated herein by reference. Form of 2016 Plan Executive Restricted Stock Unit Agreement (2018). Filed as Exhibit 10.30 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 and incorporated herein by reference. Form of 2016 Employee Stock Unit Agreement (2020). Filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 and incorporated herein by reference. Form of 2016 Plan Employee Non-Qualified Stock Option Agreement (2020). Filed as Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 and incorporated herein by reference. 61 10.22* Form of 2016 Plan Performance-Based Non-Qualified Stock Option Agreement (2020). Filed as Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 and incorporated herein by reference. 10.23* Form of 2021 Plan Employee Stock Unit Agreement (2021). Filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2021 and incorporated herein by reference. 10.24* 10.25* 10.26* Form of 2021 Plan Employee Stock Unit Agreement (2022). Filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 and incorporated herein by reference. Form of 2021 Plan Trustee Non-Qualified Stock Option Agreement. Filed as Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022 and incorporated herein by reference. Form of 2021 Plan Performance-Based Non-Qualified Stock Option Agreement (2022). Filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022 and incorporated herein by reference. 10.27* Form of 2021 Plan Performance-Based Stock Unit Agreement (2022). Filed as Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022 and incorporated herein by reference. 21 23.1 31.1 31.2 32 97.1 Listing of Subsidiaries. Filed herewith. Consent of Ernst & Young LLP. Filed herewith. Rule 13a – 14(a) Certification. Filed herewith. Rule 13a – 14(a) Certification. Filed herewith. Section 1350 Certifications. Filed herewith. Policy Relating to Recovery of Erroneously Awarded Compensation. Filed herewith. 101 .INS Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) 101 .SCH Inline XBRL Taxonomy Extension Schema. Filed herewith. 101 .CAL Inline XBRL Taxonomy Extension Calculation Linkbase. Filed herewith. 101 .DEF Inline XBRL Taxonomy Extension Definition Linkbase. Filed herewith. 101 .LAB Inline XBRL Taxonomy Extension Label Linkbase. Filed herewith. 101 .PRE Inline XBRL Taxonomy Extension Presentation Link. Filed herewith. 104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) _ (1) SEC File No. 001-33519 unless otherwise indicated. * Denotes management compensatory plan agreement or arrangement. 62 Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. SIGNATURES Date: February 20, 2024 PUBLIC STORAGE By: /s/ Joseph D. Russell, Jr. Joseph D. Russell, Jr., Chief Executive Officer, President and Trustee Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Joseph D. Russell, Jr. Joseph D. Russell, Jr. /s/ H. Thomas Boyle H. Thomas Boyle /s/ Ronald L. Havner, Jr. Ronald L. Havner, Jr. Chief Executive Officer, President and Trustee (principal executive officer) February 20, 2024 Chief Financial and Investment Officer (principal financial officer) February 20, 2024 Chairman of the Board February 20, 2024 /s/ Tamara Hughes Gustavson Trustee February 20, 2024 Tamara Hughes Gustavson /s/ Leslie Stone Heisz Leslie Stone Heisz /s/ Shankh S. Mitra Shankh S. Mitra /s/ David J. Neithercut David J. Neithercut /s/ Rebecca Owen Rebecca Owen /s/ Kristy M. Pipes Kristy M. Pipes /s/ Avedick B. Poladian Avedick B. Poladian /s/ John Reyes John Reyes Trustee Trustee Trustee Trustee Trustee Trustee Trustee 63 February 20, 2024 February 20, 2024 February 20, 2024 February 20, 2024 February 20, 2024 February 20, 2024 February 20, 2024 Signature Title Date /s/ Tariq M. Shaukat Tariq M. Shaukat /s/ Ronald P. Spogli Ronald P. Spogli /s/ Paul S. Williams Paul S. Williams Trustee Trustee Trustee February 20, 2024 February 20, 2024 February 20, 2024 64 PUBLIC STORAGE INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULES (Item 15 (a)) Report of Independent Registered Public Accounting Firm Auditor name: Ernst & Young LLP; Firm ID: (42); Auditor location: Los Angeles, California Consolidated Balance Sheets as of December 31, 2023 and 2022 For the years ended December 31, 2023, 2022, and 2021: Consolidated Statements of Income Consolidated Statements of Comprehensive Income Consolidated Statements of Equity and Redeemable Noncontrolling Interests Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements Schedule: III – Real Estate and Accumulated Depreciation Page References F-1 F-3 F-4 F-5 F-6 F-8 F-10 F-33 All other schedules have been omitted since the required information is not present or not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements or notes thereto. 65 (This Page Intentionally Left Blank) Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Trustees of Public Storage Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Public Storage (the Company) as of December 31, 2023 and 2022, the related consolidated statements of income, comprehensive income, equity and redeemable noncontrolling interests and cash flows for each of the three years in the period ended December 31, 2023, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company at December 31, 2023 and 2022, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2023, 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 20, 2024 expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. F-1 Purchase Price Allocation Description of the Matter For the year ended December 31, 2023, the Company completed the acquisition of 164 self-storage facilities for a total purchase price of $2.7 billion. As further discussed in Notes 2, 3 and 4 of the consolidated financial statements, the transactions were accounted for as asset acquisitions, and the purchase price was allocated based on a relative fair value of assets acquired and liabilities assumed, which consisted principally of land, buildings and acquired customers in place. Auditing the accounting for the Company’s 2023 acquisitions of self-storage facilities was subjective because the Company, with the assistance of its external valuation specialist, must exercise a high level of management judgment in determining the estimated fair value of land, buildings and acquired customers in place. The estimated fair value of land is based upon observable transactions involving comparable land in similar locations, as adjusted for location quality, parcel size and date of sale associated with the acquired facilities. Determining the fair value of acquired land was difficult due to the judgment utilized by management in making adjustments to the observable transaction data used in the estimate, particularly when there is a lack of recent comparable land market data. The estimated fair value of the acquired buildings was based upon (i) the income approach, which included estimating the fair value of hypothetical vacant acquired buildings and adjusting for the estimated fair value of land or (ii) estimated replacement costs, which were calculated by estimating the replacement cost of new facilities in similar geographic regions and adjusting those costs for the age, quality, amenities and configuration associated with the acquired facilities. Determining the fair value of the acquired buildings was challenging due to the judgment utilized by management in determining the assumptions utilized in the income approach and replacement cost approach. The estimated fair value of the acquired customers in place was based upon the income approach, which included estimating the forgone rent over the presumed period of time to absorb the occupied spaces if they were vacant at the time of acquisition. Determining the fair value of acquired customers in place was challenging due to the judgment utilized by management in determining the assumptions used in the income approach. How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over management’s accounting for acquired self-storage facilities, including controls over the review of assumptions underlying the purchase price allocation and accuracy of the underlying data used. For example, we tested controls over the determination of the estimated fair values of the land, buildings and acquired customers in place, including the controls over the review of the valuation models and the underlying assumptions used to develop such estimates. For the 2023 acquisitions of self-storage facilities described above, our procedures included, but were not limited to, reading the purchase and sale agreements and other closing documents, evaluating whether the Company had appropriately determined the transaction was an asset acquisition or business combination and performing a sensitivity analysis to evaluate the impact on the Company’s financial statements resulting from changes in allocated land, building and acquired customers in place values. For certain of these asset acquisitions, we also evaluated the methods and significant assumptions used by the Company and tested the completeness and accuracy of the underlying data supporting the significant assumptions and estimates. Additionally, for certain of these asset acquisitions, we involved our valuation specialists to assist in the assessment of the methodology utilized by the Company and to perform corroborative analyses to assess whether the assumptions used in the valuation and the estimated fair values were supported by observable market data. /s/ Ernst & Young LLP We have served as the Company's auditor since 1980. Los Angeles, California February 20, 2024 F-2 PUBLIC STORAGE CONSOLIDATED BALANCE SHEETS (Amounts in thousands, except share data) ASSETS Cash and equivalents Real estate facilities, at cost: Land Buildings Accumulated depreciation Construction in process Investments in unconsolidated real estate entities Goodwill and other intangible assets, net Other assets Total assets LIABILITIES AND EQUITY Notes payable Accrued and other liabilities Total liabilities Commitments and contingencies (Note 15) Equity: Public Storage shareholders’ equity: December 31, 2023 December 31, 2022 $ 370,002 $ 775,253 5,628,488 21,836,750 27,465,238 (9,423,974) 18,041,264 345,453 18,386,717 390,180 387,267 275,050 5,273,073 18,946,053 24,219,126 (8,554,155) 15,664,971 372,992 16,037,963 275,752 232,517 230,822 $ $ 19,809,216 $ 17,552,307 9,103,277 $ 598,993 9,702,270 6,870,826 514,680 7,385,506 Preferred Shares, $0.01 par value, 100,000,000 shares authorized, 174,000 shares issued (in series) and outstanding, (174,000 shares at December 31, 2022) at liquidation preference Common Shares, $0.10 par value, 650,000,000 shares authorized, 175,670,727 shares issued and outstanding (175,265,668 shares at December 31, 2022) Paid-in capital Accumulated deficit Accumulated other comprehensive loss Total Public Storage shareholders’ equity Noncontrolling interests Total equity 4,350,000 4,350,000 17,567 5,980,760 (267,910) (67,239) 17,527 5,896,423 (110,231) (80,317) 10,013,178 10,073,402 93,768 93,399 10,106,946 10,166,801 Total liabilities and equity $ 19,809,216 $ 17,552,307 See accompanying notes. F-3 PUBLIC STORAGE CONSOLIDATED STATEMENTS OF INCOME (Amounts in thousands, except per share amounts) Revenues: Self-storage facilities Ancillary operations Expenses: Self-storage cost of operations Ancillary cost of operations Depreciation and amortization Real estate acquisition and development expense General and administrative Interest expense Other increases (decreases) to net income: Interest and other income Equity in earnings of unconsolidated real estate entities Foreign currency exchange (loss) gain Gain on sale of real estate Gain on sale of equity investment in PS Business Parks, Inc. Income before income tax expense Income tax expense Net income Allocation to noncontrolling interests Net income allocable to Public Storage shareholders Allocation of net income to: Preferred shareholders Preferred shareholders - redemptions (Note 10) Restricted share units Net income allocable to common shareholders Net income per common share: Basic Diluted Basic weighted average common shares outstanding Diluted weighted average common shares outstanding For the Years Ended December 31, 2023 2022 2021 $ 4,259,613 $ 3,946,028 258,077 4,517,690 236,135 4,182,163 1,061,950 85,996 970,056 26,451 80,632 201,132 2,426,217 85,590 27,897 (51,197) 17,178 — 2,170,941 (10,821) 980,209 72,698 888,146 28,744 71,672 136,319 2,177,788 40,567 106,981 98,314 1,503 2,128,860 4,380,600 (14,326) 3,203,566 212,258 3,415,824 852,030 68,568 713,428 12,923 75,966 90,774 1,813,689 12,306 232,093 111,787 13,683 — 1,972,004 (12,365) 2,160,120 4,366,274 1,959,639 (11,793) (17,127) (6,376) 2,148,327 4,349,147 1,953,263 $ $ $ (194,703) (194,390) — (4,883) 1,948,741 11.11 11.06 175,472 176,143 $ $ $ — (12,469) 4,142,288 23.64 23.50 175,257 176,280 $ $ $ (186,579) (28,914) (5,326) 1,732,444 9.91 9.87 174,858 175,568 See accompanying notes. F-4 PUBLIC STORAGE CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Amounts in thousands) For the Years Ended December 31, 2023 2022 2021 Net income Foreign currency translation gain (loss) on investment in Shurgard Total comprehensive income Allocation to noncontrolling interests $ 2,160,120 $ 4,366,274 $ 1,959,639 13,078 2,173,198 (11,793) (26,730) (10,186) 4,339,544 1,949,453 (17,127) (6,376) Comprehensive income allocable to Public Storage shareholders $ 2,161,405 $ 4,322,417 $ 1,943,077 See accompanying notes. F-5 e l b a m e e d e R g n i l l o r t n o c n o N s t s e r e t n I y t i u q E l a t o T g n i l l o r t n o c n o N s t s e r e t n I l a t o T e g a r o t S c i l b u P ' s r e d l o h e r a h S y t i u q E d e t a l u m u c c A r e h t O e v i s n e h e r p m o C d e t a l u m u c c A e v i t a l u m u C s s o L t i c i f e D l a t i p a C n i - d i a P s e r a h S n o m m o C s e r a h S d e r r e f e r P E G A R O T S C I L B U P S T S E R E T N I G N I L L O R T N O C N O N E L B A M E E D E R D N A Y T I U Q E F O S T N E M E T A T S D E T A D I L O S N O C ) s t n u o m a e r a h s r e p d n a e r a h s t p e c x e , s d n a s u o h t n i s t n u o m A ( $ 9 9 8 , 6 7 5 , 8 $ 2 3 0 , 8 1 $ 7 6 8 , 8 5 5 , 8 $ ) 1 0 4 , 3 4 ( $ ) 1 9 7 , 4 1 9 ( $ 1 0 1 , 7 0 7 , 5 $ 8 5 4 , 7 1 $ 0 0 5 , 2 9 7 , 3 $ 0 2 0 2 , 1 3 r e b m e c e D t a s e c n a l a B — — — — — — — 0 7 4 — — ) 1 9 3 ( — — 0 7 1 , 8 6 5 5 4 , 7 4 1 , 1 ) 0 0 0 , 5 7 8 ( 0 6 8 , 5 9 ) 2 9 6 ( 1 5 4 , 2 2 9 4 , 4 5 ) 0 7 4 ( 9 3 6 , 9 5 9 , 1 — — — — ) 6 ( 1 5 4 , 2 — 6 0 9 , 5 ) 6 8 1 , 0 1 ( ) 9 0 3 , 2 0 4 , 1 ( — — ) 1 7 2 , 6 ( ) 9 7 5 , 6 8 1 ( — ) 1 7 2 , 6 ( 5 5 4 , 7 4 1 , 1 ) 0 0 0 , 5 7 8 ( 0 6 8 , 5 9 2 9 4 , 4 5 ) 6 8 6 ( — ) 6 7 3 , 6 ( 9 3 6 , 9 5 9 , 1 — ) 9 7 5 , 6 8 1 ( ) 9 0 3 , 2 0 4 , 1 ( — — — — — — — — — — — — — — — — — ) 6 7 3 , 6 ( 9 3 6 , 9 5 9 , 1 — ) 9 7 5 , 6 8 1 ( ) 9 0 3 , 2 0 4 , 1 ( ) 6 8 1 , 0 1 ( ) 6 8 1 , 0 1 ( — — ) 5 4 0 , 5 3 ( 5 0 8 , 5 9 ) 6 8 6 ( 2 9 4 , 4 5 — — — — — — — — — 5 5 — — — — — — — — — 0 0 5 , 2 8 1 , 1 ) 0 1 e t o N ( s e r a h s d e r r e f e r p 0 0 3 , 7 4 f o e c n a u s s I — — — — — — — — — — ) 0 0 0 , 5 7 8 ( e t o N ( s e r a h s d e r r e f e r p 0 0 0 , 5 3 f o n o i t p m e d e R ) 0 1 h t i w n o i t c e n n o c n i s e r a h s n o m m o c f o e c n a u s s I ) s e r a h s 3 1 7 , 2 5 5 ( n o i t a s n e p m o c d e s a b - e r a h s ) 2 1 e t o N ( h s a c f o t e n , e s n e p x e n o i t a s n e p m o c d e s a b - e r a h S ) 2 1 e t o N ( s e r a h s n o m m o c f o u e i l n i d i a p s t s e r e t n i g n i l l o r t n o c n o n y b s n o i t u b i r t n o C s t s e r e t n i g n i l l o r t n o c n o n f o n o i t i s i u q c A e m o c n i t e N s t s e r e t n i g n i l l o r t n o c n o n o t d e t a c o l l a e m o c n i t e N e r a h s d e t c i r t s e r d n a s r e d l o h e r a h s n o m m o C ) e r a h s r e p 0 0 . 8 $ ( s r e d l o h t i n u 1 2 0 2 , 1 3 r e b m e c e D t a s e c n a l a B s s o l e v i s n e h e r p m o c r e h t O ) 0 1 e t o N ( s r e d l o h e r a h s d e r r e f e r P s t s e r e t n i g n i l l o r t n o c n o N : o t s n o i t u b i r t s i D 9 4 2 , 8 6 $ 9 8 2 , 5 5 3 , 9 $ 2 1 1 , 0 2 $ 7 7 1 , 5 3 3 , 9 $ ) 7 8 5 , 3 5 ( $ ) 6 1 4 , 0 5 5 ( $ 7 6 6 , 1 2 8 , 5 $ 3 1 5 , 7 1 $ 0 0 0 , 0 0 1 , 4 $ — — — — — 6 2 4 , 5 1 2 3 8 , 2 4 2 — 5 0 4 , 5 3 ) 7 2 8 , 6 1 ( 0 6 3 , 3 6 8 0 7 , 6 — — — — — 8 0 7 , 6 ) 6 2 8 , 3 8 ( 6 2 8 , 3 8 6 2 8 , 3 8 2 3 8 , 2 4 2 — 5 0 4 , 5 3 ) 7 2 8 , 6 1 ( 0 6 3 , 3 6 — — — 4 7 2 , 6 6 3 , 4 — 4 7 2 , 6 6 3 , 4 — — — — — — — — — — — — — — — 4 7 2 , 6 6 3 , 4 ) 8 6 1 , 7 ( — 0 0 0 , 0 5 2 ) 0 1 e t o N ( s e r a h s d e r r e f e r p 0 0 0 , 0 1 f o e c n a u s s I 5 1 6 7 3 , 5 3 ) 7 2 8 , 6 1 ( 0 6 3 , 3 6 — — — 9 2 ) 5 1 ( — — — — — — — — — — — — h t i w n o i t c e n n o c n i s e r a h s n o m m o c f o e c n a u s s I ) s e r a h s 0 9 1 , 3 8 2 ( n o i t a s n e p m o c d e s a b - e r a h s ) 2 1 e t o N ( ) s e r a h s 7 7 9 , 1 5 1 ( s e r a h s n o m m o c f o t n e m e r i t e R ) 2 1 e t o N ( e s n e p x e n o i t a s n e p m o c d e s a b - e r a h S g n i l l o r t n o c n o n o t s t s e r e t n i g n i l l o r t n o c n o n e l b a m e e d e r m o r f n o i t a c i f i s s a l c e R s t s e r e t n i g n i l l o r t n o c n o n y b s n o i t u b i r t n o C f o t n e m e l t t e s e r a h s t e n n o p u d i a p s e x a T s t i n u e r a h s d e t c i r t s e r s t s e r e t n i e m o c n i t e N . s e t o n g n i y n a p m o c c a e e S 6 - F — — — — — — — — — — — — — — 0 6 6 ) 0 6 6 ( 7 6 4 , 6 1 ) 7 2 1 , 7 1 ( e l b a m e e d e R g n i l l o r t n o c n o N s t s e r e t n I y t i u q E l a t o T g n i l l o r t n o c n o N s t s e r e t n I l a t o T e g a r o t S c i l b u P ' s r e d l o h e r a h S y t i u q E — ) 9 0 5 ( ) 0 9 3 , 4 9 1 ( ) 4 1 7 , 3 3 ( ) 4 1 7 , 3 3 ( — — ) 0 9 3 , 4 9 1 ( — — — — ) 7 2 1 , 7 1 ( — ) 0 9 3 , 4 9 1 ( ) 2 7 5 , 4 1 7 , 3 ( — — — — — — — — — — — — — — — d e t a l u m u c c A r e h t O e v i s n e h e r p m o C d e t a l u m u c c A e v i t a l u m u C s s o L t i c i f e D l a t i p a C n i - d i a P s e r a h S n o m m o C s e r a h S d e r r e f e r P ) 0 3 7 , 6 2 ( ) 2 7 5 , 4 1 7 , 3 ( — — ) 2 7 5 , 4 1 7 , 3 ( ) 0 3 7 , 6 2 ( ) 0 3 7 , 6 2 ( — $ 1 0 8 , 6 6 1 , 0 1 $ 9 9 3 , 3 9 $ 2 0 4 , 3 7 0 , 0 1 $ ) 7 1 3 , 0 8 ( $ ) 1 3 2 , 0 1 1 ( $ 3 2 4 , 6 9 8 , 5 $ 7 2 5 , 7 1 $ 0 0 0 , 0 5 3 , 4 $ 6 8 3 , 3 5 ) 0 5 9 , 3 1 ( 1 4 9 , 4 4 3 0 2 , 3 — 0 2 1 , 0 6 1 , 2 — — — — 3 0 2 , 3 3 9 7 , 1 1 6 8 3 , 3 5 — ) 0 5 9 , 3 1 ( 1 4 9 , 4 4 ) 3 9 7 , 1 1 ( 0 2 1 , 0 6 1 , 2 ) 3 0 7 , 4 9 1 ( ) 7 2 6 , 4 1 ( ) 7 2 6 , 4 1 ( — — ) 3 0 7 , 4 9 1 ( — — — — — — — — — — — — — ) 3 9 7 , 1 1 ( 0 2 1 , 0 6 1 , 2 — ) 3 0 7 , 4 9 1 ( ) 3 0 3 , 1 1 1 , 2 ( 6 4 3 , 3 5 ) 0 5 9 , 3 1 ( 1 4 9 , 4 4 — — — — — — — 0 4 — — — — — — — — — — — — — — — — — — — 8 7 0 , 3 1 ) 3 0 3 , 1 1 1 , 2 ( — — ) 3 0 3 , 1 1 1 , 2 ( 8 7 0 , 3 1 8 7 0 , 3 1 — $ 6 4 9 , 6 0 1 , 0 1 $ 8 6 7 , 3 9 $ 8 7 1 , 3 1 0 , 0 1 $ ) 9 3 2 , 7 6 ( $ ) 0 1 9 , 7 6 2 ( $ 0 6 7 , 0 8 9 , 5 $ 7 6 5 , 7 1 $ 0 0 0 , 0 5 3 , 4 $ . s e t o n g n i y n a p m o c c a e e S 7 - F s t s e r e t n i g n i l l o r t n o c n o n o t d e t a c o l l a e m o c n i t e N e r a h s d e t c i r t s e r d n a s r e d l o h e r a h s n o m m o C ) e r a h s r e p 5 1 . 1 2 $ ( s r e d l o h t i n u 2 2 0 2 , 1 3 r e b m e c e D t a s e c n a l a B s s o l e v i s n e h e r p m o c r e h t O h t i w n o i t c e n n o c n i s e r a h s n o m m o c f o e c n a u s s I ) s e r a h s 9 5 0 , 5 0 4 ( n o i t a s n e p m o c d e s a b - e r a h s ) 2 1 e t o N ( f o t n e m e l t t e s e r a h s t e n n o p u d i a p s e x a T s t i n u e r a h s d e t c i r t s e r ) 2 1 e t o N ( t s o c n o i t a s n e p m o c d e s a b - e r a h S s t s e r e t n i g n i l l o r t n o c n o n y b s n o i t u b i r t n o C e m o c n i t e N s t s e r e t n i g n i l l o r t n o c n o n o t d e t a c o l l a e m o c n i t e N e r a h s d e t c i r t s e r d n a s r e d l o h e r a h s n o m m o C ) e r a h s r e p 0 0 . 2 1 $ ( s r e d l o h t i n u 3 2 0 2 , 1 3 r e b m e c e D t a s e c n a l a B e m o c n i e v i s n e h e r p m o c r e h t O ) 0 1 e t o N ( s r e d l o h e r a h s d e r r e f e r P s t s e r e t n i g n i l l o r t n o c n o N : o t s n o i t u b i r t s i D ) 0 1 e t o N ( s r e d l o h e r a h s d e r r e f e r P s t s e r e t n i g n i l l o r t n o c n o N : o t s n o i t u b i r t s i D PUBLIC STORAGE CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) Cash flows from operating activities: Net income For the Years Ended December 31, 2023 2022 2021 $ 2,160,120 $ 4,366,274 $ 1,959,639 Adjustments to reconcile net income to net cash flows from operating activities: Gain on sale of equity investment in PS Business Parks, Inc. — (2,128,860) Gain on sale of real estate Depreciation and amortization Equity in earnings of unconsolidated real estate entities Distributions from cumulative equity in earnings of unconsolidated real estate entities Unrealized foreign currency exchange loss (gain) Share-based compensation expense Other non-cash adjustments Changes in operating assets and liabilities, excluding the impact of acquisitions: Other assets Accrued and other liabilities Net cash flows from operating activities Cash flows from investing activities: Capital expenditures to maintain real estate facilities Capital expenditures for property enhancements Capital expenditures for energy efficiencies (LED lighting, solar) Development and expansion of real estate facilities Acquisition of real estate facilities and intangible assets Acquisition of BREIT Simply Storage LLC, net of cash acquired Distributions in excess of cumulative equity in earnings from unconsolidated real estate entities Contributions to unconsolidated real estate entities Proceeds from sale of real estate investments Proceeds from sale of equity investment in PS Business Parks, Inc. Net cash flows (used in) from investing activities Cash flows from financing activities: Issuance costs on amendment of credit facility Repayments of notes payable Issuance of notes payable, net of issuance costs Issuance of preferred shares Issuance of common shares in connection with share-based compensation Redemption of preferred shares Taxes paid upon net share settlement of restricted share units Acquisition of noncontrolling interests Contributions by noncontrolling interests (17,178) 970,056 (27,897) 29,333 51,239 41,566 20,508 (16,365) 35,266 (1,503) 888,146 (106,981) 134,769 (97,563) 56,703 15,207 (29,638) 20,587 — (13,683) 713,428 (232,093) 150,488 (111,787) 59,815 4,883 (44,127) 56,992 3,246,648 3,117,141 2,543,555 (236,572) (159,939) (64,626) (364,445) (473,176) (2,178,151) 10,975 (112,554) 39,986 — (3,538,502) (8,377) (8,259) 2,181,273 — 53,131 — (13,950) — 3,203 (218,713) (189,699) (51,361) (313,511) (757,944) — 13,670 — 1,543 2,636,011 1,119,996 — (513,495) — 242,832 35,271 — (16,827) — 1,669 (136,989) (103,730) (29,519) (281,981) (5,047,106) — 19,518 — 16,296 — (5,563,511) — (2,218) 5,038,904 1,147,455 95,860 (1,175,000) (13,069) (692) 2,451 Distributions paid to preferred shareholders, common shareholders and restricted share unitholders Distributions paid to noncontrolling interests Net cash flows (used in) from financing activities Net cash flows (used in) from operating, investing, and financing activities Net effect of foreign exchange impact on cash and equivalents, including restricted cash (2,305,322) (3,908,497) (1,588,888) (14,627) (112,928) (404,782) — (34,223) (4,193,270) 43,867 — (6,662) 3,498,141 478,185 505 Net (decrease) increase in cash and equivalents, including restricted cash $ (404,782) $ 43,867 $ 478,690 See accompanying notes. F-8 PUBLIC STORAGE CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) Cash and equivalents, including restricted cash at beginning of the period: Cash and equivalents Restricted cash included in other assets Cash and equivalents, including restricted cash at end of the period: Cash and equivalents Restricted cash included in other assets Supplemental schedule of non-cash investing and financing activities: Costs incurred during the period remaining unpaid at period end for: Capital expenditures to maintain real estate facilities Capital expenditures for property enhancements Capital expenditures for energy efficiencies (LED lighting, solar) Construction or expansion of real estate facilities $ $ $ $ $ For the Years Ended December 31, 2023 2022 2021 775,253 $ 734,599 $ 29,904 26,691 805,157 $ 761,290 $ 370,002 $ 775,253 $ 30,373 29,904 400,375 $ 805,157 $ 257,560 25,040 282,600 734,599 26,691 761,290 (10,798) $ (9,903) $ (3,046) (386) (68,099) (4,502) (855) (65,650) (10,879) (11,726) (775) (50,051) Real estate acquired in exchange for noncontrolling interests — (19,865) (68,170) Supplemental cash flow information: Cash paid for interest, net of amounts capitalized $ 146,213 $ 127,711 $ Cash paid for income taxes, net of refunds 11,056 11,293 74,192 12,696 See accompanying notes. F-9 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 1. Description of the Business Public Storage (referred to herein as “the Company,” “we,” “us,” or “our”) is a Maryland real estate investment trust (“REIT”) engaged in the ownership and operation of self-storage facilities that offer storage spaces for lease, generally on a month-to-month basis, for personal and business use, ancillary activities such as tenant reinsurance, merchandise sales, and third party management, as well as the acquisition and development of additional self-storage space. On August 14, 2023, the Company completed a reorganization in which its interest in its facilities is now held through an operating partnership, Public Storage OP, L.P. (“PSA OP”) and its subsidiaries including Public Storage Operating Company (“PSOC”), formerly known as Public Storage. This structure is commonly referred to as an umbrella partnership REIT, or UPREIT. The reorganization was accounted for as a transaction between entities under common control and there was no change in the Company’s total assets, liabilities or results of operations. Subsequent to the reorganization, the primary assets of the parent entity, Public Storage, are general partner and limited partner interests in PSA OP, which holds all of the Company’s assets through its ownership of all of the membership interests in PSOC. As of December 31, 2023, the Company owned all of the limited partnership interests of PSA OP. At December 31, 2023, we owned equity interests in 3,044 self-storage facilities (with approximately 218.1 million net rentable square feet) located in 40 states in the United States (“U.S.”) operating under the Public Storage® name, and 1.2 million net rentable square feet of commercial and retail space. In addition, we managed 210 facilities for third parties at December 31, 2023. At December 31, 2023, we owned a 35% common equity interest in Shurgard Self Storage Limited (“Shurgard”), a public company traded on the Euronext Brussels under the “SHUR” symbol, which owned 275 self- storage facilities (with approximately 15 million net rentable square feet) located in seven Western European countries, all operating under the Shurgard® name. 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation We have prepared the accompanying consolidated financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) as set forth in the Accounting Standards Codification of the Financial Accounting Standards Board, and in conformity with the rules and regulations of the Securities and Exchange Commission (“SEC”). We revised our prior period financial statements to correct the presentation of income tax expense in the Consolidated Statements of Income. Income tax expense in the amounts of $14.3 million and $12.4 million for 2022 and 2021, respectively, previously included in general and administrative expense, has been reclassified and presented separately in the Consolidated Statements of Income to conform to the 2023 presentation. This immaterial correction had no impact on our net income. The correction also had no impact on our balance sheet, statements of comprehensive income, statements of equity, or cash flows as of and for the years ended December 31, 2022 and 2021. Certain amounts previously reported in our 2022 and 2021 Consolidated Statements of Income have been reclassified to conform to the 2023 presentation, with respect to the separate presentation of real estate acquisition and development expense in the amounts of $28.7 million and $12.9 million for 2022 and 2021, respectively, previously included in general and administrative expense. The reclassifications had no impact on our net income. Certain amounts previously reported in our 2022 and 2021 Statements of Cash Flows have been reclassified to conform to the 2023 presentation, with respect to the separate presentation of changes in operating assets and liabilities in the cash flows from operating activities section and major types of capital expenditures in the cash flows from investing activities section. The reclassifications did not affect the subtotals for cash flows from operating, investing or financing activities. F-10 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 Disclosures of the number and square footage of facilities, as well as the number and coverage of tenant reinsurance policies (Note 15) are unaudited and outside the scope of our independent registered public accounting firm’s audit of our financial statements in accordance with the standards of the Public Company Accounting Oversight Board (U.S.). Summary of Significant Accounting Policies Consolidation and Equity Method of Accounting We consider entities to be Variable Interest Entities (“VIEs”) when they have insufficient equity to finance their activities without additional subordinated financial support provided by other parties, or the equity holders as a group do not have a controlling financial interest. In addition, we have general partner interests in limited partnerships along with third-party investors to develop, construct or operate self-storage facilities. As the general partner, we consider the limited partnerships to be VIEs if the limited partners lack both substantive participating rights and substantive kick-out rights. We consolidate VIEs when we have (i) the power to direct the activities most significantly impacting economic performance, and (ii) either the obligation to absorb losses or the right to receive benefits from the VIE. PSA OP met the definition of a VIE and is consolidated by the Company as the primary beneficiary of PSA OP. All of the assets and liabilities of the Company are held by PSA OP. The total assets, primarily real estate assets, and the total liabilities of our other consolidated VIEs are not material as of December 31, 2023. We consolidate all other entities when we control them through voting shares or contractual rights. We refer to the entities we consolidate, for the period in which the reference applies, collectively as the “Subsidiaries,” and we eliminate intercompany transactions and balances. We account for our investments in entities that we do not consolidate but over which we have significant influence using the equity method of accounting. We refer to these entities, for the periods in which the reference applies, collectively as the “Unconsolidated Real Estate Entities,” and we eliminate intra-entity profits and losses and amortize any differences between the cost of our investment and the underlying equity in net assets against equity in earnings as if the Unconsolidated Real Estate Entity were a consolidated subsidiary. Equity in earnings of unconsolidated real estate entities presented on our income statements represents our pro-rata share of the earnings of the Unconsolidated Real Estate Entities. The dividends we receive from the Unconsolidated Real Estate Entities are reflected on our consolidated statements of cash flows as “distributions from cumulative equity in earnings of unconsolidated real estate entities” to the extent of our cumulative equity in earnings, with any excess classified as “distributions in excess of cumulative equity in earnings from unconsolidated real estate entities.” Use of Estimates The preparation of consolidated financial statements and accompanying notes in conformity with GAAP requires us to make estimates and assumptions that affect the amounts reported. Actual results could differ from those estimates and assumptions. Cash Equivalents and Restricted Cash Cash equivalents represent highly liquid financial instruments that mature within three months of acquisition such as money market funds with a rating of at least AAA by Standard & Poor’s, commercial paper that is rated A1 by Standard & Poor’s or deposits with highly rated commercial banks. Restricted cash, which represent amounts used to collateralize our insurance obligations and are restricted from general corporate use, are included in other assets. Fair Value As used herein, the term “fair value” is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. In the absence of active markets for identical assets or liabilities, such measurements involve developing assumptions based on market observable data and, in the absence of such data, internal information that is consistent with what market participants would use in a hypothetical transaction that occurs at the balance sheet date. F-11 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 Assets and liabilities recorded at fair value are measured and classified in accordance with a three-tier fair value hierarchy based on the observability of the inputs available in the market used to measure fair value: Level 1 Quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2 Significant observable inputs other than Level 1, that are observable for the asset or liability, either directly or indirectly through corroboration with observable market data. Level 3 Unobservable inputs that are supported by little or no market data for the related assets or liabilities. The categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Our financial instruments consist of cash and cash equivalents, restricted cash, other assets, other liabilities, and notes payable. Cash equivalents, restricted cash, other assets and other liabilities are stated at book value, which approximates fair value as of the balance sheet date due to the short time period to maturity. We estimate and disclose the fair value of our notes payable using Level 2 inputs by discounting the related future cash flows at a rate based upon quoted interest rates for securities that have similar characteristics such as credit quality and time to maturity. We use significant judgment to estimate fair values of real estate facilities, goodwill, and other intangible assets for the purposes of purchase price allocation or impairment analysis. In estimating their values, we consider Level 3 inputs such as market prices of land, market capitalization rates, expected returns, earnings multiples, projected levels of earnings, costs of construction, and functional depreciation. Real Estate Facilities We record real estate facilities at cost. We capitalize all costs incurred to acquire, develop, construct, renovate and improve facilities as part of major repair and maintenance programs, including interest and property taxes incurred during the construction period. We expense the costs of demolition of existing facilities associated with a renovation as incurred. We allocate the net acquisition cost of acquired real estate facilities to the underlying land, buildings, and identified intangible assets based upon their respective individual estimated fair values. We expense costs associated with dispositions of real estate, as well as routine repairs and maintenance costs, as incurred. We depreciate buildings and improvements on a straight-line basis over estimated useful lives ranging generally between 5 to 25 years. When we sell a full or partial interest in a real estate facility without retaining a controlling interest following sale, we recognize a gain or loss on sale as if 100% of the property was sold at fair value. If we retain a controlling interest following the sale, we record a noncontrolling interest for the book value of the partial interest sold, and recognize additional paid-in capital for the difference between the consideration received and the partial interest at book value. Goodwill and Other Intangible Assets Intangible assets consist of goodwill, the Shurgard® trade name, which Shurgard uses pursuant to a fee-based licensing agreement, and finite-lived assets. Goodwill and the Shurgard® trade name have indefinite lives and are not amortized. Our finite-lived assets consist primarily of (i) acquired customers in place amortized relative to the benefit of the customers in place, with such amortization reflected as depreciation and amortization expense on our income statement, (ii) property tax abatements acquired and amortized relative to the reduction in property tax paid, with such amortization reflected as self-storage cost of operations on our income statement and (iii) acquired non real estate- related contracts, with such amortization reflected as depreciation and amortization expense on our income statement. F-12 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 Evaluation of Asset Impairment We evaluate our real estate and finite-lived intangible assets for impairment each quarter. If there are indicators of impairment and we determine that the asset is not recoverable from future undiscounted cash flows to be received through the asset’s remaining life (or, if earlier, the expected disposal date), we record an impairment charge to the extent the carrying amount exceeds the asset’s estimated fair value or net proceeds from expected disposal. We evaluate our investments in unconsolidated real estate entities for impairment quarterly. We record an impairment charge to the extent the carrying amount exceeds estimated fair value, when we believe any such shortfall is other than temporary. We evaluate goodwill for impairment annually and whenever relevant events, circumstances, and other related factors indicate that it is more likely than not that the fair value of the related reporting unit is less than the carrying amount. When we conclude that it is not more likely than not that the fair value of the reporting unit is less than the aggregate carrying amount, no impairment charge is recorded and no further analysis is performed. Otherwise, we record an impairment charge to the extent the carrying amount of the goodwill exceeds the amount that would be allocated to goodwill if the reporting unit were acquired for estimated fair value. We evaluate other indefinite-lived intangible assets, such as the Shurgard® trade name for impairment at least annually and whenever relevant events, circumstances and other related factors indicate that it is more likely than not that the asset is impaired. When we conclude that it is not more likely than not that the asset is impaired, we do not record an impairment charge and no further analysis is performed. Otherwise, we record an impairment charge to the extent the carrying amount exceeds the asset’s estimated fair value. No impairments were recorded in any of our evaluations for any period presented herein. Revenue and Expense Recognition We recognize revenues from self-storage facilities, which primarily comprise rental income earned pursuant to month-to-month leases, as well as associated late charges and administrative fees, as earned. Promotional discounts reduce rental income over the promotional period, which is generally one month. We recognize ancillary revenues when earned. We accrue for property tax expense based upon actual amounts billed and, in some circumstances, estimates when bills or assessments have not been received from the taxing authorities. If these estimates are incorrect, the timing and amount of expense recognition could be incorrect. We expense cost of operations (including advertising expenditures), general and administrative expense, and interest expense as incurred. Foreign Currency Exchange Translation The local currency (primarily the Euro) is the functional currency for our interests in foreign operations. The related balance sheet amounts are translated into U.S. Dollars at the exchange rates at the respective financial statement date, while amounts on our consolidated statements of income are translated at the average exchange rates during the respective period. Cumulative translation adjustments, are included in equity as a component of accumulated other comprehensive income (loss). When financial instruments denominated in a currency other than the U.S. Dollar are expected to be settled in cash in the foreseeable future, the impact of changes in the U.S. Dollar equivalent are reflected in current earnings. At December 31, 2023, due primarily to our investment in Shurgard (Note 5) and our notes payable denominated in Euros (Note 8), our operating results and financial position are affected by fluctuations in currency exchange rates between the Euro, and to a lesser extent, other European currencies, against the U.S. Dollar. The Euro was translated at exchange rates of approximately 1.104 U.S. Dollars per Euro at December 31, 2023 (1.070 at December 31, 2022), and average exchange rates of 1.081, 1.054 and 1.183 for the years ended December 31, 2023, 2022, and 2021, respectively. F-13 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 Income Taxes We and a subsidiary of PSOC have elected to be treated as a REIT, as defined in the Internal Revenue Code of 1986, as amended (the “Code”). For each taxable year in which we qualify for taxation as a REIT, we will not be subject to U.S. federal corporate income tax on our “REIT taxable income” (generally, taxable income subject to specified adjustments, including a deduction for dividends paid and excluding our net capital gain) that is distributed to our shareholders. We believe we have met these REIT requirements for all periods presented herein. Accordingly, we have recorded no U.S. federal corporate income tax expense related to our REIT taxable income. We have elected taxable REIT subsidiary (“TRS”) status for some of our consolidated subsidiaries. Our tenant reinsurance, merchandise, and third party management operations are conducted under these TRSs and are subject to federal corporate income tax. For these entities, deferred tax assets and liabilities for temporary differences are recognized based on the future tax consequences attributable to differences that exist between the financial statement carrying amounts of assets and liabilities and their respective tax bases, as well as tax attributes such as operating loss, capital loss and tax credits carryforwards on a taxing jurisdiction basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts that are expected more likely than not to be realized in the future. We recognize tax benefits of uncertain income tax positions only if we believe it is more likely than not that the position would ultimately be sustained assuming the relevant taxing authorities had full knowledge of the relevant facts and circumstances of our positions. As of December 31, 2023, we had no tax benefits that were not recognized. We also incur income taxes in certain state and local jurisdictions, which are included in income tax expense in the Consolidated Statements of Income. Share-Based Compensation We generally estimate the fair value of share-based payment awards on the date of grant. We determine the fair value of restricted share units (“RSUs”) with no market conditions based on the closing market price of the Company’s common shares on the date of grant. We value stock options with no market conditions at the grant date using the Black-Scholes option-pricing model. We value stock options and RSUs with market conditions at the grant date using a Monte-Carlo valuation simulation. Our determination of the fair value of share-based payment awards on the date of grant using an option-pricing model or Monte-Carlo valuation simulation is affected by our stock price as well as assumptions regarding a number of subjective and complex variables. These variables include, but are not limited to, our expected stock price volatility over the expected term of the awards. For stock options, variables also include actual and projected stock option exercise behaviors. For restricted share units and stock options with performance conditions, we adjust compensation cost each quarter as needed for any changes in the assessment of the probability that the specified performance criteria will be achieved. We amortize the grant-date fair value of awards as compensation expense over the service period, which begins on the grant date and ends on the expected vesting date. For awards that are earned solely upon the passage of time and continued service, the entire cost of the award is amortized on a straight-line basis over the service period. For awards with market and/or performance conditions, the individual cost of each vesting is amortized separately over each individual service period (the “accelerated attribution” method). For awards with performance conditions, the estimated number of stock awards that will ultimately vest requires judgment, and to the extent actual results or updated estimates differ from our current estimates, such amounts will be recorded as a cumulative adjustment in the period estimates are revised. In amortizing share-based compensation expense, we do not estimate future forfeitures. Instead, we reverse previously amortized share-based compensation expense with respect to grants that are forfeited in the period the employee terminates employment. F-14 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 Our share-based compensation plans allow immediate vesting of outstanding unvested awards upon retirement (“Retirement Acceleration”) for employees who meet certain conditions. We accelerate amortization of compensation expense for each grant by changing the end of the service period from the original vesting date to the date an employee is expected to be eligible for Retirement Acceleration, if earlier. Recent Accounting Pronouncements Not Yet Adopted In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosure, to require a public entity to disclose significant segment expenses and other segment items on an annual and interim basis and to provide in interim periods all disclosures about a reportable segment’s profit or loss and assets that are currently required annually. Public entities with a single reportable segment are required to provide the new disclosures and all the disclosures required under ASC 280. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, on a retrospective basis. Early adoption is permitted. We are currently evaluating the impact of this ASU on our Consolidated Financial Statements and related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, to enhance the transparency and decision-usefulness of income tax disclosures, particularly in the rate reconciliation table and disclosures about income taxes paid. The ASU’s amendments are effective for annual periods beginning after December 15, 2024 on a prospective basis. Early adoption is permitted. We are currently evaluating the impact of this ASU on our Consolidated Financial Statements and related disclosures. 3. Simply Acquisition On September 13, 2023, we acquired all the membership interests of BREIT Simply Storage LLC, a self- storage company that owns and operates 127 self-storage facilities (9.4 million net rentable square feet) and manages 25 self-storage facilities for third parties, for a purchase price of $2.2 billion in cash, including cash acquired of $6.0 million and direct transaction costs of $9.6 million (the “Simply Acquisition”). We accounted for the Simply Acquisition as an asset acquisition because substantially all the fair value of the gross assets acquired is concentrated in the real estate assets and intangible assets associated with the self-storage facilities, which are determined to be similar in nature. As a result, the direct transaction costs of $9.6 million were capitalized to the basis of the acquired properties. The total purchase price was allocated to the individual assets acquired and liabilities assumed based on their relative fair values. The total purchase price, including direct transaction costs, was allocated as follows (in thousands): Cash Real estate facilities: Land Buildings Construction in process Intangible assets: Acquired customers in place Non real estate-related contracts Other assets Accrued and other liabilities $ 6,032 229,396 1,762,752 2,922 209,516 4,750 12,046 (43,231) Total purchase price, including direct transaction costs $ 2,184,183 F-15 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 4. Real Estate Facilities Activity in real estate facilities during 2023, 2022, and 2021 is as follows: 2023 For the Years Ended December 31, 2022 (Amounts in thousands) 2021 Operating facilities, at cost: $ Beginning balance Capital expenditures to maintain real estate facilities Capital expenditures for property enhancements Capital expenditures for energy efficiencies (LED lighting, solar) Acquisitions Dispositions and other Developed or expanded facilities opened for operation Ending balance 24,219,126 $ 232,048 163,380 65,026 2,442,118 (19,322) 362,862 27,465,238 22,807,833 $ 205,169 194,931 52,216 733,442 (1,704) 227,239 24,219,126 17,372,627 137,428 116,478 30,294 4,940,413 (7,408) 218,001 22,807,833 Accumulated depreciation: Beginning balance Depreciation expense Dispositions and other Ending balance Construction in process: Beginning balance Costs incurred to develop and expand real estate facilities Acquisitions Write-off of cancelled projects and transfer to other assets Developed or expanded facilities opened for operation Ending balance (8,554,155) (7,773,308) (7,152,135) (881,255) 11,436 (781,931) 1,084 (625,968) 4,795 (9,423,974) (8,554,155) (7,773,308) 372,992 356,788 2,922 (24,387) (362,862) 345,453 272,471 336,948 — (9,188) (227,239) 372,992 188,079 302,393 — — (218,001) 272,471 Total real estate facilities at December 31, $ 18,386,717 $ 16,037,963 $ 15,306,996 During 2023, in addition to the Simply Acquisition, we acquired 37 self-storage facilities (2.7 million net rentable square feet of storage space), for a total cost of $473.2 million in cash. Approximately $23.2 million of the total cost was allocated to intangible assets. We completed development and redevelopment activities costing $362.9 million during 2023, adding 1.7 million net rentable square feet of self-storage space. Construction in process at December 31, 2023 consisted of projects to develop new self-storage facilities and expand existing self-storage facilities. During 2023, we wrote off $11.7 million of accumulated development costs for cancelled development and redevelopment projects in construction in process as real estate acquisition and development expense. We also transferred $12.7 million of land cost related to cancelled development projects to other assets at December 31, 2023. During 2023, we completed a real estate transaction with a third-party, through which we sold an operating self-storage facility with a net book value of $7.1 million for gross proceeds of $40.0 million and acquired a nearby land parcel for $13.5 million. At the close of the transaction, we entered into a leaseback of the self-storage facility until we complete development of the acquired land into a self-storage facility, no later than December 31, 2026. Of the $40.0 million in gross proceeds, $24.3 million was allocated to the sale of the property based on its estimated fair value, resulting a net gain on sale of real estate of $17.1 million after direct transaction costs, and $15.7 million was classified as a reduction of costs to develop the acquired land included in construction in process. During 2023, we also sold a land parcel for $0.1 million in cash and recorded a related gain on sale of real estate of $0.1 million. F-16 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 During 2022, we acquired 74 self-storage facilities (4.7 million net rentable square feet of storage space), for a total cost of $730.5 million, consisting of $710.6 million in cash and $19.9 million in partnership units in one of our subsidiaries. Approximately $24.1 million of the total cost was allocated to intangible assets. We completed development and redevelopment activities costing $227.2 million during 2022, adding 1.4 million net rentable square feet of self-storage space. Construction in process at December 31, 2022 consisted of projects to develop new self- storage facilities and expand existing self-storage facilities. During 2022, we wrote off $7.0 million of accumulated development costs for cancelled development and redevelopment projects in construction in process as real estate acquisition and development expense. We also transferred $2.2 million of land cost related to a cancelled development project to other assets at December 31, 2022. Additionally, on July 8, 2022, we acquired from PS Business Parks, Inc. (“PSB”) the commercial interests in five properties at three sites jointly occupied with certain of our self-storage facilities located in Maryland and Virginia, for $47.3 million. We recognized $27.0 million of real estate assets and $0.7 million of intangibles for the properties acquired, representing the cost of these commercial properties that we did not have interest in through our equity investment in PSB. We recognized the remaining $19.6 million as an increase to our basis in our equity investment in PSB, which represents the elimination of our portion of the gain recorded by PSB. During 2022, we sold portions of real estate facilities in connection with eminent domain proceedings for $1.5 million in cash proceeds and recorded a related gain on sale of real estate of approximately $1.5 million. During 2021, we acquired 232 self-storage facilities (21.8 million net rentable square feet of storage space), for a total cost of $5.1 billion, consisting of $5.0 billion in cash and $68.2 million in partnership units in one of our subsidiaries. Approximately $174.9 million of the total cost was allocated to intangible assets. We completed development and redevelopment activities costing $218.0 million during 2021, adding 1.6 million net rentable square feet of self-storage space. During 2021, we sold portions of real estate facilities in connection with eminent domain proceedings for $16.3 million in cash proceeds and recorded a related gain on sale of real estate of approximately $13.7 million. At December 31, 2023, the adjusted basis of real estate facilities for U.S. federal tax purposes was approximately $18.3 billion (unaudited). F-17 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 5. Investments in Unconsolidated Real Estate Entities The following table sets forth our equity in earnings of the Unconsolidated Real Estate Entities (amounts in thousands): Shurgard PSB Total Equity in Earnings of Unconsolidated Real Estate Entities for the 2023 Year Ended December 31, 2022 2021 $ $ 27,897 $ — 27,897 $ 26,385 $ 80,596 106,981 $ 24,371 207,722 232,093 Investment in Shurgard Our investment December 31, 2022, respectively. in Shurgard was $390.2 million and $275.8 million as of December 31, 2023 and Throughout all periods presented, we had a 35% equity interest in Shurgard. On November 14, 2023, Shurgard issued 8,163,265 new common shares to institutional investors. Public Storage participated on a pro-rata basis in the offering and acquired 2,863,674 common shares for a cost of $112.6 million, maintaining our 35% equity interest in Shurgard. As a result of the offering, Shurgard common shares that we effectively owned increased from 31,268,459 as of December 31, 2022 to 34,132,133 as of December 31, 2023. Based upon the closing price at December 31, 2023 (€44.86 per share of Shurgard common stock, at 1.104 exchange rate of U.S. Dollars to the Euro), the shares we owned had a market value of approximately $1.7 billion. Our equity in earnings of Shurgard comprised our equity share of Shurgard’s net income, less amortization of the Shurgard Basis Differential (defined below). During 2023, 2022, and 2021, we received $3.8 million, $3.5 million, and $3.5 million of trademark license fees that Shurgard pays to us for the use of the Shurgard® trademark, respectively. We eliminated $1.3 million, $1.2 million, and $1.2 million of intra-entity profits and losses for 2023, 2022, and 2021, respectively, representing our equity share of the trademark license fees. We classify the remaining license fees we receive from Shurgard as interest and other income on our income statement. During 2023, 2022, and 2021, we received cash dividend distributions from Shurgard totaling $39.0 million, $37.8 million, and $41.5 million, respectively. Approximately $11.0 million, $13.7 million, and $19.5 million of total cash distributions from Shurgard during the year ended 2023, 2022, and 2021, respectively, represented distributions in excess of cumulative equity in earnings from Shurgard, which was classified within cash flows from investing activities in the Consolidated Statements of Cash Flows. At December 31, 2023, our investment in Shurgard’s real estate assets exceeded our pro-rata share of the underlying amounts on Shurgard’s balance sheet by approximately $63.7 million ($67.8 million at December 31, 2022). This differential (the “Shurgard Basis Differential”) includes our basis adjustments in Shurgard’s real estate assets net of related deferred income taxes. The Shurgard Basis Differential is being amortized as a reduction to equity in earnings of the Unconsolidated Real Estate Entities. Such amortization totaled approximately $4.1 million, $6.9 million, and $8.4 million during 2023, 2022, and 2021, respectively. As of December 31, 2023, 2022, and 2021, we translated the book value of our investment in Shurgard from Euro to U.S. Dollars and recorded $13.1 million other comprehensive gain, $26.7 million other comprehensive loss, and $10.2 million other comprehensive loss, respectively. F-18 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 Investment in PSB On July 20, 2022, in connection with the closing of the merger of PS Business Parks, Inc. (“PSB”) with affiliates of Blackstone Real Estate (“Blackstone”), we completed the sale of our 41% common equity interest in PSB in its entirety. At the close of the merger transaction, we received a total of $2.7 billion of cash proceeds and recognized a gain of $2.1 billion during the third quarter of 2022. During 2022 and 2021, we received cash distributions from PSB totaling $109.5 million and $127.3 million, respectively, which were classified within cash flows from operating activities in the Consolidated Statements of Cash flows. Since the sale of PSB in July 2022, we no longer recognize equity in earnings or receive cash distributions from PSB. Summarized financial information of PSB The following table represents summarized financial information for PSB derived from its reported financial statements prepared under US GAAP before our basis difference adjustments for the years ended December 31, 2022 and 2021 (amounts in thousands). Due to the complete sale of our equity investment in PSB in July 2022, the summarized financial information for 2022 includes PSB's financial activities through June 30, 2022, which represents the most practical date of such reported information prior to the transaction. Summarized financial information for Shurgard is excluded in the table below. Revenues Costs of operations Operating income Gain on sale of real estate Net Income 6. Goodwill and Other Intangible Assets Year Ended December 31, 2021 2022 $ 223,750 $ 66,701 88,702 118,801 208,665 438,703 130,896 195,264 359,875 553,029 Goodwill and other intangible assets consisted of the following (amounts in thousands): At December 31, 2023 Accumulated Amortization Net Book Value 165,843 $ 18,824 Gross Book Value 165,843 $ 18,824 — $ — At December 31, 2022 Accumulated Amortization Net Book Value 165,843 18,824 — $ — Gross Book Value 165,843 $ 18,824 $ 995,578 (792,978) 202,600 758,106 (710,256) 47,850 $ 1,180,245 $ (792,978) $ 387,267 $ 942,773 $ (710,256) $ 232,517 Goodwill Shurgard® Trade Name Finite-lived intangible assets, subject to amortization Total goodwill and other intangible assets Finite-lived intangible assets consist primarily of acquired customers in place. Amortization expense related to intangible assets subject to amortization was $82.7 million, $95.2 million and $76.6 million in 2023, 2022, and 2021, respectively. During 2023, 2022, and 2021, intangibles increased $237.5 million, $24.8 million, and $174.9 million, respectively, in connection with the Simply Acquisition (Note 3) and the acquisition of real estate facilities (Note 4). F-19 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 The remaining amortization expense will be recognized over a weighted average life of approximately 1.2 years. The estimated future amortization expense for our finite-lived intangible assets at December 31, 2023 is as follows (amounts in thousands): Year Amount 2024 2025 2026 2027 2028 Thereafter Total $ $ 116,338 60,467 19,129 2,797 377 3,492 202,600 7. Credit Facility On June 12, 2023, PSOC entered into an amended revolving credit agreement (the “Credit Facility”), which increased our borrowing limit from $500 million to $1.5 billion and extended the maturity date from April 19, 2024 to June 12, 2027. We have the option to further extend the maturity date by up to one additional year with additional extension fees up to 0.125% of the extended commitment amount. Amounts drawn on the Credit Facility bear annual interest at rates ranging from SOFR plus 0.65% to SOFR plus 1.40% depending upon our credit rating (SOFR plus 0.70% at December 31, 2023). We are also required to pay a quarterly facility fee ranging from 0.10% per annum to 0.30% per annum depending upon our credit rating (0.10% per annum at December 31, 2023). At December 31, 2023 and February 20, 2024, we had no outstanding borrowings under this Credit Facility. We had undrawn standby letters of credit, which reduce our borrowing capacity, totaling $14.6 million at December 31, 2023 ($18.6 million at December 31, 2022 under the previous credit facility). The Credit Facility has various customary restrictive covenants with which we were in compliance at December 31, 2023. We incurred a total of $8.4 million of issuance costs associated with the amended Credit Facility, which is classified as Other Assets on the Consolidated Balance Sheets and will be amortized as Interest Expense on the Consolidated Statement of Income through June 12, 2027. Public Storage has provided a full and unconditional guarantee of PSOC’s obligations under the Credit Facility. F-20 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 8. Notes Payable Our notes payable (all of which were issued by PSOC), are reflected net of issuance costs (including original issue discounts), which are amortized as interest expense on the effective interest method over the term of each respective note. Our notes payable at December 31, 2023 and December 31, 2022 are set forth in the tables below: Amounts at December 31, 2023 Amounts at December 31, 2022 Coupon Rate Effective Rate Principal Unamortized Costs Book Value Fair Value Book Value Fair Value ($ amounts in thousands) U.S. Dollar Denominated Unsecured Debt Notes due April 23, 2024 SOFR+0.47% 5.831% $ 700,000 $ (221) $ 699,779 $ 700,031 $ 699,075 $ 691,309 Notes due July 25, 2025 SOFR+0.60% 5.961% Notes due February 15, 2026 Notes due November 9, 2026 0.875% 1.500% Notes due September 15, 2027 3.094% Notes due May 1, 2028 Notes due November 9, 2028 Notes due January 15, 2029 Notes due May 1, 2029 Notes due May 1, 2031 Notes due November 9, 2031 Notes due August 1, 2033 Notes due August 1, 2053 1.850% 1.950% 5.125% 3.385% 2.300% 2.250% 5.100% 5.350% Euro Denominated Unsecured Debt Notes due April 12, 2024 Notes due November 3, 2025 Notes due September 9, 2030 Notes due January 24, 2032 1.540% 2.175% 0.500% 0.875% 1.030% 1.640% 3.218% 1.962% 2.044% 5.260% 3.459% 2.419% 2.322% 5.207% 5.442% 1.540% 2.175% 0.640% 0.978% 400,000 500,000 650,000 500,000 650,000 550,000 500,000 500,000 650,000 550,000 700,000 600,000 (1,278) (1,581) (2,487) (1,964) (2,922) (2,337) (2,947) (1,637) (5,012) (2,782) (5,552) (7,983) 398,722 498,419 647,513 498,036 647,078 547,663 497,053 498,363 644,988 547,218 694,448 592,017 400,295 462,362 597,131 476,394 584,520 490,758 516,899 477,692 562,240 469,845 725,753 628,413 — — 497,678 441,849 646,643 578,899 497,508 466,029 646,401 558,197 547,182 468,509 — — 498,053 456,855 644,303 530,390 546,866 443,514 — — — — 7,450,000 (38,703) 7,411,297 7,092,333 5,223,709 4,635,551 110,372 267,116 772,607 551,862 — — (7,488) (4,322) 110,372 267,116 765,119 547,540 109,380 261,083 638,177 455,895 107,035 104,344 259,039 246,119 740,634 566,204 530,317 396,297 1,701,957 (11,810) 1,690,147 1,464,535 1,637,025 1,312,964 Mortgage Debt, secured by 2 real estate facilities with a net book value of $11.7 million 4.398% 4.398% 1,833 — 1,833 1,733 10,092 9,568 $ 9,153,790 $ (50,513) $ 9,103,277 $ 8,558,601 $ 6,870,826 $5,958,083 Public Storage has provided a full and unconditional guarantee of PSOC’s obligations under each series of unsecured notes. U.S. Dollar Denominated Unsecured Notes On July 26, 2023, we completed a public offering of $400 million, $500 million, $700 million, and $600 million aggregate principal amount of unsecured senior notes bearing interest at an annual rate of Compounded SOFR + 0.60% (reset quarterly), 5.125%, 5.100%, and 5.350%, respectively, and maturing on July 25, 2025, January 15, 2029, August 1, 2033, and August 1, 2053, respectively. Interest on the 2025 notes is payable quarterly, commencing on October 25, 2023. Interest on the 2029 notes is payable semi-annually, commencing on January 15, 2024. Interest on the 2033 notes and 2053 notes is payable semi-annually, commencing on February 1, 2024. In connection with the offering, we incurred a total of $18.7 million in costs. F-21 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 On August 15, 2022, the Company redeemed its 2.370% Senior Notes due September 15, 2022, with an aggregate principal amount of $500.0 million. On January 19, 2021, we completed a public offering of $500 million aggregate principal amount of senior notes bearing interest at an annual rate of 0.875% and maturing on February 15, 2026. Interest on the senior notes is payable semi-annually, commencing on August 15, 2021. In connection with the offering, we incurred $3.8 million in costs. On April 23, 2021, we completed a public offering of $700 million, $650 million, and $650 million aggregate principal amount of senior notes bearing interest at an annual rate of the Compounded SOFR plus 0.47% (reset quarterly and at 4.36% as of December 31, 2022), 1.850%, and 2.300%, respectively, and maturing on April 23, 2024, May 1, 2028, and May 1, 2031, respectively. Interest on the 2024 notes is payable quarterly, commencing on July 23, 2021. Interest on the 2028 notes and 2031 notes is payable semi-annually, commencing on November 1, 2021. In connection with the offering, we incurred a total of $13.7 million in costs. On November 9, 2021, we completed a public offering of $650 million, $550 million, and $550 million aggregate principal amount of senior notes bearing interest at an annual rate of 1.500%, 1.950%, and 2.250%, respectively, and maturing on November 9, 2026, November 9, 2028, and November 9, 2031, respectively. Interest on the senior notes is payable semi-annually, commencing on May 9, 2022. In connection with the offering, we incurred a total of $11.3 million in costs. The U.S. Dollar denominated unsecured notes (the “U.S. Dollar Denominated Unsecured Notes”) have various financial covenants with which we were in compliance at December 31, 2023. Included in these covenants are (a) a maximum Debt to Total Assets of 65% (approximately 16% at December 31, 2023) and (b) a minimum ratio of Adjusted EBITDA to Interest Expense of 1.5x (approximately 17x for the twelve months ended December 31, 2023) as well as covenants limiting the amount we can encumber our properties with mortgage debt. Euro Denominated Unsecured Notes Our Euro denominated unsecured notes (the “Euro Notes”) consist of four tranches: (i) €242.0 million issued to institutional investors on November 3, 2015, (ii) €100.0 million issued to institutional investors on April 12, 2016, (iii) €500.0 million issued in a public offering on January 24, 2020, and (iv) €700.0 million issued in a public offering on September 9, 2021. Interest is payable semi-annually on the notes issued November 3, 2015 and April 12, 2016, and annually on the notes issued January 24, 2020 and September 9, 2021.The Euro Notes have financial covenants similar to those of the U.S. Dollar Denominated Unsecured Notes. We reflect changes in the U.S. Dollar equivalent of the amount payable including the associated interest, as a result of changes in foreign exchange rates as “Foreign currency exchange (loss) gain” on our income statement (losses of $51.6 million for 2023, as compared to gains of $99.2 million for 2022 and $111.8 million for 2021). Mortgage Notes We assumed our non-recourse mortgage debt in connection with property acquisitions, and we recorded such debt at fair value with any premium or discount to the stated note balance amortized using the effective interest method. At December 31, 2023, the related contractual interest rates of our mortgage notes are fixed, ranging between 3.9% and 7.1%, and mature between September 1, 2028 and July 1, 2030. At December 31, 2023, approximate principal maturities of our Notes Payable are as follows (amounts in thousands): F-22 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 2024 2025 2026 2027 2028 Thereafter Weighted average effective rate Unsecured Debt Mortgage Debt Total $ $ 810,372 $ 667,116 1,150,000 500,000 1,200,000 4,824,469 9,151,957 $ 3.1% 124 $ 131 138 146 129 1,165 1,833 $ 4.4% 810,496 667,247 1,150,138 500,146 1,200,129 4,825,634 9,153,790 3.1% Cash paid for interest totaled $155.5 million, $133.8 million, and $77.7 million for 2023, 2022, and 2021, respectively. Interest capitalized as real estate totaled $9.3 million, $6.0 million, and $3.5 million for 2023, 2022, and 2021, respectively. 9. Noncontrolling Interests There are noncontrolling interests related to several subsidiaries we consolidate of which we do not own 100% of the equity. At December 31, 2023, certain of these subsidiaries have issued 499,966 partnership units to third- parties that are convertible on a one-for-one basis (subject to certain limitations) into common shares of the Company at the request of the unitholder. 10. Shareholders’ Equity Preferred Shares At December 31, 2023 and December 31, 2022, we had the following series of Cumulative Preferred Shares (“Preferred Shares”) outstanding: Earliest Redemption Date Series Dividend Rate Shares Outstanding Liquidation Preference Shares Outstanding Liquidation Preference At December 31, 2023 At December 31, 2022 (Dollar amounts in thousands) Series F Series G Series H Series I Series J Series K Series L Series M Series N Series O Series P Series Q Series R Series S 6/2/2022 8/9/2022 3/11/2024 9/12/2024 11/15/2024 12/20/2024 6/17/2025 8/14/2025 10/6/2025 11/17/2025 6/16/2026 8/17/2026 11/19/2026 1/13/2027 5.150% 5.050% 5.600% 4.875% 4.700% 4.750% 4.625% 4.125% 3.875% 3.900% 4.000% 3.950% 4.000% 4.100% $ 11,200 12,000 11,400 12,650 10,350 9,200 22,600 9,200 11,300 6,800 24,150 5,750 17,400 10,000 280,000 300,000 285,000 316,250 258,750 230,000 565,000 230,000 282,500 170,000 603,750 143,750 435,000 250,000 $ 11,200 12,000 11,400 12,650 10,350 9,200 22,600 9,200 11,300 6,800 24,150 5,750 17,400 10,000 280,000 300,000 285,000 316,250 258,750 230,000 565,000 230,000 282,500 170,000 603,750 143,750 435,000 250,000 Total Preferred Shares 174,000 $ 4,350,000 174,000 $ 4,350,000 F-23 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 The holders of our Preferred Shares have general preference rights with respect to liquidation, quarterly distributions, and any accumulated unpaid distributions. Except as noted below, holders of the Preferred Shares do not have voting rights. In the event of a cumulative arrearage equal to six quarterly dividends, holders of all outstanding series of preferred shares (voting as a single class without regard to series) will have the right to elect two additional members to serve on our Board of Trustees (our “Board”) until the arrearage has been cured. At December 31, 2023, there were no dividends in arrears. The affirmative vote of at least 66.67% of the outstanding shares of a series of Preferred Shares is required for any material and adverse amendment to the terms of such series. The affirmative vote of at least 66.67% of the outstanding shares of all of our Preferred Shares, voting as a single class, is required to issue shares ranking senior to our Preferred Shares. Except under certain conditions relating to the Company’s qualification as a REIT, the Preferred Shares are not redeemable prior to the dates indicated on the table above. On or after the respective dates, each of the series of Preferred Shares is redeemable at our option, in whole or in part, at $25.00 per depositary share, plus accrued and unpaid dividends. Holders of the Preferred Shares cannot require us to redeem such shares. Upon issuance of our Preferred Shares, we classify the liquidation value as preferred equity on our consolidated balance sheet with any issuance costs recorded as a reduction to Paid-in capital. During 2022 and 2021, we issued the following series of Preferred Shares at an issuance price of $25.00 per depository share with each depository share representing 0.001 of a share of Preferred Share (none in 2023) (amounts in thousands): Year 2022 2021 Series S P, Q and R Shares 10,000 47,300 Gross Proceeds $ 250,000 1,182,500 $ Issuance Costs 7,168 35,045 During 2021, we redeemed the following series of Preferred Shares at par (none in 2023 and 2022) (amounts in thousands): Year 2021 Series Aggregate Redemption Amount C, D and E $ 875,000 Allocation of Income to Preferred Shares Holders in Connection with Redemption 28,914 $ Common Shares During 2023, 2022, and 2021, activity with respect to the issuance of our common shares was as follows (dollar amounts in thousands): Employee stock-based compensation and exercise of stock options (Note 12) 405,059 $ 53,386 283,190 $ 35,405 552,713 $ 95,860 2023 2022 2021 Shares Amount Shares Amount Shares Amount Our Board previously authorized the repurchase from time to time of up to 35.0 million of our common shares on the open market or in privately negotiated transactions. Through December 31, 2023, we repurchased approximately 23.7 million shares pursuant to this authorization; none of which were repurchased during the three years ended December 31, 2023. F-24 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 On February 4, 2023, our Board declared a 50% increase in our regular common quarterly dividend from $2.00 to $3.00 per share. The distribution equates to an annualized increase to the Company’s regular common dividend from $8.00 to $12.00 per share. Common share dividends paid, including amounts paid to our restricted share unitholders and deferred share unitholders, totaled $2.111 billion ($12.00 per share), $3.714 billion ($21.15 per share), and $1.402 billion ($8.00 per share) for the years ended December 31, 2023, 2022, and 2021, respectively. Included in common share dividends paid during 2022 is $2.3 billion of a special cash dividend (“Special Dividend”) of $13.15 per common share paid on August 4, 2022 in connection with the sale of our equity investment in PSB on July 20, 2022. Preferred share dividends totaled $194.7 million, $194.4 million and $186.6 million for the years ended December 31, 2023, 2022, and 2021, respectively. The unaudited characterization of dividends for U.S. federal corporate income tax purposes is made based upon earnings and profits of the Company, as defined by the Code. For the tax year ended December 31, 2023, distributions for the common shares and all the various series of preferred shares were classified as follows: 2023 (unaudited) Ordinary Dividends Capital Gain Distributions Total 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 100.00 % 0.00 % 100.00 % 100.00 % 0.00 % 100.00 % 100.00 % 0.00 % 100.00 % 100.00 % 0.00 % 100.00 % The ordinary income dividends distributed for the tax year ended December 31, 2023 are not qualified dividends under the Internal Revenue Code; however, they are subject to the 20% deduction under IRS Section 199A. 11. Related Party Transactions At December 31, 2023, Tamara Hughes Gustavson, a current member of our Board, held less than a 0.1% equity interest in, and is a manager of, a limited liability company that owns 65 self-storage facilities in Canada. Two of Ms. Gustavson’s adult children owned the remaining equity interest in the limited liability company. These facilities operate under the Public Storage® tradename, which we license to the owners of these facilities for use in Canada on a royalty-free, non-exclusive basis. We have no ownership interest in these facilities and we do not own or operate any facilities in Canada. If we chose to acquire or develop our own facilities in Canada, we would have to share the use of the Public Storage® name in Canada. We have a right of first refusal, subject to limitations, to acquire the stock or assets of the corporation engaged in the operation of these facilities if their owners agree to sell them. Our subsidiaries reinsure risks relating to loss of goods stored by customers in these facilities, and have received premium payments of approximately $2.1 million, $2.2 million and $2.1 million for 2023, 2022, and 2021, respectively. 12. Share-Based Compensation Under various share-based compensation plans and under terms established or modified by our Board or a committee thereof, we grant equity awards to trustees, officers, and key employees, including non-qualified options to purchase the Company’s common shares, restricted share units (“RSUs”), deferred share units (“DSUs”), and unrestricted common shares issued in lieu of trustee compensation. On April 26, 2021, the Company’s Shareholders approved the 2021 Equity and Performance-Based Incentive Compensation Plan (“2021 Plan”), which authorized an additional three million shares available for future issuance of equity-based awards. As of December 31, 2023, there were a total of 1,364,578 shares reserved for granting of future options and stock awards under the 2021 Plan. We recorded share-based compensation expense associated with our equity awards in the various expense categories in the Consolidated Statements of Income as set forth in the following table. In addition, $2.4 million, $4.1 million, and $3.9 million share-based compensation cost was capitalized as real estate facilities for the year ended December 31, 2023, 2022, and 2021, respectively. F-25 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 For Years Ended December 31, 2022 2023 2021 (Amounts in thousands) Self-storage cost of operations Ancillary cost of operations Real estate acquisition and development expense General and administrative Total $ $ 13,636 1,289 1,242 25,399 41,566 $ $ 17,950 888 11,204 26,661 56,703 $ $ 20,544 1,561 4,031 33,729 59,865 Included in share-based compensation is $3.2 million, $14.9 million and $15.9 million for the years ended December 31, 2023, 2022, and 2021, respectively, of Retirement Acceleration as discussed in Note 2. Stock Options We have service-based and performance-based stock options outstanding. Performance-based stock options outstanding vest upon meeting certain performance conditions or market conditions. Stock options generally vest over 3 to 5 years, expire 10 years after the grant date, and have an exercise price equal to the closing trading price of our common shares on the grant date. New shares are issued for options exercised. Employees cannot require the Company to settle their awards in cash. For the years ended December 31, 2023, 2022, and 2021, we incurred share-based compensation cost for outstanding stock options of $14.9 million, $19.9 million and $25.1 million, respectively. During 2023, we granted 60,000 stock options in connection with non-management trustee compensation. 117,168 stock options were awarded during 2023 where vesting is dependent upon meeting certain market conditions over the three-year period from March 15, 2023 through March 14, 2026, with continued service-based vesting through the first quarter of 2028. These stock options require relative achievement of the Company’s total shareholder return as compared to the weighted average total shareholder return of specified peer groups and can result in grantees earning up to 200% of the target options originally granted. During 2022, 77,683 stock options were awarded where vesting is dependent upon meeting certain market conditions over the three-year period from January 1, 2022 through December 31, 2024, with continued service-based vesting through the first quarter of 2027. These stock options require relative achievement of the Company’s total shareholder return as compared to the weighted average total shareholder return of specified peer groups and can result in grantees earning up to 200% of the target options originally granted. During 2021, 245,000 stock options were awarded where vesting is dependent upon meeting certain performance targets over the three-year period from January 1, 2021 through December 31, 2023, which are considered performance conditions, with continued service-based vesting through the first quarter of 2026. These awards contain a relative Total Shareholder Return modifier that will adjust the payout based on relative performance as compared to the market. These performance targets were met at 125% achievement at December 31, 2023. With the relative Total Shareholder Return modifier measured through December 31, 2023, the total payout was at 150% of the target options originally granted. The stock options outstanding at December 31, 2023 have an aggregate intrinsic value (the excess, if any, of each option’s market value over the exercise price) of approximately $249.3 million and remaining average contractual lives of approximately five years. Total compensation cost related to nonvested stock options that has not yet been recognized is $14.7 million and is expected to be recognized as compensation cost over approximately two years on average. Exercisable stock options have an aggregate intrinsic value of approximately $183.1 million at December 31, 2023 and remaining average contractual lives of approximately four years. F-26 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 Additional information with respect to stock options during 2023, 2022, and 2021 is as follows: Service-Based Performance-Based Total Granted (a) Exercised Cancelled Exercised Cancelled Options outstanding January 1, 2021 2,231,167 $ Number of Options Weighted Average Exercise Price per Share 204.60 248.54 Weighted Average Exercise Price per Share Number of Options Number of Options 730,000 $ 420,000 — 228.94 229.53 2,961,167 $ 560,000 — (471,216) 140,000 (471,216) (203.30) — — (10,000) (228.94) (10,000) Weighted Average Exercise Price per Share 210.59 234.29 (203.30) (228.94) 216.04 331.46 N/A Options outstanding December 31, 2021 1,899,951 $ Granted (b) Special dividend adjustment (c) 65,000 62,512 208.16 398.97 N/A 1,140,000 $ 138,933 41,836 229.16 299.88 N/A 3,039,951 $ 203,933 104,348 (173,422) (189.95) (10,327) (221.68) (183,749) (191.74) — Options outstanding December 31, 2022 (d) 1,854,041 $ Granted (e) Exercised Cancelled Options outstanding December 31, 2023 Options exercisable at December 31, 2023 60,000 (272,250) (12,049) 1,629,742 1,475,764 $ $ — 209.53 286.81 (167.15) (293.81) 218.83 210.75 — 1,310,442 $ 180,423 (34,401) (34,987) 1,421,477 507,766 $ $ — 229.39 265.46 (221.68) (229.34) 234.16 221.68 — 3,164,483 $ 240,425 (306,651) (47,036) 3,051,221 1,983,530 $ $ — 217.75 270.79 (173.26) (245.86) 225.97 213.55 Aggregate exercise date intrinsic value of options exercised during the year (in 000's) $ 35,662 $ 27,210 $ 44,613 2023 2022 2021 Average assumptions used in valuing options with the Black-Scholes method: Expected life of options in years Risk-free interest rate Expected volatility, based upon historical volatility Expected dividend yield Average assumptions used in valuing options with market conditions with the Monte-Carlo simulation method: Expected life of options in years Risk-free interest rate Expected volatility, based upon historical volatility Expected dividend yield 6 3.5% 24.4% 4.2% 7 3.5% 23.8% 4.1% 6 2.9% 22.9% 2.0% 7 1.8% 22.6% 2.3% 5 0.8% 24.1% 2.9% 5 0.9% 26.5% 2.9% Average estimated value of options granted during the year $ 56.86 $ 87.57 $ 62.66 (a) Amount granted for performance-based stock options includes 180,000 options for performance adjustments above target for options granted in 2020. (b) Amount granted for performance-based stock options includes 61,250 options for performance adjustments above target for options granted in 2021. F-27 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 (c) On August 4, 2022, we paid a Special Dividend of $13.15 per common share to shareholders of record as of August 1, 2022. Stock options that were outstanding at the time of the Special Dividend were adjusted pursuant to the anti-dilution provisions of the Company’s applicable equity and performance-based incentive compensation plans that provide for equitable adjustments in the event of an extraordinary cash dividend. The anti-dilution adjustments proportionately increased the number of outstanding stock options and reduced the exercise prices of outstanding stock options by a conversion rate of 1.03275, resulting in an increase of 104,348 stock options outstanding. The adjustments did not result in incremental share-based compensation expense. (d) The weighted average exercise price of options outstanding at December 31, 2022 reflect the adjusted exercise price post the anti-dilution adjustment on August 3, 2022. (e) Amount granted for performance-based stock options includes 63,257 options for payout adjustments based on Total Shareholder Return modifier for options granted in 2021. Restricted Share Units We have service-based and performance-based RSUs outstanding, which generally vest over 5 to 8 years from the grant date. Performance-based RSUs outstanding vest upon meeting certain performance conditions or market conditions. The grantee receives dividends for each outstanding RSU equal to the per-share dividends received by our common shareholders. We expense any dividends previously paid upon forfeiture of the related RSU. Upon vesting, the grantee receives new common shares equal to the number of vested RSUs, less common shares withheld to satisfy the grantee’s statutory tax liabilities arising from the vesting. The fair value of our RSUs is determined based upon the applicable closing trading price of our common shares. For the years ended December 31, 2023, 2022, and 2021, we incurred share-based compensation cost for RSUs of $28.2 million, $39.9 million, and $37.6 million, respectively. Among the 115,185 RSUs granted during 2023, 37,211 RSUs were awarded where vesting is dependent upon meeting certain market conditions over a three-year period from March 15, 2023 through March 14, 2026, with continued service-based vesting through the first quarter of 2028. These RSUs require relative achievement of the Company’s total shareholder return as compared to the weighted average total shareholder return of specified peer groups and can result in grantees earning up to 200% of the target RSUs originally granted. During 2022, 21,985 RSUs were awarded where vesting is dependent upon meeting certain market conditions over a three-year period from January 1, 2022 through December 31, 2024, with continued service-based vesting through the first quarter of 2027. The amount of these RSUs that are earned and vested, if any, will be based, in addition to continued employment requirements, on the Company's relative total shareholder return over the three-year period as compared to the weighted average total shareholder return of the specified peer groups and can result in grantees earning up to 200% of the target RSUs originally granted. During 2021, 37,000 RSUs were awarded where vesting is dependent upon meeting certain performance targets for 2021, which are considered performance conditions, with continued service-based vesting through the first quarter of 2026. As of December 31, 2023, these targets were met at 125% achievement. Remaining compensation cost related to RSUs outstanding at December 31, 2023 totals approximately $72.5 million and is expected to be recognized over the next three years on average. The following tables set forth relevant information with respect to restricted shares (dollar amounts in thousands): F-28 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 Service-Based Performance-Based Total Number of Restricted Share Units Weighted- Average Grant-Date Fair Value Number of Restricted Share Units Weighted- Average Grant-Date Fair Value Number of Restricted Share Units Weighted- Average Grant-Date Fair Value 552,788 $ 218.11 — $ — 552,788 $ 218.11 143,068 (138,420) (32,864) 336.06 (216.63) (221.32) 46,250 275.12 189,318 — — — — (138,420) (32,864) 321.17 (216.63) (221.32) 524,572 $ 249.90 46,250 $ 275.12 570,822 $ 251.95 51,575 (146,138) (22,197) 293.43 (240.71) (256.50) 21,985 465.11 73,560 — — — — (146,138) (22,197) 344.74 (240.71) (256.50) 407,812 $ 258.34 68,235 $ 336.33 476,047 $ 269.52 77,974 (132,909) (30,229) 296.19 (245.19) (266.60) 37,211 (9,250) (2,183) 295.61 115,185 (275.12) (142,159) (300.86) (32,412) 296.01 (247.13) (268.91) Restricted share units outstanding January 1, 2021 Granted (a) Vested Forfeited Restricted share units outstanding December 31, 2021 Granted Vested Forfeited Restricted share units outstanding December 31, 2022 Granted Vested Forfeited Restricted share units outstanding December 31, 2023 322,648 $ 272.14 94,013 $ 327.06 416,661 $ 284.53 Amounts for the year (in 000's, except number of shares): Fair value of vested shares on vesting date Cash paid for taxes upon vesting in lieu of issuing common shares Common shares issued upon vesting 2023 2022 2021 $ $ $ $ 41,999 13,950 96,657 $ $ 47,244 16,827 99,009 37,430 13,069 81,325 Average assumptions used in valuing restricted share units with market conditions with the Monte-Carlo simulation method: Time from the valuation date to the end of the performance period Risk-free interest rate Expected volatility, based upon historical volatility Expected dividend yield 3 3.8% 28.2% 4.1% 3 1.6% 26.5% 2.3% (a) Amount granted for performance-based RSUs includes 9,250 RSUs for performance adjustments above target for RSUs granted in 2021. Trustee Deferral Program Non-management trustees may elect to receive all or a portion of their cash retainers in cash, unrestricted common shares, or fully-vested DSUs to be settled at a specified future date. Unrestricted common shares and/or DSUs will be granted to the non-management trustee on the last day of each calendar quarter based on the cash retainer earned for that quarter and converted into a number of shares or units based on the applicable closing price of our common shares on such date. During 2023, we granted 2,085 DSUs and 884 unrestricted common shares. During 2023, 867 previously granted DSUs were settled in common shares. A total of 10,769 DSUs were outstanding at December 31, 2023 (9,551 at December 31, 2022). F-29 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 13. Net Income per Common Share We allocate net income to (i) noncontrolling interests based upon their contractual rights in the respective subsidiaries or for participating noncontrolling interests based upon their participation in both distributed and undistributed earnings of the Company, (ii) preferred shareholders, for distributions paid or payable, (iii) preferred shareholders, to the extent redemption cost exceeds the related original net issuance proceeds (a “preferred share redemption charge”), and (iv) RSUs, for non-forfeitable dividends paid and adjusted for participation rights in undistributed earnings of the Company. We calculate basic and diluted net income per common share based upon net income allocable to common shareholders, divided by (i) weighted average common shares for basic net income per common share, and (ii) weighted average common shares adjusted for the impact of dilutive stock options outstanding for diluted net income per common share. Stock options representing 375,577 common shares were excluded from the computation of diluted earnings per share for 2023, as compared to 147,344 common shares for 2022, because their effect would have been antidilutive. The following table reconciles the numerators and denominators of the basic and diluted net income per common shares computation for the year ended December 31, 2023, 2022, and 2021, respectively (in thousands, except per share amounts): For the Years Ended December 31, 2022 2021 2023 Numerator for basic and dilutive net income per common share – net income allocable to common shareholders $ 1,948,741 $ 4,142,288 $ 1,732,444 Denominator for basic net income per share - weighted average common shares outstanding Net effect of dilutive stock options - based on treasury stock method Denominator for dilutive net income per share - weighted average common shares outstanding 175,472 175,257 174,858 671 1,023 710 176,143 176,280 175,568 Net income per common share: Basic Dilutive $ $ 11.11 $ 11.06 $ 23.64 $ 23.50 $ 9.91 9.87 F-30 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 14. Segment Information Our operating segments reflect the significant components of our operations where discrete financial information is evaluated separately by our chief operating decision maker. Self-Storage Operations The Self-Storage Operations reportable segment reflects the aggregated rental operations from the self- storage facilities we own through the following operating segments: (i) Same Store Facilities, (ii) Acquired Facilities, (iii) Developed and Expanded Facilities, and (iv) Other Non-Same Store Facilities. The presentation in the table below sets forth the Net Operating Income (“NOI”) of this reportable segment, as well as the related depreciation expense. For all periods presented, substantially all of our real estate facilities, goodwill and other intangible assets, other assets, and accrued and other liabilities are associated with the Self-Storage Operations reportable segment. Ancillary Operations The Ancillary Operations reflects the combined operations of our tenant reinsurance, merchandise sales, and third party property management operating segments. Presentation of Segment Information The following table reconciles NOI and net income attributable to our reportable segment to our consolidated net income: Self-Storage Operations Reportable Segment Revenue Cost of operations Net operating income Depreciation and amortization Net income Ancillary Operations Revenue Cost of operations Net operating income For the Years Ended December 31, 2023 2022 2021 (amounts in thousands) $ 4,259,613 $ 3,946,028 $ 3,203,566 (1,061,950) 3,197,663 (970,056) 2,227,607 258,077 (85,996) 172,081 (980,209) 2,965,819 (888,146) 2,077,673 236,135 (72,698) 163,437 (852,030) 2,351,536 (713,428) 1,638,108 212,258 (68,568) 143,690 Total net income allocated to segments 2,399,688 2,241,110 1,781,798 Other items not allocated to segments: Real estate acquisition and development expense General and administrative Interest and other income Interest expense Equity in earnings of unconsolidated real estate entities Foreign currency exchange (loss) gain Gain on sale of real estate Gain on sale of equity investment in PS Business Parks, Inc. Income tax expense Net income (26,451) (80,632) 85,590 (201,132) 27,897 (51,197) 17,178 — (10,821) (28,744) (71,672) 40,567 (136,319) 106,981 98,314 1,503 2,128,860 (14,326) (12,923) (75,966) 12,306 (90,774) 232,093 111,787 13,683 — (12,365) $ 2,160,120 $ 4,366,274 $ 1,959,639 F-31 PUBLIC STORAGE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023 15. Commitments and Contingencies Contingent Losses We are a party to various legal proceedings and subject to various claims and complaints; however, we believe that the likelihood of these contingencies resulting in a material loss to the Company, either individually or in the aggregate, is remote. Insurance and Loss Exposure We carry property, earthquake, general liability, employee medical insurance, and workers compensation coverage through internationally recognized insurance carriers, subject to deductibles. Our deductible for general liability is $2.0 million per occurrence. Our annual deductible for property loss is $25.0 million per occurrence. This deductible decreases to $5.0 million once we reach $35.0 million in aggregate losses for occurrences that exceed $5.0 million. Insurance carriers’ aggregate limits on these policies of $75.0 million for property losses and $102.0 million for general liability losses are higher than estimates of maximum probable losses that could occur from individual catastrophic events determined in recent engineering and actuarial studies; however, in case of multiple catastrophic events, these limits could be exceeded. We reinsure a program that provides insurance to our customers from an independent third-party insurer. This program covers customer claims for losses to goods stored at our facilities as a result of specific named perils (earthquakes are not covered by this program), up to a maximum limit of $5,000 per storage unit. We reinsure all risks in this program, but purchase insurance to cover this exposure for a limit of $15.0 million for losses in excess of $5.0 million per occurrence. We are subject to licensing requirements and regulations in all states. Customers participate in the program at their option. At December 31, 2023, there were approximately 1.3 million certificates held by our self- storage customers, representing aggregate coverage of approximately $6.2 billion. Commitments We have construction commitments representing future expected payments for construction under contract totaling $164.8 million at December 31, 2023. We expect to pay approximately $149.3 million in 2024 and $15.5 million in 2025 for these construction commitments. We have future contractual payments on land, equipment and office space under various lease commitments totaling $65.4 million at December 31, 2023. We expect to pay approximately $4.0 million in each of 2024, 2025, and 2026, $2.6 million in 2027, $2.5 million in 2028, and $48.3 million thereafter for these commitments. F-32 4 2 1 , 4 9 9 7 9 7 , 1 2 5 9 0 9 , 2 2 4 8 1 6 , 9 4 4 5 9 6 , 1 9 5 1 8 3 , 2 0 5 7 6 3 , 1 3 3 1 6 1 , 4 1 2 0 4 3 , 4 8 5 7 8 8 , 7 4 4 1 4 6 , 1 3 4 1 3 8 , 4 0 2 3 6 8 , 6 8 1 9 9 3 , 2 0 2 6 7 9 , 2 7 1 0 0 6 , 3 7 1 2 3 1 , 5 5 1 5 6 3 , 6 5 1 4 7 0 , 7 6 1 5 9 0 , 8 3 1 5 5 7 , 9 4 2 4 4 , 7 7 1 3 0 1 , 5 9 2 4 9 , 9 1 1 4 6 7 , 4 9 8 1 0 , 5 6 3 8 6 , 9 8 0 5 1 , 6 9 0 4 9 , 3 5 0 5 8 , 1 6 0 9 9 , 5 7 7 3 4 , 6 3 1 8 9 0 , 7 7 9 0 7 , 4 6 9 0 5 , 1 2 1 0 2 1 , 1 4 $ 9 8 7 , 8 6 1 , 2 $ 9 4 4 , 3 0 6 , 1 $ 0 4 3 , 5 6 5 $ 1 3 5 , 1 4 5 $ 3 7 0 , 8 6 0 , 1 $ 5 8 1 , 9 5 5 $ 6 0 3 $ 7 5 2 , 7 1 3 5 5 , 2 0 8 , 2 7 9 6 , 8 7 4 , 1 2 6 5 , 6 4 8 6 6 3 , 2 2 1 , 1 3 5 4 , 6 6 9 , 1 6 6 2 , 8 9 6 1 9 2 , 0 4 8 7 2 7 , 9 4 3 , 1 2 8 6 , 9 9 0 , 1 5 8 7 , 5 0 0 , 1 8 2 8 , 8 5 5 5 8 1 , 2 0 6 0 7 0 , 9 5 4 4 9 8 , 1 5 5 9 8 5 , 5 3 4 4 8 4 , 9 3 4 8 8 7 , 4 2 5 0 7 9 , 9 6 9 7 3 3 , 5 4 3 0 7 6 , 8 0 4 0 4 2 , 8 9 4 4 4 0 , 0 2 3 2 3 3 , 1 4 3 7 6 9 , 4 6 3 6 3 6 , 8 4 2 0 7 8 , 7 0 2 2 3 7 , 8 6 1 0 6 5 , 1 3 2 0 4 6 , 2 3 2 9 4 0 , 9 8 1 6 5 3 , 1 5 3 5 5 0 , 9 4 1 1 9 9 , 5 8 1 6 2 9 , 5 0 3 2 2 6 , 4 6 1 2 5 4 , 8 3 4 , 2 9 3 6 , 6 0 2 , 1 1 7 1 , 7 8 6 3 9 9 , 3 6 8 1 7 7 , 7 2 5 , 1 1 1 2 , 4 5 5 6 8 1 , 0 6 6 1 0 1 , 9 2 0 , 1 3 1 3 , 1 5 8 2 9 6 , 4 4 7 0 9 9 , 7 3 4 9 8 4 , 0 7 4 8 7 7 , 3 9 3 4 6 8 , 4 4 4 9 8 7 , 7 3 3 1 0 0 , 1 6 3 6 4 7 , 6 1 4 8 4 2 , 3 3 8 6 6 6 , 9 7 2 0 7 5 , 9 3 3 4 4 7 , 0 4 3 3 3 3 , 5 6 2 8 2 9 , 6 6 2 5 9 2 , 3 7 2 6 7 4 , 1 0 2 2 9 4 , 0 6 1 5 2 2 , 6 3 1 0 8 2 , 1 9 1 0 9 6 , 6 7 1 7 3 6 , 8 6 1 3 7 0 , 5 6 2 0 6 6 , 5 2 1 6 9 5 , 4 5 1 4 3 6 , 3 1 2 2 6 2 , 3 3 1 1 0 1 , 4 6 3 8 5 0 , 2 7 2 1 9 3 , 9 5 1 3 7 3 , 8 5 2 2 8 6 , 8 3 4 5 5 0 , 4 4 1 5 0 1 , 0 8 1 6 2 6 , 0 2 3 9 6 3 , 8 4 2 3 9 0 , 1 6 2 8 3 8 , 0 2 1 6 9 6 , 1 3 1 2 9 2 , 5 6 0 3 0 , 7 0 1 0 0 8 , 7 9 3 8 4 , 8 7 2 4 0 , 8 0 1 2 2 7 , 6 3 1 1 7 6 , 5 6 0 0 1 , 9 6 6 9 4 , 7 5 1 1 1 7 , 4 5 4 0 4 , 4 7 2 7 6 , 1 9 0 6 1 , 7 4 8 7 3 , 7 4 7 0 5 , 2 3 0 8 2 , 0 4 0 5 9 , 5 5 2 1 4 , 0 2 3 8 2 , 6 8 5 9 3 , 3 2 5 9 3 , 1 3 2 9 2 , 2 9 0 6 3 , 1 3 5 7 5 , 6 5 2 3 2 8 , 3 0 3 9 6 4 , 0 7 1 5 4 3 , 9 1 3 4 4 3 , 3 1 2 1 4 1 , 0 2 1 5 5 2 , 2 9 2 2 2 , 9 9 2 4 6 7 , 8 1 2 1 5 2 , 3 8 1 9 4 4 , 5 1 1 2 1 4 , 1 4 1 3 2 2 , 5 9 7 1 6 , 4 9 7 1 5 , 5 9 3 5 0 , 3 7 3 6 8 , 8 4 6 8 2 , 8 5 1 8 2 , 5 5 2 2 9 , 8 2 3 7 9 , 9 1 1 8 7 9 , 0 4 0 4 8 , 6 5 3 4 9 , 9 4 5 2 2 , 1 3 1 2 5 , 4 3 6 8 3 , 4 4 2 4 2 , 6 2 9 8 5 , 3 3 7 5 7 , 4 5 4 1 0 , 2 4 1 7 6 , 0 4 5 0 0 , 4 2 1 0 1 , 4 5 5 1 2 , 3 3 7 3 1 , 2 0 9 9 3 5 , 9 1 5 8 9 3 , 7 5 5 5 0 1 , 4 8 1 , 2 3 3 9 , 9 2 3 , 1 3 3 4 , 4 3 4 2 1 4 , 3 7 5 7 1 2 , 6 3 7 0 1 8 , 4 3 6 4 3 3 , 3 6 5 2 6 2 , 3 2 3 1 3 6 , 2 3 3 6 7 5 , 7 9 2 0 6 5 , 3 5 3 5 3 1 , 0 5 2 4 5 3 , 9 8 2 4 7 8 , 7 6 3 6 8 0 , 5 7 7 3 4 0 , 5 2 2 8 4 6 , 0 1 3 9 7 4 , 1 2 2 3 1 3 , 4 2 2 0 1 1 , 2 1 2 1 4 3 , 4 2 2 1 5 2 , 1 7 1 0 1 4 , 5 2 1 3 2 3 , 2 9 7 9 7 , 5 6 1 8 0 2 , 3 4 1 0 8 0 , 4 1 1 5 2 6 , 3 2 2 8 3 8 , 5 8 9 3 8 , 9 2 1 3 4 0 , 2 6 1 5 4 0 , 0 0 1 3 7 8 , 1 6 3 7 3 7 , 2 7 2 4 5 5 , 6 5 1 3 2 6 , 5 4 2 6 7 1 , 3 2 4 2 9 6 , 3 4 1 4 2 6 , 4 7 1 8 8 2 , 4 1 3 8 0 1 , 6 4 2 0 0 2 , 9 5 2 7 1 1 , 0 2 1 2 4 1 , 8 2 1 1 7 2 , 6 6 7 1 7 , 3 0 1 7 3 9 , 9 8 7 7 0 , 7 7 1 5 0 , 8 0 1 8 9 5 , 6 3 1 3 1 0 , 5 6 0 0 1 , 9 6 8 8 7 , 6 5 1 3 5 7 , 4 5 2 8 3 , 2 7 3 8 6 , 0 9 0 6 1 , 6 4 9 3 9 , 7 4 3 2 0 , 2 3 1 2 5 , 9 3 3 4 8 , 5 5 2 1 2 , 0 2 7 1 7 , 5 8 6 4 5 , 2 2 7 4 1 , 2 3 2 8 7 , 9 8 2 6 3 , 1 3 3 3 - F — — — — — 7 2 5 , 1 — — — — — — — — — — — — — — — — — — — — — — — — — — — — — 7 0 9 , 8 1 4 9 8 , 3 1 0 1 3 , 9 7 9 1 , 9 8 5 4 , 8 0 1 7 , 7 0 3 4 , 6 2 9 8 , 7 6 6 2 , 7 8 0 5 , 7 0 9 2 , 5 6 5 4 , 5 4 8 4 , 4 7 8 5 , 4 2 5 7 , 4 3 6 9 , 3 5 2 8 , 3 9 1 9 , 3 7 1 9 , 2 3 9 4 , 3 3 3 8 , 3 7 2 8 , 2 3 2 1 , 3 3 1 8 , 2 0 5 4 , 2 9 9 1 , 2 0 2 1 , 2 6 3 2 , 2 3 4 4 , 2 1 2 1 , 2 8 3 0 , 2 9 4 7 , 1 3 4 7 , 1 3 8 1 , 2 5 3 4 , 1 0 3 2 1 1 2 5 6 1 3 4 1 1 4 1 9 1 1 5 1 1 9 0 1 6 0 1 2 0 1 0 0 1 0 7 8 6 7 6 6 6 2 6 4 5 3 5 0 5 0 5 8 4 6 4 0 4 9 3 9 3 7 3 6 3 6 3 5 3 2 3 1 3 9 2 7 2 6 2 4 2 2 2 3 2 0 2 , 1 3 r e b m e c e D t A t n u o m A g n i y r r a C s s o r G t s o C l a i t i n I d e t a l u m u c c A n o i t a i c e r p e D l a t o T s g n i d l i u B d n a L s t s o C t n e u q e s b u S n o i t i s i u q c A o t & s g n i d l i u B s t n e m e v o r p m I d n a L 3 2 0 2 - m u c n E s e c n a r b t e N e l b a t n e R t e e F e r a u q S f o . o N s e i t i l i c a F E G A R O T S C I L B U P E T A T S E L A E R - I I I E L U D E H C S I N O I T A C E R P E D D E T A L U M U C C A D N A ) s e i t r e p o r p f o r e b m u n t p e c x e , s d n a s u o h t n i s t n u o m A ( n o i t p i r c s e D : t e k r a m y b s e i t i l i c a f e g a r o t s - f l e S h t r o W . t F / s a l l a D s e l e g n A s o L n o t s u o H o g a c i h C C D n o t g n i h s a W o c s i c n a r F n a S a t n a l t A a n o t y a D / o d n a l r O a m o c a T / e l t t a e S k r o Y w e N i m a i M r e v n e D l u a P . t S / s i l o p a e n n i M a i h p l e d a l i h P e t t o l r a h C a p m a T t i o r t e D x i n e o h P e r o m i t l a B d n a l t r o P h c a e B m l a P t s e W y t i C a m o h a l k O o i n o t n A n a S s i l o p a n a i d n I o t n e m a r c a S k l o f r o N a i b m u l o C s u b m u l o C y t i C s a s n a K s i u o L . t S n o t s o B s a g e V s a L o g e i D n a S n i t s u A h g i e l a R n e e r G g n i l w o B / e l l i v h s a N E G A R O T S C I L B U P E T A T S E L A E R - I I I E L U D E H C S I N O I T A C E R P E D D E T A L U M U C C A D N A ) s e i t r e p o r p f o r e b m u n t p e c x e , s d n a s u o h t n i s t n u o m A ( 8 9 8 , 8 2 6 7 6 , 1 4 9 2 4 , 0 2 5 8 6 , 8 3 5 3 7 , 1 3 0 1 4 , 8 2 8 1 0 , 4 2 2 4 5 , 7 2 9 4 4 , 8 3 4 5 5 , 0 4 8 4 6 , 3 3 1 0 6 , 1 3 0 1 8 , 6 3 5 0 7 , 1 2 5 4 9 , 8 1 6 1 1 , 5 8 4 1 7 , 4 3 3 7 4 , 5 2 3 9 6 , 3 1 2 1 2 , 7 3 6 9 2 , 6 1 3 3 8 , 0 1 3 8 2 , 7 1 0 0 9 , 6 3 7 4 , 5 1 1 5 8 , 4 2 5 4 9 , 2 1 2 7 4 , 6 2 4 7 1 , 6 7 4 7 , 7 4 2 6 , 8 2 4 0 , 7 4 4 5 , 8 0 1 2 , 3 5 2 4 , 5 6 0 2 , 4 1 8 8 5 , 2 2 7 8 , 0 1 2 6 6 7 , 6 1 1 5 7 5 , 9 2 1 0 3 6 , 4 0 1 1 5 7 , 9 5 1 6 0 7 , 4 9 9 9 3 , 5 8 5 1 4 , 7 8 2 2 5 , 6 5 4 6 4 , 8 7 9 6 0 , 5 7 0 6 5 , 8 4 7 5 8 , 9 9 4 7 6 , 4 6 8 0 7 , 8 6 2 9 8 , 1 8 1 3 6 4 , 7 9 1 0 6 , 5 0 1 6 6 9 , 0 9 8 2 7 , 5 2 1 0 8 8 , 0 8 2 3 5 , 0 6 9 8 4 , 6 6 4 6 3 , 3 4 1 6 9 , 3 6 0 9 3 , 7 5 6 5 3 , 2 4 4 3 9 , 1 8 2 4 8 , 4 5 5 0 6 , 8 4 5 8 6 , 9 1 2 7 5 1 , 9 4 1 8 9 5 , 9 9 6 4 5 , 1 8 7 1 5 , 2 9 8 7 3 , 4 5 5 8 1 , 6 4 4 7 4 , 0 5 0 9 9 , 1 3 9 8 8 , 0 9 1 7 1 , 1 3 4 8 8 , 3 4 2 4 5 , 7 1 1 6 4 , 0 4 2 4 3 , 8 1 0 9 4 , 6 2 2 3 3 , 5 1 5 8 1 , 8 1 2 6 7 , 2 3 0 0 7 , 6 2 5 7 7 , 4 2 6 5 6 , 9 2 8 2 6 , 2 2 4 3 3 , 5 8 0 8 7 , 9 4 2 5 5 , 4 7 5 3 9 , 5 4 6 7 8 , 9 3 1 4 6 , 0 4 7 0 2 , 5 2 3 3 1 , 4 7 4 8 6 , 5 2 0 0 0 , 4 3 2 1 4 , 5 1 6 0 0 , 2 3 0 3 0 , 6 1 2 8 3 , 7 1 9 5 2 , 4 1 8 9 6 , 4 1 8 1 1 , 0 3 2 5 6 , 4 2 2 8 6 , 9 1 7 4 3 , 1 2 5 9 8 , 9 1 0 8 9 , 8 2 3 0 3 , 9 1 4 7 9 , 3 2 4 6 6 , 3 1 3 2 0 , 4 3 6 2 8 , 3 1 7 6 8 , 4 2 6 2 9 , 0 2 8 5 1 , 3 1 3 0 5 , 4 1 9 7 6 , 7 1 4 0 2 , 6 3 2 9 , 7 1 2 3 8 , 9 3 0 1 , 0 2 8 2 5 , 0 7 4 6 2 , 4 1 6 6 7 , 1 3 5 6 9 , 7 1 3 4 4 , 8 9 0 3 , 6 3 3 8 , 9 3 8 7 , 6 6 5 7 , 6 1 7 8 4 , 5 4 8 8 , 9 0 3 1 , 2 5 5 4 , 8 2 1 3 , 2 8 0 1 , 9 3 7 0 , 1 7 8 4 , 3 4 4 6 , 2 8 4 0 , 2 3 9 0 , 5 9 0 3 , 8 3 3 7 , 2 6 4 3 , 5 1 9 9 5 , 9 2 0 9 5 , 9 4 9 3 , 6 2 0 8 1 , 2 1 0 4 9 , 2 1 6 4 3 , 0 1 2 9 0 , 0 1 2 6 2 , 1 1 5 9 5 , 6 1 8 9 2 , 6 1 7 7 6 , 6 1 7 1 1 , 6 2 6 6 0 , 9 7 4 6 , 6 3 3 0 , 3 2 7 7 0 , 3 1 7 8 9 , 5 7 6 4 , 5 1 4 6 , 7 2 4 9 4 , 9 0 9 1 , 5 1 5 2 , 7 1 2 2 , 2 0 8 9 , 6 0 9 9 , 8 4 3 8 , 8 5 4 8 , 7 6 8 6 , 1 8 4 8 , 3 3 8 2 , 5 5 9 6 , 3 0 0 0 , 4 5 5 7 , 1 1 9 5 , 1 2 8 2 , 3 6 6 6 9 9 8 , 7 6 1 2 8 7 , 7 6 8 3 8 , 5 9 9 6 5 , 4 6 2 8 7 , 3 1 1 6 5 8 , 8 6 5 8 1 , 0 5 2 0 2 , 6 5 1 7 0 , 2 3 5 1 4 , 7 4 1 8 1 , 3 4 7 6 5 , 5 2 3 9 7 , 6 5 8 7 5 , 5 4 7 0 6 , 1 4 1 4 0 , 7 2 1 5 2 4 , 2 7 5 6 4 , 2 4 5 8 0 , 9 6 9 5 9 , 9 1 5 7 7 , 0 3 1 5 4 , 5 3 4 5 9 , 7 1 2 1 9 , 1 7 4 0 7 , 8 1 1 9 4 , 5 2 1 9 6 , 6 1 5 1 , 4 2 6 1 3 , 4 1 1 8 4 , 3 1 5 7 9 , 8 3 0 0 , 1 1 8 1 1 , 6 2 7 9 8 , 2 2 1 9 0 , 8 1 5 6 0 , 8 1 8 2 2 , 9 1 7 2 6 , 7 2 5 8 3 , 9 1 7 4 1 , 4 2 7 6 6 , 3 1 9 8 7 , 3 3 0 1 9 , 2 1 8 6 8 , 4 2 1 2 1 , 1 2 9 8 1 , 3 1 4 5 4 , 4 1 0 9 5 , 5 1 6 1 3 , 6 7 4 9 , 6 1 0 3 0 , 0 1 4 5 4 , 0 2 1 1 6 , 9 6 6 9 0 , 4 1 4 9 0 , 3 3 5 6 9 , 7 1 8 7 7 , 6 6 1 9 , 5 3 3 8 , 9 5 8 7 , 6 6 5 7 , 6 1 7 8 4 , 5 3 0 4 , 9 7 1 0 , 2 5 6 4 , 8 0 4 3 , 2 1 6 1 , 9 4 7 0 , 1 7 8 4 , 3 4 4 6 , 2 8 4 0 , 2 3 9 0 , 5 9 0 3 , 8 4 3 7 , 2 4 3 - F — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — 8 1 4 , 1 1 4 2 , 1 7 9 0 , 1 2 7 1 , 1 9 0 2 , 1 8 9 9 0 7 9 8 0 8 4 6 9 2 2 9 1 1 9 6 0 6 8 7 9 6 4 8 2 0 8 6 9 8 1 6 8 0 0 7 0 4 9 3 9 6 1 3 6 6 8 5 2 6 4 1 7 6 9 5 5 9 3 4 3 3 4 9 2 3 6 2 3 8 9 2 4 8 2 1 7 2 8 4 2 3 3 2 3 2 2 2 4 2 1 9 1 2 2 1 2 9 1 7 1 6 1 6 1 6 1 6 1 5 1 5 1 5 1 5 1 4 1 3 1 3 1 2 1 2 1 2 1 1 1 1 1 0 1 0 1 9 7 7 7 7 7 5 5 5 4 4 4 4 3 3 3 2 0 2 , 1 3 r e b m e c e D t A t n u o m A g n i y r r a C s s o r G t s o C l a i t i n I d e t a l u m u c c A n o i t a i c e r p e D l a t o T s g n i d l i u B d n a L s t s o C t n e u q e s b u S n o i t i s i u q c A o t & s g n i d l i u B s t n e m e v o r p m I d n a L 3 2 0 2 - m u c n E s e c n a r b t e N e l b a t n e R t e e F e r a u q S f o . o N s e i t i l i c a F e l l i v e h s A / g r u b n a t r a p S / e l l i v s n e e r G n o i t p i r c s e D s g n i r p S o d a r o l o C s e l p a N / s r e y M t r o F s i h p m e M i t a n n i c n i C e l i b o M e l l i v s i u o L d n o m h c i R e e k u a w l i M e l l i v n o s k c a J o r o b s n e e r G m a h g n i m r i B a g o o n a t t a h C n o t s e l r a h C y t i C e k a L t l a S s n a e l r O w e N u l u l o n o H h a n n a v a S a h a m O n e v a H w e N / d r o f t r a H n o r k A / d n a l e v e l C r e t s e h c o R / o l a f f u B a t s u g u A s a n i l a S / y e r e t n o M e l l i v s n a v E r u t a c e D / e l l i v s t n u H e n y a W t r o F e c n e d i v o r P n o t y a D g n i s n a L e k o n a o R s g n i r p S m l a P t n i l F e s i o B o n e R n o s c u T a t i h c i W E G A R O T S C I L B U P E T A T S E L A E R - I I I E L U D E H C S I N O I T A C E R P E D D E T A L U M U C C A D N A ) s e i t r e p o r p f o r e b m u n t p e c x e , s d n a s u o h t n i s t n u o m A ( 9 1 7 , 4 9 2 3 , 5 0 3 3 , 5 2 7 1 , 7 2 4 3 , 3 8 3 7 , 1 5 5 1 , 2 7 6 1 , 1 8 2 7 , 6 1 3 2 3 , 7 7 0 4 , 7 2 2 0 , 6 1 1 1 8 , 3 5 3 2 , 2 7 3 2 , 3 9 4 6 , 1 3 5 6 , 4 1 2 8 5 , 6 0 8 9 , 5 9 8 2 , 0 1 6 8 5 , 3 1 7 9 , 1 2 9 6 , 2 6 5 4 , 1 1 4 7 5 7 0 , 2 7 2 4 , 1 3 3 7 , 5 5 2 2 4 6 2 5 4 5 3 9 1 9 9 7 , 3 6 7 4 , 3 9 9 5 , 2 3 8 1 , 1 7 6 1 , 2 7 6 0 , 1 3 1 4 , 1 9 9 3 , 1 7 8 7 , 0 1 0 3 0 , 3 0 8 3 , 3 6 0 1 , 9 9 1 4 , 1 4 0 9 9 7 2 , 1 6 0 2 7 1 8 2 4 1 , 2 8 2 4 , 1 3 3 7 , 5 5 2 2 4 6 2 5 4 5 4 4 1 3 3 , 9 6 2 6 6 , 5 7 1 4 1 3 , 2 6 1 8 4 3 , 3 1 5 2 3 , 6 3 1 3 4 1 , 6 2 4 9 1 , 3 1 — — — — — — — — — 5 5 1 0 5 1 4 4 1 8 9 4 9 6 5 5 5 3 3 3 2 2 2 2 1 1 1 4 7 9 , 3 2 4 , 9 $ 8 3 2 , 5 6 4 , 7 2 $ 0 5 7 , 6 3 8 , 1 2 $ 8 8 4 , 8 2 6 , 5 $ 0 1 5 , 4 4 7 , 4 $ 7 4 9 , 7 7 1 , 7 1 $ 1 8 7 , 2 4 5 , 5 $ 3 3 8 , 1 $ 1 7 0 , 8 1 2 4 4 0 , 3 3 2 0 2 , 1 3 r e b m e c e D t A t n u o m A g n i y r r a C s s o r G t s o C l a i t i n I d e t a l u m u c c A n o i t a i c e r p e D l a t o T s g n i d l i u B d n a L s t s o C t n e u q e s b u S n o i t i s i u q c A o t & s g n i d l i u B s t n e m e v o r p m I d n a L 3 2 0 2 - m u c n E s e c n a r b t e N e l b a t n e R t e e F e r a u q S f o . o N s e i t i l i c a F n o i t p i r c s e D e k o y l o H / d l e i f g n i r p S a r a b r a B a t n a S r e t s e h c o R t r o p e v e r h S a k e p o T n i l p o J e s u c a r y S n o t k c o t S / o n s e r F / o t s e d o M e t a t s e l a e r g n i t a r e p o - n o n d n a l a i c r e m m o C r e b m u n e h t f o s e r u s o l c s i d , n o i t i d d a n I . s r a e y 5 2 o t 5 n e e w t e b y l l a r e n e g g n i g n a r s e v i l l u f e s u d e t a m i t s e r e v o s i s a b e n i l - t h g i a r t s a n o d e t a i c e r p e d e r a s t n e m e v o r p m i d n a s g n i d l i u B : e t o N . d e t i d u a n u e r a s e i t i l i c a f r u o f o e g a t o o f e r a u q s d n a 5 3 - F (This Page Intentionally Left Blank) Exhibit 23.1 Consent of Independent Registered Public Accounting Firm We consent to the incorporation by reference in the following Registration Statements: (1) (2) (3) (4) (5) Registration Statement on Form S-3ASR (No. 333-273970) and related prospectus, Registration Statement on Form S-8 (No.333-255733) and related prospectus of Public Storage for the registration of common shares of beneficial interest pertaining to the Public Storage 2021 Equity and Performance-Based Incentive Compensation Plan, Registration Statement on Form S-8 (No. 333-210937) and related prospectus of Public Storage for the registration of common shares of beneficial interest pertaining to the Public Storage 2016 Equity and Performance-Based Incentive Compensation Plan, Registration Statement on Form S-8 (No. 333-195646) and related prospectus of Public Storage for the registration of common shares of beneficial interest pertaining to the Public Storage 2007 Equity and Performance-Based Incentive Compensation Plan, as amended, and Registration Statement on Form S-8 (No.333-144907) and related prospectus of Public Storage for the registration of common shares of beneficial interest pertaining to the Public Storage 2007 Equity and Performance-Based Incentive Compensation Plan; of our reports dated February 20, 2024, with respect to the consolidated financial statements of Public Storage and the effectiveness of internal control over financial reporting of Public Storage included in this Annual Report (Form 10-K) of Public Storage for the year ended December 31, 2023. /s/ ERNST & YOUNG LLP February 20, 2024 Los Angeles, California Exhibit 31.1 RULE 13A – 14(a) CERTIFICATION I, Joseph D. Russell, Jr., certify that: 1. I have reviewed this Annual Report on Form 10-K of Public Storage; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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; c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): a) b) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ Joseph D. Russell, Jr. Name: Title: Date: Joseph D. Russell, Jr. President and Chief Executive Officer February 20, 2024 Exhibit 31.2 RULE 13A – 14(a) CERTIFICATION I, H. Thomas Boyle, certify that: 1. I have reviewed this Annual Report on Form 10-K of Public Storage; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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; c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and 5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): a) b) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ H. Thomas Boyle Name: H. Thomas Boyle Title: Date: Senior Vice President, Chief Financial and Investment Officer February 20, 2024 Exhibit 32 SECTION 1350 CERTIFICATION In connection with the Annual Report on Form 10-K of Public Storage (the “Company”) for the year ended December 31, 2023, as filed with the Securities and Exchange Commission (the “SEC”) on the date hereof (the “Report”), Joseph D. Russell, Jr., as Chief Executive Officer and President of the Company and H. Thomas Boyle, as Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley”), that: (1) The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. /s/ Joseph D. Russell, Jr. Name: Title: Date: Joseph D. Russell, Jr. President and Chief Executive Officer February 20, 2024 /s/ H. Thomas Boyle Name: H. Thomas Boyle Title: Senior Vice President, Chief Financial and Investment Officer February 20, 2024 Date: This certification accompanies the Report pursuant to §906 of Sarbanes-Oxley and shall not, except to the extent required by Sarbanes-Oxley, be deemed filed by the Company for purposes of §18 of the Exchange Act. A signed original of this written statement required by §906 of Sarbanes-Oxley has been provided to the Company, and will be retained and furnished to the SEC or its staff upon request. Corporate Headquarters 701 Western Avenue Glendale, CA 91201-2349 Investor Relations Ryan Burke Vice President, Investor Relations and Strategic Partnerships (818) 244-8080 Transfer Agent Computershare Trust Company, N.A. P.O. Box 43078 Providence, RI 02940-3078 (781) 575-3120 Shareholder website: www.computershare.com/investor Shareholder online inquiries: www.computershare.com/us/investor-inquiries Independent Registered Public Accounting Firm Ernst & Young LLP Los Angeles, CA Annual Meeting of Shareholders The Annual Meeting of Shareholders of Public Storage will be held on May 7, 2024 at 11:00 a.m. Eastern Time at Millennium Downtown New York, 55 Church Street, New York, NY 10007. Additional Information Sources The Company’s website, PublicStorage.com, contains financial information of interest to shareholders, brokers and others. Public Storage is a member and active supporter of the National Association of Real Estate Investment Trusts. Certifications The most recent certifications by our Chief Executive Officer and Chief Financial Officer pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are filed as exhibits to our Form 10-K. Our Chief Executive Officer’s most recent annual certification to the New York Stock Exchange was submitted on May 4, 2023. Stock Exchange Listing The Company’s Common Shares trade under ticker symbol PSA on the New York Stock Exchange. CORPORATE INFORMATION (as of February 29, 2024) Trustees Ronald L. Havner, Jr. (2002) Chairman of the Board, Retired Chief Executive Officer, Public Storage Executive Team Joseph D. Russell, Jr. President, Chief Executive Officer Joseph D. Russell, Jr. (2019) President and Chief Executive Officer, Public Storage Tamara Hughes Gustavson (2008) Real Estate Investor, Philanthropist Leslie S. Heisz (2017) Retired Managing Director, Lazard Frères & Co. H. Thomas Boyle Senior Vice President, Chief Financial and Investment Officer Natalia N. Johnson Senior Vice President, Chief Administrative Officer Nathaniel A. Vitan Senior Vice President, Chief Legal Officer and Corporate Secretary Shankh S. Mitra (2021) Chief Executive Officer, Welltower, Inc. Michael Braine Chief Technology Officer David J. Neithercut (2021) Retired Chief Executive Officer, Equity Residential Andres M. Friedman Senior Vice President, Development Rebecca Owen (2021) Founder and Chairperson, Battery Reef, and Former Chief Legal Officer and Chief Investment Officer, Clark Enterprises, Inc. Kristy M. Pipes (2020) Retired Managing Director and Chief Financial Officer, Deloitte Consulting LLP Avedick B. Poladian (2010) Retired Executive Vice President and Chief Operating Officer, Lowe Enterprises, Inc. Dilhara Kaluarachchi Vice President, Customer Care Nicholas J. Kangas Executive Vice President, Finance and Accounting Steven H. Lentin Executive Vice President, Operations Michael K. McGowan Senior Vice President, Acquisitions John Reyes (2019) Retired Chief Financial Officer, Public Storage Matthew S. Murphy Chief Financial Officer, Operations Tariq M. Shaukat (2019) Co-Chief Executive Officer, Sonar Ronald P. Spogli (2010) Co-Founder, Freeman Spogli & Co. Paul S. Williams (2021) Retired Partner, Major, Lindsey & Africa, and Former President, National Association of Corporate Directors ( ) = Year trustee was elected to the Board Terrance F. Spidell Senior Vice President, Corporate Controller Nathan A. Tan Senior Vice President, Human Resources Phillip D. Williams, Jr. Senior Vice President, Construction Robbie Williams Senior Vice President, Asset Management Third Party Management Peter G. Panos President PS Insurance Marshann G. Varley President Lending Irena R. Edwards Vice President Founders B. Wayne Hughes Kenneth Q. Volk, Jr. Shurgard Self Storage Limited Marc Oursin Chief Executive Officer PUBLIC STORAGE 701 Western Avenue, Glendale, California 91201-2349 (818) 244-8080 • PublicStorage.com 

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