UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-K

☒

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☒~~ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934~~

For the fiscal year ended December 31, ~~2017~~2021

☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐~~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 001-32324 (CubeSmart)

Commission file number 000-54462 (CubeSmart, L.P.)

CUBESMART

CUBESMART, L.P.

(Exact Name of Registrant as Specified in Its Charter)

Maryland (CubeSmart)		20-1024732 (CubeSmart)
Delaware (CubeSmart, L.P.)		34-1837021 (CubeSmart, L.P.)
(State or Other Jurisdiction of		(IRS Employer
Incorporation or Organization)		Identification No.)

5 Old Lancaster Road		19355
Malvern, Pennsylvania		(Zip Code)
(Address of Principal Executive Offices)

Registrant’s telephone number, including area code (610) 535-5000

Securities registered pursuant to Section 12(b) of the Act:

Title of ~~each class~~Each Class		Trading Symbol(s)		Name of ~~each exchange~~Each Exchange on ~~which registered~~Which Registered
Common Shares, $0.01 par value per share, of CubeSmart		CUBE		New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: Units of General Partnership Interest of CubeSmart, L.P.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

CubeSmart	Yes	☒	No	☐
CubeSmart, L.P.	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 Act.

CubeSmart	Yes ☐	◻	No ☒	⌧
CubeSmart, L.P.	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.

CubeSmart	Yes	☒	No	☐
CubeSmart, L.P.	Yes	☒	No	☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files).

CubeSmart	Yes ☒	⌧	No ☐	◻
CubeSmart, L.P.	Yes ☒	⌧	No ☐	◻

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

~~CubeSmart~~	~~Yes ☒ No ☐~~
~~CubeSmart, L.P.~~	~~Yes ☒ No ☐~~

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” ~~and~~ “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:



CubeSmart:
Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company	☐	Emerging growth company	☐
CubeSmart, L.P.:
Large accelerated filer ☒	☐	Accelerated filer ☐	☐	Non-accelerated filer ☐	☒	Smaller reporting company	☐	Emerging growth company	☐

~~CubeSmart, L.P.:~~
~~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.


CubeSmart	☐◻
CubeSmart, L.P.	☐◻

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.


CubeSmart ⌧
CubeSmart, L.P. ⌧

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).


CubeSmart	Yes	☐	No	☒
CubeSmart, L.P.	Yes	☐	No	☒

As of June 30, ~~2017,~~2021, the last business day of CubeSmart’s most recently completed second fiscal quarter, the aggregate market value of common shares held by non-affiliates of CubeSmart was ~~$4,331,947,035.~~$9,345,935,587. As of February ~~14, 2018,~~23, 2022, the number of common shares of CubeSmart outstanding was ~~182,277,838.~~

224,002,775.

As of June 30, ~~2017,~~2021, the last business day of CubeSmart, L.P.’s most recently completed second fiscal quarter, the aggregate market value of the ~~2,471,554~~7,284,506 units of limited partnership (the “OP Units”) held by non-affiliates of CubeSmart, L.P. was ~~$59,416,158~~$337,418,318 based upon the last reported sale price of ~~$24.04~~$46.32 per share on the New York Stock Exchange on June 30, ~~2017~~2021 of the common shares of CubeSmart, the sole general partner of CubeSmart, L.P. (For this computation, the market value of all OP Units beneficially owned by CubeSmart has been excluded.)

Documents incorporated by reference: Portions of the Proxy Statement for the ~~2018~~2022 Annual Meeting of Shareholders of CubeSmart to be filed subsequently with the SEC are incorporated by reference into Part III of this report.

EXPLANATORY NOTE

This report combines the annual reports on Form 10-K for the year ended December 31, ~~2017~~2021 of CubeSmart (the “Parent Company” or “CubeSmart”) and CubeSmart, L.P. (the “Operating Partnership”). The Parent Company is a Maryland real estate investment trust ~~or REIT,~~(“REIT”), that owns its assets and conducts its operations through the Operating Partnership, a Delaware limited partnership, and subsidiaries of the Operating Partnership. The Parent Company, the Operating Partnership and their consolidated subsidiaries are collectively referred to in this report as the “Company”. In addition, terms such as “we”, “us”, or “our” used in this report may refer to the Company, the Parent Company and/or the Operating Partnership.

The Parent Company is the sole general partner of the Operating Partnership and, as of December 31, ~~2017,~~2021, owned a ~~99.0%~~99.2% interest in the Operating Partnership. The remaining ~~1.0%~~0.8% interest consists of common units of limited partnership interest issued by the Operating Partnership to third parties in exchange for contributions of properties to the Operating Partnership. As the sole general partner of the Operating Partnership, the Parent Company has full and complete authority over the Operating Partnership’s day-to-day operations and management.

Management operates the Parent Company and the Operating Partnership as one enterprise. The management teams of the Parent Company and the Operating Partnership are identical, and their constituents are officers of both the Parent Company and of the Operating Partnership.

There are a few differences between the Parent Company and the Operating Partnership, which are reflected in the note disclosures in this report. The Company believes it is important to understand the differences between the Parent Company and the Operating Partnership in the context of how these entities operate as a consolidated enterprise. The Parent Company is a REIT, whose only material asset is its ownership of the partnership interests of the Operating Partnership. As a result, the Parent Company does not conduct business itself, other than acting as the sole general partner of the Operating Partnership, issuing public equity from time to time and guaranteeing the debt obligations of the Operating Partnership. The Operating Partnership holds substantially all of the assets of the Company and, directly or indirectly, holds the ownership interests in the Company’s real estate ventures. The Operating Partnership conducts the operations of the Company’s business and is structured as a partnership with no publicly traded equity. Except for net proceeds from equity issuances by the Parent Company, which are contributed to the Operating Partnership in exchange for partnership units, the Operating Partnership generates the capital required by the Company’s business through the Operating Partnership’s operations, by the Operating Partnership’s direct or indirect incurrence of indebtedness or through the issuance of partnership units of the Operating Partnership or equity interests in subsidiaries of the Operating Partnership.

The substantive difference between the Parent Company’s and the Operating Partnership’s filings is the fact that the Parent Company is a REIT with public equity, while the Operating Partnership is a partnership with no publicly traded equity. In the financial statements, this difference is primarily reflected in the equity (or capital for the Operating Partnership) section of the consolidated balance sheets and in the consolidated statements of equity (or capital). Apart from the different equity treatment, the consolidated financial statements of the Parent Company and the Operating Partnership are nearly identical.

The Company believes that combining the annual reports on Form 10-K of the Parent Company and the Operating Partnership into a single report will:

●

facilitate a better understanding by the investors of the Parent Company and the Operating Partnership by enabling them to view the business as a whole in the same manner as management views and operates the business;

●

remove duplicative disclosures and provide a more straightforward presentation in light of the fact that a substantial portion of the disclosure applies to both the Parent Company and the Operating Partnership; and

●

create time and cost efficiencies through the preparation of one combined report instead of two separate reports.

In order to highlight the differences between the Parent Company and the Operating Partnership, the separate sections in this report for the Parent Company and the Operating Partnership specifically refer to the Parent Company and the Operating Partnership. In the sections that combine disclosures of the Parent Company and the Operating Partnership, this report refers to such disclosures as those of the Company. Although the Operating Partnership is generally the entity that directly or indirectly enters into contracts and real estate ventures and holds assets and debt, reference to the Company is appropriate because the business is one enterprise and the Parent Company operates the business through the Operating Partnership.

As general partner with control of the Operating Partnership, the Parent Company consolidates the Operating Partnership for financial reporting purposes, and the Parent Company does not have significant assets other than its investment in the Operating Partnership. Therefore, the assets and liabilities of the Parent Company and the Operating Partnership are the same on their respective financial

statements. The separate discussions of the Parent Company and the Operating Partnership in this report should be read in conjunction with each other to understand the results of the Company’s operations on a consolidated basis and how management operates the Company.

This report also includes separate Item 9A - Controls and Procedures sections, signature pages and ~~Exhibit~~Exhibits 31 and 32, certifications for each of the Parent Company and the Operating Partnership, in order to establish that the Chief Executive Officer and the Chief Financial Officer of the Parent Company and the Chief Executive Officer and the Chief Financial Officer of the Operating Partnership have made the requisite certifications and that the Parent Company and the Operating Partnership are compliant with Rule 13a-15 or Rule 15d-15 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and 18 U.S.C. §1350.

PART I

Forward-Looking Statements

This Annual Report on Form 10-K, or this Report, together with other statements and information publicly disseminated by the Parent Company and the Operating Partnership, contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. Forward-looking statements include statements concerning the Company’s plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs, plans or intentions relating to acquisitions and other information that is not historical information. In some cases, forward-looking statements can be identified by terminology such as “believes”, “expects”, “estimates”, “may”, “will”, “should”, “anticipates”, or “intends” or the negative of such terms or other comparable terminology, or by discussions of strategy. Such statements are based on assumptions and expectations that may not be realized and are inherently subject to risks, uncertainties and other factors, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Although we believe the expectations reflected in these forward-looking statements are based on reasonable assumptions, future events and actual results, performance, transactions or achievements, financial and otherwise, may differ materially from the results, performance, transactions or achievements expressed or implied by the forward-looking statements. As a result, you should not rely on or construe any forward-looking statements in this Report, or which management or persons acting on their behalf may make orally or in writing from time to time, as predictions of future events or as guarantees of future performance. We caution you not to place undue reliance on forward-looking statements, which speak only as of the date of this Report or as of the dates otherwise indicated in ~~the~~such forward-looking statements. All of our forward-looking statements, including those in this Report, are qualified in their entirety by this statement.

There are a number of risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements contained in or contemplated by this Report. Any forward-looking statements should be considered in light of the risks and uncertainties referred to in Item 1A. “Risk Factors” in this Report and in our other filings with the Securities and Exchange Commission (“SEC”). These risks include, but are not limited to, the following:

●

~~national and local~~adverse changes in economic ~~business,~~conditions in the real estate industry and ~~other market conditions;~~

in the ~~competitive environment~~markets in which we own and operate ~~including~~self-storage properties;

●

the effect of competition from existing and new self-storage properties and operators on our ability to maintain or raise occupancy and rental rates;

●

the ~~execution of~~failure to execute our business plan;

●

adverse impacts from the COVID-19 pandemic, other pandemics, quarantines and stay at home orders, including the impact on our ability to operate our self-storage properties, the demand for self-storage, rental rates and fees and rent collection levels;

~~the~~●

reduced availability and increased costs of external sources of capital;

●

increases in interest rates and operating costs;

●

financing risks, including the risk of over-leverage and the corresponding risk of default on our mortgage and other debt and potential inability to refinance existing ~~indebtedness;~~

or future debt;

●

~~increases in interest rates and operating costs;~~

counterparty non-performance related to the use of derivative financial instruments;

●

risks related to our ability to maintain our Parent Company’s qualification as a REIT for federal income tax purposes;

●

~~acquisition~~the failure of acquisitions and ~~development risks;~~

developments to close on expected terms, or at all, or to perform as expected;

●

increases in taxes, fees and assessments from state and local jurisdictions;

●

the failure of our joint venture partners to fulfill their obligations to us or their pursuit of actions that are inconsistent with our objectives;

●

reductions in asset valuations and related impairment charges;

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●

cyber security breaches, cyber or ransomware attacks or a failure of our networks, systems or technology, which could adversely impact our business, customer and employee ~~relationships;~~

relationships or result in fraudulent payments;

●

changes in real estate, zoning, use and ~~zoning~~occupancy laws or regulations;

●

risks related to or a consequence of natural ~~disasters;~~

disasters or acts of violence, pandemics, active shooters, terrorism, insurrection or war that affect the markets in which we operate;

●

potential environmental and other liabilities;

●

governmental, administrative and executive orders and laws, which could adversely impact our business operations and customer and employee relationships;

●

uninsured or uninsurable losses and the ability to obtain insurance coverage or recovery from insurance against risks and losses;

●

the ability to attract and retain talent in the current labor market;

●

other factors affecting the real estate industry generally or the self-storage industry in particular; and

●

other risks identified in this Report and, from time to time, in other reports that we file with the SEC or in other documents that we publicly disseminate.

Given these uncertainties and the other risks identified elsewhere in this Report, we caution readers not to place undue reliance on forward-looking statements. We undertake no obligation to publicly update or revise these forward-looking statements, whether as a result of new information, future events or otherwise except as may be required by securities laws. Because of the factors referred to above, the future events discussed in or incorporated by reference in this Report may not occur and actual results, performance or achievement could differ materially from that anticipated or implied in the forward-looking statements.

ITEM 1. BUSINESS

~~ITEM 1.~~ ~~BUSINESS~~

Overview

~~Overview~~

We are a self-administered and self-managed real estate company focused primarily on the ownership, operation, management, acquisition and development of self-storage properties in the United States.

As of December 31, ~~2017,~~2021, we owned ~~484~~(or partially owned and consolidated) 607 self-storage properties located in 2324 states and in the District of Columbia containing an aggregate of approximately ~~33.8~~43.6 million rentable square feet. As of December 31, ~~2017,~~2021, approximately ~~89.2%~~92.0% of the rentable square footage at our owned stores was leased to approximately ~~279,000~~379,000 customers, and no single customer represented a significant concentration of our revenues. As of December 31, ~~2017,~~2021, we owned stores in the District of Columbia and the following 2324 states: Arizona, California, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah and Virginia. In addition, as of December 31, ~~2017,~~2021, we managed ~~452~~651 stores for third parties (including ~~117~~90 stores containing an aggregate of approximately ~~6.9~~6.5 million net rentable square feet as part of ~~four~~seven separate unconsolidated real estate ventures) bringing the total number of stores we owned and/or managed to ~~936.~~1,258. As of December 31, ~~2017,~~2021, we managed stores for third parties in the District of Columbia and the following 3136 states: Alabama, Arizona, California, Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, ~~Kansas,~~Indiana, Iowa, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Vermont, Virginia, Washington ~~West Virginia,~~ and Wisconsin.

Our self-storage properties are designed to offer affordable and easily-accessible storage space for our residential and commercial customers. Our customers rent storage cubes for their exclusive use, typically on a month-to-month basis. Additionally, some of our stores offer outside storage areas for vehicles and boats. Our stores are designed to accommodate both residential and commercial customers, with features such as wide aisles and load-bearing capabilities for large truck access. All of our stores have a storage associate available to assist our customers during business hours, and ~~286,~~331, or approximately ~~59.1%~~54.5%, of our owned stores have a manager who resides in an apartment at the store. Our customers can access their storage cubes during business hours, and some of our stores provide customers with 24-hour access through computer-controlled access systems. Our goal is to provide customers with the highest standard of physical attributes and service in the industry. To that end, ~~410,~~505, or approximately ~~84.7%~~83.2%, of our owned stores include climate-controlled cubes.

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The Parent Company was formed in July 2004 as a Maryland REIT. The Parent Company owns its assets and conducts its business through the Operating Partnership, and its subsidiaries. The Parent Company controls the Operating Partnership as its sole general partner and, as of December 31, ~~2017,~~2021, owned ~~an approximately 99.0%~~a 99.2% interest in the Operating Partnership. The Operating Partnership was formed in July 2004 as a Delaware limited partnership and has been engaged in virtually all aspects of the self-storage business, including the development, acquisition, management, ownership and operation of self-storage properties.

Impact of COVID-19 on the Consolidated Financial Statements and Business Operations

Since the first quarter of 2020, the world has been impacted by the spread of a novel strain of coronavirus, its variants and the disease that they cause known as COVID-19. Our stores have remained open throughout the pandemic and, to date, we have not experienced any material degradation in rent collections or occupancy. However, the duration and scope of the pandemic; actions that have been and continue to be taken by governmental entities, individuals and businesses in response to the pandemic; and the continued impact on economic activity from the pandemic may, individually or in aggregate, impact our future business, financial condition, results of operations, access to capital and share price.

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Acquisition and Disposition Activity

As of December 31, ~~2017~~2021 and ~~2016,~~2020, we owned ~~484~~607 and ~~475~~543 stores, respectively, that contained an aggregate of ~~33.8~~43.6 million and ~~32.9~~38.5 million rentable square feet with occupancy levels of ~~89.2%~~92.0% and ~~89.7%~~92.3%, respectively. ~~A complete listing of, and additional~~Additional information about our stores is included in Item 2 of this Report. The following is a summary of our ~~2017, 2016~~2021, 2020 and ~~2015~~2019 acquisition and disposition activity:


			Number of	Purchase / Sale Price
Asset/Portfolio	Metropolitan Statistical Area	Transaction Date	Stores	(in thousands)

2021 Acquisitions:

Minnesota Asset ⁽¹⁾	Minneapolis-St. Paul-Bloomington, MN-WI	April 2021	1	$	12,000
Maryland Asset	Baltimore-Towson, MD	June 2021	1		22,075
New Jersey/Pennsylvania Assets	Philadelphia-Camden-Wilmington, PA-NJ-DE-MD	July 2021	2		33,000
Florida Asset	Miami-Fort Lauderdale-Pompano Beach, FL	November 2021	1		14,750
Georgia Asset	Atlanta-Sandy Springs-Marietta, GA	November 2021	1		15,200
Pennsylvania Asset	Philadelphia-Camden-Wilmington, PA-NJ-DE-MD	November 2021	1		24,500
Nevada Asset	Las Vegas-Paradise, NV	December 2021	1		21,000
Storage West Assets	Various (see note 4)	December 2021	57		1,648,426	⁽²⁾
Illinois Asset	Chicago-Naperville-Joliet, IL-IN-WI	December 2021	1		10,300
			66	$	1,801,251

2021 Dispositions:

Colorado/Nevada Assets	Denver-Aurora, CO / Las Vegas-Paradise, NV	September 2021	2	$	16,900
North Carolina Assets	Burlington, NC	September 2021	2		21,700
Texas Asset	Houston-Sugar Land-Baytown, TX	November 2021	1		5,200
			5	$	43,800

2020 Acquisitions:

Texas Asset	San Antonio, TX	February 2020	1	$	9,025
Maryland Asset	Baltimore-Towson, MD	April 2020	1		17,200
New Jersey Asset	New York-Northern New Jersey-Long Island, NY-NJ-PA	April 2020	1		48,450
Florida Asset	Palm Bay-Melbourne-Titusville, FL	November 2020	1		3,900
Texas Asset	Austin-Round Rock, TX	November 2020	1		10,750
Texas Asset	Dallas-Fort Worth-Arlington, TX	November 2020	1		10,150
Nevada Asset	Las Vegas-Paradise, NV	December 2020	1		16,800
New York Asset	New York-Northern New Jersey-Long Island, NY-NJ-PA	December 2020	1		6,750
Florida Asset	Tampa-St. Petersburg-Clearwater, FL	December 2020	1		10,000
Virginia Asset	Washington-Arlington-Alexandria, DC-VA-MD-WV	December 2020	1		17,350
Storage Deluxe Assets	New York-Northern New Jersey-Long Island, NY-NJ-PA	December 2020	8		540,000
Florida Assets	Orlando-Kissimmee, FL / Deltona-Daytona Beach-Ormond Beach, FL	December 2020	3		45,500
			21	$	735,875

2020 Disposition:

New York Asset	New York-Northern New Jersey-Long Island, NY-NJ-PA	December 2020	1	$	12,750
			1	$	12,750
2019 Acquisitions:

Maryland Asset	Baltimore-Towson, MD	March 2019	1	$	22,000
Florida Assets	Cape Coral-Fort Myers, FL	April 2019	2		19,000
Arizona Asset	Phoenix-Mesa-Scottsdale, AZ	May 2019	1		1,550
HVP III Assets	Various (see note 4)	June 2019	18		128,250	⁽³⁾
Georgia Asset	Atlanta-Sandy Springs-Marietta, GA	August 2019	1		14,600
South Carolina Asset	Charleston-North Charleston, SC	August 2019	1		3,300
Texas Asset	Dallas-Fort Worth-Arlington, TX	October 2019	1		7,300
Florida Assets	Orlando-Kissimmee, FL	November 2019	3		32,100
California Asset	Los Angeles-Long Beach-Santa Ana, CA	December 2019	1		18,500
			29	$	246,600

2019 Disposition:

Texas Asset	College Station-Bryan, TX	October 2019	1	$	4,146
			1	$	4,146

(1)

Acquired by a consolidated joint venture in which we hold a 50% interest.

(2)

Purchase price represents the acquisition of all 167,557 outstanding partnership units of LAACO, Ltd. (“LAACO”) for $9,838 per unit. At the time of the acquisition, LAACO owned 57 storage properties (the “Storage West Assets”) and 50% ownership interests in two separate joint ventures. Through this acquisition, the Company also acquired LAACO’s wholly-owned subsidiaries, the Los Angeles Athletic Club and the California Yacht Club (the “Club Operations”), which are classified as held

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Number of

Purchase / Sale Price
Asset/Portfolio

Market

Transaction Date

Stores

(in thousands)

2017 Acquisitions:

Illinois Asset

Chicago

April 2017

1

$
11,200
Maryland Asset

Baltimore / DC

May 2017

1

18,200
California Asset

Sacramento

May 2017

1

3,650
Texas Asset

Texas Markets - Major

October 2017

1

4,050
Florida Asset

Florida Markets - Other

October 2017

1

14,500
Illinois Asset

Chicago

November 2017

1

11,300
Florida Asset

Florida Markets - Other

December 2017

1

17,750

7

$
80,650

2016 Acquisitions:

Metro DC Asset

Baltimore / DC

January 2016

1

$
21,000
Texas Assets

Texas Markets - Major

January 2016

2

24,800
New York Asset

New York / Northern NJ

January 2016

1

48,500
Texas Asset

Texas Markets - Major

January 2016

1

11,600
Connecticut Asset

Connecticut

February 2016

1

19,000
Texas Asset

Texas Markets - Major

March 2016

1

11,600
Florida Assets

Florida Markets - Other

March 2016

3

47,925
Colorado Asset

Denver

April 2016

1

11,350
Texas Asset

Texas Markets - Major

April 2016

1

11,600
Texas Asset

Texas Markets - Major

May 2016

1

10,100
Texas Asset

Texas Markets - Major

May 2016

1

10,800
Illinois Asset

Chicago

May 2016

1

12,350
Illinois Asset

Chicago

May 2016

1

16,000
Massachusetts Asset

Massachusetts

June 2016

1

14,300
Nevada Assets

Las Vegas

July 2016

2

23,200
Arizona Asset

Phoenix

August 2016

1

14,525
Minnesota Asset

Minneapolis

August 2016

1

15,150
Colorado Asset

Denver

August 2016

1

15,600
Texas Asset

Texas Markets - Major

September 2016

1

6,100
Texas Asset

Texas Markets - Major

September 2016

1

5,300
Nevada Asset

Las Vegas

October 2016

1

13,250
North Carolina Asset

Charlotte

November 2016

1

10,600
Arizona Asset

Phoenix

November 2016

1

14,000
Nevada Asset

Las Vegas

December 2016

1

14,900

28

$
403,550

2015 Acquisitions:

Texas Asset

Texas Markets - Major

February 2015

1

$
7,295
HSRE Assets

Chicago

March 2015

4

27,500
Arizona Asset

Arizona / Las Vegas

March 2015

1

7,900
Tennessee Asset

Tennessee

March 2015

1

6,575
Texas Asset

Texas Markets - Major

April 2015

1

15,795
Florida Asset

Florida Markets - Other

May 2015

1

7,300
Arizona Asset

Arizona / Las Vegas

June 2015

1

10,100
Florida Asset

Florida Markets - Other

June 2015

1

10,500
Texas Asset

Texas Markets - Major

July 2015

1

14,200
Maryland Asset

Baltimore / DC

July 2015

1

17,000
Maryland Asset

Baltimore / DC

July 2015

1

19,200
New York/New Jersey Assets

New York / Northern NJ

August 2015

2

24,823
New Jersey Asset

New York / Northern NJ

December 2015

1

14,350
PSI Assets

Various (see note 4)

December 2015

12

109,824

29

$
292,362

2015 Dispositions:

Texas Assets

Texas Markets - Major

October 2015

7

$
28,000
Florida Asset

Florida Markets - Other

October 2015

1

9,800

8

$
37,800

for sale on the Company’s consolidated balance sheets as of December 31, 2021. See note 4 to our consolidated financial statements.

(3)

Amount represents the purchase price for 90% of the ownership interest in 191 III CUBE LLC (“HVP III”), which at the time of the acquisition owned 18 storage properties (see note 5 to our consolidated financial statements).

The comparability of our results of operations is affected by the timing of acquisition and disposition activities during the periods reported. As of December 31, ~~2017, 2016,~~2021, 2020 and ~~2015,~~2019, we owned ~~484, 475,~~(or partially owned and ~~445~~consolidated) 607, 543 and 523 self-storage properties and related assets, respectively. The following table summarizes the change in number of owned stores from January 1, ~~2015~~2019 through December 31, ~~2017:~~2021:

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	2017	2016	2015


				2021	2020	2019

Balance - January 1	475	445	421	543	523	493
Stores acquired	—	10	7	—	1	1
Stores developed	1	1	—	1	—	—
Stores combined ⁽¹⁾				(1)	—	—
Balance - March 31	476	456	428	543	524	494
Stores acquired	3	7	4
Stores acquired ⁽²⁾				2	2	21
Stores developed	—	1	1	2	1	2
Stores combined (1)	(1)	—	—
Stores combined ⁽³⁾				—	—	(1)
Balance - June 30	478	464	433	547	527	516
Stores acquired	—	7	5	2	—	2
Stores developed	2	—	—	—	—	1
Stores sold				(4)	—	—
Balance - September 30	480	471	438	545	527	519
Stores acquired	4	4	13	62	18	5
Stores developed	1	—	2	1	—	—
Stores combined (2)	(1)	—	—
Stores combined ⁽³⁾				—	(1)	—
Stores sold	—	—	(8)	(1)	(1)	(1)
Balance - December 31	484	475	445	607	543	523

(1)

On ~~May 16, 2017, the Company acquired~~March 3, 2021, we completed development of a store located in ~~Sacramento, CA~~Arlington, VA for a total cost of approximately ~~$3.7 million, which~~$26.4 million. The developed store is located ~~directly~~ adjacent to an existing ~~wholly-owned~~consolidated joint venture store. Given their proximity to each other, the stores have been combined in our store count, as well as for operational and reporting purposes.

(2)

For the quarter ended June 30, 2021, includes one store acquired by a consolidated joint venture in which we hold a 50% interest.

(3)

On ~~October 2, 2017, the Company~~May 24, 2019 and November 10, 2020, we acquired ~~a store~~stores located in ~~Keller, TX~~Tempe, AZ and Merritt Island, FL for approximately ~~$4.1~~$1.6 million ~~which~~and $3.9 million, respectively. In each case, the store acquired is located ~~directly adjacent~~in near proximity to an existing wholly-owned store. Given their proximity to each other, ~~the stores have~~each acquired store has been combined with the existing store in our store count, as well as for operational and reporting purposes.

Financing and Investing Activities

The following summarizes certain financing and investing activities during the year ended December 31, ~~2017:~~2021:

●

Store Acquisitions. We acquired LAACO, the owner of the Storage West Assets, for a purchase price of $1.69 billion, which included approximately $40.9 million of LAACO debt that we repaid at the closing. This acquisition included 57 stores in Arizona (17), California (20), Nevada (13) and Texas (7). As part of this transaction, we also acquired a 50% interest in two separate unconsolidated joint ventures, each of which own a store in California. Through our acquisition of LAACO, we also acquired the Club Operations.

In addition to LAACO, we acquired eight additional stores which are located in Florida (1), Georgia (1), Illinois (1), Maryland (1), Nevada (1), New Jersey (1), and Pennsylvania (2) for an aggregate purchase price of approximately $140.8 million. Also, a consolidated joint venture in which we hold a 50% interest acquired a store in Minnesota for a purchase price of $12.0 million.

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●

~~Store Acquisitions.~~ ~~During 2017, we acquired seven self-storage~~Development Activity. We completed construction of and opened for operation four joint venture development properties located ~~throughout~~in Massachusetts (1), New York (1), Pennsylvania (1) and Virginia (1) for a total cost of $95.9 million. As of December 31, 2021, we had three joint venture development properties under construction located in New York (2) and Virginia (1), which are expected to be completed by the ~~United States, including~~first quarter of 2023. As of December 31, 2021, we had invested $37.8 million of an expected $92.3 million related to these three projects.

●

Consolidated Development Joint Venture Buy-outs. We acquired the noncontrolling members’ interests in two previously consolidated development joint ventures for an aggregate of $10.0 million. The stores ~~upon completion~~are located in Massachusetts (1) and New York (1) and are wholly owned by the Company as of ~~construction~~December 31, 2021.

●

Store Dispositions. We sold five stores in Colorado (1), Nevada (1), North Carolina (2) and Texas (1) for an aggregate sales price of $43.8 million. In conjunction with the ~~issuance of~~sales, we recorded gains that totaled $32.7 million.

●

Unconsolidated Real Estate Venture Activity. 191 V CUBE LLC, a ~~certificate of occupancy,~~newly-formed unconsolidated real estate venture in which we own a 20% interest, acquired five stores for an aggregate purchase price of ~~approximately $80.7 million. In connection with these acquisitions,~~$143.7 million, of which we allocated a portion of the purchase price paid for each store to the intangible value of in-place leases which aggregated $3.2 million. As of December 31, 2017, we had one store under contract for a total acquisition price of $12.2 million, which was acquired on January 31, 2018. As of December 31, 2017, we also had one store under contract for a total acquisition price of $20.8 million to be acquired after the completion of construction and the issuance of the certificate of occupancy. This acquisition is subject to due diligence and other customary closing conditions, and no assurance can be provided that the acquisition will be completed on the terms described, or at all.

~~Development Activity.~~ ~~During 2017, we completed construction and opened for operation two wholly-owned development properties and two joint venture development properties for a total cost of $168.0~~contributed $22.6 million. The ~~wholly-owned development properties opened during 2017~~acquired stores are located in Florida (2), New Jersey (2) and ~~Washington, D.C. The joint~~New York (1). 191 IV CUBE LLC, an existing unconsolidated real estate venture ~~development properties opened during 2017 are both~~in which we own a 20% interest, acquired seven additional stores located in ~~New York. As~~Connecticut (1), Illinois (5) and Maryland (1), for an aggregate purchase price of ~~December 31, 2017,~~$108.6 million, of which we ~~had six joint~~contributed $5.7 million. Cube HHF Limited Partnership (“HHF”), an existing unconsolidated real estate venture ~~development properties under construction. We anticipate investing~~in which we own a ~~total~~50% interest, sold seven stores located in Texas for an aggregate sales price of ~~$230.5~~$85.0 million ~~related to these six projects,~~ and ~~construction for all projects is expected to be completed by~~recorded a gain of $46.9 million in connection with the ~~third quarter of 2019.~~

sale.

●

Unsecured Senior Note Activity. On November 30, 2021, the Operating Partnership issued $550.0 million in aggregate principal amount of unsecured senior notes due December 15, 2028, which bear interest at a rate of 2.250% per annum (the “2028 Notes”) and $500.0 million in aggregate principal amount of unsecured senior notes due February 15, 2032, which bear interest at a rate of 2.500% per annum (the “2032 Notes”). On December 23, 2021, with net proceeds from our issuance of the 2028 Notes and 2032 Notes, we redeemed, in full, our $300.0 million of outstanding 4.375% senior notes due 2023.

●

Mortgage Loan Activity. We repaid two mortgage loans with an aggregate outstanding principal balance of $43.9 million.

●

Public Equity Offering. On November 19, 2021, we completed an underwritten offering of 15.5 million common shares at a public offering price of $51.00 per share, resulting in net proceeds of $765.6 million, after deducting offering costs.

●

At-The-Market Equity ~~Program.~~ ~~During 2017, under~~Program Activity. Under our at-the-market equity program, we sold a total of ~~1.0~~5.0 million common shares at an average sales price of ~~$29.13~~$40.57 per share, resulting in net proceeds ~~under~~of $200.0 million for the ~~program of $29.6 million,~~year, after deducting offering costs. As of December 31, ~~2017, 4.7~~2021, 5.9 million common shares remained available for sale under the program. ~~The~~We used the proceeds from the 2021 sales ~~conducted during~~under the ~~year ended December 31, 2017 were used~~program to fund ~~acquisitions~~the acquisition and development of self-storage properties and for general corporate purposes.

~~Debt Offering.~~ On April 4, 2017, we completed the issuance and sale of $50.0 million in aggregate principal amount of 4.375% unsecured senior notes due December 15, 2023, which are part of the same series as the $250.0 million in aggregate principal amount of 4~~.375% senior notes due December 15, 2023 issued on December 17, 2013.~~ ~~On April 4, 2017, we also~~

completed the issuance and sale of $50.0 million in aggregate principal amount of 4.000% unsecured senior notes due November 15, 2025, which are part of the same series as the $250.0 million in aggregate principal amount of 4~~.000% senior notes due November 15, 2025 issued on October 26, 2015.~~ ~~Net proceeds from the offerings were used to repay outstanding indebtedness under our $100.0 million unsecured term loan that was scheduled to mature in June 2018.~~

~~Mortgage Loans.~~ During 2017, we repaid one mortgage loan for $6.2 million and, in conjunction with the acquisition of a store located in Maryland, assumed one mortgage loan with an outstanding principal balance of $5.8 million as of December 31, 2017.

Business Strategy

Our business strategy consists of several elements:

●

Maximize cash flow from our stores — ~~Our operating strategy focuses on maximizing sustainable rents at our stores while achieving and sustaining occupancy targets.~~ We utilize our operating systems and experienced personnel to manage the balance between rental rates, discounts and physical occupancy with an objective of maximizing our rental revenue.

●

Acquire stores within targeted markets — During ~~2018,~~2022, we intend to pursue selective acquisitions in markets that we believe have high barriers to entry, strong demographic fundamentals and demand for storage in excess of storage capacity. We believe the self-storage industry will continue to afford us opportunities for growth through acquisitions due to the highly fragmented composition of the industry. In the past, we have formed joint ventures with unaffiliated third parties, and in the future we may form additional joint ventures, to facilitate the funding of future developments or acquisitions.

●

Dispose of stores — During ~~2018,~~2022, we intend to continue to evaluate opportunities to dispose of assets that have unattractive ~~risk adjusted~~risk-adjusted returns. We intend to use proceeds from these transactions to fund acquisitions within targeted ~~markets.~~

markets and for general corporate purposes.

●

Grow our third-party management business — We intend to pursue additional third-party management ~~opportunities. We intend~~opportunities and to leverage our current platform to take advantage of consolidation in the industry. We plan to utilize our relationships with third-party owners to help source future ~~acquisitions.~~

acquisitions and other investment opportunities.

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Investment and Market Selection Process

We maintain a disciplined and focused process in the acquisition and development of self-storage properties. Our investment committee is comprised of ~~five~~four senior officers ~~and led by Christopher P. Marr, our Chief Executive Officer, oversees~~who oversee our investment process. Our investment process involves six stages — identification, initial due diligence, economic assessment, investment committee approval (and when required, the approval of our Board of Trustees (the “Board”)), final due diligence and documentation. Through our investment committee, we intend to focus on the following criteria:

●

Targeted markets — Our targeted markets include areas where we currently maintain management that can be extended to additional stores, or where we believe that we can acquire a significant number of stores ~~efficiently and within a short period of~~over time. We evaluate both the broader market and the immediate trade area, typically three miles around the store, for its ability to support above-average demographic growth. We seek to increase our presence primarily in areas ~~that we expect will experience~~with strong demographics and growth, including, ~~the Northeastern and Mid-Atlantic areas of~~but not exclusively limited to, major metropolitan regions within the United ~~States and areas within Arizona, California, Florida, Georgia, Illinois, and Texas, and to enter additional markets should suitable opportunities arise.~~

States.

●

Quality of store — We focus on self-storage properties that have good visibility, ease of access and are located near retail centers, which typically provide high traffic corridors and are generally located near residential communities and commercial customers.

●

Growth potential — We target acquisitions that offer growth potential through increased operating efficiencies and, in some cases, through additional leasing efforts, renovations or expansions. In addition to acquiring single stores, we seek to invest in portfolio acquisitions, including those offering significant potential for increased operating efficiency and the ability to spread our fixed costs across a large base of stores.

Segment

We have one reportable segment: we own, operate, develop, manage and acquire self-storage properties.

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Concentration

~~Concentration~~

Our self-storage properties are located in major metropolitan areas as well as suburban areas and have numerous customers per store. No single customer represented a significant concentration of our ~~2017~~2021 revenues. Our stores in New York, Florida, Texas and California provided approximately 19%, 15%, 9% and 8%, respectively, of our total revenues for the year ended December 31, 2021. Our stores in New York, Florida, Texas and California provided approximately 16%, 15%, 9% and 8%, respectively, of our total revenues for the year ended December 31, 2020. Our stores in Florida, New York, Texas and California provided approximately ~~17%~~16%, 16%, 10% and 8%, respectively, of our total revenues for ~~each of the years ended December 31, 2017 and 2016. Our stores in Florida, New York, Texas, and California provided total revenues of approximately 18%, 16%, 10%, and 8%, respectively, for~~ the year ended December 31, ~~2015.~~2019.

Seasonality

We typically experience seasonal fluctuations in occupancy levels at our stores, ~~with the levels~~which are generally slightly higher during the summer months due to increased moving activity.

Financing Strategy

We maintain a capital structure that we believe is reasonable and prudent and that will enable us to have ample cash flow to cover debt service and make distributions to our shareholders. As of December 31, ~~2017,~~2021, our debt to total market capitalization ratio (determined by dividing the carrying value of our total indebtedness by the sum of (a) the market value of the Parent Company’s outstanding common shares and units of the Operating Partnership held by third parties and (b) the carrying value of our total indebtedness) was approximately ~~23.5%~~19.7% compared to approximately ~~24.7%~~25.6% as of December 31, ~~2016.~~2020. Our ratio of debt to the undepreciated cost of our total assets as of December 31, ~~2017~~2021 was approximately ~~38.0%~~41.2% compared to approximately ~~38.5%~~41.0% as of December 31, ~~2016.~~2020. We expect to finance additional investments in self-storage properties through the most attractive sources of capital available at the time of the transaction, in a manner consistent with maintaining a strong financial position and future financial flexibility, subject to limitations on incurrence of indebtedness in our unsecured credit facilities and the indenture that governs our unsecured notes. These capital sources may include existing cash, borrowings under ~~the~~our revolving ~~portion of our~~ credit facility, additional secured or unsecured financings, sales of common or preferred shares of the Parent Company in public offerings or private placements, additional issuances of debt securities, issuances of common or preferred units in our Operating Partnership in exchange for contributed properties and formations of joint ventures. We also may sell stores that have unattractive ~~risk adjusted~~risk-adjusted returns and use the sales proceeds to fund other acquisitions.

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Competition

~~Competition~~

Self-storage properties compete based on a number of factors, including location, rental rates, occupancy, security, suitability of the store’s design to prospective customers’ needs and the manner in which the store is operated and marketed. In particular, the number of competing self-storage properties in a market could have a material effect on our occupancy levels, rental rates and on the overall operating performance of our stores. We believe that the primary competition for potential customers of any of our self-storage properties comes from other self-storage providers within a three-mile radius of that store. We believe our stores are well-positioned within their respective markets, and we emphasize customer service, convenience, security, professionalism and cleanliness.

Our key competitors include local and regional operators as well as the other public self-storage REITs, including Public Storage, Extra Space Storage Inc., ~~and~~ Life Storage, Inc. and National Storage Affiliates Trust. These companies, some of which operate significantly more stores than we do and have greater resources than we have, and other entities may be able to accept more risk than we determine is prudent for us, including risks with respect to the geographic proximity of investments and the payment of higher acquisition prices. This competition may reduce the number of suitable acquisition opportunities available to us, increase the price required to acquire stores and reduce the demand for self-storage space at our stores. Nevertheless, we believe that our experience in operating, managing, acquiring, developing and obtaining financing for self-storage properties should enable us to compete effectively.

Government Regulation

We are subject to various laws, ordinances and regulations, including regulations relating to lien sale rights and procedures and various federal, state and local regulations that apply generally to the ownership of real property and the operation of self-storage properties.

Under the Americans with Disabilities Act of 1990 and applicable state accessibility act laws (collectively, the “ADA”), all places of public accommodation are required to meet federal requirements related to physical access and use by disabled persons. A number of other federal, state and local laws may also impose access and other similar requirements at our stores. A failure to comply with the ADA or similar state or local requirements could result in the governmental imposition of fines or the award of damages to private litigants affected by the noncompliance. Although we believe that our stores comply in all material respects with these requirements (or would be eligible for applicable exemptions from material requirements because of adaptive assistance provided), a determination that one or more

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of our stores or websites is not in compliance with the ADA or similar state or local requirements would result in the incurrence of additional costs associated with bringing them into compliance.

Under various federal, state and local laws, ordinances and regulations, an owner or operator of real property may become liable for the costs of removal or remediation of hazardous substances released on or in its property. These laws often impose liability without regard to whether the owner or operator knew of, or was responsible for, the release of such hazardous substances. The presence of hazardous substances, or the failure to properly remediate such substances, when released, may adversely affect the property owner’s ability to sell the real estate or to borrow using the real estate as collateral, and may cause the property owner to incur substantial remediation costs. In addition to claims for cleanup costs, the presence of hazardous substances on a property could result in a claim by a private party for personal injury or a claim by an adjacent property owner or user for property damage. We may also become liable for the costs of removal or remediation of hazardous substances stored at ~~the~~our properties by a customer even though storage of hazardous substances would be without our knowledge or approval and in violation of the customer’s storage lease agreement with us.

Our practice is to conduct or obtain environmental assessments in connection with the acquisition or development of properties. Whenever the environmental assessment for one of our stores indicates that a store is impacted by soil or groundwater contamination from prior owners/operators or other sources, we work with our environmental consultants and, where appropriate, state governmental agencies, to ensure that the store is either cleaned up, that no cleanup is necessary because the low level of contamination poses no significant risk to public health or the environment, or that the responsibility for cleanup rests with a third party. In certain cases, we have purchased environmental liability insurance coverage to indemnify us against claims for contamination or other adverse environmental conditions that may affect a property.

We are not aware of any environmental cleanup liability that we believe will have a material adverse effect on us. We cannot provide assurance, however, that these environmental assessments and investigations have revealed or will reveal all potential environmental liabilities, that no prior owner created any material environmental condition not known to us or the independent consultant or that future events or changes in environmental laws will not result in the imposition of environmental liability on us.

We have not received notice from any governmental authority of any material noncompliance, claim or liability in connection with any of our stores, nor have we been notified of a claim for personal injury or property damage by a private party in connection with any of our stores relating to environmental conditions.

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We are not aware of any environmental condition with respect to any of our stores that could reasonably be expected to have a material adverse effect on our financial condition or results of operations, and we do not expect that the cost of compliance with environmental regulations will have a material adverse effect on our financial condition or results of operations. We cannot provide assurance, however, that this will continue to be the case.

Insurance

We carry comprehensive liability, fire, casualty, extended coverage and rental loss insurance covering all of the properties in our portfolio. We also carry environmental insurance coverage on certain stores in our portfolio. We believe the policy specifications and insured limits are appropriate and adequate given the relative risk of loss, the cost of the coverage and industry practice. We do not carry insurance for losses such as loss from riots, war or acts of God, and, in some cases, flood and environmental hazards, because such coverage is either not available or not available at commercially reasonable rates. Some of our policies, such as those covering losses due to ~~terrorist activities,~~terrorism, hurricanes, floods and earthquakes, are insured subject to limitations involving large deductibles or co-payments and policy limits that may not be sufficient to cover losses. ~~We also carry liability~~Additionally, we use a combination of insurance products to ~~insure against~~provide risk mitigation for potential liabilities associated with automobiles, workers’ compensation, employment practices, general contractors, directors and officers, employee health-care benefits and personal injuries that might be sustained at our ~~stores as well as director and officer liability insurance.~~stores.

Offices

Our principal executive offices are located at 5 Old Lancaster Road, Malvern, PA 19355. Our telephone number is (610) 535-5000.

~~Employees~~Human Capital

At CubeSmart, we refer to our employees as teammates, because collaboration towards shared goals defines our workplace. We care deeply about the experience our teammates have working with us. The CubeSmart work experience takes a holistic approach to our teammates’ total wellbeing at work. Our teammate value proposition includes promoting a sense of belonging to a team; providing opportunities to make a meaningful difference at work and in their communities; supporting our teammates’ ongoing personal and professional development; and offering competitive pay and rewards.

As of December 31, ~~2017,~~2021, we employed ~~2,508~~2,892 teammates, all within the United States. Of the total employees, approximately 90% were hourly and approximately 10% were salaried. We have no union presence or collective bargaining agreements. Our average teammate tenure as of ~~whom 328~~December 31, 2021 was 3.5 years.

Company Culture and Teammate Experience

We measure our teammates’ experience each year through our Teammate Engagement Survey. In 2021, our annual engagement survey had a 91% participation rate. Results are communicated within individual teams to share what we learned and discuss both the positive aspects about working at CubeSmart and where we have opportunities to improve. In 2021, we identified teams whose engagement was below a certain threshold and provided coaching to the leaders and set goals to increase the attention given to the teammates. Through ongoing conversations and transparent commitment to continuous improvement, every CubeSmart teammate plays a role in building our company culture and making the experience working here the best it can be.

Teammate Development and Wellbeing

As part of our culture, we seek to help teammates grow with us and leverage their development both at CubeSmart and beyond. We believe in providing all teammates with training and development opportunities to succeed in their role. We plan, design and deliver training programs for all levels of the organization, from orientation and general job skills to enhancing leadership capabilities through skills trainings and mentoring. In 2021, we provided an average of 17 hours of training per teammate.

When recruiting new teammates, our talent management team engages with our store management teams and corporate leaders to identify a pool of potential candidates to serve our customers and deliver best-in-class customer service. We recruited, hired and trained 1,488 teammates during the year ended December 31, 2021. Teammate referrals were ~~corporate executive~~our top source for the candidates we hired, accounting for 30% of our new teammates. Additionally, more than 390 teammates were promoted into new roles and/or transitioned into new positions to further their career development.

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We believe that career growth and ~~administrative personnel~~personal development is an important part of our teammates’ personal and ~~2,180 were property-level personnel.~~professional success. To further support our teammates’ success, we offer a number of benefits aimed at supporting the wellbeing of our teammates and their families. Those benefits include: medical, dental, vision, disability and life insurance coverage. We also offer a variety of programs designed to provide teammates with the ability to rest, rejuvenate and take care of their families such as paid holidays, vacation and sick time, and parental leave. Our Employee Assistance Program is available to all teammates, providing extra support as they and their families experience life changes and challenges.

Another important part of our teammates’ wellbeing is their connection to a larger sense of purpose. We empower our teammates to find this with us and provide programs and opportunities for them. Our Idea Center provides a forum where teammates can submit ideas to enhance the workplace, streamline systems and processes and identify solutions and best practices. We encourage our teammates to participate in community service and philanthropy, and provide paid time off for teammates who participate in these activities. Also, through our matching gifts program, we match qualified charitable contributions made by teammates up to $100 per teammate each year.

Diversity, Equity and Inclusion

Our Philosophy Regarding Respect in the Workplace defines our approach to diversity, inclusion and treatment of differences. Our Philosophy is acknowledged by teammates and states:

At CubeSmart, we respect, value, and celebrate the unique attributes, characteristics and perspectives that make each teammate who they are. We believe that our ~~relations~~business is better because of the diversity of participation, thought, and action that comes from the unique individuals who come to work here. Every teammate deserves the right to come to work as their authentic self. Our goal for CubeSmart is to be a place where people feel supported, listened to, and able to do their personal best. Our philosophy isn’t any different from our philosophy regarding Customer interactions, namely to “treat our Customers as they want to be treated.” When it comes to our teammates, we ask that every teammate “treat our teammates as they want to be treated.”

As of December 31, 2021, of our total teammate population, 55% were female and 45% were male. Approximately 46% have self-identified as Black or African American, Hispanic or Latino, Asian, American Indian, or of two or more races. The average teammate age was 41; 38% of our teammates were 34 and younger while 39% of our teammates were 45 or older.

COVID-19 Update

The situation surrounding the COVID-19 virus in our country continued to impact our teammates and business operations. Throughout the pandemic, we have closely monitored legal requirements and the advice of experts and put actions into place as we found to be necessary. The goal of these actions was to find a way to still provide a differentiated CubeSmart customer experience while safeguarding the health of our teammates and customers and ensuring compliance with frequently-changing government mandates and/or restrictions. The actions we took in 2021 to support the wellbeing of our ~~employees are good. Our employees are not unionized.~~teammates included:

●

Updating and enacting policies to support the health and safety of our teammates, including related to changing mask and vaccination guidelines, travel, and office visitors;

●

Providing paid time off for teammates to get vaccinated;

●

Collecting vaccination status information from our teammates to inform policy decisions and prepare for potential mandates;

●

Returning corporate office and sales center teammates to in-office work in September with a new hybrid arrangement;

●

Supporting our teammates as the New York City vaccine mandate went into effect to help them understand the impact and guide them on steps needed to get compliant, ensuring our stores remained operational; and

●

Paying out appreciation bonuses to teammates who stayed with us throughout 2021.

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Sustainability

We are focused on building our company for the long-term to generate sustainable growth. To that end, we have established a cross-functional ESG (Environmental, Social, & Governance) committee responsible for establishing our sustainability priorities and objectives. Management regularly evaluates sustainability risks faced by our portfolio and believe the low obsolescence, geographic diversification, and low emissions of our portfolio help to mitigate those risks. Our Senior Management team reports annually to the Board of Trustees on the status of our ESG program, our progress against the goals we’ve set, and provides updates on the various initiatives we’ve undertaken to improve our sustainability. Our efforts to enact change are highlighted by our sustainability targets which look to track improvements across key ESG metrics and are aligned to the United Nations Sustainable Development Goals.

A key area of focus from a sustainability perspective is minimizing the impact we make on the environment. Self-storage remains a low-environmental impact business as it consumes less energy and water while emitting fewer greenhouse gases than other real estate property types. We continue to look for ways to further reduce our low impact through a variety of initiatives including solar panel installations, HVAC upgrades, high-efficiency lighting retrofits, energy management systems, and paper reduction through our online rental platform.

We encourage you to review our Sustainability Report (located on our internet website at www.cubesmart.com) for more detailed information regarding our sustainability programs and initiatives. Nothing on our website, including our Sustainability Report or sections thereof, shall be deemed incorporated by reference into this Annual Report.

Information Security

We face risks associated with security breaches through cyber-attacks, cyber intrusions, or otherwise, as well as other significant disruptions of our information technology networks and related systems. The audit committee of the Company’s Board of Trustees is responsible for overseeing management’s risk assessment and risk management processes designed to monitor and control information security risk. A cross-organizational cyber task force meets regularly and management briefs the audit committee on information security matters at least once a year.

We have adopted and implemented an approach to identify and mitigate information security risks that we believe are commercially reasonable for real estate companies. We leverage the Center for Internet Security Critical Security Control Framework as the core of our governance program and include additional best practices from the Cloud Security Alliance, vendors, and other sources as necessary. Since January 1, 2019, we have not experienced any information security breaches that resulted in financial loss. We have insurance coverage designed to help us mitigate cyber risk exposure by offsetting costs involved with recovery and remediation after an information security breach or similar event. We regularly engage independent third parties to test our information security processes and systems as part of our overall enterprise risk management. We also regularly conduct information security training to ensure all employees, including those who may come into possession of confidential financial or personally identifiable information, are aware of information security risks and to enable them to take steps to mitigate such risks.

Available Information

We file registration statements, proxy statements, ~~our~~ annual ~~report~~reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports with the SEC. You may obtain copies of these documents by ~~visiting the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549, by calling the SEC at 1-800-SEC-0330, or by~~ accessing the SEC’s website at www.sec.gov. Our internet website address is www.cubesmart.com. You also can obtain on our website, free of charge, copies of our annual ~~report~~reports on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K and any amendments to those reports, after we electronically file such reports or amendments with, or furnish them to, the SEC. Our internet website and the information contained therein or connected thereto are not intended to be incorporated by reference into this Report.

Also available on our website, free of charge, are copies of our Code of Business Conduct and Ethics, our Corporate Governance Guidelines and the charters for each of the committees of our Board — the Audit Committee, the Corporate Governance and Nominating Committee and the Compensation Committee. Copies of each of these documents are also available in print free of charge, upon request by any shareholder. You can obtain copies of these documents by contacting Investor Relations by mail at 5 Old Lancaster Road, Malvern, PA 19355.

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ITEM 1A. RISK FACTORS

Overview

An investment in our securities involves various risks. Investors should carefully consider the risks set forth below together with other information contained in this Report. These risks are not the only ones that we may face. Additional risks not presently known to us, or that we currently consider immaterial, may also impair our business, financial condition, operating results and ability to make distributions to our shareholders.

Risks Related to our Business and Operations

Adverse macroeconomic and business conditions may significantly and negatively affect our rental rates, occupancy levels and therefore our results of operations.

We are susceptible to the effects of adverse macro-economic events that can result in higher unemployment, shrinking demand for products, large-scale business failures and tight credit markets. Our results of operations are sensitive to changes in overall economic conditions that impact consumer spending, including discretionary spending, as well as to increased bad debts due to recessionary pressures. Adverse economic conditions affecting disposable consumer income, such as employment levels, business conditions, inflation, interest rates, tax rates and fuel and energy costs, could reduce consumer spending or cause consumers to shift their spending to other products and services. A general reduction in the level of discretionary spending or shifts in consumer discretionary spending could adversely affect our growth and profitability.

It is difficult to determine the breadth and duration of economic and financial market disruptions and the many ways in which they may affect our customers and our business in general. Nonetheless, financial and macroeconomic disruptions could have a significant adverse effect on our sales, profitability and results of operations.

~~Many states and local jurisdictions are facing severe budgetary problems which may have an adverse impact on our business and financial results.~~

Many states and jurisdictions are facing severe budgetary problems. Action that may be taken in response to these problems, such as increases in property taxes on commercial properties, changes to sales taxes or other governmental efforts, including mandating medical insurance for employees, could adversely impact our business and results of operations.

Our financial performance is dependent upon economic and other conditions of the markets in which our stores are located.

We are susceptible to adverse developments in the markets in which we operate, such as business layoffs or downsizing, industry slowdowns, relocations of businesses, changing demographics and other factors. Our stores in ~~Florida,~~ New York, Florida, Texas and California accounted for approximately ~~17%~~19%, ~~16%~~15%, ~~10%~~9% and 8%, respectively, of our total ~~2017~~2021 revenues. As a result of this geographic concentration of our stores, we are particularly susceptible to adverse market conditions in these areas. Any adverse economic or real estate developments in these markets, or in any of the other markets in which we operate, or any decrease in demand for self-storage space

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resulting from the local business climate, could adversely affect our rental revenues, which could impair our ability to satisfy our debt service obligations and pay distributions to our shareholders.

Our business, financial condition,results of operations and share price have, and may continue to be, impacted by the COVID-19 pandemic and such impact could be materially adverse.

Since the first quarter of 2020, the world has been impacted by the spread of a novel strain of coronavirus and its variants and the disease that it causes known as COVID-19, which has resulted in global business disruptions and significant volatility in U.S. and international debt and equity markets. There continues to be significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the U.S. economy. The extent to which the COVID-19 pandemic ultimately impacts our business, results of operations, financial condition and share price will depend on numerous evolving factors, including, among others: the duration and scope of the pandemic; actions that have been and continue to be taken by governmental entities, individuals and businesses in response to the pandemic; the impact on economic activity from the pandemic and actions taken in response thereto; the impact on capital availability and costs of capital; the impact on our employees any other operational disruptions or difficulties we may face; and, the effect on our customers and their ability to make rental payments. Any of these events, individually or in aggregate, could have a material adverse impact on the Company’s business, financial condition, results of operations and share price.

We face risks associated with property acquisitions.

We intend to continue to acquire individual and portfolios of self-storage properties. The purchase agreements that we enter into in connection with acquisitions typically contain closing conditions that need to be satisfied before the acquisitions can be consummated. The satisfaction of many of these conditions is outside of our control, and we therefore cannot assure that any of our pending or future acquisitions will be consummated. These conditions include, among other things, satisfactory examination of the title, zoning and entitlements to the properties, the ability to obtain title insurance and customary closing deliverables and conditions. Moreover, in the

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event we are unable to complete pending or future acquisitions, we may have incurred significant legal, accounting, due diligence and other transaction costs in connection with such acquisitions without realizing the expected benefits.

Those acquisitions that we do consummate would increase our size and may potentially alter our capital structure. Although we believe that future acquisitions that we complete will enhance our financial performance, the success of acquisitions is subject to the risks that:

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acquisitions may fail to perform as expected;

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the actual costs of repositioning or redeveloping acquired properties may be higher than our estimates;

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we may be unable to obtain acquisition financing on favorable terms;

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acquisitions may be located in new markets where we may have limited knowledge and understanding of the local economy, an absence of business relationships in the area or an unfamiliarity with local governmental and permitting procedures; and

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there is only limited recourse, or no recourse, to the former owners of newly acquired properties for unknown or undisclosed liabilities such as the clean-up of undisclosed environmental contamination; claims by customers, vendors or other persons arising on account of actions or omissions of the former owners of the properties; and claims by local governments, adjoining property owners, property owner associations and easement holders for fees, assessments or taxes on other property-related changes. As a result, if a liability were asserted against us based upon ownership of an acquired property, we might be required to pay significant sums to settle it, which could adversely affect our financial results and cash flow.

In addition, we often do not obtain third-party appraisals of acquired properties ~~(and~~and instead rely on internal value ~~determinations by our senior management) and the consideration we pay in exchange for those properties may exceed the determined value.~~determinations.

We will incur costs and will face integration challenges when we acquire additional stores.

As we acquire or develop additional self-storage properties and bring additional self-storage properties onto our ~~third party~~third-party management platform, we will be subject to risks associated with integrating and managing new stores, including customer retention and mortgage default risks. In the case of a large portfolio purchase, we could experience strains in our existing ~~information~~systems and management ~~capacity.~~capacities. In addition, acquisitions or developments may cause disruptions in our operations and divert management’s attention away from day-to-day operations. Furthermore, our income may decline because we will be required to depreciate/amortize in future periods costs for acquired real property and intangible assets. Our failure to successfully integrate any future acquisitions into our portfolio could have an adverse effect on our operating costs and our ability to make distributions to our shareholders.

The acquisition of new stores that lack operating history with us will make it more difficult to predict revenue potential.

We intend to continue to acquire ~~additional stores.~~individual and portfolios of self-storage properties. These acquisitions could fail to perform in accordance with expectations. If we fail to accurately estimate occupancy levels, rental rates, operating costs or costs of improvements to bring an acquired store up to the standards established for our intended market position, the performance of the store may be below expectations. Acquired stores may have characteristics or deficiencies affecting their valuation or revenue potential that we have not yet discovered. We cannot assure that the performance of stores acquired by us will increase or be maintained under our management.

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Our development activities may be more costly or difficult to complete than we anticipate.

We intend to continue to develop self-storage properties where market conditions warrant such investment. Once made, these investments may not produce results in accordance with our expectations. Risks associated with development and construction activities include:

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the unavailability of favorable financing sources in the debt and equity markets;

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construction cost overruns, including on account of rising interest rates, diminished availability of materials and labor, and increases in the costs of materials and labor;

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construction delays and failure to achieve target occupancy levels and rental rates, resulting in a lower than projected return on our investment; and

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complications (including building moratoriums and anti-growth legislation) in obtaining necessary zoning, occupancy and other governmental permits.

We depend on external sources of capital that are outside of our control; the unavailability of capital from external sources could adversely affect our ability to acquire or develop stores, satisfy our debt obligations and/or make distributions to shareholders.

We depend on external sources of capital to fund acquisitions and development, to satisfy our debt obligations and to make distributions to our shareholders required to maintain our status as a REIT, and these sources of capital may not be available on favorable terms, if at all. Our access to external sources of capital depends on a number of factors, including the market’s perception of our growth potential, ~~and~~ our current and potential future earnings and our ability to continue to qualify as a REIT for federal income tax purposes. If we are unable to obtain external sources of capital, we may not be able to acquire or develop properties when strategic opportunities exist, satisfy our debt obligations, or make distributions to shareholders that would permit us to qualify as a REIT or avoid paying tax on our REIT taxable income.

~~We may incur impairment charges.~~

We evaluate on a quarterly basis our real estate portfolios for indicators of impairment. Impairment charges reflect management’s judgment of the probability and severity of the decline in the value of real estate assets we own. These charges and provisions may be required in the future as a result of factors beyond our control, including, among other things, changes in the economic environment and market conditions affecting the value of real property assets or natural or man-made disasters. If we are required to take impairment charges, our results of operations will be adversely impacted.

~~Rising operating expenses could reduce our cash flow and funds available for future distributions.~~

Our stores and any other stores we acquire or develop in the future are and will be subject to operating risks common to real estate in general, any or all of which may negatively affect us. Our stores are subject to increases in operating expenses such as real estate and other taxes, personnel costs including the cost of providing specific medical coverage to our employees, utilities, insurance, administrative expenses, and costs for repairs and maintenance. If operating expenses increase without a corresponding increase in revenues, our profitability could diminish and limit our ability to make distributions to our shareholders.

~~We cannot assure our ability to pay dividends in the future.~~

Historically, we have paid quarterly distributions to our shareholders, and we intend to continue to pay quarterly dividends and to make distributions to our shareholders in amounts such that all or substantially all of our taxable income in each year, subject to certain adjustments, is distributed. This, along with other factors, should enable us to continue to qualify for the tax benefits accorded to a REIT under the Internal Revenue Code. We have not established a minimum dividends payment level, and all future distributions will be made at the discretion of our Board. Our ability to pay dividends will depend upon, among other factors:

~~the operational and financial performance of our stores;~~

~~capital expenditures with respect to existing and newly acquired stores;~~

~~general and administrative costs associated with our operation as a publicly-held REIT;~~

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~~maintenance of our REIT status;~~

~~the amount of, and the interest rates on, our debt;~~

~~the absence of significant expenditures relating to environmental and other regulatory matters; and~~

~~other risk factors described in this Report.~~

Certain of these matters are beyond our control and any significant difference between our expectations and actual results could have a material adverse effect on our cash flow and our ability to make distributions to shareholders.

If we are unable to promptly re-let our cubes or if the rates upon such re-letting are significantly lower than expected, our business and results of operations would be adversely affected.

We derive revenues principally from rents received from customers who rent cubes at our self-storage properties under month-to-month leases. Any delay in re-letting cubes as vacancies arise would reduce our revenues and harm our operating results. In addition, lower than expected rental rates upon re-letting could adversely affect our revenues and impede our growth.

Store ownership through joint ventures may limit our ability to act exclusively in our interest.

We ~~have in the past co-invested~~co-invest with, and we may continue to co-invest with, third parties through joint ventures. In any such joint venture, we may not be in a position to exercise sole decision-making authority regarding the stores owned through joint ventures. Investments in joint ventures may, under certain circumstances, involve risks not present when a third party is not involved, including the possibility that joint venture partners might become bankrupt or fail to fund their share of required capital contributions. Joint venture partners may have business interests or goals that are inconsistent with our business interests or goals and may be in a position to take actions contrary to our policies or objectives. Such investments also have the potential risk of impasse on strategic decisions, such as a sale, in cases where neither we nor the joint venture partner would have full control over the joint venture. In other circumstances, joint venture partners may have the ability without our agreement to make certain major decisions, including decisions about sales, capital expenditures, and/or financing. Any disputes that may arise between us and our joint venture partners could result in litigation or arbitration that could increase our expenses and distract our officers and/or Trustees from focusing their time and effort on our business. In addition, we might in certain circumstances be liable for the actions of our joint venture partners, and the activities of a joint venture could adversely affect our ability to qualify as a REIT, even though we do not control the joint venture.

We face significant competition for customers and acquisition and development opportunities.

Actions by our competitors may decrease or prevent increases of the occupancy and rental rates of our stores. We compete with numerous developers, owners and operators of self-storage properties, including other REITs, as well as on-demand storage providers, some of which own or may in the future own stores similar to ours in the same submarkets in which our stores are located and some of which may have greater capital resources. In addition, due to the relatively low cost of each individual self-storage property, other developers, owners and operators have the capability to build additional stores that may compete with our stores.

If our competitors build new stores that compete with our stores or offer space at rental rates below the rental rates we currently charge our customers, we may lose potential customers, and we may be pressured to reduce our rental rates below those we currently charge in order to retain customers when our customers’ leases expire. As a result, our financial condition, cash flow, cash available for distribution, market price of our shares and ability to satisfy our debt service obligations could be materially adversely affected. In addition, increased competition for customers may require us to make capital improvements to our stores that we would not have otherwise made. Any unbudgeted capital improvements we undertake may reduce cash available for distributions to our shareholders.

We also face significant competition for acquisitions and development opportunities. Some of our competitors have greater financial resources than we do and a greater ability to borrow funds to acquire stores. These competitors may also be willing to accept more risk than we can prudently manage, including risks with respect to the geographic proximity of investments and the payment of higher acquisition prices. This competition for investments may reduce the number of suitable investment opportunities available to us, may increase acquisition costs and may reduce demand for self-storage space in certain areas where our stores are located and, as a result, adversely affect our operating results.

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~~We may become subject to litigation or threatened litigation which may divert management’s time and attention, require us to pay damages and expenses, or restrict the operation of our business.~~

We may become subject to disputes with commercial parties with whom we maintain relationships or other parties with whom we do business. Any such dispute could result in litigation between us and the other parties. Whether or not any dispute actually proceeds to litigation, we may be required to devote significant management time and attention to its successful resolution (through litigation, settlement, or otherwise), which would detract from our management’s ability to focus on our business. Any such resolution could involve the payment of damages or expenses by us, which may be significant. In addition, any such resolution could involve our agreement with terms that restrict the operation of our business.

There are other commercial parties, at both a local and national level, that may assert that our use of our brand names and other intellectual property conflict with their rights to use brand names, internet domains, and other intellectual property that they consider to be similar to ours. Any such commercial dispute and related resolution would involve all of the risks described above, including, in particular, our agreement to restrict the use of our brand name or other intellectual property.

We also could be sued for personal injuries and/or property damage occurring on our properties. We maintain liability insurance with limits that we believe are adequate to provide for the defense and/or payment of any damages arising from such lawsuits. There can be no assurance that such coverage will cover all costs and expenses from such suits.

~~Legislative actions and changes may cause our general and administrative costs and compliance costs to increase.~~

In order to comply with laws adopted by Federal, state or local government or regulatory bodies, we may be required to increase our expenditures and hire additional personnel and additional outside legal, accounting and advisory services, all of which may cause our general and administrative and compliance costs to increase. Significant workforce-related legislative changes could increase our expenses and adversely affect our operations. Examples of possible workforce-related legislative changes include changes to an employer's obligation to recognize collective bargaining units, the process by which collective bargaining agreements are negotiated or imposed, minimum wage requirements, and health care and medical and family leave mandates. In addition, changes in the regulatory environment affecting health care reimbursements, and increased compliance costs related to enforcement of federal and state wage and hour statutes and common law related to overtime, among others, could cause our expenses to increase without an ability to pass through any increased expenses through higher prices.

Potential losses may not be covered by ~~insurance, which could result in the loss of our investment in a property and the future cash flows from the property.~~insurance.

We carry comprehensive liability, fire, casualty, extended coverage and rental loss insurance covering all of the properties in our portfolio. We also carry environmental insurance coverage on certain stores in our portfolio. We believe the policy specifications and insured limits are appropriate and adequate given the relative risk of loss, the cost of the coverage and industry practice. We do not carry insurance for losses such as loss from riots, war or acts of God, and, in some cases, ~~flooding~~flood and environmental hazards, because such coverage is either not available or is not available at commercially reasonable rates. Some of our policies, such as those covering losses due to terrorism, hurricanes, floods and earthquakes, are insured subject to limitations involving large deductibles or co-payments and policy limits that may not be sufficient to cover losses. If we experience a loss at a store that is uninsured or that exceeds policy limits, we could lose the capital invested in that store as well as the anticipated future cash flows from that store. Inflation, changes in building codes and ordinances, environmental considerations and other factors also might make it impractical or undesirable to use insurance proceeds to replace a store after it has been damaged or destroyed. In addition, if the damaged stores are subject to recourse indebtedness, we would continue to be liable for the indebtedness, even if these stores were irreparably damaged.

Additionally, we use a combination of insurance products, some of which include deductibles and self-insured retention amounts, to provide risk mitigation for potential liabilities associated with automobiles, workers’ compensation, employment practices, general contractors, cyber risks, crime, directors and officers, employee health-care benefits and personal injuries that might be sustained at our stores. Liabilities associated with the risks that are retained by us are estimated, in part, by considering historical claims experience and actuarial assumptions. Our results of operations could be materially impacted by claims and other expenses related to such insurance plans if future occurrences and claims differ from these assumptions and historical trends.

Our insurance coverage may not comply with certain loan requirements.

Certain of our stores serve as collateral for our mortgage-backed debt, some of which we assumed in connection with our acquisition of stores and requires us to maintain insurance, deductibles, retentions and other policy terms at levels ~~and on terms~~ that are not commercially reasonable in the current insurance environment. We may be unable to obtain required insurance coverage if the cost and/or availability make it impractical or impossible to comply with debt covenants. If we cannot comply with a lender’s requirements, the lender could declare a default, which could affect our ability to obtain future financing and have a material adverse effect on our results of operations and cash flows and our ability to obtain future financing. In addition, we may be required to self-insure against certain losses or our insurance costs may increase.

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Potential liability for environmental contamination could result in substantial costs.

We are subject to federal, state and local environmental regulations that apply generally to the ownership of real property and the operation of self-storage properties. If we fail to comply with those laws, we could be subject to significant fines or other governmental sanctions.

Under various federal, state and local laws, ordinances and regulations, an owner or operator of real estate may be required to investigate and clean up hazardous or toxic substances or petroleum product releases at a property and may be held liable to a governmental entity or to third parties for property damage and for investigation and clean-up costs incurred by such parties in connection with contamination. Such liability may be imposed whether or not the owner or operator knew of, or was responsible for, the presence of these hazardous or toxic substances. The cost of investigation, remediation or removal of such substances may be substantial, and the presence of such substances, or the failure to properly remediate such substances, may adversely affect our ability to sell or rent such property or to borrow using such property as collateral. In addition, in connection with the ownership, operation and management of properties, we are potentially liable for property damage or injuries to persons and property.

Our practice is to conduct or obtain environmental assessments in connection with the acquisition or development of additional stores. We carry environmental insurance coverage on certain stores in our portfolio. We obtain or examine environmental assessments from qualified and reputable environmental consulting firms (and intend to conduct such assessments prior to the acquisition or development of additional stores). The environmental assessments received to date have not revealed, nor do we have actual knowledge of, any environmental liability that we believe will have a material adverse effect on us. However, we cannot assure that our environmental assessments have identified or will identify all material environmental conditions, that any prior owner of any property did not create a material environmental condition not actually known to us, that environmental conditions on neighboring properties will not have an impact on any of our properties, or that a material environmental condition does not otherwise exist with respect to any of our properties.

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Americans with Disabilities Act and applicable state accessibility act compliance may require unanticipated expenditures.

Under the ADA, all places of public accommodation are required to meet federal requirements related to ~~physical~~ access and use by disabled persons. A number of other federal, state and local laws may also impose access and other similar requirements at our ~~properties.~~properties or websites. A failure to comply with the ADA or similar state or local requirements could result in the governmental imposition of fines or the award of damages to private litigants affected by the noncompliance. Although we believe that our properties and websites comply in all material respects with these requirements (or would be eligible for applicable exemptions from material requirements because of adaptive assistance provided), a determination that one or more of our properties or websites is not in compliance with the ADA or similar state or local requirements would result in the incurrence of additional costs associated with bringing the properties or websites into compliance. If we are required to make substantial modifications to comply with the ADA or similar state or local requirements, we may be required to incur significant unanticipated expenditures, which could have an adverse effect on our operating costs and our ability to make distributions to our shareholders.

~~Privacy concerns could result in regulatory changes that may harm our business.~~

Personal privacy has become a significant issue in the jurisdictions in which we operate. Many jurisdictions in which we operate have imposed restrictions and requirements on the use of personal information by those collecting such information. The regulatory framework for privacy issues is rapidly evolving and future enactment of more restrictive laws, rules, or regulations and/or future enforcement actions or investigations could have a materially adverse impact on us through increased costs or restrictions on our business. Failure to comply with such laws and regulations could result in consent orders or regulatory penalties and significant legal liability, including fines, which could damage our reputation and have an adverse effect on our results of operations or financial condition.

We face system security risks as we depend upon automated processes and the ~~Internet~~internet, and webreaches of, or failures in the performance of, our information technology systems could damage our reputation, cause us to incur substantial additional costs and ~~become~~ subject us to ~~litigation if our systems are penetrated.~~litigation.

We are increasingly dependent upon automated information technology processes and ~~Internet~~internet commerce, and many of our new customers come from the telephone or over the ~~Internet.~~internet. Moreover, the nature of our business involves the receipt and retention of personal information about our customers. We also rely extensively on third-party vendors to retain data, process transactions and provide other systems and services. These systems, and our systems, are subject to damage or interruption from power outages, computer and telecommunications failures, computer viruses, malware and other destructive or disruptive security breaches and catastrophic events, such as a natural disaster or a terrorist event or cyber-attack. In addition, experienced computer programmers and hackers may be able to penetrate our security systems and misappropriate our confidential information, create system disruptions or cause shutdowns. Such data security breaches as well as system disruptions and shutdowns could result in additional costs to repair or replace such networks or

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information systems and possible legal liability, including government enforcement actions and private litigation. In addition, our customers could lose confidence in our ability to protect their personal information, which could cause them to discontinue leasing at our ~~self-storage properties.~~stores.

If we are unable to attract and retain team members or contract with third parties having the specialized skills or technologies needed to support our systems, implement improvements to our customer-facing technology in a timely manner, allow accurate visibility to product availability when customers are ready to rent, quickly and efficiently fulfill our customers rental and payment methods they demand or provide a ~~convienent~~convenient and consistent experience for our customers regardless of the ultimate sales channel, our ability to compete and our results of operations could be adversely affected.

~~Terrorist attacks and other acts of violence or war may adversely impact our performance and may affect the markets on which our securities are traded.~~

Terrorist attacks against our stores, the United States or our interests, may negatively impact our operations and the value of our securities. Attacks or armed conflicts could negatively impact the demand for self-storage and increase the cost of insurance coverage for our stores, which could reduce our profitability and cash flow. Furthermore, any terrorist attacks or armed conflicts could result in increased volatility in or damage to the United States and worldwide financial markets and economy.

Risks Related to the Real Estate Industry

Our performance and the value of our self-storage properties are subject to risks associated with our properties and with the real estate industry.

Our rental revenues, ~~and~~ operating costs and the value of our real estate assets, and consequently the value of our securities, are subject to the risk that if our stores do not generate revenues sufficient to meet our operating expenses, including debt service and capital expenditures, our cash flow and ability to pay distributions to our shareholders will be adversely affected. Events or conditions beyond our control that may adversely affect our operations or the value of our properties include but are not limited to:

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downturns in the national, regional and local economic climate;

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local or regional oversupply, increased competition or reduction in demand for self-storage space;

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vacancies or changes in market rents for self-storage space;

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inability to collect rent from customers;

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increased operating costs, including maintenance, personnel, insurance premiums, customer acquisition costs and real estate taxes;

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changes in interest rates and availability of financing;

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hurricanes, earthquakes and other natural disasters, civil disturbances, terrorist acts or acts of war that may result in uninsured or underinsured losses;

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significant expenditures associated with acquisitions and development projects, such as debt service payments, real estate taxes, insurance and maintenance costs which are generally not reduced when circumstances cause a reduction in revenues from a property;

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costs of complying with changes in laws and governmental regulations, including those governing usage, zoning, the environment and taxes; and

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the relative illiquidity of real estate investments.

In addition, prolonged periods of economic slowdown or recession, rising interest rates, or declining demand for self-storage or the public perception that any of these events may occur, could result in a general decline in rental revenues, which could impair our ability to satisfy our debt service obligations and to make distributions to our shareholders.

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Rental revenues are significantly influenced by demand for self-storage space generally, and a decrease in such demand would likely have a greater adverse effect on our rental revenues than if we owned a more diversified real estate portfolio.

Because our real estate portfolio consists primarily of self-storage properties, we are subject to risks inherent in investments in a single industry. A decrease in the demand for self-storage space would have a greater adverse effect on our rental revenues than if we owned a more diversified real estate portfolio. Demand for self-storage space could be adversely affected by weakness in the national, regional and local economies, changes in supply of, or demand for, similar or competing self-storage properties in an area and the excess amount of self-storage space in a particular market. To the extent that any of these conditions occur, they are likely to affect market rents for self-storage space, which could cause a decrease in our rental revenue. Any such decrease could impair our ability to satisfy debt service obligations and make distributions to our shareholders.

Because real estate is illiquid, we may not be able to sell ~~propeties~~properties when appropriate.

Real estate property investments generally cannot be sold quickly. Also, the tax laws applicable to REITs require that we hold our properties for investment, rather than for sale in the ordinary course of business, which may cause us to forgo or defer sales of properties that otherwise would be in our best interest. Therefore, we may not be able to dispose of properties promptly, or on favorable terms, in response to economic or other market conditions, which may adversely affect our financial position.

Risks Related to our Qualification and Operation as a REIT

Failure to qualify as a REIT would subject us to U.S. federal income tax which would reduce the cash available for distribution to our shareholders.

We operate our business to qualify to be taxed as a REIT for federal income tax purposes. We have not requested and do not plan to request a ruling from the ~~IRS~~Internal Revenue Service (“IRS”) that we qualify as a REIT, and the statements in this Report are not binding on the IRS or any court. As a REIT, we generally will not be subject to federal income tax on the income that we distribute currently to our shareholders. Many of the REIT requirements, however, are highly technical and complex. The determination that we are a REIT requires an analysis of various factual matters and circumstances that may not be totally within our control. For example, to qualify as a REIT, at least 95% of our gross income must come from specific passive sources, such as rent, that are itemized in the REIT tax laws. In addition, to qualify as a REIT, we cannot own specified amounts of debt and equity securities of some issuers. We also are required to distribute to our shareholders with respect to each year at least 90% of our REIT taxable income, excluding net capital gains. The fact that we hold substantially all of our assets through the Operating Partnership and its subsidiaries and joint ventures further complicates the application of the REIT requirements for us. Even a technical or inadvertent mistake could jeopardize our REIT status, and, given the highly complex nature of the rules governing REITs and the ongoing importance of factual determinations, we cannot provide any assurance that we will continue to qualify as a REIT. Changes to rules governing REITs were made by legislation commonly known as the Tax Cuts and Jobs Act (the “TCJA”) and the Protecting Americans From Tax Hikes Act of 2015, signed into law on December 22, 2017 and December 18, 2015, respectively, and Congress and the IRS ~~might~~may make ~~further~~ changes to the tax laws and regulations, and the courts might issue new rulings that make it more difficult, or impossible, for us to remain qualified as a REIT. If we fail to qualify as a REIT for federal income tax purposes and are able to avail ourselves of one or more of the statutory savings provisions in order to maintain our REIT status, we would nevertheless be required to pay penalty taxes of $50,000 or more for each such failure.

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If we fail to qualify as a REIT for federal income tax purposes, and are unable to avail ourselves of certain savings provisions set forth in the Internal Revenue Code, we would be subject to federal income tax at regular corporate rates on all of our income. As a taxable corporation, we would not be allowed to take a deduction for distributions to shareholders in computing our taxable income or pass through long-term capital gains to individual shareholders at favorable rates. ~~For tax years beginning before January 1, 2018, we~~We also could be subject to ~~the federal alternative minimum tax and possibly~~ increased state and local taxes. We would not be able to elect to be taxed as a REIT ~~for four years following~~until the fifth taxable that begins after the taxable year we first failed to qualify unless the IRS were to grant us relief under certain statutory provisions. If we failed to qualify as a REIT, we would have to pay significant income taxes, which would reduce our net earnings available for investment or distribution to our shareholders. This likely would have a significant adverse effect on our earnings and likely would adversely affect the value of our securities. In addition, we would no longer be required to pay any distributions to shareholders.

Furthermore, aswe owned a ~~result of our acquisition of all the issued and outstanding shares of common stock of a privately held self-storage~~subsidiary REIT (“PSI”)~~, we now own a subsidiary REIT.~~ that was liquidated on December 31, 2018. Prior to liquidation, PSI iswas independently subject to, and ~~must~~was required to comply with, the same REIT requirements that we must satisfy in order to qualify as a REIT, together with all other rules applicable to REITs. If PSI ~~fails~~failed to qualify as a REIT during our period of ownership, and certain statutory relief provisions do not apply, as a result of a protective election made jointly by PSI and CubeSmart, PSI ~~will~~should be taxed as a taxable REIT subsidiary. See the section entitled “Taxation of CubeSmart−Requirements for Qualification−Taxable REIT Subsidiaries” in Exhibit 99.1 for more information regarding taxable REIT subsidiaries.

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it on December 9, 2021. Failure of 90% or more of a publicly traded partnership’s gross income to be “qualifying income” under Section 7704 of the Internal Revenue Code in each of its tax years could result in such entity being taxed as a corporation rather than a partnership for U.S. federal income tax purposes. If LAACO failed to qualify as a partnership for U.S. federal income tax purposes immediately prior to our acquisition of it, and certain relief provisions do not apply, it might adversely affect our ability to satisfy the income and asset tests for REIT qualification. In addition, LAACO’s classification as a corporation for U.S. federal income tax purposes would mean that it has corporate income tax liabilities for all tax years during which it is classified as a corporation for U.S. federal income tax purposes.

Failure of the Operating Partnership (or a subsidiary partnership or joint venture) to be treated as a partnership would have serious adverse consequences to our shareholders.

If the IRS were to successfully challenge the tax status of the Operating Partnership or any of its subsidiary partnerships or joint ventures for federal income tax purposes, the Operating Partnership or the affected subsidiary partnership or joint venture would be taxable as a corporation. In such event, we likely would cease to qualify as a REIT and the imposition of a corporate tax on the Operating Partnership, a subsidiary partnership or joint venture would reduce the amount of cash available for distribution from the Operating Partnership to us and ultimately to our shareholders.

To maintain our REIT status, we may be forced to borrow funds on a short-term basis during unfavorable market conditions.

As a REIT, we are subject to certain distribution requirements, including the requirement to distribute 90% of our REIT taxable income, excluding net capital gains, which may result in our having to make distributions at a disadvantageous time or to borrow funds at unfavorable rates. Compliance with this requirement may hinder our ability to operate solely on the basis of maximizing profits.

We will pay some taxes even if we qualify as a REIT, which will reduce the cash available for distribution to our shareholders.

Even if we qualify as a REIT for federal income tax purposes, we will be required to pay certain federal, state and local taxes on our income and property. For example, we will be subject to income tax to the extent we distribute less than 100% of our REIT taxable income, including capital gains. Additionally, we will be subject to a 4% nondeductible excise tax on the amount, if any, by which dividends paid by us in any calendar year are less than the sum of 85% of our ordinary income, 95% of our capital gain net income and 100% of our undistributed income from prior years. Moreover, if we have net income from “prohibited transactions,” that income will be subject to a 100% penalty tax. In general, prohibited transactions are sales or other dispositions of property held primarily for sale to customers in the ordinary course of business. The determination as to whether a particular sale is a prohibited transaction depends on the facts and circumstances related to that sale. We cannot guarantee that sales of our properties would not be prohibited transactions unless we comply with certain statutory safe-harbor provisions.

In addition, any net taxable income earned directly by our taxable REIT subsidiaries, or through entities that are disregarded for federal income tax purposes as entities separate from our taxable REIT subsidiaries, will be subject to federal and possibly state corporate income tax. We have elected to treat some of our subsidiaries as taxable REIT subsidiaries, and we may elect to treat other subsidiaries as taxable REIT subsidiaries in the future. In this regard, several provisions of the laws applicable to REITs and their subsidiaries ensure that a taxable REIT subsidiary will be subject to an appropriate level of federal income taxation. For example, a taxable REIT subsidiary is

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limited in its ability to deduct certain interest payments made to an affiliated REIT. In addition, the REIT has to pay a 100% penalty tax on some payments that it receives or on some deductions taken by a taxable REIT subsidiary if the economic arrangements between the REIT, the REIT’s customers, and the taxable REIT subsidiary are not comparable to similar arrangements between unrelated parties. Finally, some state and local jurisdictions may tax some of our income even though as a REIT we are not subject to federal income tax on that income because not all states and localities follow the federal income tax treatment of REITs. To the extent that we and our affiliates are required to pay federal, state and local taxes, we will have less cash available for distributions to our shareholders.

We have made taxable REIT subsidiary elections for the corporate subsidiaries of LAACO that hold the Club Operations and we intend to sell the assets in such subsidiaries to a third-party purchaser. If the purchase price for the assets of the subsidiaries exceeds our tax basis in such assets, then we may face corporate tax liability, which could have an adverse impact on our ability to make distributions.

We face possible federal, state and local tax audits.

Because we are organized and qualify as a REIT, we are generally not subject to federal income taxes, but are subject to certain state and local taxes. Certain entities through which we own real estate either have undergone, or are currently undergoing, tax audits. Although we believe that we have substantial arguments in favor of our positions in the ongoing audits, in some instances there is no controlling precedent or interpretive guidance on the specific point at issue. Collectively, tax deficiency notices received to date from the jurisdictions conducting the ongoing audits have not been material. However, there can be no assurance that future audits will not occur with increased frequency or that the ultimate result of such audits will not have a material adverse effect on our results of operations.

Legislative or regulatory tax changes related to REITs could materially and adversely affect our business.

At any time, the federal income tax laws or regulations governing REITs or the administrative interpretations of those laws or regulations may be changed, possibly with retroactive effect. We cannot predict if or when any new federal income tax law, regulation or administrative interpretation, or any amendment to any existing federal income tax law, regulation or administrative interpretation, will be adopted, promulgated or become effective or whether any such law, regulation or interpretation may take effect retroactively. We and our shareholders could be adversely affected by any such change in, or any new, federal income tax law, regulation or administrative interpretation.

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The TCJA makes significant changes to the U.S. federal income tax rules for taxation of individuals and corporations, generally effective for taxable years beginning after December 31, 2017. In addition to reducing corporate and non-corporate tax rates, the TCJA made changes to the number of provisions of the Code that may affect the taxation of REITs and their security holders. While the changes in the TCJA generally appear to be favorable with respect to REITs, certain changes to the U.S. federal income tax laws enacted by the TCJA could have a material and adverse effect on us. For example, certain changes in law pursuant to the Tax Cuts and Jobs Act could reduce the relative competitive advantage of operating as a REIT as compared with operating as a C corporation, including by:

~~reducing the rate of tax applicable to individuals and C corporations, which could reduce the relative attractiveness of the generally single level of taxation on REIT distributions;~~

~~permitting immediate expensing of capital expenditures, which could likewise reduce the relative attractiveness of the REIT taxation regime; and~~

~~limiting the deductibility of interest expense, which could increase the distribution requirement of REITs.~~

Most of the changes applicable to individuals are temporary and apply only to taxable years beginning after December 31, 2017 and before January 1, 2026. The TCJA makes numerous large and small changes to the tax rules that do not affect REITs directly but may affect our shareholders and may indirectly affect us.

Moreover, Congressional leaders have recognized that the process of adopting extensive tax legislation in a short amount of time without hearings and substantial time for review is likely to have led to drafting errors, issues needing clarification and unintended consequences that will have to be reviewed in subsequent tax legislation. At this point, it is not clear when Congress will address these issues or when the Internal Revenue Service will be able to issue administrative guidance on the changes made in the TCJA.

Shareholders are urged to consult with their tax advisors with respect to the status of ~~the TCJA and~~ any ~~other~~ regulatory or administrative developments and proposals and their potential effect on investment in our capital stock.

Dividends paid by REITs do not qualify for the reduced tax rates provided under current law.

Dividends paid by REITs are generally not eligible for the reduced 15% maximum tax rate for dividends paid to individuals (20% for those with taxable income above certain thresholds that are adjusted annually under current law). The more favorable rates applicable to regular corporate dividends could cause shareholders who are individuals to perceive investments in REITs to be relatively less attractive than investments in the stock of non-REIT corporations that pay dividends to which more favorable rates apply, which could reduce the value of REIT stocks.

Legislation modifies the rules applicable to partnership tax audits.

The Bipartisan Budget Act of 2015 requires our Operating Partnership and any subsidiary partnership to pay the hypothetical increase in partner-level taxes (including interest and penalties) resulting from an adjustment of partnership tax items on audit or in other tax proceedings, unless the partnership elects an alternative method under which the taxes resulting from the adjustment (and interest and penalties) are assessed at the partner level. Uncertainties remain as to the application of these rules and the impact they will have on us. It is possible that partnerships in which we invest may be subject to U.S. federal income tax, interest and penalties in the event of a U.S. federal income tax audit as a result of these law changes.

Risks Related to our Debt Financings

We face risks related to current debt maturities, including refinancing risk.

Certain of our mortgages, bank loans and unsecured debt (including our senior notes) will have significant outstanding balances on their maturity dates, commonly known as “balloon payments.” We may not have the cash resources available to repay those amounts, and we may have to raise funds for such repayment either through the issuance of equity or debt securities, additional bank borrowings (which may include extension of maturity dates), joint ventures or asset sales. Furthermore, we are restricted from incurring certain additional

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indebtedness and making certain other changes to our capital and debt structure under the terms of the Credit Facility (defined below) and senior notes and the ~~indenture~~indentures governing the Credit Facility and senior notes.

There can be no assurance that we will be able to refinance our debt on favorable terms or at all. To the extent we cannot refinance debt on favorable terms or at all, we may be forced to dispose of properties on disadvantageous terms or pay higher interest rates, either of which would have an adverse impact on our financial performance and ability to pay dividends to our shareholders.

As a result of our interest rate hedges, swap agreements and other, similar arrangements, we face counterparty risks.

We may be exposed to the potential risk of counterparty default or non-payment with respect to interest rate hedges, swap agreements, floors, caps and other interest rate hedging contracts that we may enter into from time to time, in which event we could suffer a material loss on the value of those agreements. Although these agreements may lessen the impact of rising interest rates on us, they also expose us to the risk that other parties to the agreements will not perform or that we cannot enforce the agreements. There is no assurance that our potential counterparties on these agreements will perform their obligations under such agreements.

Financing our future growth plan or refinancing existing debt maturities could be impacted by negative capital market conditions.

From time to time, domestic financial markets experience volatility and uncertainty. At times in recent years liquidity has tightened in the domestic financial markets, including the investment grade debt and equity capital markets from which we historically sought financing. Consequently, there is greater uncertainty regarding our ability to access the credit markets in order to attract financing on reasonable terms; there can be no assurance that we will be able to continue to issue common or preferred equity securities at a reasonable price. Our ability to finance new acquisitions and refinance future debt maturities could be adversely impacted by our inability to secure permanent financing on reasonable terms, if at all.

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The terms and covenants relating to our indebtedness could adversely impact our economic performance.

Like other real estate companies that incur debt, we are subject to risks associated with debt financing, such as the insufficiency of cash flow to meet required debt service payment obligations and the inability to refinance outstanding indebtedness at maturity. If our debt cannot be paid, refinanced or extended at maturity, we may not be able to make distributions to shareholders at expected levels or at all and may not be able to acquire new stores. Failure to make distributions to our shareholders could result in our failure to qualify as a REIT for federal income tax purposes. Furthermore, an increase in our interest expense could adversely affect our cash flow and ability to make distributions to shareholders. If we do not meet our debt service obligations, any stores securing such indebtedness could be foreclosed on, which would have a material adverse effect on our cash flow and ability to make distributions and, depending on the number of stores foreclosed on, could threaten our continued viability.

Our Credit Facility (defined below) contains (and any new or amended facility we may enter into from time to time will likely contain) customary affirmative and negative covenants, including financial covenants that, among other things, require us to comply with certain liquidity and ~~net worth~~other tests. Our ability to borrow under the Credit Facility is (and any new or amended facility we may enter into from time to time will be) subject to compliance with such financial and other covenants. In the event that we fail to satisfy these covenants, we would be in default under the Credit Facility and may be required to repay such debt with capital from other sources. Under such circumstances, other sources of debt or equity capital may not be available to us, or may be available only on unattractive terms. Moreover, the presence of such covenants in our credit agreements could cause us to operate our business with a view toward compliance with such covenants, which might not produce optimal returns for shareholders. Similarly, the indenture under which we have issued unsecured senior notes contains customary financial covenants, including limitations on incurrence of additional indebtedness.

Increases in interest rates on ~~variable rate~~variable-rate indebtedness would increase our interest expense, which could adversely affect our cash flow and ability to make distributions to shareholders. Rising interest rates could also restrict our ability to refinance existing debt when it matures. In addition, an increase in interest rates could decrease the amounts that third parties are willing to pay for our assets, thereby limiting our ability to alter our portfolio promptly in relation to economic or other conditions.

Our organizational documents contain no limitation on the amount of debt we may incur. As a result, we may become highly leveraged in the future.

Our organizational documents do not limit the amount of indebtedness that we may incur. We could alter the balance between our total outstanding indebtedness and the value of our assets at any time. If we become more highly leveraged, then the resulting increase in debt service could adversely affect our ability to make payments on our outstanding indebtedness and to pay our anticipated distributions and/or the distributions required to maintain our REIT status, and could harm our financial condition.

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Changes in the method of determining LIBOR, or the replacement of LIBOR with an alternative reference rate, may adversely affect our financial results.

As of December 31, 2021, we did not have any outstanding debt that was indexed to the London Interbank Offered Rate (“LIBOR”) other than borrowings under our Revolver (defined below). On July 27, 2017, the Financial Conduct Authority (“FCA”), which regulates LIBOR, announced its intention to phase out LIBOR rates by the end of 2021. On March 5, 2021, the ICE Benchmark Administration Limited (“IBA”) announced an 18-month extension (to June 30, 2023) on certain U.S. dollar LIBOR rates, including the rate that our Revolver is indexed to. It is not possible to predict the further effect of these announcements, any changes in the methods by which LIBOR is determined, or any other reforms to LIBOR that may be enacted in the United Kingdom, the European Union or elsewhere. Such developments may cause LIBOR to perform differently than in the past, or cease to exist. In addition, any other legal or regulatory changes made by the FCA, the IBA, the European Money Markets Institute (formerly Euribor-EBF), the European Commission or any other successor governance or oversight body, or future changes adopted by such body, in the method by which LIBOR is determined or the transition from LIBOR to a successor benchmark may result in, among other things, a sudden or prolonged increase or decrease in LIBOR, a delay in the publication of LIBOR, and changes in the rules or methodologies in LIBOR, which may discourage market participants from continuing to administer or to participate in LIBOR’s determination, and, in certain situations, could result in LIBOR no longer being determined and published. If a published U.S. dollar LIBOR rate becomes unavailable, the interest rates on our debt which is indexed to LIBOR will be determined using alternative methods, which may result in interest obligations which are more than or do not otherwise correlate over time with the payments that would have been made on such debt if U.S. dollar LIBOR was available in its current form. Further, the same costs and risks that may lead to the unavailability of U.S. dollar LIBOR may make one or more of the alternative methods impossible or impracticable to determine. Any of these proposals or consequences could have a material adverse effect on our financing costs, and as a result, our financial condition, operating results and cash flows.

Risks Related to our Organization and Structure

We are dependent upon our senior management team whose continued service is not guaranteed.

Our executive team, including our named executive officers, has extensive self-storage, real estate and public company experience. ~~Effective January 1, 2017, our~~Our Chief Executive Officer, Chief Financial Officer, Chief Legal Officer and Chief ~~Legal~~Operating Officer are parties to the Company’s executive severance plan, however, we cannot provide assurance that any of them will remain in our employment. The loss of services of one or more members of our senior management team could adversely affect our operations and our future growth.

We are dependent upon our on-site personnel to maximize customer satisfaction; any difficulties we encounter in hiring, training and retaining skilled field personnel may adversely affect our rental revenues.

As of December 31, ~~2017,~~2021, we had ~~2,180~~2,431 property-level personnel involved in the management and operation of our stores. The customer service, marketing skills and knowledge of local market demand and competitive dynamics of our store managers are contributing factors to our ability to maximize our rental income and to achieve the highest sustainable rent levels at each of our stores. We compete with various other companies in attracting and retaining qualified and skilled personnel. Competitive pressures may require that we enhance our pay and benefits package to compete effectively for such personnel. If there is an increase in these costs or if we fail to attract and retain qualified and skilled personnel, our business and operating results could be adversely affected.

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Certain provisions of Maryland law could inhibit changes in control, which may discourage third parties from conducting a tender offer or seeking other change of control transactions that could involve a premium price for our shares or otherwise benefit our shareholders.

Certain provisions of Maryland law may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under circumstances that otherwise could provide the holders of our common shares with the opportunity to realize a premium over the then-prevailing market price of those shares, including:

●

“business combination moratorium/fair price” provisions that, subject to limitations, prohibit certain business combinations between us and an “interested shareholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our shares or an affiliate thereof) for five years after the most recent date on which the shareholder becomes an interested shareholder, and thereafter imposes stringent fair price and super-majority shareholder voting requirements on these combinations; and

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●

“control share” provisions that provide that “control shares” of our company (defined as shares which, when aggregated with other shares controlled by the shareholder, entitle the shareholder to exercise one of three increasing ranges of voting power in electing Trustees) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of “control shares” from a party other than the issuer) have no voting rights except to the extent approved by our shareholders by the affirmative vote of at least two thirds of all the votes entitled to be cast on the matter, excluding all interested shares, and are subject to redemption in certain circumstances.

We have opted out of these provisions of Maryland law. However, our Board may opt to make these provisions applicable to us at any time without shareholder approval.

Our Trustees also have the discretion, granted in our bylaws and Maryland law, without shareholder approval to, among other things (1) create a staggered Board, (2) amend our bylaws or repeal individual bylaws in a manner that provides the Board with greater authority, and (3) issue additional equity securities. Any such action could inhibit or impede a third party from making a proposal to acquire us at a price that could be beneficial to our shareholders.

Our shareholders have limited control to prevent us from making any changes to our investment and financing policies.

Our Board has adopted policies with respect to certain activities. These policies may be amended or revised from time to time at the discretion of our Board without a vote of our shareholders. This means that our shareholders have limited control over changes in our policies. Such changes in our policies intended to improve, expand or diversify our business may not have the anticipated effects and consequently may adversely affect our business and prospects, results of operations and share price.

Our rights and the rights of our shareholders to take action against our Trustees and officers are limited.

Maryland law provides that a trustee or officer has no liability in that capacity if he or she performs his or her duties in good faith, in a manner he or she reasonably believes to be in our best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. Our declaration of trust and bylaws require us to indemnify our Trustees and officers for actions taken by them in those capacities on our behalf, to the extent permitted by Maryland law. Accordingly, in the event that actions taken in good faith by any Trustee or officer impede our performance, our shareholders’ ability to recover damages from that Trustee or officer will be limited.

Our declaration of trust permits our Board to issue preferred shares with terms that may discourage third parties from conducting a tender offer or seeking other change of control transactions that could involve a premium price for our shares or otherwise benefit our shareholders.

Our declaration of trust permits our Board to issue up to 40,000,000 preferred shares, having those preferences, conversion or other rights, voting powers, restrictions, limitations as to distributions, qualifications or terms or conditions of redemption as determined by our Board. In addition, our Board may reclassify any unissued common shares into one or more classes or series of preferred shares. Thus, our Board could authorize, without shareholder approval, the issuance of preferred shares with terms and conditions that could have the effect of discouraging a takeover or other transaction in which holders of some or a majority of our shares might receive a premium for their shares over the then-prevailing market price of our shares. We currently do not expect that the Board would require shareholder approval prior to such a preferred issuance. In addition, any preferred shares that we issue would rank senior to our common shares with

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respect to the payment of distributions, in which case we could not pay any distributions on our common shares until full distributions have been paid with respect to such preferred shares.

Risks Related to our Securities

Additional issuances of equity securities may be dilutive to shareholders.

The interests of our shareholders could be diluted if we issue additional equity securities to finance future acquisitions or developments or to repay indebtedness. Our Board may authorize the issuance of additional equity securities, including preferred shares, without shareholder approval. Our ability to execute our business strategy depends upon our access to an appropriate blend of debt financing, including unsecured lines of credit and other forms of secured and unsecured debt, and equity financing, including common and preferred equity.

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Many factors could have an adverse effect on the market value of our securities.

A number of factors might adversely affect the price of our securities, many of which are beyond our control. These factors include:

●

increases in market interest rates, relative to the dividend yield on our shares. If market interest rates go up, prospective purchasers of our securities may require a higher yield. Higher market interest rates would not, however, result in more funds for us to distribute and, to the contrary, would likely increase our borrowing costs and potentially decrease funds available for distribution. Thus, higher market interest rates could cause the market price of our equity securities to go down;

●

anticipated benefit of an investment in our securities as compared to investment in securities of companies in other industries (including benefits associated with tax treatment of dividends and distributions);

●

perception by market professionals of REITs generally and REITs comparable to us in particular;

●

level of institutional investor interest in our securities;

●

relatively low trading volumes in securities of REITs;

●

our results of operations and financial condition;

●

investor confidence in the stock market generally; and

●

additions and departures of key personnel.

The market value of our equity securities is based primarily upon the market’s perception of our growth potential and our current and potential future earnings and cash distributions. Consequently, our equity securities may trade at prices that are higher or lower than our net asset value per equity security. If our future earnings or cash distributions are less than expected, it is likely that the market price of our equity securities will diminish.

The market price of our common shares has been, and may continue to be, particularly volatile, and our shareholders may be unable to resell their shares at a profit.

The market price of our common shares has been subject to ~~significant~~ fluctuation and may continue to fluctuate or decline. Between January 1, ~~2015~~2019 and December 31, ~~2017,~~2021, the closing price per share of our common shares has ranged from a high of ~~$33.30~~$57.02 (on ~~March 31, 2016)~~December 30, 2021) to a low of ~~$22.31~~$20.85 (on March ~~6, 2015)~~23, 2020). ~~In the past several years, REIT securities have experienced high levels of volatility and significant increases in value from their historic lows.~~

In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been brought against that company. If our share price is volatile, we may become the target of securities ~~litigation. Securities~~ litigation, which could result in substantial costs and divert our management’s attention and resources from our business.

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General Risk Factors

Many states and local jurisdictions are facing severe budgetary problems which may have an adverse impact on our business and financial results.

Many states and jurisdictions are facing severe budgetary problems. Action that may be taken in response to these problems, such as increases in property taxes on commercial properties, changes to sales taxes or other governmental efforts, including mandating medical insurance, paid time off and severance payments for employees, could adversely impact our business and results of operations.

We may incur impairment charges.

We evaluate on a quarterly basis our real estate portfolio for indicators of impairment. Impairment charges reflect management’s judgment of the probability and severity of the decline in the value of real estate assets we own. These charges and provisions may be required in the future as a result of factors beyond our control, including, among other things, changes in the economic environment and market conditions affecting the value of real property assets or natural or man-made disasters. If we are required to take impairment charges, our results of operations will be adversely impacted.

Inflation and rising operating expenses could reduce our cash flow and funds available for future distributions.

Our stores and any other stores we acquire or develop in the future are, and will be, subject to operating risks common to real estate in general, any or all of which may negatively affect us. Our stores are subject to increases in operating expenses such as real estate, sales and other taxes, personnel costs including mandated minimum hourly wage rates and the cost of providing specific medical coverage and governmental mandated benefits to our employees, utilities, customer acquisition costs, insurance, administrative expenses and costs for repairs and maintenance. If operating expenses continue to increase without a corresponding increase in revenues, our profitability could diminish and limit our ability to make distributions to our shareholders.

We cannot assure our ability to pay dividends in the future.

●

the operational and financial performance of our stores;

●

capital expenditures with respect to existing and newly acquired stores;

●

general and administrative costs associated with our operation as a publicly-held REIT;

●

maintenance of our REIT status;

●

the amount of, and the interest rates on, our debt;

●

the absence of significant expenditures relating to environmental and other regulatory matters; and

●

other risk factors described in this Report.

We may become subject to litigation or threatened litigation which may divert management’s time and attention, require us to pay damages and expenses or restrict the operation of our business.

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settlement or otherwise), which would detract from our management’s ability to focus on our business. Any such resolution could involve the payment of damages or expenses by us, which may be significant. In addition, any such resolution could involve our agreement with terms that restrict the operation of our business.

There are other commercial parties, at both a local and national level, that may assert that our use of our brand names and other intellectual property conflict with their rights to use brand names, internet domains and other intellectual property that they consider to be similar to ours. Any such commercial dispute and related resolution would involve all of the risks described above, including, in particular, our agreement to restrict the use of our brand name or other intellectual property.

Legislative actions and changes may cause our general and administrative costs and compliance costs to increase.

In order to comply with laws adopted by federal, state or local government or regulatory bodies, we may be required to increase our expenditures and hire additional personnel and additional outside legal, accounting and advisory services, all of which may cause our general and administrative and compliance costs to increase. Significant workforce-related legislative changes could increase our expenses and adversely affect our operations. Examples of possible workforce-related legislative changes include changes to an employer's obligation to recognize collective bargaining units, the process by which collective bargaining agreements are negotiated or imposed, minimum wage requirements and health care and medical and family leave mandates. In addition, changes in the regulatory environment affecting health care reimbursements, and increased compliance costs related to enforcement of federal and state wage and hour statutes and common law related to overtime, among others, could cause our expenses to increase without an ability to pass through any increased expenses through higher prices.

Privacy concerns could result in regulatory changes that may harm our business.

Personal privacy has become a significant issue in the jurisdictions in which we operate. Many jurisdictions in which we operate, including California and New York, have imposed restrictions and requirements on the use of personal information by those collecting such information. The regulatory framework for privacy issues is rapidly evolving and future enactment of more restrictive laws, rules or regulations and/or future enforcement actions or investigations could have a materially adverse impact on us through increased costs or restrictions on our business. Failure to comply with such laws and regulations could result in consent orders or regulatory penalties and significant legal liability, including fines, which could damage our reputation and have an adverse effect on our results of operations or financial condition.

Terrorist attacks, active shooter incidents and other acts of violence or war may adversely impact our performance and may affect the markets on which our securities are traded.

Terrorist attacks at or against our stores, the United States or our interests, may negatively impact our operations and the value of our securities. Attacks, armed conflicts or active-shooter situations could negatively impact the demand for self-storage and increase the cost of insurance coverage for our stores, which could reduce our profitability and cash flow. Furthermore, any terrorist attacks, armed conflicts or active-shooter situations could result in increased volatility in or damage to the United States and worldwide financial markets and economy.

Failure to maintain effective internal control over financial reporting could have a material adverse effect on our business, results of operations, financial condition, and stock price.

Pursuant to the Sarbanes-Oxley Act of 2002, we are required to provide a report by management on internal control over financial reporting, including management’s assessment of the effectiveness of internal control. Changes to our business will necessitate ongoing changes to our internal control systems and processes. Internal control over financial reporting may not prevent or detect misstatement because of its inherent limitations, including the possibility of human error, the circumvention or overriding of controls, or fraud. Therefore, even effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements. If we fail to maintain the adequacy of our internal controls, including any failure to implement required new or improved controls, or if we experience difficulties in their implementation, our business, results of operations, and financial condition could be materially harmed, we could fail to meet our reporting obligations, and there could be a material adverse effect on the market price of our common shares.

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ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

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ITEM 2. PROPERTIES

~~ITEM 2.~~ ~~PROPERTIES~~

~~Overview~~

As of December 31, ~~2017,~~2021, we owned ~~484~~607 self-storage properties that contain approximately ~~33.8~~43.6 million rentable square feet and are located in 2324 states and the District of Columbia. The following table sets forth summary information regarding our stores by state as of December 31, ~~2017.~~2021.


		��		Total	% of Total
	Number of			Rentable	Rentable		Period-end

											Total	% of Total
									Number of	Number of	Rentable	Rentable		Ending
State	Stores		Cubes	Square Feet	Square Feet		Occupancy		Stores	Units	Square Feet	Square Feet		Occupancy


Florida	80		58,125	5,956,304	17.7	%	90.7	%	90	65,018	6,801,203	15.6	%	95.0	%
Texas	63		36,634	4,376,387	13.1	%	87.7	%	75	45,751	5,358,803	12.3	%	92.8	%
California									63	45,099	4,741,051	10.9	%	94.0	%
New York	45		58,183	3,289,051	9.7	%	80.9	%	58	82,438	4,593,319	10.5	%	89.5	%
California	40		26,468	2,881,220	8.5	%	92.4	%
Arizona									48	28,121	3,070,755	7.0	%	92.5	%
Illinois	41		24,940	2,663,648	7.9	%	86.2	%	43	25,905	2,761,024	6.3	%	93.2	%
Arizona	33		19,135	2,078,331	6.2	%	90.9	%
New Jersey	25		16,837	1,700,780	5.0	%	93.4	%	28	20,488	1,983,294	4.6	%	92.3	%
Nevada									22	14,613	1,700,457	3.9	%	93.0	%
Maryland	16		13,001	1,320,572	3.9	%	91.2	%	19	16,143	1,585,705	3.6	%	91.8	%
Georgia	18		11,043	1,317,487	3.9	%	91.4	%	21	13,151	1,562,380	3.6	%	92.7	%
Ohio	20		11,114	1,289,553	3.8	%	91.7	%	20	11,129	1,294,303	3.0	%	91.4	%
Massachusetts									20	12,996	1,256,014	2.9	%	85.0	%
Connecticut	22		10,668	1,179,145	3.5	%	91.7	%	22	10,759	1,197,402	2.8	%	91.8	%
Virginia	10		7,874	788,260	2.3	%	88.8	%	11	9,972	965,100	2.2	%	84.0	%
Pennsylvania									12	9,057	890,594	2.0	%	78.0	%
Tennessee									9	5,673	755,595	1.7	%	91.7	%
Colorado	11		6,017	697,269	2.1	%	90.5	%	10	5,540	654,265	1.5	%	93.2	%
Massachusetts	11		7,239	667,868	2.0	%	90.2	%
North Carolina	9		5,614	654,145	1.9	%	90.2	%	9	5,345	611,298	1.4	%	93.8	%
Tennessee	7		4,442	617,980	1.8	%	90.0	%
Pennsylvania	9		6,029	609,136	1.8	%	91.3	%
Nevada	7		4,136	548,822	1.6	%	91.0	%
South Carolina									8	3,877	432,389	1.0	%	95.9	%
Washington D.C.	4		3,920	295,693	0.9	%	72.3	%	5	5,293	409,484	0.9	%	92.5	%
Utah	4		2,269	240,023	0.7	%	91.0	%	4	2,386	293,988	0.7	%	86.3	%
Rhode Island	4		1,976	237,195	0.7	%	93.2	%	4	2,037	247,305	0.6	%	93.4	%
New Mexico	3		1,661	182,261	0.5	%	93.2	%	3	1,693	182,261	0.4	%	91.6	%
Minnesota	1		1,019	101,028	0.3	%	93.2	%	2	1,827	176,296	0.4	%	77.5	%
Indiana	1		577	67,604	0.2	%	94.1	%	1	583	70,380	0.2	%	90.0	%
Total/Weighted Average	484		338,921	33,759,762	100.0	%	89.2	%
Total/Weighted average									607	444,894	43,594,665	100.0	%	92.0	%

~~Table of Contents~~

~~Our Stores~~

The following table sets forth additional information with respect to each of our owned stores as of December 31, 2017. Our ownership of each store consists of a fee interest in the store held by our Operating Partnership, or one of its subsidiaries, except for eight of our stores, which are subject to ground leases. In addition, small parcels of land at two of our other stores are subject to ground leases.

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Chandler I, AZ

2005

1985

47,680

81.6
%
456

Y

12.7
%
Chandler II, AZ

2013

2008

82,915

82.5
%
1,175

N

73.9
%
Gilbert I, AZ

2013

2010

57,200

84.0
%
443

Y

84.0
%
Gilbert II, AZ

2016

2005/14

114,080

81.1
%
835

Y

43.8
%
Glendale, AZ

1998

1987

56,807

90.1
%
534

Y

0.0
%
Green Valley, AZ

2005

1985

25,050

97.9
%
266

N

9.0
%
Mesa I, AZ

2006

1985

52,575

91.7
%
512

N

0.0
%
Mesa II, AZ

2006

1981

45,511

94.8
%
412

Y

16.7
%
Mesa III, AZ

2006

1986

59,629

94.2
%
527

Y

15.7
%
Peoria, AZ

2015

2005

110,835

94.6
%
926

N

35.4
%
Phoenix I, AZ

2006

1987

101,275

82.2
%
782

Y

24.8
%
Phoenix II, AZ

2006/11

1974

83,160

93.0
%
814

Y

6.6
%
Phoenix III, AZ

2014

2009

121,730

91.9
%
817

N

74.3
%
Phoenix IV, AZ

2016

2008

69,610

92.5
%
696

Y

100.0
%
Queen Creek, AZ

2015

2013

94,462

87.8
%
628

Y

61.3
%
Scottsdale, AZ

1998

1995

80,725

93.9
%
658

Y

20.5
%
Surprise, AZ

2015

2006

72,325

96.1
%
604

N

100.0
%
Tempe I, AZ

2005

1975

53,890

91.8
%
409

Y

18.8
%
Tempe II, AZ

2013

2007

68,409

90.9
%
735

Y

86.7
%
Tucson I, AZ

1998

1974

59,800

94.9
%
500

Y

0.0
%
Tucson II, AZ

1998

1988

43,950

92.6
%
537

Y

100.0
%
Tucson III, AZ

2005

1979

49,820

93.1
%
499

N

0.0
%
Tucson IV, AZ

2005

1982

48,040

92.5
%
505

Y

13.5
%
Tucson V, AZ

2005

1982

45,134

95.4
%
423

Y

11.3
%
Tucson VI, AZ

2005

1982

40,790

92.3
%
418

Y

13.6
%
Tucson VII, AZ

2005

1982

52,663

93.8
%
609

Y

6.9
%
Tucson VIII, AZ

2005

1979

46,650

92.4
%
463

Y

0.0
%
Tucson IX, AZ

2005

1984

67,496

93.7
%
609

Y

5.9
%
Tucson X, AZ

2005

1981

46,350

91.0
%
425

N

0.0
%
Tucson XI, AZ

2005

1974

42,700

95.3
%
413

Y

0.0
%
Tucson XII, AZ

2005

1974

42,275

90.4
%
446

Y

3.8
%
Tucson XIII, AZ

2005

1974

45,800

94.5
%
501

Y

0.0
%
Tucson XIV, AZ

2005

1976

48,995

94.5
%
558

Y

17.9
%
Benicia, CA

2005

1988/93/05

74,770

93.3
%
722

Y

0.0
%
Citrus Heights, CA

2005

1987

75,620

91.6
%
684

Y

0.0
%
Corona, CA

2014

2014

94,975

94.6
%
971

N

6.9
%
Diamond Bar, CA

2005

1988

103,558

92.2
%
916

Y

0.0
%
Escondido, CA

2007

2002

143,645

96.4
%
1,269

Y

12.0
%
Fallbrook, CA

1997

1985/88

45,926

90.4
%
451

Y

0.0
%
Fremont, CA

2014

1987

51,324

90.2
%
526

Y

0.0
%
Lancaster, CA

2001

1987

60,475

96.6
%
371

Y

0.0
%
Long Beach, CA

2006

1974

124,571

93.7
%
1,378

Y

0.0
%
Murrieta, CA

2005

1996

49,775

91.5
%
453

Y

5.1
%
North Highlands, CA

2005

1980

57,094

88.8
%
476

Y

0.0
%
Ontario, CA

2014

1986

93,590

93.4
%
849

Y

0.0
%

~~Table of Contents~~

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Orangevale, CA

2005

1980

50,542

91.6
%
533

Y

0.0
%
Pleasanton, CA

2005

2003

83,600

92.2
%
765

Y

0.0
%
Rancho Cordova, CA

2005

1979

53,978

90.0
%
480

Y

0.0
%
Rialto I, CA

2006

1987

57,391

95.9
%
466

Y

0.0
%
Rialto II, CA

1997

1980

99,783

93.1
%
720

Y

0.0
%
Riverside I, CA

2006

1977

67,220

94.2
%
670

Y

0.0
%
Riverside II, CA

2006

1985

85,176

91.5
%
812

Y

5.5
%
Roseville, CA

2005

1979

59,944

87.8
%
561

Y

0.0
%
Sacramento I, CA

2005

1979

50,664

91.0
%
555

Y

0.0
%
Sacramento II, CA

2005/17

1986

111,736

88.0
%
1,087

Y

0.0
%
San Bernardino I, CA

1997

1987

31,070

90.2
%
236

N

0.0
%
San Bernardino II, CA

1997

1991

41,546

94.0
%
374

Y

0.0
%
San Bernardino III, CA

1997

1985/92

35,416

92.9
%
375

N

0.0
%
San Bernardino IV, CA

2005

2002/04

83,227

94.3
%
743

Y

12.5
%
San Bernardino V, CA

2006

1974

56,745

88.5
%
492

Y

6.7
%
San Bernardino VII, CA

2006

1978

78,809

94.0
%
641

Y

2.3
%
San Bernardino VIII, CA

2006

1977

103,567

92.5
%
875

Y

0.0
%
San Marcos, CA

2005

1979

37,425

86.7
%
244

Y

0.0
%
Santa Ana, CA

2006

1984

63,916

92.3
%
742

Y

4.3
%
South Sacramento, CA

2005

1979

52,390

92.5
%
415

Y

0.0
%
Spring Valley, CA

2006

1980

55,035

88.3
%
713

Y

0.0
%
Temecula I, CA

1998

1985/03

81,340

88.3
%
704

Y

45.9
%
Temecula II, CA

2007

2003

84,520

94.1
%
690

Y

55.2
%
Vista I, CA

2001

1988

74,238

96.1
%
622

Y

0.0
%
Vista II, CA

2005

2001/02/03

147,753

93.6
%
1,304

Y

3.7
%
Walnut, CA

2005

1987

50,708

94.2
%
538

Y

16.0
%
West Sacramento, CA

2005

1984

39,765

93.1
%
479

Y

0.0
%
Westminster, CA

2005

1983/98

68,393

91.9
%
566

Y

0.0
%
Aurora, CO

2005

1981

75,717

91.7
%
619

Y

0.0
%
Centennial, CO

2016

2009

62,400

91.5
%
530

Y

95.5
%
Colorado Springs I, CO

2005

1986

47,975

87.4
%
468

Y

0.0
%
Colorado Springs II, CO

2006

2001

62,400

88.7
%
433

Y

0.0
%
Denver I, CO

2006

1997

59,200

94.8
%
449

Y

0.0
%
Denver II, CO

2012

2007

74,390

88.9
%
679

N

95.1
%
Denver III, CO

2016

2015

76,025

86.2
%
722

N

95.0
%
Federal Heights, CO

2005

1980

54,770

92.0
%
551

Y

0.0
%
Golden, CO

2005

1985

87,800

92.9
%
640

Y

1.6
%
Littleton, CO

2005

1987

53,490

88.7
%
442

Y

64.5
%
Northglenn, CO

2005

1980

43,102

92.5
%
484

Y

0.0
%
Bloomfield, CT

1997

1987/93/94

48,700

92.1
%
445

Y

8.8
%
Branford, CT

1995

1986

50,629

84.4
%
430

Y

3.5
%
Bristol, CT

2005

1989/99

47,725

92.1
%
471

N

31.8
%
East Windsor, CT

2005

1986/89

45,966

93.1
%
305

N

0.0
%
Enfield, CT

2001

1989

52,875

93.8
%
374

Y

0.0
%
Gales Ferry, CT

1995

1987/89

54,905

89.7
%
607

N

9.4
%
Manchester I, CT

2002

1999/00/01

46,925

92.9
%
467

N

44.5
%
Manchester II, CT

2005

1984

52,725

92.4
%
405

N

0.0
%
Manchester III, CT

2014

2009

60,113

91.8
%
583

N

87.3
%
Milford, CT

1996

1975

44,885

86.1
%
375

Y

6.9
%
Monroe, CT

2005

1996/03

58,500

96.3
%
397

N

0.0
%

~~Table of Contents~~

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Mystic, CT

1996

1975/86

50,825

91.8
%
561

Y

4.6
%
Newington I, CT

2005

1978/97

42,620

95.2
%
248

N

0.0
%
Newington II, CT

2005

1979/81

36,140

92.4
%
194

N

0.0
%
Norwalk I, CT

2012

2009

30,160

90.3
%
348

N

100.0
%
Norwalk II, CT

2016

1990

78,175

86.6
%
936

Y

78.0
%
Old Saybrook I, CT

2005

1982/88/00

87,000

91.6
%
719

N

10.8
%
Old Saybrook II, CT

2005

1988/02

26,425

90.7
%
253

N

72.7
%
Shelton, CT

2011

2007

78,405

92.6
%
855

Y

94.2
%
South Windsor, CT

1996

1976

72,025

91.2
%
561

Y

1.2
%
Stamford, CT

2005

1997

28,907

93.5
%
363

N

38.8
%
Wilton, CT

2012

1966

84,515

96.2
%
771

Y

66.8
%
Washington I, DC

2008

2002

62,685

87.6
%
751

Y

97.6
%
Washington II, DC

2011

1929/98

82,697

91.2
%
1,044

N

99.6
%
Washington III, DC

2016

1961/13

78,340

89.5
%
1,050

Y

97.3
%
Washington IV, DC *

2017

1925

71,971

18.5
%
1,075

N

99.3
%
Boca Raton, FL

2001

1998

37,968

92.4
%
611

N

70.7
%
Boynton Beach I, FL

2001

1999

61,725

93.1
%
760

Y

62.1
%
Boynton Beach II, FL

2005

2001

61,514

92.6
%
580

Y

89.0
%
Boynton Beach III, FL

2014

2001

67,393

94.5
%
721

N

100.0
%
Boynton Beach IV, FL

2015

2002

76,098

92.6
%
641

N

84.2
%
Bradenton I, FL

2004

1979

68,398

92.0
%
594

N

6.6
%
Bradenton II, FL

2004

1996

88,063

94.7
%
852

Y

46.7
%
Cape Coral I, FL

2000

2000

76,857

91.9
%
902

Y

91.0
%
Cape Coral II, FL

2014

2007

67,955

93.7
%
615

Y

71.5
%
Coconut Creek I, FL

2012

2001

78,846

92.0
%
757

Y

53.1
%
Coconut Creek II, FL

2014

1999

90,147

93.2
%
811

N

79.8
%
Dania Beach, FL

2004

1984

180,588

92.4
%
1,778

N

27.4
%
Dania, FL

1996

1988

58,165

93.3
%
496

Y

53.8
%
Davie, FL

2001

2001

80,985

95.2
%
837

Y

74.0
%
Deerfield Beach, FL

1998

1998

57,230

88.8
%
520

Y

55.2
%
Delray Beach I, FL

2001

1999

67,833

95.4
%
816

Y

45.6
%
Delray Beach II, FL

2013

1987

75,710

93.8
%
1,180

N

95.5
%
Delray Beach III, FL

2014

2006

94,377

91.8
%
904

N

99.8
%
Delray Beach IV, FL *

2017

2017

97,945

1.9
%
1,155

N

100.0
%
Ft. Lauderdale I, FL

1999

1999

70,093

92.8
%
695

Y

55.0
%
Ft. Lauderdale II, FL

2013

2007

49,577

93.3
%
862

N

100.0
%
Ft. Myers I, FL

1999

1998

67,534

95.4
%
593

Y

84.3
%
Ft. Myers II, FL

2014

2001

83,375

96.5
%
838

Y

63.2
%
Ft. Myers III, FL

2014

2002

81,554

90.3
%
870

Y

89.4
%
Jacksonville I, FL

2005

2005

79,705

95.7
%
720

N

100.0
%
Jacksonville II, FL

2007

2004

64,970

92.5
%
672

N

100.0
%
Jacksonville III, FL

2007

2003

65,840

93.0
%
686

N

100.0
%
Jacksonville IV, FL

2007

2006

77,525

92.6
%
720

N

100.0
%
Jacksonville V, FL

2007

2004

82,523

89.0
%
720

N

80.3
%
Jacksonville VI, FL

2014

2006

67,375

92.9
%
539

Y

71.4
%
Kendall, FL

2007

2003

75,495

95.2
%
702

N

79.6
%
Lake Worth I, FL †

1998

1998/02

160,622

90.0
%
1,280

Y

72.4
%
Lake Worth II, FL

2014

2004/08

86,924

96.4
%
757

Y

85.9
%
Lake Worth III, FL

2015

2006

92,510

91.6
%
787

Y

42.4
%
Lakeland, FL

1994

1988

49,095

93.6
%
493

Y

83.0
%

~~Table of Contents~~

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Leisure City, FL

2012

2005

56,225

93.9
%
619

N

70.3
%
Lutz I, FL

2004

2000

66,795

92.3
%
616

Y

44.6
%
Lutz II, FL

2004

1999

69,232

88.9
%
537

Y

29.4
%
Margate I, FL †

1996

1979/81

53,660

94.8
%
370

Y

27.8
%
Margate II, FL †

1996

1985

65,380

94.2
%
460

Y

55.9
%
Merritt Island, FL

2002

2000

50,261

88.5
%
465

Y

66.7
%
Miami I, FL

1996

1995

46,500

93.2
%
557

Y

69.1
%
Miami II, FL

1996

1989

66,960

88.7
%
569

Y

19.0
%
Miami III, FL

2005

1988/03

151,620

92.8
%
1,513

N

91.3
%
Miami IV, FL

2011

2007

76,695

93.7
%
929

N

99.9
%
Miramar, FL

2013

2009

80,130

91.8
%
746

N

97.1
%
Naples I, FL

1996

1996

48,100

89.8
%
318

Y

49.1
%
Naples II, FL

1997

1985

65,850

87.6
%
649

Y

56.2
%
Naples III, FL

1997

1981/83

80,021

93.5
%
805

Y

48.8
%
Naples IV, FL

1998

1990

40,625

90.7
%
443

Y

63.7
%
New Smyrna Beach, FL

2014

2001

81,454

94.6
%
607

N

59.6
%
North Palm Beach, FL *

2017

2017

46,275

51.7
%
504

N

100.0
%
Oakland Park, FL

2017

2012

63,231

91.3
%
554

N

97.8
%
Ocoee, FL

2005

1997

76,150

94.9
%
635

Y

22.7
%
Orange City, FL

2004

2001

59,580

91.2
%
655

N

53.0
%
Orlando II, FL

2005

2002/04

63,184

89.3
%
586

N

81.9
%
Orlando III, FL

2006

1988/90/96

101,510

91.3
%
825

Y

22.1
%
Orlando IV, FL

2010

2009

76,601

93.3
%
647

N

68.6
%
Orlando V, FL

2012

2008

75,327

91.9
%
651

N

91.4
%
Orlando VI, FL

2014

2006

67,275

91.3
%
581

Y

35.3
%
Oviedo, FL

2006

1988/91

49,276

86.1
%
446

Y

3.6
%
Palm Coast I, FL

2014

2001

47,400

90.2
%
426

Y

52.6
%
Palm Coast II, FL

2014

1998/04

122,490

94.9
%
1,192

N

43.0
%
Palm Harbor, FL

2016

2001

82,685

92.6
%
744

N

73.0
%
Pembroke Pines, FL

1997

1997

67,321

91.3
%
693

Y

78.2
%
Royal Palm Beach II, FL

2007

2004

81,238

91.3
%
757

N

90.2
%
Sanford I, FL

2006

1988/06

61,810

90.7
%
443

Y

35.7
%
Sanford II, FL

2014

2000

69,755

94.2
%
667

N

62.4
%
Sarasota, FL

1999

1998

71,142

92.4
%
544

Y

60.7
%
St. Augustine, FL

1996

1985

59,725

92.8
%
725

Y

26.2
%
St. Petersburg, FL

2016

1987

66,025

92.6
%
845

N

35.0
%
Stuart, FL

1997

1995

86,756

91.9
%
987

Y

60.0
%
SW Ranches, FL

2007

2004

64,975

91.0
%
650

N

88.9
%
Tampa I, FL

2007

2001/02

83,938

94.3
%
792

N

34.3
%
Tampa II, FL

2016

1999

74,790

92.4
%
703

N

100.0
%
West Palm Beach I, FL

2001

1997

66,906

93.2
%
974

Y

52.6
%
West Palm Beach II, FL

2004

1996

94,353

94.2
%
836

Y

76.7
%
West Palm Beach III, FL

2012

2008

77,410

91.1
%
909

Y

90.3
%
West Palm Beach IV, FL

2014

2004

102,742

90.5
%
945

N

85.5
%
Winter Park, FL

2014

2005

54,416

92.0
%
542

N

58.5
%
Alpharetta, GA

2001

1996

90,501

91.7
%
673

Y

79.5
%
Atlanta, GA

2012

2008

66,625

94.0
%
631

N

100.0
%
Austell, GA

2006

2000

83,655

92.7
%
674

Y

64.2
%
Decatur, GA

1998

1986

145,320

88.8
%
1,334

Y

2.7
%
Duluth, GA

2011

2009

70,885

90.0
%
590

N

100.0
%

~~Table of Contents~~

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Lawrenceville, GA

2011

1999

73,740

93.2
%
605

Y

27.6
%
Lithia Springs, GA

2015

2007

66,750

91.2
%
591

N

59.2
%
Norcross I, GA

2001

1997

85,420

89.7
%
601

Y

66.1
%
Norcross II, GA

2011

1996

52,595

90.4
%
400

Y

62.5
%
Norcross III, GA

2012

2007

46,955

89.7
%
500

N

100.0
%
Norcross IV, GA

2012

2005

57,505

90.2
%
543

Y

89.1
%
Peachtree City I, GA

2001

1997

49,875

90.1
%
455

N

76.7
%
Peachtree City II, GA

2012

2005

59,950

91.2
%
429

N

43.4
%
Smyrna, GA

2001

2000

57,015

92.0
%
503

Y

99.4
%
Snellville, GA

2007

1996/97

79,950

91.5
%
770

Y

21.7
%
Suwanee I, GA

2007

2000/03

85,125

95.3
%
653

Y

29.1
%
Suwanee II, GA

2007

2005

80,340

91.8
%
592

N

66.2
%
Villa Rica, GA

2015

2009

65,281

92.3
%
499

N

61.5
%
Addison, IL

2004

1979

31,575

90.3
%
367

Y

0.0
%
Aurora, IL

2004

1996

73,985

91.3
%
558

Y

8.6
%
Bartlett, IL

2004

1987

51,395

87.2
%
415

Y

31.8
%
Bellwood, IL

2001

1999

86,350

88.7
%
738

Y

51.1
%
Blue Island, IL

2015

2008

55,125

91.2
%
557

N

100.0
%
Bolingbrook, IL

2014

2004

82,425

90.8
%
728

N

77.3
%
Chicago I, IL

2014

1935

95,845

92.9
%
1,087

N

94.7
%
Chicago II, IL

2014

1953

78,585

90.3
%
757

N

85.6
%
Chicago III, IL

2014

1959

84,990

95.5
%
1,078

N

99.8
%
Chicago IV, IL

2015

2009

60,495

91.5
%
613

N

100.0
%
Chicago V, IL

2015

2008

51,775

90.5
%
603

N

100.0
%
Chicago VI, IL

2016

1954/61/13

71,785

75.0
%
714

N

100.0
%
Chicago VII, IL *

2017

2017

91,292

26.8
%
1,094

N

100.0
%
Countryside, IL

2014

2002

97,356

92.6
%
903

N

98.8
%
Des Plaines, IL

2004

1978

69,450

95.3
%
577

N

0.0
%
Downers Grove, IL

2016

2015

71,625

90.6
%
666

N

100.0
%
Elk Grove Village, IL

2004

1987

64,054

92.6
%
623

Y

7.5
%
Evanston, IL

2013

2009

57,715

89.4
%
593

N

100.0
%
Glenview, IL

2004

1998

100,085

93.4
%
738

Y

100.0
%
Gurnee, IL

2004

1987

80,300

91.0
%
708

Y

37.4
%
Hanover, IL

2004

1987

41,190

88.7
%
417

Y

2.2
%
Harvey, IL

2004

1987

60,090

91.7
%
575

Y

2.8
%
Joliet, IL

2004

1993

72,865

94.2
%
532

Y

94.0
%
Kildeer, IL

2004

1988

74,463

63.9
%
779

Y

58.0
%
Lombard, IL

2004

1981

58,241

89.0
%
536

Y

26.1
%
Maywood, IL

2015

2009

60,225

92.1
%
655

N

100.0
%
Mount Prospect, IL

2004

1979

64,950

92.2
%
578

Y

10.4
%
Mundelein, IL

2004

1990

44,700

89.6
%
484

Y

12.2
%
North Chicago, IL

2004

1985

53,400

87.8
%
420

N

0.0
%
Plainfield I, IL

2004

1998

53,900

90.3
%
403

N

8.7
%
Plainfield II, IL

2005

2000

51,900

90.5
%
356

N

32.6
%
Riverwoods, IL *

2017

2017

73,915

30.0
%
807

N

100.0
%
Schaumburg, IL

2004

1988

31,160

94.4
%
317

N

5.4
%
Streamwood, IL

2004

1982

64,305

94.3
%
551

N

7.6
%
Warrenville, IL

2005

1977/89

48,796

88.0
%
380

N

0.0
%
Waukegan, IL

2004

1977

79,500

91.0
%
661

Y

8.2
%
West Chicago, IL

2004

1979

48,175

90.8
%
437

Y

0.0
%

~~Table of Contents~~

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Westmont, IL

2004

1979

53,400

94.6
%
383

Y

0.0
%
Wheeling I, IL

2004

1974

54,210

90.7
%
485

N

0.0
%
Wheeling II, IL

2004

1979

67,825

89.1
%
604

Y

9.9
%
Woodridge, IL

2004

1987

50,232

88.4
%
463

Y

17.1
%
Schererville, IN

2014

2005

67,604

94.1
%
577

Y

40.6
%
Boston I, MA

2010

1950

33,286

86.9
%
584

N

100.0
%
Boston II, MA

2002

2001

60,470

91.1
%
628

N

99.0
%
Boston III, MA

2014

1960

108,205

95.0
%
1,103

N

25.2
%
Brockton, MA

2015

1900/70/80

59,296

82.0
%
701

N

0.0
%
Haverhill, MA

2015

1900

60,589

91.1
%
606

N

93.2
%
Lawrence, MA

2015

1966

34,672

91.0
%
411

N

100.0
%
Leominster, MA

1998

1987/88/00

54,073

92.5
%
511

Y

50.5
%
Medford, MA

2007

2001

58,685

90.2
%
658

Y

97.4
%
Stoneham, MA

2013

2009/11

61,300

95.4
%
589

N

100.0
%
Tewksbury, MA

2014

2007

62,402

92.2
%
751

N

100.0
%
Walpole, MA

2016

1998

74,890

82.2
%
697

Y

31.4
%
Annapolis, MD

2017

1976

92,332

86.7
%
952

Y

59.9
%
Baltimore, MD

2001

1999/00

93,750

92.7
%
800

Y

49.0
%
Beltsville, MD

2013

2006

63,687

91.3
%
648

Y

9.7
%
California, MD

2004

1998

77,840

88.4
%
721

Y

41.3
%
Capitol Heights, MD

2015

2013

79,600

94.2
%
950

Y

98.9
%
Clinton, MD

2013

2008/10

84,225

88.6
%
914

Y

51.8
%
District Heights, MD

2011

2007

78,240

92.5
%
960

Y

96.4
%
Elkridge, MD

2013

1999

63,475

89.1
%
601

Y

91.5
%
Gaithersburg I, MD

2005

1998

87,045

90.5
%
789

Y

45.2
%
Gaithersburg II, MD

2015

2008

74,150

92.3
%
831

Y

99.2
%
Hyattsville, MD

2013

2006

52,830

91.7
%
602

Y

9.3
%
Laurel, MD †

2001

1978/99/00

162,896

92.4
%
1,017

N

64.5
%
Temple Hills I, MD

2001

2000

97,270

90.3
%
820

Y

71.1
%
Temple Hills II, MD

2014

2010

84,225

91.6
%
1,070

Y

99.3
%
Timonium, MD

2014

1965/98

66,717

89.4
%
662

Y

95.5
%
Upper Marlboro, MD

2013

2006

62,290

90.7
%
664

Y

21.7
%
Bloomington, MN

2016

1978

101,028

93.2
%
1,019

N

74.1
%
Belmont, NC

2001

1996/97/98

81,850

91.1
%
595

N

21.8
%
Burlington I, NC

2001

1990/91/93/94/98

109,300

94.2
%
952

N

7.8
%
Burlington II, NC

2001

1991

42,165

89.6
%
396

Y

16.4
%
Cary, NC

2001

1993/94/97

112,402

89.4
%
840

N

11.3
%
Charlotte I, NC

2002

1999

69,000

89.8
%
745

Y

44.4
%
Charlotte II, NC

2016

2008

53,736

89.7
%
491

N

96.3
%
Cornelius, NC

2015

2000

59,270

88.9
%
526

N

43.2
%
Pineville, NC

2015

1997/01

77,747

89.8
%
642

N

13.2
%
Raleigh, NC

1998

1994/95

48,675

85.8
%
427

Y

11.7
%
Bordentown, NJ

2012

2006

50,550

92.5
%
382

N

27.2
%
Brick, NJ

1996

1981

51,720

96.0
%
433

N

0.0
%
Cherry Hill I, NJ

2010

2004

51,500

93.4
%
369

Y

0.0
%
Cherry Hill II, NJ

2012

2004

65,500

93.8
%
613

N

94.8
%
Clifton, NJ

2005

2001

105,550

94.4
%
1,004

Y

93.2
%
Cranford, NJ

1996

1987

91,280

88.2
%
849

Y

7.9
%
East Hanover, NJ

1996

1983

107,679

93.7
%
970

N

3.4
%
Egg Harbor I, NJ

2010

2005

36,025

95.9
%
290

N

14.8
%

~~Table of Contents~~

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Egg Harbor II, NJ

2010

2002

70,400

92.4
%
695

N

19.9
%
Elizabeth, NJ

2005

1925/97

38,830

92.2
%
674

N

0.0
%
Fairview, NJ

1997

1989

27,876

95.6
%
448

N

98.9
%
Freehold, NJ

2012

2002

81,420

95.8
%
744

Y

66.1
%
Hamilton, NJ

2006

1990

70,550

93.2
%
618

Y

0.0
%
Hoboken, NJ

2005

1945/97

34,130

92.4
%
741

N

99.6
%
Linden, NJ

1996

1983

100,425

92.9
%
1,118

N

5.3
%
Lumberton, NJ

2012

2004

96,025

93.6
%
771

Y

32.6
%
Morris Township, NJ

1997

1972

72,226

92.5
%
560

Y

5.7
%
Parsippany, NJ

1997

1981

84,655

89.2
%
773

N

49.4
%
Rahway, NJ

2013

2006

83,121

93.7
%
983

Y

92.3
%
Randolph, NJ

2002

1998/99

52,565

95.3
%
550

Y

91.6
%
Ridgefield, NJ

2015

1921/44

67,803

94.3
%
684

Y

100.0
%
Roseland, NJ

2015

1951/04

53,569

92.6
%
658

N

98.8
%
Sewell, NJ

2001

1984/98

57,826

92.5
%
465

N

9.2
%
Somerset, NJ

2012

2000

57,485

96.3
%
507

N

83.8
%
Whippany, NJ

2013

2007

92,070

95.6
%
938

Y

86.0
%
Albuquerque I, NM

2005

1985

65,927

93.0
%
604

Y

13.9
%
Albuquerque II, NM

2005

1985

58,798

93.8
%
532

Y

15.0
%
Albuquerque III, NM

2005

1986

57,536

92.7
%
525

Y

11.0
%
Henderson, NV

2014

2005

75,150

94.7
%
528

Y

75.9
%
Las Vegas I, NV †

2006

1986

48,732

95.4
%
373

Y

13.6
%
Las Vegas II, NV

2006

1997

48,850

94.2
%
533

Y

66.4
%
Las Vegas III, NV

2016

2005

84,600

90.5
%
578

Y

78.9
%
Las Vegas IV, NV

2016

2004

91,557

85.3
%
578

Y

66.8
%
Las Vegas V, NV

2016

1996

107,226

89.5
%
909

Y

84.8
%
Las Vegas VI, NV

2016

2003

92,707

91.4
%
637

N

73.6
%
Baldwin, NY

2015

1974

61,380

93.2
%
613

N

99.8
%
Bronx I, NY

2010

1931/04

67,864

89.2
%
1,322

N

97.6
%
Bronx II, NY (5)

2011

2006

99,046

73.0
%
1,881

N

99.7
%
Bronx III, NY

2011

2007

105,900

87.4
%
2,033

N

99.2
%
Bronx IV, NY (5)

2011

2007

74,580

93.8
%
1,310

N

99.3
%
Bronx V, NY (5)

2011

2007

54,704

92.1
%
1,101

N

99.6
%
Bronx VI, NY (5)

2011

2011

45,970

92.4
%
1,130

N

94.5
%
Bronx VII, NY (5)

2012

2005

78,625

92.0
%
1,524

N

100.0
%
Bronx VIII, NY

2012

1928

30,550

89.4
%
544

N

100.0
%
Bronx IX, NY

2012

1973

147,870

90.3
%
3,008

Y

99.6
%
Bronx X, NY

2012

2001

159,805

92.2
%
2,666

Y

74.7
%
Bronx XI, NY (5) *

2014

2014

46,425

91.8
%
1,085

N

98.9
%
Bronx XII, NY (5) *

2016

2016

89,785

45.6
%
1,847

N

100.0
%
Brooklyn I, NY

2010

1917/04

57,566

88.8
%
1,050

N

100.0
%
Brooklyn II, NY

2010

1962/03

60,920

92.8
%
1,146

N

18.8
%
Brooklyn III, NY

2011

2006

41,510

93.0
%
850

N

100.0
%
Brooklyn IV, NY

2011

2006

37,545

91.9
%
792

N

100.0
%
Brooklyn V, NY

2011

2007

47,020

89.9
%
884

N

100.0
%
Brooklyn VI, NY

2011

2007

74,920

86.3
%
1,416

N

97.7
%
Brooklyn VII, NY

2011

2006

72,750

96.2
%
1,395

N

100.0
%
Brooklyn VIII, NY

2014

2010

61,555

93.5
%
1,203

N

92.1
%
Brooklyn IX, NY

2014

2013

46,980

92.9
%
1,258

N

100.0
%
Brooklyn X, NY *

2015

2015

55,875

63.8
%
1,203

N

100.0
%

~~Table of Contents~~

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Brooklyn XI, NY *

2016

2016

110,075

48.2
%
2,295

N

100.0
%
Brooklyn XII, NY *

2017

2017

131,588

0.3
%
2,612

N

100.0
%
Holbrook, NY

2015

2007

60,397

94.3
%
620

N

82.1
%
Jamaica I, NY

2001

2000

88,385

91.7
%
918

Y

21.5
%
Jamaica II, NY

2011

2010

92,805

94.4
%
1,500

N

100.0
%
Long Island City, NY *

2014

2014

88,825

84.7
%
1,950

N

100.0
%
New Rochelle I, NY

2005

1998

43,596

90.3
%
545

N

47.2
%
New Rochelle II, NY

2012

1917

63,300

90.8
%
1,024

Y

94.2
%
New York, NY *

2017

1917

94,912

14.2
%
3,585

N

100.0
%
North Babylon, NY

1998

1988/99

78,350

93.4
%
651

N

11.7
%
Patchogue, NY

2014

1982

47,759

91.4
%
468

N

0.0
%
Queens I, NY *

2015

2015

74,188

64.4
%
1,438

N

99.6
%
Queens II, NY *

2016

2016

90,728

75.7
%
1,449

N

98.1
%
Riverhead, NY

2005

1985/86/99

38,490

93.6
%
331

N

0.0
%
Southold, NY

2005

1989

59,945

90.5
%
614

N

4.7
%
Staten Island, NY

2013

1900/2011

96,573

94.5
%
914

N

100.0
%
Tuckahoe, NY

2011

2007

50,978

90.7
%
758

N

100.0
%
West Hempstead, NY

2012

2002

83,395

97.9
%
899

Y

35.4
%
White Plains, NY

2011

1938

85,864

88.5
%
1,507

N

78.0
%
Woodhaven, NY

2011

2008

50,665

88.4
%
1,029

N

100.0
%
Wyckoff, NY

2010

1910/07

60,210

90.1
%
1,037

N

96.3
%
Yorktown, NY

2011

2006

78,879

94.9
%
778

Y

79.0
%
Cleveland I, OH

2005

1997/99

46,000

91.6
%
343

Y

7.3
%
Cleveland II, OH

2005

2000

58,325

90.4
%
574

Y

0.0
%
Columbus I, OH

2006

1999

71,905

90.7
%
603

Y

26.2
%
Columbus II, OH

2014

1999

36,409

92.0
%
354

N

49.2
%
Columbus III, OH

2014

1998/05

51,200

90.9
%
406

N

0.0
%
Columbus IV, OH

2014

2006

60,950

89.6
%
481

N

21.6
%
Columbus V, OH

2014

2006

73,325

93.9
%
593

N

16.4
%
Columbus VI, OH

2014

2002

63,525

92.6
%
546

N

0.0
%
Grove City, OH

2006

1997

89,290

95.3
%
790

Y

14.9
%
Hilliard, OH

2006

1995

89,290

88.3
%
781

Y

24.8
%
Lakewood, OH

1989

1989

39,332

91.4
%
466

Y

37.1
%
Lewis Center, OH

2014

1985/05

76,024

90.5
%
566

N

32.0
%
Middleburg Heights, OH

1980

1980

93,200

90.3
%
707

Y

5.0
%
North Olmsted I, OH

1979

1979

48,672

90.6
%
444

Y

10.6
%
North Olmsted II, OH

1988

1988

47,850

94.3
%
401

Y

23.9
%
North Randall, OH

1998

1998/02

80,297

93.9
%
809

N

91.7
%
Reynoldsburg, OH

2006

1979

67,245

90.7
%
668

Y

0.0
%
Strongsville, OH

2007

1978

43,683

88.7
%
406

N

100.0
%
Warrensville Heights, OH

1980

1980/82/98

90,281

93.1
%
719

Y

0.0
%
Westlake, OH

2005

2001

62,750

94.4
%
457

Y

8.5
%
Conshohocken, PA

2012

2003

81,285

89.7
%
731

Y

39.3
%
Exton, PA

2012

2006

57,750

95.5
%
542

N

96.5
%
Langhorne, PA

2012

2001

64,938

94.9
%
672

Y

58.6
%
Levittown, PA

2001

2000

76,130

91.5
%
652

Y

35.0
%
Malvern, PA *

2014

2014

18,848

85.2
%
229

N

99.6
%
Montgomeryville, PA

2012

2003

84,145

89.9
%
783

Y

50.8
%
Norristown, PA

2011

2005

61,746

90.6
%
609

N

100.0
%
Philadelphia I, PA

2001

1999

96,016

90.0
%
950

N

44.8
%

~~Table of Contents~~

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Philadelphia II, PA

2014

2005

68,279

91.7
%
861

N

58.5
%
Exeter, RI

2014

1968/90

41,275

95.6
%
413

Y

22.0
%
Johnston, RI

2014

2000

77,275

96.1
%
579

N

0.0
%
Wakefield, RI

2014

1956

45,745

89.0
%
389

N

39.3
%
Woonsocket, RI

2014

2004

72,900

91.4
%
595

N

11.4
%
Antioch, TN

2005

1985/98

75,985

91.0
%
635

Y

9.4
%
Nashville I, TN

2005

1984

107,850

87.4
%
736

Y

0.0
%
Nashville II, TN

2005

1986/00

83,174

93.0
%
635

Y

13.1
%
Nashville III, TN

2006

1985

101,525

92.4
%
620

Y

8.1
%
Nashville IV, TN

2006

1986/00

102,450

91.9
%
735

Y

10.1
%
Nashville V, TN

2015

1993

74,560

91.0
%
534

N

22.8
%
Nashville VI, TN

2015

1956/01

72,436

82.4
%
547

Y

37.8
%
Allen, TX

2012

2003

62,170

89.5
%
496

Y

57.9
%
Austin I, TX

2005

2001

59,645

91.9
%
537

Y

63.5
%
Austin II, TX

2006

2000/03

64,415

92.2
%
596

Y

45.8
%
Austin III, TX

2006

2004

70,585

92.2
%
574

Y

93.0
%
Austin IV, TX

2014

2004

65,308

89.4
%
626

N

18.8
%
Austin V, TX

2014

1999

67,850

88.1
%
616

Y

35.2
%
Austin VI, TX

2014

2004

62,850

90.3
%
747

Y

54.9
%
Austin VII, TX

2015

2003/08

71,023

82.9
%
637

Y

38.9
%
Austin VIII, TX

2016

2015

61,075

72.5
%
568

Y

99.1
%
Bryan, TX

2005

1994

60,400

64.7
%
495

Y

0.0
%
Carrollton, TX

2012

2002

77,380

85.9
%
542

Y

40.8
%
Cedar Park, TX

2016

2014

88,700

69.1
%
518

N

26.8
%
College Station, TX

2005

1993

26,550

78.0
%
346

N

0.0
%
Cypress, TX

2012

1998

58,161

89.4
%
448

Y

46.0
%
Dallas I, TX

2005

2000

58,582

91.5
%
532

Y

38.0
%
Dallas II, TX

2013

1996

76,673

92.3
%
600

Y

27.7
%
Dallas III, TX

2014

1964/76

83,427

91.4
%
892

Y

91.4
%
Dallas IV, TX *

2015

2015

114,550

72.0
%
1,214

N

93.5
%
Dallas V, TX (5)

2015

2013

54,499

91.0
%
596

N

93.1
%
Denton, TX

2006

1996

60,846

94.1
%
462

Y

3.2
%
Fort Worth I, TX

2005

2000

50,416

91.9
%
405

Y

38.8
%
Fort Worth II, TX

2006

2003

72,900

95.1
%
650

Y

68.5
%
Fort Worth III, TX

2015

2000

80,445

92.5
%
675

N

76.9
%
Fort Worth IV, TX *

2016

2016

77,329

49.8
%
923

N

94.7
%
Frisco I, TX

2005

1996

50,854

91.8
%
427

Y

26.0
%
Frisco II, TX

2005

1998/02

71,599

91.7
%
523

Y

28.7
%
Frisco III, TX

2006

2004

74,665

91.9
%
630

Y

92.9
%
Frisco IV, TX †

2010

2007

75,175

96.2
%
512

Y

21.4
%
Frisco V, TX

2014

2002

74,415

89.9
%
556

Y

59.9
%
Frisco VI, TX

2014

2004

69,176

89.7
%
541

Y

54.7
%
Garland I, TX

2006

1991

70,100

90.1
%
683

Y

4.2
%
Garland II, TX

2006

2004

68,425

94.5
%
470

Y

54.0
%
Grapevine, TX *

2016

2016

78,019

56.3
%
803

N

100.0
%
Houston III, TX

2005

1984

61,590

89.2
%
467

Y

9.0
%
Houston IV, TX

2005

1987

43,750

94.2
%
380

Y

10.3
%
Houston V, TX †

2006

1980/97

124,279

87.3
%
1,054

Y

62.6
%
Houston VI, TX

2011

2002

54,690

93.1
%
592

Y

99.3
%
Houston VII, TX

2012

2004

46,991

91.6
%
521

N

100.0
%

~~Table of Contents~~

Year












Acquired /

Rentable

Manager

% Climate

Developed

Square

Occupancy

Apartment

Controlled

Store Location

(1)

Year Built

Feet

(2)

Cubes

(3)

(4)

Houston VIII, TX

2012

1989

54,209

95.4
%
497

N

76.3
%
Houston IX, TX

2012

1992

51,208

90.4
%
434

Y

48.2
%
Humble, TX

2015

2009/13

70,702

90.6
%
559

Y

42.6
%
Katy, TX

2013

2009

71,308

93.2
%
573

Y

88.8
%
Keller, TX

2006/17

2000/17

88,060

71.5
%
795

Y

52.7
%
Lewisville I, TX

2006

1996

67,340

85.8
%
429

Y

21.7
%
Lewisville II, TX

2013

2003

127,659

92.5
%
1,183

Y

30.9
%
Lewisville III, TX

2016

2002/04

93,855

92.7
%
639

Y

39.6
%
Little Elm I, TX

2016

2003

60,065

90.7
%
504

Y

47.6
%
Little Elm II, TX

2016

2007/14

96,896

88.1
%
639

Y

38.2
%
Mansfield I, TX

2006

2003

63,025

94.9
%
481

Y

43.2
%
Mansfield II, TX

2012

2002

57,375

88.7
%
483

Y

68.3
%
Mansfield III, TX

2016

2002/14

70,920

82.2
%
518

Y

37.5
%
McKinney I, TX

2005

1996

47,020

94.4
%
356

Y

12.1
%
McKinney II, TX

2006

1996

70,050

92.4
%
538

Y

47.6
%
McKinney III, TX

2014

2014

53,750

89.9
%
393

Y

37.7
%
North Richland Hills, TX

2005

2002

57,200

88.9
%
433

Y

60.7
%
Pearland, TX

2012

1985

72,050

95.3
%
473

Y

45.9
%
Richmond, TX

2013

1998

102,330

93.1
%
540

Y

30.0
%
Roanoke, TX

2005

1996/01

59,300

89.6
%
449

Y

30.7
%
San Antonio I, TX

2005

2005

73,329

93.1
%
574

Y

89.7
%
San Antonio II, TX

2006

2005

73,155

89.8
%
668

N

91.8
%
San Antonio III, TX

2007

2006

71,825

89.2
%
574

N

93.2
%
San Antonio IV, TX

2016

1998

61,500

87.6
%
514

Y

39.1
%
Spring, TX

2006

1980/86

72,751

96.1
%
534

Y

26.8
%
Murray I, UT

2005

1976

60,280

91.6
%
635

Y

0.0
%
Murray II, UT †

2005

1978

71,621

93.1
%
379

Y

5.3
%
Salt Lake City I, UT

2005

1976

56,446

93.5
%
757

Y

0.0
%
Salt Lake City II, UT

2005

1978

51,676

90.5
%
498

Y

0.0
%
Alexandria, VA

2012

2000

114,100

96.2
%
1,153

Y

97.3
%
Arlington, VA *

2015

2015

96,143

78.1
%
1,141

N

97.0
%
Burke Lake, VA

2011

2003

91,467

85.3
%
908

Y

81.9
%
Fairfax, VA

2012

1999

73,265

88.4
%
677

N

88.6
%
Fredericksburg I, VA

2005

2001/04

69,475

89.5
%
611

N

22.1
%
Fredericksburg II, VA

2005

1998/01

61,057

92.3
%
564

N

87.4
%
Leesburg, VA

2011

2001/04

85,503

85.8
%
890

Y

84.0
%
Manassas, VA

2010

1998

72,745

93.8
%
638

Y

64.9
%
McLearen, VA

2010

2002

69,385

89.0
%
733

Y

91.0
%
Vienna, VA

2012

2000

55,111

92.1
%
559

Y

97.5
%
Total/Weighted Average (484 stores)

33,759,762

89.2
%
338,921

*Denotes stores developed by us or acquired at development completion.

†Denotes stores that contain commercial rentable square footage. All of this commercial space, which was developed in conjunction with the self-storage cubes, is located within or adjacent to our self-storage properties and is managed by our store managers. As of December 31, 2017, properties in our owned portfolio included an aggregate of approximately 232,000 rentable square feet of commercial space.

~~(1)~~

~~Represents the year acquired for those stores we acquired from a third party or the year of completion for those stores we developed.~~

~~(2)~~

~~Represents occupied square feet as of December 31, 2017 divided by total rentable square feet.~~

~~(3)~~

~~Indicates whether a store has an on-site apartment where a manager resides.~~

~~(4)~~

~~Represents the number of climate-controlled cubes divided by total number of cubes.~~

~~(5)~~

~~We do not own the land at these properties. We lease the land pursuant to ground leases that expire between 2052 and 2064, subject to renewal options.~~

~~Table of Contents~~

We have grown by adding stores to our portfolio through acquisitions and development. The tables set forth below show the ~~average~~ending occupancy, annual rent per occupied square foot and total revenues for our stores owned as of December 31, ~~2017,~~2021, and for each of the previous three years, grouped by the year during which we first owned or operated the store.

Stores by Year Acquired ~~- Average~~– Ending Occupancy

Rentable Square

Average Occupancy

Year Acquired (1)

# of Stores

Feet

2017

2016

2015

2014 and earlier

413

28,307,299

92.9
%
92.6
%
91.7
%
2015

32

2,258,773

88.8
%
82.8
%
77.2
%
2016

30

2,430,230

79.9
%
67.8
%
—

2017

9

763,460

39.1
%
—

—

All Stores Owned as of December 31, 2017

484

33,759,762

91.2
%
90.7
%
91.3
%


		Rentable	Ending Occupancy
Year Acquired ⁽¹⁾	# of Stores	Square Feet	2021		2020		2019

2018 and earlier	486	34,631,955	92.9	%	93.0	%	90.2	%
2019	31	2,022,899	92.6	%	87.9	%	76.6	%
2020	21	1,805,317	87.6	%	83.7	%	—
2021	69	5,134,492	87.5	%	—		—
All stores owned as of December 31, 2021	607	43,594,663	92.0	%	92.3	%	89.5	%

Table of Contents

Stores by Year Acquired - Annual Rent Per Occupied Square Foot ⁽²⁾

Rent per Square Foot

Year Acquired (1)

# of Stores

2017

2016

2015

2014 and earlier

413

$
16.92

$
16.29

$
15.36

2015

32

16.36

14.94

14.84

2016

30

15.36

15.24

—

2017

9

19.11

—

—

All Stores Owned as of December 31, 2017

484

$
16.80

$
16.14

$
15.34


		Annual Rent per Occupied Square Foot
Year Acquired ⁽¹⁾	# of Stores	2021		2020		2019

2018 and earlier	486	$	19.79	$	17.89	$	17.97
2019	31		16.89		14.62		14.54
2020	21		29.21		26.62		—
2021	69		19.71		—		—
All stores owned as of December 31, 2021	607	$	20.00	$	18.10	$	17.81

Stores by Year Acquired - Total Revenues (dollars in thousands)


		Total Revenues
Year Acquired ⁽¹⁾	# of Stores	2021		2020		2019

2018 and earlier	486	$	684,058	$	604,479	$	593,565
2019	31		33,572		26,271		11,841
2020	21		46,822		4,337		—
2021	69		8,668		—		—
All stores owned as of December 31, 2021	607	$	773,120	$	635,087	$	605,406

Total Revenues

Year Acquired (1)

# of Stores

2017

2016

2015

2014 and earlier

413

$
471,476

$
451,160

$
420,581

2015

32

34,870

29,660

9,636

2016

30

31,391

16,005

—

2017

9

2,102

—

—

All Stores Owned as of December 31, 2017

484

$
539,839

$
496,825

$
430,217

(1)

Represents the year acquired for those stores we acquired from a third party or the year placed in service for those stores we developed.

(2)

Determined by dividing the aggregate rental revenue for each twelve-month period by the average of the month-end occupied square feet for the period. Rental revenue includes the impact of promotional discounts, which reduce rental income over the promotional period, of ~~$18.2~~$19.7 million, ~~$17.4~~$15.3 million and ~~$16.2~~$21.5 million for the periods ended December 31, ~~2017, 2016~~2021, 2020 and ~~2015,~~2019, respectively.

Unconsolidated Real Estate Ventures

As of December 31, ~~2017,~~2021, we held common ownership interests ranging from 10% to 50% in ~~four~~seven unconsolidated real estate ventures for an aggregate investment ~~balance~~carrying value of ~~$91.2~~$119.8 million. We ~~formed~~hold interests in these real estate ventures with unaffiliated third parties to acquire, own and operate self-storage properties in select markets. As of December 31, ~~2017,~~2021, these ~~four~~seven unconsolidated real estate ventures owned ~~117~~90 self-storage properties that ~~contain~~contained an aggregate of approximately ~~6.9~~6.5 million net rentable square feet. The self-storage properties owned by ~~the~~these seven real estate ventures are managed by us and are located in ~~Texas (35)~~Arizona (2), ~~South Carolina (22)~~California (2), ~~Michigan (17)~~Connecticut (6), ~~Massachussetts (13)~~Florida (8), ~~Tennessee~~Georgia (10), ~~Georgia~~Illinois (5), Maryland (2), Massachusetts (6), Minnesota (1), New Jersey (2), New York (1), North Carolina ~~(5)~~(1), ~~Connecticut (3), Florida (3)~~Pennsylvania (1), Rhode Island (2), South Carolina (4), Texas (35) and Vermont (2).

On September 5, 2018, we invested $5.0 million in exchange for 100% of the Class A preferred units of Capital Storage Partners, LLC (“Capital Storage”), a then newly formed venture that acquired 22 self-storage properties that contained an aggregate of approximately 1.7 million net rentable square feet. The stores owned by Capital Storage are located in Florida (4), Oklahoma (5) and Texas (13). The Class A preferred units earned an 11% cumulative dividend prior to any other distributions. On August 24, 2021, the Class A preferred units and all accrued and unpaid dividends were redeemed and paid, respectively. We no longer have an ownership interest in Capital Storage.

Each of ~~these~~the seven real estate ventures has ~~other~~ assets and liabilities that we do not consolidate in our financial statements.

We account for our investments in ~~these~~ real estate ventures using the equity ~~method.~~method when it is determined that we have the ability to exercise significant influence over the venture. See note 5 to ~~the~~our consolidated financial statements for further disclosure regarding the assets, liabilities and operating results of our unconsolidated real estate ~~ventures.~~ventures which we account for using the equity method of accounting.

~~Table of Contents~~

Capital Expenditures

We have a capital improvement program that ~~includes~~covers office upgrades, ~~adding~~addition of climate control to ~~selected~~select cubes, construction of parking areas and other store upgrades. For ~~2018,~~2022, we anticipate spending approximately ~~$5.0~~$8.5 million to ~~$8.0~~$13.5 million associated with these capital

Table of Contents

expenditures. For ~~2018,~~2022, we also anticipate spending approximately ~~$12.0~~$10.5 million to ~~$16.0~~$15.5 million on recurring capital expenditures and approximately ~~$60.0~~$27.0 million to ~~$75.0~~$37.0 million on the development of new self-storage properties.

ITEM 3. LEGAL PROCEEDINGS

WeTo our knowledge, no legal proceedings are ~~involved in claims from time to time,~~pending against us, other than routine actions and administrative proceedings, and other actions not deemed material, and which, ~~arise~~ in the ordinary course of business. In the opinion of management, we have made adequate provisions for potential liabilities, if any, arising from any such matters. However, litigation is inherently unpredictable, and the costs and other effects of pending or future litigation, governmental investigations, legal and administrative cases and proceedings (whether civil or criminal), settlements, judgments and investigations, claims, and changes in any such matters, couldaggregate, are not expected to have a material adverse effect on our ~~business,~~ financial condition, ~~and operating results.~~

On July 13, 2015, a putative class action was filed against the Company in the Federal District Court of New Jersey seeking to obtain declaratory, injunctive and monetary relief for a class of New Jersey consumers based upon alleged violations by the Company of the New Jersey Truth in Customer Contract, Warranty and Notice Act and the New Jersey Consumer Fraud Act. On December 15, 2017, the court granted preliminary approval of a settlement for the class action. The settlement and associated expenses, which were previously reserved for, did not have a material impact on our consolidated financial position or results of ~~operations.~~operations or cash flows.

ITEM 4. MINING SAFETY DISCLOSURES

Not applicable.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED SHAREHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Repurchase of Parent Company Common ~~and Preferred~~ Shares

The following table provides information about repurchases of the Parent Company’s common ~~and preferred~~ shares during the three months ended December 31, ~~2017:~~2021:


	Total Number of Shares Purchased ⁽¹⁾	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs

October 1 - October 31	446	$	48.96	N/A	3,000,000
November 1 - November 30	158	$	54.99	N/A	3,000,000
December 1 - December 31	41	$	54.52	N/A	3,000,000
Total	645	$	50.79	N/A	3,000,000

Total
Number of
Shares
Purchased (1)

Average
Price Paid
Per Share

Total
Number of
Shares
Purchased
as Part of
Publicly
Announced
Plans or Programs

Maximum
Number of
Shares that
May Yet Be
Purchased
Under the
Plans or
Programs

October 1 - October 31

83

$
25.97

N/A

3,000,000

November 1 - November 30

80

$
28.99

N/A

3,000,000

December 1 - December 31

253

$
28.94

N/A

3,000,000

Total

416

$
28.36

N/A

3,000,000

(1)

Represents common shares withheld by the Parent Company upon the vesting of restricted shares to cover employee tax obligations.

~~On September 27, 2007, the~~The Parent Company ~~announced that the Board of Trustees approved~~adopted a share repurchase program in 2007 for up to 3.0 million of the Parent Company’s outstanding common shares. Unless terminated earlier by resolution of the Board of Trustees, the program will expire when the number of authorized shares has been repurchased. The Parent Company has made no repurchases under this program to date.

~~Table of Contents~~

Market Information for and Holders of Record of Common Shares

As of December 31, ~~2017,~~2021, there were ~~approximately 112~~157 registered record holders of the Parent Company’s common shares and 1324 holders (other than the Parent Company) of the Operating Partnership’s common units. These ~~figures~~amounts do not include common shares held by brokers and other institutions on behalf of shareholders. The Parent Company’s common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol CUBE. There is no established trading market for units of the Operating Partnership. ~~The following table shows the high and low closing prices per common share, as reported by the New York Stock Exchange, and the cash dividends declared with respect to such shares:~~

Cash Dividends

Declared per

High

Low

Share

2016

First quarter

$
33.30

$
27.70

$
0.21

Second quarter

$
33.28

$
29.18

$
0.21

Third quarter

$
32.07

$
26.43

$
0.21

Fourth quarter

$
26.96

$
23.88

$
0.27

2017

First quarter

$
27.38

$
25.12

$
0.27

Second quarter

$
27.96

$
23.81

$
0.27

Third quarter

$
26.84

$
22.94

$
0.27

Fourth quarter

$
29.65

$
25.63

$
0.30

~~For each quarter in 2016 and 2017, the Operating Partnership paid a cash distribution per unit in an amount equal to the dividend paid on a common share for each such quarter.~~

Since our initial quarter as a publicly-traded REIT, we have made regular quarterly distributions to our shareholders. Distributions to shareholders are usually taxable as ordinary income, although a portion of the distribution may be designated as a capital gain or may constitute a tax-free return of capital. Annually, we provide each of the Parent Company’s common shareholders a statement detailing the tax characterization of dividends paid during the preceding year as ordinary income, capital gain or return of capital. The characterization of the Parent Company’s dividends for ~~2017~~2021 consisted of ~~an 86.602%~~a 92.6365% ordinary income distribution and a ~~0.495%~~7.3635% capital gain ~~distribution, and a 12.903% return~~distribution.

Table of ~~capital distribution from earnings and profits.~~Contents

We intend to continue to declare quarterly distributions. However, we cannot provide any assurance as to the amount or timing of future distributions. Under our Credit Facility, we are restricted from paying distributions on the Parent Company’s common shares in excess of the greater of (i) 95% of our funds from operations, and (ii) such amount as may be necessary to maintain our REIT status.

To the extent that we make distributions in excess of our earnings and profits, as computed for federal income tax purposes, these distributions will represent a return of capital, rather than a dividend, for federal income tax purposes. Distributions that are treated as a return of capital for federal income tax purposes generally will not be taxable as a dividend to a U.S. shareholder, but will reduce the shareholder’s basis in its shares (but not below zero) and therefore can result in the shareholder having a higher gain upon a subsequent sale of such shares. Return of capital distributions in excess of a shareholder’s basis generally will be treated as gain from the sale of such shares for federal income tax purposes.

Recent Sales of Unregistered Equity Securities and Use of Proceeds

Recent Sales of Operating Partnership Unregistered Equity Securities

On December 7, 2017, the Operating Partnership entered into an agreement to acquire a self-storage property located in Texas for $12.2 million, and agreed to fund a portion of the acquisition price in the form of common units, designated Class B Units. On January 31, 2018, the Operating Partnership closed on the acquisition and funded approximately $4.8 million of the acquisition price through the issuance of 168,011 common units. Following a 13-month lock-up period, the holder may tender the common units for redemption by the Operating Partnership for a cash amount per common unit equal to the market value of an equivalent number of common shares of the Company. The Company has the right, but not the obligation, to assume and satisfy the redemption obligation of the Operating Partnership by issuing one common share in exchange for each common unit tendered for redemption. The common units were sold to a single accredited investor unaffiliated with the Company in a private placement transaction exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(a)(2) of such Act.None.

~~Table of Contents~~

Share Performance Graph

The SEC requires us to present a chart comparing the cumulative total shareholder return, assuming reinvestment of dividends, on our common shares with the cumulative total shareholder return of (i) a broad equity index and (ii) a published industry or peer group index. The following chart compares the yearly cumulative total shareholder return for our common shares with the cumulative shareholder return of companies on (i) the S&P 500 Index, (ii) the Russell 2000 Index and (iii) the FTSE NAREIT All Equity REIT Index as provided by NAREIT for the period beginning December 31, ~~2012~~2016 and ending December 31, ~~2017.~~2021.

Period Ending

Index

12/31/2012

12/31/2013

12/31/2014

12/31/2015

12/31/2016

12/31/2017

CubeSmart

100.00

112.51

160.37

228.41

205.93

229.74

S&P 500 Index

100.00

132.39

150.51

152.59

170.84

208.14

Russell 2000 Index

100.00

138.82

145.62

139.19

168.85

193.58

NAREIT All Equity REIT Index

100.00

102.86

131.68

135.40

147.09

159.85

~~ITEM 6.~~ ~~SELECTED FINANCIAL DATA~~

~~CUBESMART~~

The following table sets forth selected financial and operating data on a historical consolidated basis for the Parent Company. The selected historical financial data as of and for each of the years in the five-year period ended December 31, 2017 are derived from the Parent Company’s consolidated financial statements, which financial statements have been audited by KPMG LLP, an independent registered public accounting firm. The consolidated financial statements as of December 31, 2017 and 2016, and for each of the years in the three-year period ended December 31, 2017, and the report thereon, are included herein. The selected data should be read in conjunction with the consolidated financial statements for the year ended December 31, 2017, the related notes, and the independent registered public accounting firm’s report. The other data presented below is not derived from the audited financial statements included herein.


	For the year ended December 31,
Index	2016	2017	2018	2019	2020	2021
CubeSmart	100.00	112.74	116.59	133.05	148.58	259.40
S&P 500 Index	100.00	121.83	116.49	153.17	181.35	233.41
Russell 2000 Index	100.00	114.65	102.02	128.06	153.62	176.39
FTSE NAREIT All Equity REIT Index	100.00	108.67	104.28	134.17	127.30	179.87

3933

Table of Contents

The following data should be read in conjunction with the audited financial statements and notes thereto of the Parent Company and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this Report.

For the year ended December 31,


2017

2016

2015

2014

2013

(in thousands, except per share data)

REVENUES

Rental income

$
489,043

$
449,601

$
392,476

$
330,898

$
281,250

Other property related income

55,001

50,255

45,189

40,065

32,365

Property management fee income

14,899

10,183

6,856

6,000

4,780

Total revenues

558,943

510,039

444,521

376,963

318,395

OPERATING EXPENSES

Property operating expenses

181,508

165,847

153,172

132,701

118,222

Depreciation and amortization

145,681

161,865

151,789

126,813

112,313

General and administrative

34,745

32,823

28,371

28,422

29,563

Acquisition related costs

1,294

6,552

3,301

7,484

3,849

Total operating expenses

363,228

367,087

336,633

295,420

263,947

OPERATING INCOME

195,715

142,952

107,888

81,543

54,448

OTHER (EXPENSE) INCOME

Interest:

Interest expense on loans

(56,952)

(50,399)

(43,736)

(46,802)

(40,424)

Loan procurement amortization expense

(2,638)

(2,577)

(2,324)

(2,190)

(2,058)

Loan procurement amortization expense - early repayment of debt

—

—

—

—

(414)

Equity in losses of real estate ventures

(1,386)

(2,662)

(411)

(6,255)

(1,151)

Gains from sale of real estate, net

—

—

17,567

475

—

Other

872

1,062

(228)

(405)

8

Total other expense

(60,104)

(54,576)

(29,132)

(55,177)

(44,039)

INCOME FROM CONTINUING OPERATIONS

135,611

88,376

78,756

26,366

10,409

DISCONTINUED OPERATIONS

Income from discontinued operations

—

—

—

336

4,145

Gain from disposition of discontinued operations

—

—

—

—

27,440

Total discontinued operations

—

—

—

336

31,585

NET INCOME

135,611

88,376

78,756

26,702

41,994

NET (INCOME) LOSS ATTRIBUTABLE TO

NONCONTROLLING INTERESTS

Noncontrolling interests in the Operating Partnership

(1,593)

(941)

(960)

(307)

(588)

Noncontrolling interest in subsidiaries

270

470

(84)

(16)

42

NET INCOME ATTRIBUTABLE TO THE COMPANY

134,288

87,905

77,712

26,379

41,448

Distribution to preferred shareholders

—

(5,045)

(6,008)

(6,008)

(6,008)

Preferred share redemption charge

—

(2,937)

—

—

—

NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS

$
134,288

$
79,923

$
71,704

$
20,371

$
35,440

Basic earnings per share from continuing operations attributable to common shareholders

$
0.74

$
0.45

$
0.43

$
0.13

$
0.03

Basic earnings per share from discontinued operations attributable to common shareholders

$
—

$
—

$
—

$
0.01

$
0.23

Basic earnings per share attributable to common shareholders

$
0.74

$
0.45

$
0.43

$
0.14

$
0.26

Diluted earnings per share from continuing operations attributable to common shareholders

$
0.74

$
0.45

$
0.42

$
0.13

$
0.03

Diluted earnings per share from discontinued operations attributable to common shareholders

$
—

$
—

$
—

$
0.01

$
0.23

Diluted earnings per share attributable to common shareholders

$
0.74

$
0.45

$
0.42

$
0.14

$
0.26

Weighted-average basic shares outstanding (1)

180,525

178,246

168,640

149,107

135,191

Weighted-average diluted shares outstanding (1)

181,448

179,533

170,191

150,863

137,742

AMOUNTS ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS:

Income from continuing operations

$
134,288

$
79,923

$
71,704

$
20,040

$
4,392

Total discontinued operations

—

—

—

331

31,048

Net income

$
134,288

$
79,923

$
71,704

$
20,371

$
35,440

~~Table of Contents~~

At December 31,


2017

2016

2015

2014

2013

Balance Sheet Data (in thousands):

Storage properties, net

$
3,408,790

$
3,326,816

$
2,872,983

$
2,625,129

$
2,155,170

Total assets

3,545,336

3,475,028

3,104,164

2,776,906

2,347,819

Unsecured senior notes, net

1,142,460

1,039,076

741,904

493,957

493,283

Revolving credit facility

81,700

43,300

—

78,000

38,600

Unsecured term loans, net

299,396

398,749

398,183

397,617

397,261

Mortgage loans and notes payable, net

111,434

114,618

111,455

194,844

198,869

Total liabilities

1,855,646

1,759,384

1,393,183

1,277,465

1,218,337

Noncontrolling interests in the Operating Partnership

54,320

54,407

66,128

49,823

36,275

Total CubeSmart shareholders' equity

1,629,134

1,655,382

1,643,327

1,448,026

1,092,276

Noncontrolling interests in subsidiaries

6,236

5,855

1,526

1,592

931

Total liabilities and equity

3,545,336

3,475,028

3,104,164

2,776,906

2,347,819

Other Data:

Number of stores

484

475

445

421

366

Total rentable square feet (in thousands)

33,760

32,858

30,361

28,622

24,662

Occupancy percentage

89.2
%

89.7
%

90.2
%

89.1
%

88.3
%
Cash dividends declared per common share (2)

$
1.11

$
0.90

$
0.69

$
0.55

$
0.46

~~(1)~~

~~OP units have been excluded from the earnings per share calculations as the related income or loss is presented in noncontrolling interests in the Operating Partnership.~~

~~(2)~~

We announced full quarterly dividends $0.11 and $0.484 per common and preferred shares, respectively, on February 21, 2013, May 29, 2013, and August 7, 2013; dividends of $0.13 and $0.484 per common and preferred shares, respectively, on December 19, 2013, February 25, 2014, May 28, 2014, and August 5, 2014; dividends of $0.16 and $0.484 per common and preferred shares, respectively, on December 16, 2014, February 24, 2015, May 27, 2015, and August 4, 2015; dividends of $0.21 and $0.484 per common and preferred shares, respectively, on December 10, 2015, February 16, 2016, June 1, 2016, and August 2, 2016; dividends of $0.174 per preferred share on September 2, 2016; dividends of $0.27 per common share on December 15, 2016, February 14, 2017, May 31, 2017, and July 25, 2017; and dividends of $0.30 per common share on December 14, 2017.

~~CUBESMART, L.P.~~

The following table sets forth selected financial and operating data on a historical consolidated basis for the Operating Partnership. The selected historical financial data as of and for each of the years in the the five-year period ended December 31, 2017 are derived from the Operating Partnership’s consolidated financial statements, which financial statements have been audited by KPMG LLP, an independent registered public accounting firm. The consolidated financial statements as of December 31, 2017 and 2016, and for each of the years in the three-year period ended December 31, 2017, and the report thereon, are included herein. The selected data should be read in conjunction with the consolidated financial statements for the year ended December 31, 2017, the related notes, and the independent registered public accounting firm’s report. The other data presented below is not derived from the audited financial statements included herein.

~~Table of Contents~~

ITEM 6. [Reserved]

The following data should be read in conjunction with the audited financial statements and notes thereto of the Operating Partnership and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included elsewhere in this Report.

For the year ended December 31,


2017

2016

2015

2014

2013

(in thousands, except per unit data)

REVENUES

Rental income

$
489,043

$
449,601

$
392,476

$
330,898

$
281,250

Other property related income

55,001

50,255

45,189

40,065

32,365

Property management fee income

14,899

10,183

6,856

6,000

4,780

Total revenues

558,943

510,039

444,521

376,963

318,395

OPERATING EXPENSES

Property operating expenses

181,508

165,847

153,172

132,701

118,222

Depreciation and amortization

145,681

161,865

151,789

126,813

112,313

General and administrative

34,745

32,823

28,371

28,422

29,563

Acquisition related costs

1,294

6,552

3,301

7,484

3,849

Total operating expenses

363,228

367,087

336,633

295,420

263,947

OPERATING INCOME

195,715

142,952

107,888

81,543

54,448

OTHER (EXPENSE) INCOME

Interest:

Interest expense on loans

(56,952)

(50,399)

(43,736)

(46,802)

(40,424)

Loan procurement amortization expense

(2,638)

(2,577)

(2,324)

(2,190)

(2,058)

Loan procurement amortization expense - early repayment of debt

—

—

—

—

(414)

Equity in losses of real estate ventures

(1,386)

(2,662)

(411)

(6,255)

(1,151)

Gains from sale of real estate, net

—

—

17,567

475

—

Other

872

1,062

(228)

(405)

8

Total other expense

(60,104)

(54,576)

(29,132)

(55,177)

(44,039)

INCOME FROM CONTINUING OPERATIONS

135,611

88,376

78,756

26,366

10,409

DISCONTINUED OPERATIONS

Income from discontinued operations

—

—

—

336

4,145

Gain from disposition of discontinued operations

—

—

—

—

27,440

Total discontinued operations

—

—

—

336

31,585

NET INCOME

135,611

88,376

78,756

26,702

41,994

NET LOSS (INCOME) ATTRIBUTABLE TO

NONCONTROLLING INTERESTS

Noncontrolling interest in subsidiaries

270

470

(84)

(16)

42

NET INCOME ATTRIBUTABLE TO CUBESMART L.P.

135,881

88,846

78,672

26,686

42,036

Operating Partnership interests of third parties

(1,593)

(941)

(960)

(307)

(588)

NET INCOME ATTRIBUTABLE TO OPERATING PARTNER

134,288

87,905

77,712

26,379

41,448

Distribution to preferred unitholders

—

(5,045)

(6,008)

(6,008)

(6,008)

Preferred unit redemption charge

—

(2,937)

—

—

—

NET INCOME ATTRIBUTABLE TO COMMON UNITHOLDERS

$
134,288

$
79,923

$
71,704

$
20,371

$
35,440

Basic earnings per unit from continuing operations attributable to common unitholders

$
0.74

$
0.45

$
0.43

$
0.13

$
0.03

Basic earnings per unit from discontinued operations attributable to common unitholders

$
—

$
—

$
—

$
0.01

$
0.23

Basic earnings per unit attributable to common unitholders

$
0.74

$
0.45

$
0.43

$
0.14

$
0.26

Diluted earnings per unit from continuing operations attributable to common unitholders

$
0.74

$
0.45

$
0.42

$
0.13

$
0.03

Diluted earnings per unit from discontinued operations attributable to common unitholders

$
—

$
—

$
—

$
0.01

$
0.23

Diluted earnings per unit attributable to common unitholders

$
0.74

$
0.45

$
0.42

$
0.14

$
0.26

Weighted-average basic units outstanding (1)

180,525

178,246

168,640

149,107

135,191

Weighted-average diluted units outstanding (1)

181,448

179,533

170,191

150,863

137,742

AMOUNTS ATTRIBUTABLE TO COMMON UNITHOLDERS:

Income from continuing operations

$
134,288

$
79,923

$
71,704

$
20,040

$
4,392

Total discontinued operations

—

—

—

331

31,048

Net income

$
134,288

$
79,923

$
71,704

$
20,371

$
35,440

~~Table of Contents~~

At December 31,


2017

2016

2015

2014

2013

Balance Sheet Data (in thousands):

Storage properties, net

$
3,408,790

$
3,326,816

$
2,872,983

$
2,625,129

$
2,155,170

Total assets

3,545,336

3,475,028

3,104,164

2,776,906

2,347,819

Unsecured senior notes, net

1,142,460

1,039,076

741,904

493,957

493,283

Revolving credit facility

81,700

43,300

—

78,000

38,600

Unsecured term loans, net

299,396

398,749

398,183

397,617

397,261

Mortgage loans and notes payable, net

111,434

114,618

111,455

194,844

198,869

Total liabilities

1,855,646

1,759,384

1,393,183

1,277,465

1,218,337

Operating Partnership interests of third parties

54,320

54,407

66,128

49,823

36,275

Total CubeSmart L.P. Capital

1,629,134

1,655,382

1,643,327

1,448,026

1,092,276

Noncontrolling interests in subsidiaries

6,236

5,855

1,526

1,592

931

Total liabilities and capital

3,545,336

3,475,028

3,104,164

2,776,906

2,347,819

Other Data:

Number of stores

484

475

445

421

366

Total rentable square feet (in thousands)

33,760

32,858

30,361

28,622

24,662

Occupancy percentage

89.2
%

89.7
%

90.2
%

89.1
%

88.3
%
Cash dividends declared per common unit (2)

$
1.11

$
0.90

$
0.69

$
0.55

$
0.46

~~(1)~~

~~OP units have been excluded from the earnings per unit calculations as the related income or loss is presented in Operating Partnership interest of third parties.~~

~~(2)~~

We announced full quarterly dividends of $0.11 and $0.484 per common and preferred units, respectively, on February 21, 2013, May 29, 2013, and August 7, 2013; dividends of $0.13 and $0.484 per common and preferred units, respectively, on December 19, 2013, February 25, 2014, May 28, 2014, and August 5, 2014; dividends of $0.16 and $0.484 per common and preferred units, respectively, on December 16, 2014, February 24, 2015, May 27, 2015, and August 4, 2015; dividends of $0.21 and $0.484 per common and preferred units, respectively, on December 10, 2015, February 16, 2016, June 1, 2016, and August 2, 2016; dividends of $0.174 per preferred unit on September 2, 2016; dividends of $0.27 per common unit on December 15, 2016, February 14, 2017, May 31, 2017, and July 25, 2017; and dividends of $0.30 per common unit on December 14, 2017.

~~Table of Contents~~

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with the financial statements and notes thereto appearing elsewhere in this Report. Some of the statements we make in this section are forward-looking statements within the meaning of the federal securities laws. For a complete discussion of forward-looking statements, see the section in this Report entitled “Forward-Looking Statements”. Certain risk factors may cause actual results, performance or achievements to differ materially from those expressed or implied by the following discussion. For a discussion of such risk factors, see the section in this Report entitled “Risk Factors”.

Overview

We are an integrated self-storage real estate company, and as such we have in-house capabilities in the operation, design, development, leasing, management and acquisition of self-storage properties. The Parent Company’s operations are conducted solely through the Operating Partnership and its subsidiaries. The Parent Company has elected to be taxed as a REIT for U.S. federal income tax purposes. As of December 31, ~~2017~~2021 and ~~December 31, 2016,~~2020, we owned ~~484~~(or partially owned and ~~475~~consolidated) 607 self-storage properties ~~respectively,~~ totaling approximately ~~33.8~~43.6 million rentable square feet and ~~32.9~~543 self-storage properties totaling approximately 38.5 million rentable square feet, respectively. As of December 31, ~~2017,~~2021, we owned stores in the District of Columbia and the following 2324 states: Arizona, California, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah and Virginia. In addition, as of December 31, ~~2017,~~2021, we managed ~~452~~651 stores for third parties (including ~~117~~90 stores containing an aggregate of approximately ~~6.9~~6.5 million net rentable square feet as part of ~~four~~seven separate unconsolidated real estate ventures), bringing the total number of stores we owned and/or managed to ~~936.~~1,258. As of December 31, ~~2017,~~2021, we managed stores for third parties in the District of Columbia and the following 3136 states: Alabama, Arizona, California, Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, ~~Kansas,~~Indiana, Iowa, Kentucky, Louisiana, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Vermont, Virginia, Washington ~~West Virginia,~~ and Wisconsin.

We derive revenues principally from rents received from customers who rent cubes at our self-storage properties under month-to-month leases. Therefore, our operating results depend materially on our ability to retain our existing customers and lease our available self-storage cubes to new customers while maintaining and, where possible, increasing our pricing levels. In addition, our operating results depend on the ability of our customers to make required rental payments to us. Our approach to the management and operation of our stores combines centralized marketing, revenue management and other operational support with local operations teams that provide market-level oversight and ~~control.~~management. We believe this approach allows us to respond quickly and effectively to changes in local market conditions and to maximize revenues by managing rental rates and occupancy levels.

We typically experience seasonal fluctuations in the occupancy levels of our stores, which are generally slightly higher during the summer months due to increased moving activity.

Our results of operations may be sensitive to changes in overall economic conditions that impact consumer spending, including discretionary spending and moving trends, as well as to increased bad debts due to recessionary pressures. Adverse economic conditions affecting disposable consumer income, such as employment levels, business conditions, interest rates, tax rates, fuel and energy costs, and other matters could reduce consumer spending or cause consumers to shift their spending to other products and services. A general reduction in the level of discretionary spending or shifts in consumer discretionary spending could adversely affect our growth and profitability.

We continue our focus on maximizing internal growth opportunities and selectively pursuing targeted acquisitions and developments of self-storage properties.

We have one reportable segment: we own, operate, develop, manage and acquire self-storage properties.

Our self-storage properties are located in major metropolitan and suburban areas and have numerous customers per store. No single customer represents a significant concentration of our revenues. Our stores in ~~Florida,~~ New York, Florida, Texas and California provided approximately ~~17%~~19%, ~~16%~~15%, ~~10%,~~9% and 8%, respectively, of total revenues for the year ended December 31, ~~2017.~~2021.

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Summary of Critical Accounting Policies and Estimates

Set forth below is a summary of the accounting policies and estimates that management believes are critical to the preparation of the consolidated financial statements included in this Report. Certain of the accounting policies used in the preparation of these consolidated financial statements are particularly important for an understanding of the financial position and results of operations presented in the historical consolidated financial statements included in this Report. A summary of significant accounting policies is also provided in ~~the~~

~~Table of Contents~~

~~notes~~note 2 to our consolidated financial ~~statements (see note 2 to the consolidated financial statements).~~statements. These policies require the application of judgment and assumptions by management and, as a result, are subject to a degree of uncertainty. Due to this uncertainty, actual results could differ materially from estimates calculated and utilized by management.

Basis of Presentation

The accompanying consolidated financial statements include all of the accounts of the Company, and its majority-owned and/or controlled subsidiaries. The portion of these entities not owned by the Company is presented as noncontrolling interests as of and during the periods presented. All significant intercompany accounts and transactions have been eliminated in consolidation.

When the Company obtains an economic interest in an entity, the Company evaluates the entity to determine if the entity is deemed a variable interest entity (“VIE”), and if the Company is deemed to be the primary beneficiary, in accordance with authoritative guidance issued by the Financial Accounting Standards Board (“FASB”) on the consolidation of VIEs. To the extent that the Company (i) has the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and (ii) has the obligation or rights to absorb the VIE's losses or receive its benefits, then the Company is considered the primary beneficiary. The Company may also consider additional factors included in the authoritative guidance, such as whether or not it is the partner in the VIE that is most closely associated with the VIE. When an entity is not deemed to be a VIE, the Company considers the provisions of additional FASB guidance to determine whether a general partner, or the general partners as a group, controls a limited partnership or similar entity when the limited partners have certain rights. The Company consolidates (i) entities that are VIEs and of which the Company is deemed to be the primary beneficiary and (ii) entities that are non-VIEs which the Company controls and in which the limited partners do not have substantive participating rights, or the ability to dissolve the entity or remove the Company without ~~cause.~~cause nor substantive participating rights.

Self-Storage Properties

The Company records self-storage properties at cost less accumulated depreciation. Depreciation on the buildings, improvements and equipment is recorded on a straight-line basis over their estimated useful lives, which range from five to 39 years. Expenditures for significant renovations or improvements that extend the useful life of assets are capitalized. Repairs and maintenance costs are expensed as incurred.

When stores are acquired, the purchase price is allocated to the tangible and intangible assets acquired and liabilities assumed based on estimated fair values. When a portfolio of stores is acquired, the purchase price is allocated to the individual stores based upon an income approach or a cash flow analysis using appropriate risk adjusted capitalization rates, which take into account the relative size, age, and location of the individual store along with current and projected occupancy and rental rate levels or appraised values, if available.

Allocations to ~~the individual assets and liabilities are based upon comparable market sales information for~~ land, ~~buildings~~building and improvements and ~~estimates of depreciated replacement cost of equipment.~~

~~In allocating~~equipment are recorded based upon their respective fair values as estimated by management. If appropriate, the ~~purchase price for an acquisition, the Company determines whether the acquisition includes intangible assets or liabilities. The~~ Company allocates a portion of the purchase price to an intangible asset ~~attributable~~attributed to the value of in-place leases. This intangible asset is generally amortized to expense over the expected remaining term of the respective leases. Substantially all of the storage leases in place at acquired stores are at market rates, as the majority of the leases are month-to-month contracts. Accordingly, to date, no portion of the purchase price has been allocated to above- or below-market lease ~~intangibles.~~intangibles associated with storage leases assumed at acquisition. Above- or below- market lease intangibles associated with assumed leases in which the Company serves as lessee are recorded as an adjustment to the right-of-use asset and reflect the difference between the contractual amounts to be paid pursuant to each in-place lease and management’s estimate of fair market lease rates. These amounts are amortized over the term of the lease. To date, no intangible asset has been recorded for the value of customer relationships, because the Company does not have any concentrations of significant customers and the average customer turnover is fairly frequent.

Long-lived assets classified as “held for use” are reviewed for impairment when events and circumstances such as declines in occupancy and operating results indicate that there may be an impairment. The carrying value of these long-lived assets is compared to the undiscounted future net operating cash flows, plus a terminal value, attributable to the assets to determine if the store’s basis is recoverable. If a store’s basis is not considered recoverable, an impairment loss is recorded to the extent the net carrying value of the asset exceeds the fair value. The impairment loss recognized equals the excess of net carrying value over the related fair value of the asset. There were no impairment losses recognized in accordance with these procedures during the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015.~~2019.

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The Company considers long-lived assets to be “held for sale” upon satisfaction of the following criteria: (a) management commits to a plan to sell ~~a store~~an asset (or group of ~~stores)~~assets), (b) the ~~store~~asset is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such ~~stores,~~assets, (c) an active program to locate a buyer and other actions required to complete the plan to sell the ~~store~~asset have been initiated, (d) the sale of the ~~store~~asset is probable and transfer of the asset is expected to be completed within one year, (e) the ~~store~~asset is being actively marketed for sale at a price that is reasonable in relation to its current fair value and (f) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

~~Table of Contents~~

transaction from closing. However, each potential transaction is evaluated based on its separate facts and circumstances. ~~Stores~~Assets classified as held for sale are reported at the lesser of carrying value or fair value less estimated costs to ~~sell.~~sell and are not depreciated. The Club Operations that we acquired through our acquisition of LAACO have been classified as held for sale as of December 31, 2021. There were no stores classified as held for sale as of December 31, 2021.

~~Revenue Recognition~~

Management has determined that all our leases with customers are operating leases. Rental income is recognized in accordance with the terms of the lease agreements or contracts, which generally are month to month. Property management fee income is recognized monthly as services are performed and in accordance with the terms of the related management agreements.

The Company recognizes gains from disposition of stores only upon closing in accordance with the guidance on sales of real estate. Payments received from purchasers prior to closing are recorded as deposits. Profit on real estate sold is recognized using the full accrual method upon closing when the collectability of the sales price is reasonably assured and the Company is not obligated to perform significant activities after the sale. Profit may be deferred in whole or part until the sale meets the requirements of profit recognition on sales under this guidance.

~~Noncontrolling Interests~~

Noncontrolling interests are the portion of equity (net assets) in a subsidiary not attributable, directly or indirectly, to a parent. The ownership interests in the subsidiary that are held by owners other than the parent are noncontrolling interests. In accordance with authoritative guidance issued on noncontrolling interests in consolidated financial statements, such noncontrolling interests are reported on the consolidated balance sheets within equity/capital, separately from the Parent Company’s equity/capital. The guidance also requires that noncontrolling interests are adjusted each period so that the carrying value equals the greater of its carrying value based on the accumulation of historical cost or its redemption value. On the consolidated statements of operations, revenues, expenses, and net income or loss from less-than-wholly-owned subsidiaries are reported at the consolidated amounts, including both the amounts attributable to the Parent Company and noncontrolling interests. Presentation of consolidated equity/capital activity is included for both quarterly and annual financial statements, including beginning balances, activity for the period and ending balances for shareholders’ equity/capital, noncontrolling interests, and total equity/capital.

Investments in Unconsolidated Real Estate Ventures

The Company accounts for its investments in unconsolidated real estate ventures under the equity method of ~~accounting.~~accounting when it is determined that the Company has the ability to exercise significant influence over the venture. Under the equity method, investments in unconsolidated ~~joint~~real estate ventures are recorded initially at cost, as investments in real estate entities, and subsequently adjusted for equity in earnings (losses), and cash contributions, less cash distributions and impairments. On a periodic basis, management also assesses whether there are any indicators that the carrying value of the Company’s investments in unconsolidated real estate entities may be other than temporarily impaired. An investment is impaired only if the fair value of the investment, as estimated by management, is less than the carrying value of the investment and the decline is other than temporary. To the extent impairment that is other than temporary has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the fair value of the investment, as estimated by management. Fair value is determined through various valuation techniques, including but not limited to, discounted cash flow models, quoted market values and ~~third party~~third-party appraisals. There were no impairment losses related to the Company’s investments in unconsolidated real estate ventures recognized during the years ended December 31, ~~2017, 2016~~2021, 2020 and ~~2015.~~2019.

~~Income Taxes~~

~~The Parent Company elected to be taxed as a~~Differences between the Company's net investment in unconsolidated real estate ~~investment trust under Sections 856-860~~ventures and its underlying equity in the net assets of the ~~Internal Revenue Code beginning with~~ventures are primarily a result of the ~~period from October 21, 2004 (commencement~~Company acquiring interests in existing unconsolidated real estate ventures. As of ~~operations) through~~ December 31, ~~2004. In management’s opinion,~~2021, the ~~requirements to maintain these elections are being met. Accordingly, no provision for federal income taxes has been reflected~~Company’s net investment in unconsolidated real estate ventures was greater than its underlying equity in the ~~consolidated financial statements other than for operations conducted through our taxable REIT subsidiaries.~~

~~Earnings and profits, which determine the taxability of distributions to shareholders, differ from~~ net income reported for financial reporting purposes due to differences in cost basis, the estimated useful lives used to compute depreciation, and the allocation of net income and loss for financial versus tax reporting purposes.

~~The Parent Company is subject to a 4% federal excise tax if sufficient taxable income is not distributed within prescribed time limits. The excise tax equals 4%~~assets of the ~~annual amount, if any,~~unconsolidated real estate ventures by ~~which~~an aggregate of $33.6 million. There were no such differences as of December 31, 2020. These differences are amortized over the ~~sum of (a) 85%~~lives of the ~~Parent Company’s ordinary income, (b) 95% of the Parent Company’s net capital gains, and (c) 100% of prior year taxable income exceeds cash distributions and certain taxes paid~~self-storage properties owned by the ~~Parent Company.~~

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~~Recent Accounting Pronouncements~~

In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-12 – Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The purpose of this updated guidancereal estate ventures. This amortization is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. The transition guidance provides companies with the option of early adopting the new standard using a modified retrospective transition methodincluded in any interim period after issuance of the update, or alternatively requires adoption for fiscal years beginning after December 15, 2018. This adoption method will require us to recognize the cumulative effect of initially applying the new guidance as an adjustment to accumulated other comprehensive income with a corresponding adjustment to the opening balance of retainedequity in earnings ~~as of the beginning of the fiscal year that we adopt the update. We are in the process of evaluating the impact of this new guidance.~~

In February 2017, as part of the new revenue standard, the FASB issued ASU No. 2017-05 – Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance, which focuses on recognizing gains and losses from the transfer of nonfinancial assets in contracts with non-customers. Specifically, the new guidance defines “in substance nonfinancial asset”, unifies guidance related to partial sales of nonfinancial assets, eliminates rules specifically addressing sales of real estate removes exceptions to the financial asset derecognition model, and clarifies the accounting for contributions of nonfinancial assets to joint ventures. The new guidance became effective on January 1, 2018 when the entity adopted the new revenue standard. Upon adoption, the majority of our sale transactions are now treated as dispositions of nonfinancial assets rather than dispositions of a business given the FASB’s recently revised definition of a business (see ASU No. 2017-01 below). Additionally, in partial sale transactions where we sell a controlling interest in real estate but retain a noncontrolling interest, we will now fully recognize a gain or lossventures on the ~~fair value measurement of the retained interest as the new guidance eliminates the partial profit recognition model.~~

In January 2017, the FASB issued ASU 2017-01 - Business Combinations (Topic 805): Clarifying the Definition of a Business, which changes the definition of a business to include an input and a substantive process that together significantly contribute to the ability to create outputs. A framework is provided to evaluate when an input and a substantive process are present. The new guidance also narrows the definition of outputs, which are defined as the results of inputs and substantive processes that provide goods or services to customers, other revenue, or investment income. The standard became effective on January 1, 2018. Upon adoption of the new guidance, the majority of future property acquisitions will now be considered asset acquisitions, resulting in the capitalization of acquisition related costs incurred in connection with these transactions and the allocation of purchase price and acquisition related costs to the assets acquired based on their relative fair values.

In November 2016, the FASB issued ASU No. 2016-18 - Statement of Cash Flows (Topic 230): Restricted Cash, which requires the statement of cash flows to explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. The new guidance also requires entities to reconcile such total to amounts on the balance sheet and disclose the nature of the restrictions. The standard became effective on January 1, 2018. The standard requires the use of the retrospective transition method. The adoption of this guidance will not have a material impact on our consolidated financial statements as the update primarily relates to financial statement presentation and disclosures.

In August 2016, the FASB issued ASU No. 2016-15 – Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. The eight items that the ASU provides classification guidance on include (1) debt prepayment and extinguishment costs, (2) settlement of zero-coupon debt instruments, (3) contingent consideration payments made after a business combination, (4) proceeds from the settlement of insurance claims, (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, (6) distributions received from equity method investments, (7) beneficial interests in securitization transactions, and (8) separately identifiable cash flows and application of the predominance principle. The standard became effective on January 1, 2018. The standard requires the use of the retrospective transition method. The adoption of this guidance will not have a material impact on our consolidated financial statements as the update primarily relates to financial statement presentation and disclosures.

In March 2016, the FASB issued ASU No. 2016-09 - Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which is intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The new guidance requires entities to make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. We have elected to account for forfeitures when they occur. In addition, the guidance allows employers to withhold shares to satisfy minimum statutory tax withholding requirements up to the employees’ maximum individual tax rate without causing the award to be classified as a liability. The guidance also stipulates that cash paid by an employer to a taxing authority when directly withholding shares for tax-withholding purposes should be classified as a financing activity on the statement of cash flows. The new standard became effective on January 1, 2017. The adoption of this guidance did not have a material impact on our consolidated financial position or results of operations.

~~Table of Contents~~

In February 2016, the FASB issued ASU No. 2016-02 - Leases (Topic 842), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either financing or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. The standard is effective on January 1, 2019, however early adoption is permitted. We are currently assessing the impact of the adoption of the new standard on our consolidated financial statements and related disclosures but at this time, expect the primary impact to be related to our ten ground leases in which we serve as the ground lessee (see note 14).

Recent Accounting Pronouncements

For a discussion of recent accounting pronouncements affecting our business, see note 2 to the Company’s consolidated financial position or results of operations primarily because most of our revenue is derived from lease contracts, which are excluded from the scope of the new guidance. Our insurance fee revenue, property management fee revenue, and merchandise sale revenue are included in the scope of the new guidance, however, we identified similar performance obligations under this standard as compared with deliverables and separate units of account identified under our previous revenue recognition methodology. Accordingly, revenue recognized under the new guidance will not differ materially from revenue recognized under previous guidance and there will be no material prior year impact.statements.

Results of Operations

The following discussion of our results of operations should be read in conjunction with the consolidated financial statements and the accompanying notes thereto. Historical results set forth in the consolidated statements of operations reflect only the existing stores for each period presented and should not be taken as indicative of future operations. We consider our same-store portfolio to consist of only those stores owned and operated on a stabilized basis at the beginning and at the end of the applicable years presented. We consider a store to be stabilized once it has achieved an occupancy rate that we believe, based on our assessment of market-specific data, is representative of similar self-storage assets in the applicable market for a full year measured as of the most recent January 1 and has not been significantly damaged by natural disaster or undergone significant renovation. We believe that same-store results are useful to investors in evaluating our performance because they provide information relating to changes in store-level operating performance without taking into account the effects of acquisitions, developments or dispositions. As of December 31, ~~2017,~~2021, we owned ~~432~~506 same-store properties and ~~52 non-same-store~~101 non same-store properties. All of the ~~non-same-store~~non same-store properties were ~~2016~~2020 and ~~2017~~2021 acquisitions, dispositions, developed stores, or stores with a significant portion of net rentable square footage taken out of ~~service.~~service or stores that have not yet reached stabilization as defined above. For analytical presentation, all percentages are calculated using the numbers presented in the financial statements contained in this Report.

Table of Contents

~~Table of Contents~~

The following table summarizes the change in number of owned stores from January 1, ~~2015~~2019 through December 31, ~~2017:~~2021:


	2017	2016	2015


				2021	2020	2019

Balance - January 1	475	445	421	543	523	493
Stores acquired	—	10	7	—	1	1
Stores developed	1	1	—	1	—	—
Stores combined ⁽¹⁾				(1)	—	—
Balance - March 31	476	456	428	543	524	494
Stores acquired	3	7	4
Stores acquired ⁽²⁾				2	2	21
Stores developed	—	1	1	2	1	2
Stores combined (1)	(1)	—	—
Stores combined ⁽³⁾				—	—	(1)
Balance - June 30	478	464	433	547	527	516
Stores acquired	—	7	5	2	—	2
Stores developed	2	—	—	—	—	1
Stores sold				(4)	—	—
Balance - September 30	480	471	438	545	527	519
Stores acquired	4	4	13	62	18	5
Stores developed	1	—	2	1	—	—
Stores combined (2)	(1)	—	—
Stores combined ⁽³⁾				—	(1)	—
Stores sold	—	—	(8)	(1)	(1)	(1)
Balance - December 31	484	475	445	607	543	523

(1)

On ~~May 16, 2017,~~March 3, 2021, we ~~acquired~~completed development of a store located in ~~Sacramento, CA~~Arlington, VA for a total cost of approximately ~~$3.7 million, which~~$26.4 million. The developed store is located ~~directly~~ adjacent to an existing ~~wholly-owned~~consolidated joint venture store. Given their proximity to each other, the stores have been combined in our store count, as well as for operational and reporting purposes.

(2)

For the quarter ended June 30, 2021, includes one store acquired by a consolidated joint venture in which we hold a 50% interest.

(3)

On ~~October 2, 2017,~~May 24, 2019 and November 10, 2020, we acquired ~~a store~~stores located in ~~Keller, TX~~Tempe, AZ and Merritt Island, FL for approximately ~~$4.1~~$1.6 million ~~which~~and $3.9 million, respectively. In each case, the store acquired is located ~~directly adjacent~~in near proximity to an existing wholly-owned store. Given their proximity to each other, ~~the stores have~~each acquired store has been combined with the existing store in our store count, as well as for operational and reporting purposes.

4937

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Comparison of the Year Ended December 31, ~~2017~~2021 to the Year Ended December 31, ~~2016~~2020 (dollars in thousands)


											Non Same-Store						Other/
	Same-Store Property Portfolio										Properties						Eliminations				Total Portfolio
									%																				%
	2021			2020			Change		Change		2021			2020			2021		2020		2021			2020			Change		Change
REVENUES:
Rental income	$	631,410		$	557,201		$	74,209	13.3	%	$	76,341		$	23,808		$	—	$	—	$	707,751		$	581,009		$	126,742	21.8	%
Other property related income ⁽¹⁾		26,399			24,673			1,726	7.0	%		2,906			1,280			54,300		44,770		83,605			70,723			12,882	18.2	%
Property management fee income		—			—			—	0.0	%		—			—			31,208		27,445		31,208			27,445			3,763	13.7	%
Total revenues		657,809			581,874			75,935	13.1	%		79,247			25,088			85,508		72,215		822,564			679,177			143,387	21.1	%

OPERATING EXPENSES:
Property operating expenses ⁽²⁾		192,650			184,939			7,711	4.2	%		23,457			9,601			35,997		29,094		252,104			223,634			28,470	12.7	%
NET OPERATING INCOME:		465,159			396,935			68,224	17.2	%		55,790			15,487			49,511		43,121		570,460			455,543			114,917	25.2	%

Store count		506			506							101			37							607			543
Total square footage		35,490			35,490							8,105			3,054							43,595			38,544
Period end occupancy		93.3	%		93.3	%						86.2	%		80.5	%						92.0	%		92.3	%
Period average occupancy		94.7	%		92.9	%
Realized annual rent per occupied sq. ft. ⁽³⁾	$	18.78		$	16.91

Depreciation and amortization																						232,049			156,573			75,476	48.2	%
General and administrative																						47,809			41,423			6,386	15.4	%
Subtotal																						279,858			197,996			81,862	41.3	%

OTHER (EXPENSE) INCOME
Interest:
Interest expense on loans																						(78,448)			(75,890)			(2,558)	(3.4)	%
Loan procurement amortization expense																						(8,168)			(2,674)			(5,494)	(205.5)	%
Loss on early extinguishment of debt																						(20,328)			(18,020)			(2,308)	(12.8)	%
Equity in earnings of real estate ventures																						25,275			178			25,097	14,099.4	%
Gains from sales of real estate, net																						32,698			6,710			25,988	387.3	%
Other																						(10,818)			(240)			(10,578)	(4,407.5)	%
Total other expense																						(59,789)			(89,936)			30,147	33.5	%

NET INCOME																						230,813			167,611			63,202	37.7	%
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
Noncontrolling interests in the Operating Partnership																						(7,873)			(1,825)			(6,048)	(331.4)	%
Noncontrolling interests in subsidiaries																						542			(165)			707	428.5	%
NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS																					$	223,482		$	165,621		$	57,861	34.9	%

Non Same-Store

Other/

Same-Store Property Portfolio

Properties

Eliminations

Total Portfolio







Increase/

%



















Increase/

%

2017

2016

(Decrease)

Change

2017

2016

2017

2016

2017

2016

(Decrease)

Change

REVENUES:

Rental income
$
444,290

$
424,977

$
19,313

4.5
%
$
44,753

$
24,624

$
—

$
—

$
489,043

$
449,601

$
39,442

8.8
%
Other property related income

46,131

44,689

1,442

3.2
%

4,643

2,574

4,227

2,992

55,001

50,255

4,746

9.4
%
Property management fee income

—

—

—

0.0
%

—

—

14,899

10,183

14,899

10,183

4,716

46.3
%
Total revenues

490,421

469,666

20,755

4.4
%

49,396

27,198

19,126

13,175

558,943

510,039

48,904

9.6
%

OPERATING EXPENSES:

Property operating expenses

139,092

135,366

3,726

2.8
%

18,858

11,936

23,558

18,545

181,508

165,847

15,661

9.4
%
NET OPERATING INCOME (LOSS):

351,329

334,300

17,029

5.1
%

30,538

15,262

(4,432)

(5,370)

377,435

344,192

33,243

9.7
%

Store count

432

432

52

43

484

475

Total square footage

29,561

29,561

4,199

3,297

33,760

32,858

Period End Occupancy (1)

91.7
%

91.8
%

71.7
%

71.4
%

89.2
%

89.7
%

Period Average Occupancy (2)

93.1
%

92.9
%

Realized annual rent per occupied sq. ft. (3)
$
16.15

$
15.48

Depreciation and amortization

145,681

161,865

(16,184)

(10.0)
%
General and administrative

34,745

32,823

1,922

5.9
%
Acquisition related costs

1,294

6,552

(5,258)

(80.3)
%
Subtotal

181,720

201,240

(19,520)

(9.7)
%
OPERATING INCOME

195,715

142,952

52,763

36.9
%

OTHER (EXPENSE) INCOME

Interest:

Interest expense on loans

(56,952)

(50,399)

(6,553)

(13.0)
%
Loan procurement amortization expense

(2,638)

(2,577)

(61)

(2.4)
%
Equity in losses of real estate ventures

(1,386)

(2,662)

1,276

47.9
%
Other

872

1,062

(190)

(17.9)
%
Total other expense

(60,104)

(54,576)

(5,528)

(10.1)
%

NET INCOME

135,611

88,376

47,235

53.4
%
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS

Noncontrolling interests in the Operating Partnership

(1,593)

(941)

(652)

(69.3)
%
Noncontrolling interests in subsidiaries

270

470

(200)

(42.6)
%
NET INCOME ATTRIBUTABLE TO THE COMPANY

$
134,288

$
87,905

$
46,383

52.8
%
Distribution to preferred shareholders

—

(5,045)

5,045

100.0
%
Preferred share redemption charge

—

(2,937)

2,937

100.0
%
NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS

$
134,288

$
79,923

$
54,365

68.0
%

(1)	~~(1)~~ Protection plan revenue, which prior to 2021 had been included in our same-store and non same-store portfolio results, is now recorded in other/eliminations. Prior periods have been adjusted for comparability.

(2)

~~Represents occupancy as~~For comparability purposes, current year amounts related to the expiration of certain real estate tax abatements have been excluded from the same-store portfolio results ($296k for the year ended December 31, ~~of the respective year.~~

2021).

(3)

~~(2)~~

~~Represents the weighted average occupancy for the period.~~

~~(3)~~

Realized annual rent per occupied square foot is computed by dividing rental income by the weighted average occupied square feet for the period.

Revenues

Rental income increased from ~~$449.6~~$581.0 million during ~~2016~~the year ended December 31, 2020 to ~~$489.0~~$707.8 million ~~during 2017,~~for the year ended December 31, 2021, an increase of ~~$39.4~~$126.7 million, or ~~8.8%~~21.8%. The $74.2 million increase in same-store ~~revenue~~rental income was due primarily to ana 1.8% increase in average occupancy ~~of 20 basis points~~ and ~~higher~~an increase in rental ~~rates. Realized annual rent per square foot on our same-store portoflio increased 4.3% as a result of higher~~ rates for new and existing ~~customers during 2017 as~~customers. Realized annual rent per occupied square foot increased 11.1% for 2021 compared to ~~2016.~~2020. The remaining increase iswas primarily attributable to ~~$20.1~~$52.5 million of additional rental income ~~from the stores acquired in 2016 and 2017 included in our non-same store portfolio.~~

Other property related income consists of late fees, administrative charges, customer insurance fees, sales of storage supplies, and other ancillary revenues. Other property related income increased from $50.3 million in 2016 to $55.0 million in 2017, an increase of $4.7 million, or 9.4%. The $1.4 million increase in same-store property related income is mainly attributable to increased insurance participation and higher average occupancy. The remainder of the increase is attributable to other property income derived from the stores acquired or opened in ~~2016~~2020 and ~~2017~~2021 included in our ~~non-same store~~non same-store portfolio.

Other property related income increased from $70.7 million during the year ended December 31, 2020 to $83.6 million for the year ended December 31, 2021, an increase of $12.9 million, or 18.2%. The $1.7 million increase in same-store other property related income was mainly attributable to increases in fee revenue and merchandise sales. The increase was also due to a $5.7 million increase in customer storage protection plan participation at our owned and managed stores.

Property management fee income increased from ~~$10.2~~$27.4 million during ~~2016~~the year ended December 31, 2020 to ~~$14.9~~$31.2 million ~~during 2017,~~for the year ended December 31, 2021, an increase of ~~$4.7~~$3.8 million, or ~~46.3%~~13.7%. This increase iswas attributable to an increase in ~~management fees related~~rental income at our managed stores for the year ended December 31, 2021 as compared to the ~~third-party management business resulting from more stores under management and higher revenue at managed stores (452 stores as of~~year ended December, 31, ~~2017 compared to 316 stores as of December 31, 2016).~~2020.

Operating Expenses

Property operating expenses increased from ~~$165.8~~$223.6 million ~~in 2016~~during the year ended December 31, 2020 to ~~$181.5~~$252.1 million ~~in 2017,~~for the year ended December 31, 2021, an increase of ~~$15.7~~$28.5 million, or ~~9.4%, which is~~12.7%. The $7.7 million increase in property operating expenses in the same-store portfolio was primarily due to a $3.2 million increase in property taxes and a $2.7 million increase in advertising. The remainder of the increase was primarily attributable to ~~$7.0~~$13.9 million of increased expenses associated with newly acquired ~~stores, a $3.7 million increase in~~

~~Table of Contents~~

~~property operating expenses on the same-store portfolio, primarily due to higher property tax expenses, and $0.9 million related to hurricane damage, net of expected insurance proceeds.~~or developed stores.

Depreciation and amortization ~~decreased~~increased from ~~$161.9~~$156.6 million ~~in 2016~~during the year ended December 31, 2020 to ~~$145.7~~$232.0 million ~~in 2017, a decrease~~for the year ended December 31, 2021, an increase of ~~$16.2~~$75.5 million, or ~~10.0%.~~ ~~This decrease is~~48.2%.This increase was primarily attributable to ~~five-year assets~~depreciation and amortization associated with newly acquired ~~as part~~or developed stores.

Table of ~~the Company’s property acquisitions in 2011 and 2012 that became fully depreciated during 2016 and 2017.~~Contents

General and administrative expenses increased from ~~$32.8~~$41.4 million ~~in 2016~~during the year ended December 31, 2020 to ~~$34.7~~$47.8 million ~~in 2017,~~for the year ended December 31, 2021, an increase of ~~$1.9~~$6.4 million, or ~~5.9%~~15.4%. The change iswas primarily attributable to increased ~~professional fees and payroll~~personnel expenses resulting in part from additional employee headcount to support our growth.

Acquisition related costs decreased from $6.6 million during 2016 to $1.3 million during 2017, a decrease of $5.3 million, or 80.3%. Acquisition-related costs are non-recurring and fluctuate based on periodic investment activity.

Other (expense) income

Interest expense on loans increased from ~~$50.4~~$75.9 million during the year ended December 31, ~~2016~~2020 to ~~$57.0~~$78.4 million ~~during~~for the year ended December 31, ~~2017,~~2021, an increase of ~~$6.6~~$2.6 million, or ~~13.0%~~3.4%. The increase ~~is primarily~~was attributable to a higher amount of outstanding debt during ~~2017 as~~2021 compared to 2016, partially offset by lower interest rates during 2017. The average debt balance increased $199.4 million to $1.6 billion during 2017 as compared to $1.4 billion during 2016 as the result of borrowings to2020. To fund a portion of our growth, the ~~Company’s acquisition acitivity.~~ average outstanding debt balance increased by $312.6 million to $2.35 billion during 2021 as compared to $2.04 billion during 2020. The increase in the average outstanding debt balance was offset by a decrease in the weighted average effective interest rate on our outstanding debt, ~~decreased from~~which was 3.36% and 3.82% ~~during 2016~~for 2021 and 2020, respectively.

Loss on early extinguishment of debt was $20.3 million for the year ended December 31, 2021 compared to ~~3.79% during 2017.~~ $18.0 million for the year ended December 31, 2020, an increase of $2.3 million. The 2021 amount was related to the early redemption of $300.0 million of outstanding 4.375% senior notes due 2023 (the “2023 Notes”). The 2020 amount was related to the early redemption of $250.0 million of outstanding 4.800% senior notes due 2022 (the “2022 Notes”) (see “Liquidity and Capital Resources” below).

Equity in ~~losses~~earnings of real estate ventures ~~fluctuated~~increased from ~~a loss of $2.7~~$0.2 million during the year ended December 31, ~~2016~~2020 to ~~a loss of $1.4 million during the year ended December 31, 2017, a change of $1.3 million, or 47.9%. The change is mainly driven by our share of the losses attributable to HVP~~ ~~III~~, a real estate venture in which we own a 10% interest. The loss incurred in 2016 was primarily the result of amortization expense associated with the in-place lease intangible that was recorded in connection with HVP ~~III’s acquisition of 68 properties during 2015 and 2016. These assets became fully amortized during 2016 and 2017.~~

~~Table of Contents~~

~~Comparison of the Year Ended December 31, 2016 to the Year Ended December 31, 2015 (dollars in thousands)~~

Non Same-Store

Other/

Same-Store Property Portfolio

Properties

Eliminations

Total Portfolio







Increase/

%



















Increase/

%

2016

2015

(Decrease)

Change

2016

2015

2016

2015

2016

2015

(Decrease)

Change

REVENUES:

Rental income
$
402,239

$
375,149

$
27,090

7.2
%
$
47,362

$
17,327

$
—

$
—

$
449,601

$
392,476

$
57,125

14.6
%

Other property related income

42,172

40,194

1,978

4.9
%

5,091

2,039

2,992

2,956

50,255

45,189

5,066

11.2
%

Property management fee income

—

—

—

0.0
%

—

—

10,183

6,856

10,183

6,856

3,327

48.5
%

Total revenues

444,411

415,343

29,068

7.0
%

52,453

19,366

13,175

9,812

510,039

444,521

65,518

14.7
%

OPERATING EXPENSES:

Property operating expenses

126,824

127,209

(385)

(0.3)
%

20,478

8,210

18,545

17,753

165,847

153,172

12,675

8.3
%

NET OPERATING INCOME (LOSS):

317,587

288,134

29,453

10.2
%

31,975

11,156

(5,370)

(7,941)

344,192

291,349

52,843

18.1
%

Store count

407

407

68

38

475

445

Total square footage

27,828

27,828

5,030

2,533

32,858

30,361

Period End Occupancy (1)

91.8
%

91.6
%

78.3
%

75.4
%

89.7
%

90.2
%

Period Average Occupancy (2)

92.9
%

92.1
%

Realized annual rent per occupied sq. ft. (3)
$
15.56

$
14.63

Depreciation and amortization

161,865

151,789

10,076

6.6
%

General and administrative

32,823

28,371

4,452

15.7
%

Acquisition related costs

6,552

3,301

3,251

98.5
%

Subtotal

201,240

183,461

17,779

9.7
%

OPERATING INCOME

142,952

107,888

35,064

32.5
%

OTHER (EXPENSE) INCOME

Interest:

Interest expense on loans

(50,399)

(43,736)

(6,663)

(15.2)
%

Loan procurement amortization expense

(2,577)

(2,324)

(253)

(10.9)
%

Equity in losses of real estate ventures

(2,662)

(411)

(2,251)

(547.7)
%

Gains from sale of real estate, net

—

17,567

(17,567)

(100.0)
%

Other

1,062

(228)

1,290

565.8
%

Total other expense

(54,576)

(29,132)

(25,444)

(87.3)
%

NET INCOME

88,376

78,756

9,620

12.2
%

NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS

Noncontrolling interests in the Operating Partnership

(941)

(960)

19

2.0
%

Noncontrolling interests in subsidiaries

470

(84)

554

659.5
%

NET INCOME ATTRIBUTABLE TO THE COMPANY

$
87,905

$
77,712

$
10,193

13.1
%

Distribution to preferred shareholders

(5,045)

(6,008)

963

16.0
%

Preferred share redemption charge

(2,937)

—

(2,937)

(100.0)
%

NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS

$
79,923

$
71,704

$
8,219

11.5
%

~~(1)~~

~~Represents occupancy as of December 31 of each respective year.~~

~~(2)~~

~~Represents the weighted average occupancy for the period.~~

~~(3)~~

~~Realized annual rent per occupied square foot is computed by dividing rental income by the weighted average occupied square feet for the period.~~

~~Revenues~~

Rental income increased from $392.5 million during 2015 to $449.6 million during 2016, an increase of $57.1 million, or 14.6%. The increase in same-store revenue was due primarily to an increase in average occupancy of 80 basis points and higher rental rates. Realized annual rent per square foot on our same-store portoflio increased 6.4% as a result of higher rates for new and existing customers during 2016 as compared to 2015. The remaining increase is primarily attributable to $30.0 million of additional income from the stores acquired in 2015 and 2016 included in our non-same store portfolio.

Other property related income consists of late fees, administrative charges, customer insurance fees, sales of storage supplies and other ancillary revenues. Other property related income increased from $45.2 million in 2015 to $50.3 million in 2016, an increase of $5.1 million, or 11.2%. This increase is primarily attributable to increased fee revenue and insurance fees of $3.5 million on the stores acquired in 2015 and 2016 and a $2.0 million increase in same-store property related income mainly attributable to increased insurance participation and higher average occupancy, offset by a decrease of $0.4 million of income relating to the disposals of nine stores in 2015.

Property management fee income increased to $10.2 million in 2016 from $6.9 million during 2015, an increase of $3.3 million, or 48.5%. This increase is attributable to an increase in management fees related to the third-party management business resulting from more stores under management and higher revenue at managed stores (316 stores as of December 31, 2016 compared to 227 stores as of December 31, 2015).

~~Operating Expenses~~

Property operating expenses increased from $153.2 million in 2015 to $165.8 million in 2016, an increase of $12.7 million, or 8.3%, which is primarily attributable to $12.3 million of increased expenses associated with newly acquired stores.

~~Table of Contents~~

Depreciation and amortization increased from $151.8 million in 2015 to $161.9 million in 2016, an increase of $10.1 million, or 6.6%. This increase is primarily attributable to depreciation and amortization expense related to the 2015 and 2016 acquisitions.

General and administrative expenses increased from $28.4 million in 2015 to $32.8 million in 2016, an increase of $4.5 million, or 15.7%. The change is primarily attributable to $4.1 million of increased payroll expenses resulting from additional employee headcount to support our growth.

Acquisition related costs increased from $3.3 million during 2015 to $6.6 million during 2016, an increase of $3.3 million, or 98.5%. Acquisition-related costs are non-recurring and fluctuate based on periodic investment activity.

~~Other (expense) income~~

Interest expense on loans increased from $43.7 million during the year ended December 31, 2015 to $50.4 million during the year ended December 31, 2016, an increase of $6.7 million, or 15.2%. The increase is primarily attributable to a higher amount of outstanding debt during 2016 as compared to 2015. The average debt balance increased $234.6 million to $1.4 billion during 2016 as compared to $1.2 billion during 2015 as the result of borrowings to fund a portion of the Company’s acquisition activity.

Equity in losses of real estate ventures increased from $0.4 million during the year ended December 31, 2015 to $2.7 million during the year ended December 31, 2016, an increase of $2.3 million, or 547.7%. The increase is mainly driven by our share of the losses attributable to HVP ~~III~~, a real estate venture in which we own a 10% interest. The loss incurred in 2016 was primarily the result of amortization expense associated with the in-place lease intangible that was recorded in connection with HVP ~~III’s acquisition of 68 properties.~~ ~~The amortization expense did not exist in 2015 as the acquisitions took place during the fourth quarter of 2015 and throughout 2016~~.

~~Gains from sale of real estate, net were $17.6~~$25.3 million for the year ended December 31, ~~2015~~2021, an increase of $25.1 million. The increase was mainly due to our portion of the gains associated with ~~no comparable amounts~~HHF’s sale of seven stores (see note 5 to our consolidated financial statements).

Gains from sales of real estate, net increased from $6.7 million for the year ended December 31, ~~2016.~~2020 to $32.7 million for the year ended December 31, 2021, an increase of $26.0 million. These gains are determined on a transactional basis and, accordingly, are not comparable across reporting periods.

~~Other~~For the year ended December 31, 2021, the component of other (expense) income ~~(expense) increased $1.3~~designated as other includes $15.0 million ~~from 2015 to 2016~~of transaction-related expenses comprised primarily ~~due to acquisition fees earned in conjunction~~of severance costs associated with ~~HVP III’s~~the acquisition of ~~68 self-storage properties.~~LAACO. There were no such expenses for the year ended December 31, 2020.

Comparison of the Year Ended December 31, 2020 to the Year Ended December 31, 2019

Refer to the section entitled “Results of Operations” within Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2020 for a comparison of the year ended December 31, 2020 to the year ended December 31, 2019.

Non-GAAP Financial Measures

NOI

We define net operating income, which we refer to as ~~NOI,~~“NOI”, as total continuing revenues less continuing property operating expenses. NOI also can be calculated by adding back to net income (loss): interest expense on loans, loan procurement amortization expense, ~~loan procurement amortization expense —~~loss on early ~~repayment~~extinguishment of debt, acquisition related costs, equity in losses of real estate ventures, other expense, depreciation and amortization expense, general and administrative expense, and deducting from net income (loss): ~~gains from sale~~equity in earnings of real estate ~~net, income from discontinued operations,~~ventures, gains from ~~disposition~~sales of ~~discontinued operations,~~real estate, net, other income, gains from remeasurement of investments in real estate ventures and interest income. NOI is not a measure of performance calculated in accordance with GAAP.

We use NOI as a measure of operating performance at each of our stores, and for all of our stores in the aggregate. NOI should not be considered as a substitute for operating income, net income, cash flows provided by operating, investing and financing activities, or other income statement or cash flow statement data prepared in accordance with GAAP.

We believe NOI is useful to investors in evaluating our operating performance because:

●

it is one of the primary measures used by our management and our store managers to evaluate the economic productivity of our stores, including our ability to lease our stores, increase pricing and occupancy and control our property operating expenses;

Table of Contents

●

it is widely used in the real estate industry and the self-storage industry to measure the performance and value of real estate assets without regard to various items included in net income that do not relate to or are not indicative of operating performance, such as depreciation and amortization, which can vary depending upon accounting methods and the book value of assets; and

~~Table of Contents~~

●

it helps our investors to meaningfully compare the results of our operating performance from period to period by removing the impact of our capital structure (primarily interest expense on our outstanding indebtedness) and depreciation of our basis in our assets from our operating results.

There are material limitations to using a measure such as NOI, including the difficulty associated with comparing results among more than one company and the inability to analyze certain significant items, including depreciation and interest expense, that directly affect our net income. We compensate for these limitations by considering the economic effect of the excluded expense items independently as well as in connection with our analysis of net income. NOI should be considered in addition to, but not as a substitute for, other measures of financial performance reported in accordance with GAAP, such as total revenues, operating income and net income.

FFO

Funds from operations (“FFO”) is a widely used performance measure for real estate companies and is provided here as a supplemental measure of operating performance. The April 2002 National Policy Bulletin of the National Association of Real Estate Investment Trusts, as amended and restated, defines FFO as net income (computed in accordance with GAAP), excluding gains (or losses) from sales of real estate and related impairment charges, plus real estate depreciation and amortization and after adjustments for unconsolidated partnerships and joint ventures.

Management uses FFO as a key performance indicator in evaluating the operations of our stores. Given the nature of our business as a real estate owner and operator, we consider FFO a key measure of our operating performance that is not specifically defined by accounting principles generally accepted in the United States. We believe that FFO is useful to management and investors as a starting point in measuring our operational performance because FFO excludes various items included in net income that do not relate to or are not indicative of our operating performance such as gains (or losses) from sales of real estate, gains from remeasurement of investments in real estate ventures, impairments of depreciable assets and depreciation, which can make periodic and peer analyses of operating performance more difficult. Our computation of FFO may not be comparable to FFO reported by other REITs or real estate companies.

FFO should not be considered as an alternative to net income (determined in accordance with GAAP) as an indication of our performance. FFO does not represent cash generated from operating activities determined in accordance with GAAP and is not a measure of liquidity or an indicator of our ability to make cash distributions. We believe that to further understand our performance, FFO should be compared with our reported net income and considered in addition to cash flows computed in accordance with GAAP, as presented in our ~~Consolidated Financial Statements.~~consolidated financial statements.

FFO, as adjusted

FFO, as adjusted represents FFO as defined above, excluding the effects of acquisition related costs, gains or losses from early extinguishment of debt, and non-recurring items, which we believe are not indicative of the Company’s operating results. We present FFO, as adjusted because we believe it is a helpful measure in understanding our results of operations insofar as we believe that the items noted above that are included in FFO, but excluded from FFO, as adjusted are not indicative of our ongoing operating results. We also believe that the analyst community considers our FFO, as adjusted (or similar measures using different terminology) when evaluating us. Because other REITs or real estate companies may not compute FFO, as adjusted in the same manner as we do, and may use different terminology, our computation of FFO, as adjusted may not be comparable to FFO, as adjusted reported by other REITs or real estate companies.

5440

Table of Contents

The following table presents a reconciliation of net income to FFO and FFO, as adjusted, for the years ended December 31, ~~2017~~2021 and ~~2016 (in thousands):~~2020:

For the Year Ended December 31,

2017

2016

Net income attributable to the Company’s common shareholders

$
134,288

$
79,923

Add:

Real estate depreciation and amortization:

Real property

142,961

159,495

Company’s share of unconsolidated real estate ventures

10,243

11,016

Noncontrolling interests in the Operating Partnership

1,593

941

FFO attributable to common shareholders and OP unitholders

$
289,085

$
251,375

Add:

Loan procurement amortization expense - early repayment of debt

190

—

Acquisition related costs (1)

1,319

6,932

Preferred share redemption charge

—

2,937

Property damage related to hurricanes, net of expected insurance proceeds (2)

874

—

FFO, as adjusted, attributable to common shareholders and OP unitholders

$
291,468

$
261,244

Weighted-average diluted shares outstanding

181,448

179,533

Weighted-average diluted units outstanding

2,150

2,158

Weighted-average diluted shares and units outstanding

183,598

181,691


	Year Ended December 31,
	2021		2020

Net income attributable to the Company’s common shareholders	$	223,482	$	165,621

Add (deduct):
Real estate depreciation and amortization:
Real property		226,599		152,897
Company’s share of unconsolidated real estate ventures		8,510		7,430
Gains from sales of real estate, net ⁽¹⁾		(56,181)		(6,710)
Noncontrolling interests in the Operating Partnership		7,873		1,825
FFO attributable to common shareholders and OP unitholders	$	410,283	$	321,063

Add (deduct):
Loss on early repayment of debt ⁽²⁾		20,884		18,020
Transaction-related expenses ⁽³⁾		14,986		—
Loan forgiveness income ⁽⁴⁾		(1,546)		—
Bridge loan fee ⁽⁵⁾		4,000		—
FFO, as adjusted, attributable to common shareholders and OP unitholders	$	448,607	$	339,083

Weighted average diluted shares outstanding		205,009		194,943
Weighted average diluted units outstanding		7,117		2,137
Weighted average diluted shares and units outstanding		212,126		197,080

(1)

The year ended December 31, 2021 includes $23.5 million of gains from sale of real estate, net that are included in the Company’s share of equity in earnings of real estate ventures.

~~Acquisition related costs for~~(2)

For the year ended December 31, ~~2016 includes $0.4~~2021, loss on early extinguishment of debt relates to a $20.0 million prepayment premium and a $0.3 million write-off of ~~acquisition related~~unamortized loan procurement costs associated with the Operating Partnership’s redemption, in full, of its 2023 Notes on December 23, 2021, as well as $0.6 million of costs that are included in the Company’s share of equity in ~~losses~~earnings of real estate ventures.

~~(2)~~

~~Property damage related to hurricanes, net of expected insurance proceeds for~~ For the year ended December 31, ~~2017 includes $0.1~~2020, loss on early extinguishment of debt relates to a $17.6 million prepayment premium and a $0.4 million write-off of ~~storm damage related~~unamortized loan procurement costs associated with the Operating Partnership’s redemption, in full, of its 2022 Notes on October 30, 2020.

(3)

Transaction-related expenses include severance expenses ($14.8 million) and other transaction expenses ($0.2 million). The predecessor company, LAACO, Ltd., entered into severance agreements with certain employees, including members of their executive team, prior to our acquisition of LAACO, Ltd. on December 9, 2021. These costs were known to us and the assumption of the obligation to make these payments post-closing was contemplated in our net consideration paid in the transaction. In accordance with GAAP, and based on the specific details of the arrangements with the employees prior to closing, these costs are considered post-combination compensation expenses. We expect that an additional $10.3 million in severance costs will be expensed during the six months ended June 30, 2022. Transaction-related expenses are included in the ~~Company’s share~~component of ~~equity~~other income (expense) designated as other.

(4)

The Company assumed a Paycheck Protection Program loan in ~~losses~~conjunction with the LAACO transaction. This loan was subsequently forgiven by the Small Business Administration and the associated income is included in the component of ~~real estate ventures.~~other income (expense) designated as other.

(5)

Relates to a nonrefundable commitment fee to obtain bridge financing in the event that the Company's November 2021 senior note offerings were delayed, or could not be executed, in advance of the LAACO transaction. Upon issuance of the senior notes, the bridge financing commitment expired and the fee was fully amortized. The amortization of this fee is included in loan procurement amortization expense.

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Cash Flows

Comparison of the Year Ended December 31, ~~2017~~2021 to the Year Ended December 31, ~~2016~~2020

A comparison of cash flow related to operating, investing and financing activities for the years ended December 31, ~~2017~~2021 and ~~2016~~2020 is as follows:

Year Ended December 31,

Net cash provided by (used in):

2017

2016

Change

(in thousands)

Operating activities

$
293,438

$
265,164

$
28,274

Investing activities

$
(147,824)

$
(544,471)

$
396,647

Financing activities

$
(143,319)

$
219,411

$
(362,730)


	Year Ended December 31,
Net cash provided by (used in):	2021		2020		Change

	(in thousands)

Operating activities	$	449,185	$	351,033	$	98,152
Investing activities	$	(1,852,668)	$	(511,441)	$	(1,341,227)
Financing activities	$	1,410,572	$	108,196	$	1,302,376

Cash provided by operating activities increased from $351.0 million for the ~~years~~year ended December 31, ~~2017 and 2016 was $293.4~~2020 to $449.2 million ~~and $265.2 million, respectively,~~for the year ended December 31, 2021, reflecting an increase of ~~$28.3~~$98.2 million. Our increased cash flow from operating activities iswas primarily attributable to ~~our 2016~~stores acquired and ~~2017 acquisitions~~developed during 2020 and 2021 and increased net operating income levels onin the same-store portfolio in the ~~2017~~2021 period as compared to the ~~2016~~corresponding 2020 period.

Cash used in investing activities increased from $511.4 million for the year ended December 31, 2020 to $1,852.7 million for the year ended December 31, 2021, reflecting an increase of $1,341.2 million. The change was ~~$147.8~~primarily driven by the $1,679.0 million of cash used for the acquisition of LAACO in ~~2017 and $544.5 million in 2016, a decrease of $396.6 million driven~~2021 offset by a decrease in cash used for acquisitions of ~~self-storage properties.~~ other storage properties compared to the 2020 period. Excluding the storage properties acquired through the acquisition of LAACO, cash used during the year ended December 31, 2021 included the acquisition of nine stores (including the acquisition of a 50% membership interest in a consolidated joint venture that owns a single store) for an aggregate net purchase price of $152.8 million. Cash used during ~~2017 related to~~the year ended December 31, 2020 included the acquisition of ~~seven~~21 stores for an aggregate net purchase price of ~~$80.7~~$406.4 million, ~~inclusive~~net of ~~$6.2~~$154.4 million of assumed debt and ~~$12.3~~$175.1 million of OP units ~~issued, while~~issued. Additionally, cash ~~used in investing activities during 2016 related~~distributed from real estate ventures increased from $6.2 million for the year ended December 31, 2020 to $66.6 million for the ~~acquisition~~year ended December 31, 2021, an increase of ~~28 stores for an aggregate purchase price of $403.6~~$60.4 million, ~~inclusive of $6.5 million of assumed debt. The change is also driven by a decrease in cash used for development costs~~primarily resulting from the ~~acquisition~~distribution of ~~a development property~~proceeds received from the seven storage properties sold by aour HHF real estate venture (see note 5 to the Company’s consolidated ~~joint venture for $67.2 million, inclusive of $35.0 million of assumed debt,~~financial statements) during ~~2016.~~2021.

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Cash ~~used in financing activities was $143.3 million in 2017 compared to cash~~ provided by financing activities was $108.2 million for the year ended December 31, 2020 compared to $1,410.6 million for the year ended December 31, 2021, reflecting an increase of ~~$219.4 million in 2016, a change of $362.7~~$1,302.4 million. ~~The change is primarily a result of $298.5 million of~~During the years ended December 31, 2021 and 2020, we received net proceeds from ~~our issuance of~~ unsecured senior notes ~~in August 2016 compared to $103.2~~ of ~~net proceeds from our issuance~~$1,043.4 million and $445.8 million, respectively, reflecting an increase of ~~unsecured senior notes in April 2017.~~$597.6 million. There was also ~~a $106.5~~an increase of $844.9 million ~~decrease~~ in proceeds received from the issuance of common shares ~~from 2016~~during the year ended December 31, 2021 compared to ~~2017 and~~the year ended December 31, 2020, primarily as a ~~$100.0~~result of our underwritten offering of 15.5 million ~~term loan~~common shares to partially fund the LAACO acquisition. These cash inflows were offset by $87.3 million of principal payments made on mortgage loans during the year ended December 31, 2021 compared to $46.1 million during the year ended December 31, 2020, reflecting an increase of $41.2 million that was primarily attributable to the repayment during April 2017 with no comparable repayment in the prior year. We also paid $77.6 million to redeem our 7.75% Series A Preferred shares in November 2016 with no similar transaction in 2017. Additionally, cash distributions paid to common shareholders, preferred shareholders, and noncontrolling interests in the Operating Partnership increased $39.6 million from 2016 to 2017, resulting primarily from the increase in the common dividend per share and number of ~~shares outstanding.~~LAACO’s outstanding long-term debt at closing.

Comparison of the Year Ended December 31, ~~2016~~2020 to the Year Ended December 31, ~~2015~~2019

~~A comparison~~Refer to the section entitled “Cash Flows” within Item 7. “Management’s Discussion and Analysis of ~~cash flow related to operating, investing~~Financial Condition and ~~financing activities~~Results of Operations” of our Annual Report on Form 10-K for the ~~years~~year ended December 31, ~~2016 and 2015 is as follows:~~

Year Ended December 31,

Net cash provided by (used in):

2016

2015

Change

(in thousands)

Operating activities

$
265,164

$
217,272

$
47,892

Investing activities

$
(544,471)

$
(374,608)

$
(169,863)

Financing activities

$
219,411

$
217,304

$
2,107

~~Cash provided by operating activities~~2020 for a comparison of the ~~years~~year ended December 31, 2016 and 2015 was $265.2 million and $217.3 million, respectively, an increase of $47.9 million. Our increased cash flow from operating activities is primarily attributable to our 2015 and 2016 acquisitions and increased net operating income levels on the same-store portfolio in the 2016 period as compared2020 to the ~~2015 period.~~year ended December 31, 2019.

~~Cash used in investing activities was $544.5 million in 2016 and $374.6 million in 2015, an increase of $169.9 million driven by an increase in cash used for acquisitions of self-storage properties.~~ Cash used during 2016 relates to the acquisition of 28 stores for an aggregate purchase price of $403.6 million, inclusive of $6.5 million of assumed debt, while cash used in investing activities during 2015 relates to the acquisition of 29 stores for an aggregate purchase price of $292.4 million, inclusive of $2.7 million of assumed debt. The change is also driven by a $62.4 million increase in cash used for development costs, resulting primarily from the acquisition of a development property by a consolidated joint venture in the second quarter of 2016 for $67.2 million, inclusive of $35.0 million of assumed debt.

Cash provided by financing activities was $219.4 million in 2016 and $217.3 million in 2015, an increase of $2.1 million. From 2015 to 2016, proceeds from the issuance of unsecured senior notes increased $49.2 million and net proceeds in revolving credit facility borrowings increased $121.3 million. A $47.6 million decrease in principal payments on mortgage loans, resulting primarily from the repayment of five secured loans during 2016 for $34.9 million compared to four repayments during 2015 for $82.6 million also contributed to the increase in net cash inflows provided by financing activities from 2015 to 2016. These increases were offset by a $43.1 million increase in cash distributions paid to common shareholders, preferred shareholders and noncontrolling interests in the Operating Partnership during 2016 compared to 2015, resulting primarily from the increase in the common dividend per share and number of shares outstanding. The increases were also offset by $77.6 million paid to redeem our ~~7.75% Series A Preferred~~ ~~shares in November 2016 with no similar transaction in 2015 and a $97.9 million decrease in proceeds from the issuance of common shares in 2016 as compared to 2015~~.

Liquidity and Capital Resources

Liquidity Overview

Our cash flow from operations has historically been one of our primary sources of liquidity used to fund debt service, distributions and capital expenditures. We derive substantially all of our revenue from customers who lease space ~~from us~~ at our stores and fees earned from managing stores. Therefore, our ability to generate cash from operations is dependent on the rents that we are able to charge and collect from our customers. We believe that the properties in which we invest, self-storage properties, are less sensitive than other real estate product types to near-term economic downturns. However, prolonged economic downturns will adversely affect our cash flows from operations.

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In order to qualify as a REIT for federal income tax purposes, the Parent Company is required to distribute at least 90% of its REIT taxable income, excluding capital gains, to its shareholders on an annual basis orand must pay federal income ~~tax.~~tax on undistributed income to the extent it distributes less than 100% of its REIT taxable income. The nature of our business, coupled with

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the requirement that we distribute a substantial portion of our income on an annual basis, will cause us to have substantial liquidity needs over both the short ~~term~~ and ~~the~~ long term.

Our short-term liquidity needs consist primarily of funds necessary to pay operating expenses associated with our stores, refinancing of certain mortgage indebtedness, interest expense and scheduled principal payments on debt, expected distributions to limited partners and shareholders, capital expenditures and the development of new stores. These funding requirements will vary from year to year, in some cases significantly. In the ~~2018~~2022 fiscal year, we expect recurring capital expenditures to be approximately ~~$12.0~~$10.5 million to ~~$16.0~~$15.5 million, planned capital improvements and store upgrades to be approximately ~~$5.0~~$8.5 million to ~~$8.0~~$13.5 million and costs associated with the development of new stores to be approximately ~~$60.0~~$27.0 million to ~~$75.0~~$37.0 million. Our currently scheduled principal payments on debt ~~including borrowings outstanding on the Credit Facility and Term Loan Facility,~~ are approximately ~~$2.7~~$2.4 million in ~~2018.~~2022.

Our most restrictive financial covenants limit the amount of additional leverage we can add; however, we believe cash flows from operations, access to equity financing, including through our ~~“at-the-market”~~at-the-market equity program and available borrowings under our ~~Credit Facility~~Revolver (defined below) provide adequate sources of liquidity to enable us to execute our current business plan and remain in compliance with our covenants.

Our liquidity needs beyond ~~2018~~2022 consist primarily of contractual obligations which include repayments of indebtedness at maturity, as well as potential discretionary expenditures such as (i) non-recurring capital expenditures; (ii) redevelopment of operating stores; (iii) acquisitions of additional stores; and (iv) development of new stores. We will have to satisfy the portion of our needs not covered by cash flow from operations through additional borrowings, including borrowings under our ~~Credit Facility,~~Revolver, sales of common or preferred shares of the Parent Company and common or preferred units of the Operating Partnership and/or cash generated through store dispositions and joint venture transactions.

We believe that, as a publicly traded REIT, we will have access to multiple sources of capital to fund our long-term liquidity requirements, including the incurrence of additional debt and the issuance of additional equity. However, we cannot provide any assurance that this will be the case. Our ability to incur additional debt will be dependent on a number of factors, including our degree of leverage, the value of our unencumbered assets and borrowing restrictions that may be imposed by lenders. In addition, dislocation in the United States debt markets may significantly reduce the availability and increase the cost of long-term debt capital, including conventional mortgage financing and commercial mortgage-backed securities financing. There can be no assurance that such capital will be readily available in the future. Our ability to access the equity capital markets will be dependent on a number of factors as well, including general market conditions for REITs and market perceptions about us.

As of December 31, ~~2017,~~2021, we had approximately ~~$5.3~~$11.1 million in available cash and cash equivalents. In addition, we had approximately ~~$417.6~~$539.5 million of availability for borrowings under our ~~Credit Facility.~~Revolver.

Unsecured Senior Notes

On November 30, 2021, we issued $550.0 million in aggregate principal amount of unsecured senior notes due December 15, 2028, which bear interest at a rate of 2.250% per annum (the “2028 Notes”) and $500.0 million in aggregate principal amount of unsecured senior notes due February 15, 2032, which bear interest at a rate of 2.500% per annum (the “2032 Notes”). The 2028 Notes were priced at 99.515% of the principal amount to yield 2.325% at maturity, and the 2032 Notes were priced at 99.219% of the principal amount to yield 2.587% at maturity. Net proceeds from the offering were used to fund a portion of the purchase price for the acquisition of LAACO. The remaining proceeds from the offerings were used to repay, in full, $300.0 million of outstanding 4.375% senior notes due in December 2023 (the “2023 Notes”) as well as for working capital and other general corporate purposes.

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Our unsecured senior notes are summarized as follows (collectively referred to as the “Senior Notes”):


	December 31,		December 31,		Effective		Issuance	Maturity

									December 31,				Effective		Issuance	Maturity
Unsecured Senior Notes	2017		2016		Interest Rate		Date	Date	2021		2020		Interest Rate		Date	Date
	(in thousands)
$250M 4.800% Guaranteed Notes due 2022	$	250,000	$	250,000	4.82	%	Jun-12	Jul-22
$300M 4.375% Guaranteed Notes due 2023 (1)		300,000		250,000	4.33	%	Various (1)	Dec-23
									(in thousands)
$300M 4.375% Guaranteed Notes due 2023 ⁽¹⁾ ⁽²⁾									$	—	$	300,000	4.33	%	Various ⁽²⁾	Dec-23
$300M 4.000% Guaranteed Notes due 2025 ~~(2)~~(3)		300,000		250,000	3.99	%	Various (2)	Nov-25		300,000		300,000	3.99	%	Various ⁽³⁾	Nov-25
$300M 3.125% Guaranteed Notes due 2026		300,000		300,000	3.18	%	Aug-16	Sep-26		300,000		300,000	3.18	%	Aug-16	Sep-26
$550M 2.250% Guaranteed Notes due 2028										550,000		—	2.33	%	Nov-21	Dec-28
$350M 4.375% Guaranteed Notes due 2029										350,000		350,000	4.46	%	Jan-19	Feb-29
$350M 3.000% Guaranteed Notes due 2030										350,000		350,000	3.04	%	Oct-19	Feb-30
$450M 2.000% Guaranteed Notes due 2031										450,000		450,000	2.10	%	Oct-20	Feb-31
$500M 2.500% Guaranteed Notes due 2032										500,000		—	2.59	%	Nov-21	Feb-32
Principal balance outstanding		1,150,000		1,050,000						2,800,000		2,050,000
Less: Discount on issuance of unsecured senior notes, net		(617)		(3,971)						(13,455)		(7,470)
Less: Loan procurement costs, net		(6,923)		(6,953)						(18,336)		(12,158)
Total unsecured senior notes, net	$	1,142,460	$	1,039,076					$	2,768,209	$	2,030,372

(1)

On December 23, 2021, the Operating Partnership redeemed, in full, the 2023 Notes, with a portion of the net proceeds from the 2028 Notes and 2032 Notes issued on November 30, 2021. In connection with the redemption of the 2023 Notes, we recognized a loss on early debt extinguishment of $20.3 million, of which $20.0 million represents a prepayment premium and $0.3 million represents the write-off of unamortized loan procurement costs.

(2)

On April 4, 2017, the Operating Partnership issued $50.0 million of its 4.375% senior notes due 2023, which are part of the same series as the $250.0 million principal amount of the Operating Partnership’s 4.375% senior notes due December 15, 2023 issued on December 17, 2013. The $50.0 million and $250.0 million ~~traunches~~tranches were priced at 105.040% and 98.995%, respectively, of the principal amount to yield 3.495% and 4.501%, respectively, to maturity. The combined ~~weighted-average~~weighted average effective interest rate of the 2023 notes is 4.330%.

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~~(2)~~

(3)

On April 4, 2017, the Operating Partnership issued $50.0 million of its 4.000% senior notes due 2025, which are part of the same series as the $250.0 million principal amount of the Operating Partnership’s 4.000% senior notes due November 15, 2025 issued on October 26, 2015. The $50.0 million and $250.0 million ~~traunches~~tranches were priced at 101.343% and 99.735%, respectively, of the principal amount to yield 3.811% and 4.032%, respectively, to maturity. The combined ~~weighted-average~~weighted average effective interest rate of the 2025 notes is 3.994%.

The indenture under which the Senior Notes were issued restricts the ability of the Operating Partnership and its subsidiaries to incur debt unless the Operating Partnership and its consolidated subsidiaries comply with a leverage ratio not to exceed 60% and an interest coverage ratio of more than 1.5:11.0 after giving effect to the incurrence of the debt. The indenture also restricts the ability of the Operating Partnership and its subsidiaries to incur secured debt unless the Operating Partnership and its consolidated subsidiaries comply with a secured debt leverage ratio not to exceed 40% after giving effect to the incurrence of the debt. The indenture also contains other financial and customary covenants, including a covenant not to own unencumbered assets with a value less than 150% of the unsecured indebtedness of the Operating Partnership and its consolidated subsidiaries. As of and for the year ended December 31, ~~2017,~~2021, the Operating Partnership was in compliance with all of the financial covenants under the Senior Notes.

Revolving Credit Facility and Unsecured Term Loans

On December 9, 2011, we entered into a credit agreement (the “Credit Facility”),. On June 19, 2019, we amended and restated, in its entirety, the Credit Facility (the “Amended and Restated Credit Facility”) which, ~~was subsequently amended on April 5, 2012, June 18, 2013,~~subsequent to the amendment and ~~April 22, 2015 to provide for, amongst other things,~~restatement, is comprised of a ~~$500.0~~$750.0 million unsecured revolving facility (the “Revolver”) ~~with a maturity date of April 22, 2020. Pricing~~maturing on June 19, 2024. Under the Amended and Restated Credit Facility, pricing on the Revolver is dependent onupon our unsecured debt credit ratings. At ~~our~~the Company’s current Baa2/BBB level, amounts drawn under the Revolver are priced at ~~1.25%~~1.10% over LIBOR, inclusive of a facility fee of 0.15%.

As of December 31, ~~2017, $417.6~~2021, borrowings under the Revolver had an interest rate of 1.20%. Additionally, as of December 31, 2021, $539.5 million was available for borrowing under the Revolver. The available balance under the Revolver is reduced by an outstanding letter of credit of ~~$0.7~~$0.6 million.

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Under the Amended and Restated Credit Facility, our ability to borrow under the Revolver is subject to ongoing compliance with certain financial covenants which include, among other things, (1) a maximum total indebtedness to total asset value of 60.0%, and (2) a minimum fixed charge coverage ratio of 1.5:1.0. As of and for the year ended December 31, ~~2017, we also had a $200.0 million unsecured term loan outstanding under~~2021, the ~~Credit Facility, which is included~~Operating Partnership was in ~~the table below.~~compliance with all of its financial covenants.

On June 20, 2011, we entered into an unsecured term loan agreement (the “Term Loan Facility”), which was subsequently amended on June 18, 2013 and August 5, 2014, consisting of, among other things, a $100.0 million unsecured term loan ~~with a five-year maturity~~that was scheduled to mature in January 2020. On June 19, 2019, we used an initial advance at closing of the Amended and ~~a $100.0 million unsecured term loan with a seven-year maturity.~~

~~Our unsecured term loans~~Restated Credit Facility to repay all of the outstanding indebtedness under the ~~Credit Facility and Term Loan Facility are summarized below:~~

Carrying Value as of:

Effective Interest


December 31,

December 31,

Rate as of

Maturity

Unsecured Term Loans

2017

2016

December 31, 2017 (1)

Date

(in thousands)

Credit Facility

Unsecured term loan

$
200,000

$
200,000

2.86
%

Jan-19

Term Loan Facility

Unsecured term loan (2)

—

100,000

—
%

Jun-18

Unsecured term loan (3)

100,000

100,000

3.62
%

Jan-20

Principal balance outstanding

300,000

400,000

Less: Loan procurement costs, net

(604)

(1,251)

Total unsecured term loans, net

$
299,396

$
398,749

~~(1)~~

Pricing on the Term Loan Facility and the unsecured term loan under the Credit Facility is dependent on our unsecured debt credit ratings. At our current Baa2/BBB level, amounts drawn under the term loan scheduled to mature in January 2019 are priced at 1.30% over LIBOR, while amounts drawn under the term loan scheduled to mature in January 2020 are priced at 1.15% over LIBOR, excluding the impact of interest rate swaps. As of December 31, 2017, borrowings under the Credit Facility, inclusive of the Revolver, and Term Loan Facility, as amended and after giving effect to the interest rate swaps, had an effective weighted average interest rate of 3.05%.

~~(2)~~

~~On April 6, 2017, we used the net proceeds from the issuance of $50.0 million of our 4.375% Senior Notes due 2023 and $50.0 million of our 4.000% Senior Notes due 2025 to repay~~ ~~all of the outstanding indebtedness~~ ~~under our unsecured term loan that was scheduled to mature in June 2018. Unamortized loan procurement costs of $0.2 million were written off in conjunction with the repayment.~~

~~(3)~~

~~As of December 31, 2017, we had interest rate swaps in place on these borrowings that fix 30-day LIBOR.~~

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The Term Loan Facility and the unsecured term loan under the Credit Facility were fully drawn as of December 31, 2017 and no further borrowings may be made under the term loans. Our ability to borrow under the Revolver is subject to ongoing compliance with certain financial covenants which include:

~~Maximum total indebtedness to total asset value of 60.0% at any time;~~

~~Minimum fixed charge coverage ratio of 1.50:1.00; and~~

~~Minimum tangible net worth of $821,211,200 plus 75% of net proceeds from equity issuances after June 30, 2010.~~

Further, under the Credit Facility and Term Loan Facility, we are restricted from paying distributions on the Parent Company’s common shares in excess of the greater of (i) 95% of funds from operations, and (ii) such amount as may be necessary to maintain the Parent Company’s REIT status.

As of December 31, 2017, we were in compliance with all of our financial covenants and we anticipate being in compliance with all of our financial covenants through the terms of the Credit Facility and Term Loan Facility. Unamortized loan procurement costs of $0.1 million were written off in conjunction with the repayment.

Issuance of Common Shares

On November 19, 2021 we closed an underwritten offering of 15.5 million common shares at a public offering price of $51.00 per share, resulting in net proceeds of $765.6 million, after deducting offering costs.

We maintain an at-the-market equity program that enables us to offer and sell up to ~~40.0~~60.0 million common shares through sales agents pursuant to equity distribution agreements (the “Equity Distribution Agreements”). Our sales activity under the program for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019 is summarized below:


	For the year ended December 31,
	2021		2020		2019

	(dollars and shares in thousands, except per share amounts)
Number of shares sold		4,982		3,627		5,899
Average sales price per share	$	40.57	$	33.69	$	33.64
Net proceeds after deducting offering costs	$	199,977	$	120,727	$	196,304

For the year ended December 31,

2017

2016

2015

(Dollars and shares in thousands, except per share amounts)
Number of shares sold

1,036

4,408

8,977
Average sales price per share

$
29.13

$
31.25

$
26.35
Net proceeds after deducting offering costs

$
29,642

$
136,120

$
234,240

We used proceeds from sales of common shares under the program during the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019 to fund ~~acquisitions~~the acquisition and development of storage properties and for general corporate purposes. As of December 31, ~~2017, 2016,~~2021, 2020 and ~~2015, 4.7~~2019, 5.9 million common shares, ~~5.8~~10.9 million common shares and ~~10.2~~4.6 million common shares, respectively, remained available for issuance under the Equity Distribution Agreements.

~~Redemption of Preferred Shares~~

On November 2, 2016, we completed the redemption of all of our 3,100,000 outstanding shares of 7.75% Series A Cumulative Redeemable Preferred Shares at a cash redemption price of $25.00 per share plus accumulated and unpaid dividends. The redemption price of $77.5 million was paid by the Company from available cash balances. ~~In connection with the redemption, we recognized a charge of $2.9 million related to excess redemption costs over the original net proceeds.~~

Recent Developments

Subsequent to December 31, ~~2017,~~2021, we acquired ~~one~~a self-storage property located in ~~Texas~~Maryland for ~~a purchase price of $12.2~~$32.0 million. We funded the purchase price with $7.4 million of cash and $4.8 million through the issuance of 168,011 common units. Following a 13-month lock-up period, the holder may tender the common units for redemption by the Operating Partnership for a cash amount per common unit equal to the market value of an equivalent number of common shares of the Company. We have the right, but not the obligation, to assume and satisfy the redemption obligation of the Operating Partnership by issuing one common share in exchange for each common unit tendered for redemption.

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Other Material Changes in Financial Position

December 31,


2017

2016

Change

(in thousands)

Selected Assets

Storage properties, net

$
3,408,790

$
3,326,816

$
81,974

Selected Liabilities

Unsecured senior notes, net

$
1,142,460

$
1,039,076

$
103,384

Revolving credit facility

$
81,700

$
43,300

$
38,400

Unsecured term loans, net

$
299,396

$
398,749

$
(99,353)

Accounts payable, accrued expenses and other liabilities

$
143,344

$
93,764

$
49,580


	December 31,
	2021		2020		Change
			(in thousands)
Selected Assets
Storage properties, net	$	6,097,670	$	4,505,814	$	1,591,856
Investment in real estate ventures, at equity		119,751		92,071		27,680
Assets held for sale		49,313		—		49,313
Other assets, net		265,705		170,753		94,952

Selected Liabilities
Unsecured senior notes, net	$	2,768,209	$	2,030,372	$	737,837
Revolving credit facility		209,900		117,800		92,100
Mortgage loans and notes payable, net		167,676		216,504		(48,828)
Accounts payable, accrued expenses and other liabilities		199,985		159,140		40,845
Distributions payable		97,417		68,301		29,116

Noncontrolling interests in the Operating Partnership	$	108,220	$	249,414	$	(141,194)

Storage properties, net ~~of accumulated depreciation,~~ increased ~~$82.0 million~~$1.59 billion from December 31, 2020 to December 31, 2021, primarily as a result of the acquisition of ~~seven self-storage~~66 storage properties, ~~fixed asset~~ additions and improvements to storage properties, and development costs incurred during the year.

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~~The increase~~Investment in real estate ventures, at equity increased $27.7 million from December 31, 2020 to December 31, 2021, primarily as the result of the acquisition of two 50% joint venture interests as part of the acquisition of LAACO.

Assets held for sale increased $49.3 million from December 31, 2020 to December 31, 2021 as the result of classifying the Club Operations acquired in the LAACO acquisition as held for sale at December 31, 2021.

Other assets, net increased $95.0 million from December 31, 2020 to December 31, 2021, primarily due to the value assigned to the in-place leases at the 66 storage properties acquired during the year as well as assets related to deferred compensation for former LAACO executives.

Unsecured senior notes, net ~~of $103.4~~increased $737.8 million ~~was the~~from December 31, 2020 to December 31, 2021 as a result of the issuance of ~~$50.0 million of our 4.375% senior notes due 2023, which are part~~the 2028 Notes and 2032 Notes on November 30, 2021 offset by the redemption of the ~~same series as the $250.0 million principal amount of our 4.375% senior notes due December 15,~~ 2023 ~~issued~~Notes on December 17, 2013, and the issuance of $50.0 million of our 4.000% senior notes due 2025, which are part of the same series as the $250.0 million principal amount of our 4.000% senior notes due November 15, 2025 issued on October 26, 2015.23, 2021.

Revolving credit facility increased ~~$38.4~~$92.1 million from December 31, 2020 to December 31, 2021 primarily as a result of borrowings used to fund the acquisition of ~~seven self-storage~~66 storage properties, ~~fixed asset~~ additions and improvements to storage properties, and development costs incurred during the year.

~~The decrease in Unsecured term~~Mortgage loans and notes payable, net ~~of $99.4~~decreased $48.8 million ~~was the result of~~from December 31, 2020 to December 31, 2021 primarily due to the repayment on March 1, 2021 of ~~the outstanding indebtedness under our unsecured term loan that was scheduled to mature in June of 2018.~~two mortgage loans totaling $43.9 million.

Accounts payable, accrued expenses and other liabilities increased ~~$49.6~~$40.8 million from December 31, 2020 to December 31, 2021 primarily ~~as a result~~due to severance and deferred compensation obligations owed to former employees of ~~accrued development costs. Five of our development joint venture agreements provide the option for the noncontrolling members~~LAACO.

Distributions payable increased $29.1 million from December 31, 2020 to ~~put their ownership interest~~December 31, 2021 primarily due to an increase in common shares outstanding and an increase in the ~~ventures~~annualized dividend declared from $1.36 per share to ~~us within~~$1.72 per share.

Noncontrolling interests in the one-year period after construction of each store is substantially complete. Additionally, we have a one-year option to call the ownership interest of the noncontrolling members beginning on the second anniversary of each store’s construction being substantially complete. We are accreting the respective liabilities, which totaled $63.0Operating Partnership decreased $141.2 million ~~and $27.8 million as of~~from December 31, ~~2017 and 2016, respectively,~~2020 to December 31, 2021, primarily due to the redemption of 5.5 million OP Units during the ~~development periods.~~

~~Contractual Obligations~~

~~The following table summarizes our known contractual obligations as of~~year ended December 31, ~~2017 (in thousands):~~2021.

Payments Due by Period




















2023 and

Total

2018

2019

2020

2021

2022

thereafter

Mortgage loans and notes payable (1)

$
108,796

$
2,650

$
11,652

$
12,791

$
45,057

$
923

$
35,723

Revolving credit facility and unsecured term loans

381,700

—

200,000

181,700

—

—

—

Unsecured senior notes

1,150,000

—

—

—

—

250,000

900,000

Interest payments

349,168

63,793

58,157

52,275

49,437

42,719

82,787

Ground leases

133,039

2,500

2,670

2,743

2,812

2,971

119,343

Software and service contracts

600

497

73

30

—

—

—

Development commitments

82,728

70,199

12,529

—

—

—

—

$
2,206,031

$
139,639

$
285,081

$
249,539

$
97,306

$
296,613

$
1,137,853

~~(1)~~

~~Amounts do not include unamortized discounts/premiums.~~

~~We expect to satisfy contractual obligations owed in 2018 through a combination of cash generated from operations and from draws on the revolving portion of our Credit Facility.~~

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Off-Balance Sheet Arrangements

We do not have off-balance sheet arrangements, financings or other relationships with other unconsolidated entities (other than our co-investment partnerships) or other persons, also known as variable interest entities not previously discussed.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our future income, cash flows and fair values relevant to financial instruments depend upon prevailing market interest rates.

Market Risk

Our investment policy relating to cash and cash equivalents is to preserve principal and liquidity while maximizing the return through investment of available funds.

Effect of Changes in Interest Rates on our Outstanding Debt

Our interest rate risk objectives are to limit the impact of interest rate fluctuations on earnings and cash flows and to lower our overall borrowing costs. To achieve these objectives, we may choose to manage our exposure to fluctuations in market interest rates for a portion of our borrowings through the use of derivative financial instruments such as interest rate swaps or caps to mitigate our interest rate risk on a related financial instrument or to effectively lock the interest rate on a portion of our ~~variable rate~~variable-rate debt. The analysis below presents the sensitivity of the market value of our financial instruments to selected changes in market interest rates. The range of changes chosen reflects our view of changes which are reasonably possible over a one-year period. Market values are the present value of projected future cash flows based on the market interest rates chosen.

As of December 31, ~~2017~~2021 our consolidated debt consisted of ~~$1.4~~$2.96 billion of outstanding ~~mortgages,~~mortgage loans and notes payable and unsecured senior notes ~~and unsecured term loans~~ that are subject to fixed ~~rates, including variable rate debt that is effectively fixed through our use of interest rate swaps.~~rates. Additionally, as of December 31, ~~2017,~~2021, there were ~~$81.7 million and $200.0~~$209.9 million of outstanding unsecured credit facility ~~and unsecured term loan~~ borrowings ~~respectively,~~ subject to floating rates. Changes in market interest rates have different impacts on the ~~fixed~~fixed- and ~~variable rate~~

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variable-rate portions of our debt portfolio. A change in market interest rates on the fixed portion of the debt portfolio impacts the net financial instrument position, but has no impact on interest incurred or cash flows. A change in market interest rates on the variable portion of the debt portfolio impacts the interest incurred and cash flows, but does not impact the net financial instrument position.

If market interest rates on our variable-rate debt increase by 100 basis points, the increase in annual interest expense on our variable-rate debt would decrease future earnings and cash flows by approximately $2.1 million a year. If market interest rates on our variable-rate debt decrease by 100 basis points, the decrease in interest expense on our variable-rate debt would increase future earnings and cash flows by approximately $2.1 million a year.

If market interest rates increase by 100 basis points, the fair value of our outstanding fixed-rate mortgage debt and unsecured senior notes ~~and unsecured term loans~~ would decrease by approximately ~~$74.4~~$190.7 million. If market interest rates decrease by 100 basis points, the fair value of our outstanding fixed-rate mortgage debt and unsecured senior notes ~~and unsecured term loans~~ would increase by approximately ~~$84.2~~$205.9 million.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Financial statements required by this item appear with an Index to Financial Statements and Schedules, starting on page F-1 of this Report.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Controls and Procedures (Parent Company)

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Report, the Parent Company carried out an evaluation, under the supervision and with the participation of its management, including its chief executive officer and chief financial officer, of the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rules 13a-15(e) under the Exchange Act).

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Based on that evaluation, the Parent Company’s chief executive officer and chief financial officer have concluded that the Parent Company’s disclosure controls and procedures are designed at a reasonable assurance level and are effective to provide reasonable assurance that information required to be disclosed by the Parent Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to the Parent Company’s management, including its chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There has been no change in the Parent Company’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) during its most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting.

Management’s Report on Internal Control Over Financial Reporting

Management’s report on internal control over financial reporting of the Parent Company is set forth on page F-2 of this Report, and is incorporated herein by reference. The effectiveness of the Parent Company’s internal control over financial reporting as of December 31, ~~2017~~2021 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in its report which is included herein.

Controls and Procedures (Operating Partnership)

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Report, the Operating Partnership carried out an evaluation, under the supervision and with the participation of its management, including the Operating Partnership’s chief executive officer and chief financial officer, of the

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effectiveness of the design and operation of the Operating Partnership’s disclosure controls and procedures (as defined in Rules 13a-15(e) under the Exchange Act).

Based on that evaluation, the Operating Partnership’s chief executive officer and chief financial officer have concluded that the Operating Partnership’s disclosure controls and procedures are designed at a reasonable assurance level and are effective to provide reasonable assurance that information required to be disclosed by the Operating Partnership in reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to the Operating Partnership’s management, including the Operating Partnership’s chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

There has been no change in the Operating Partnership’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Operating Partnership’s internal control over financial reporting.

Management’s Report on Internal Control Over Financial Reporting

Management’s report on internal control over financial reporting of the Operating Partnership is set forth on page F-3 of this Report, and is incorporated herein by reference. The effectiveness of the Operating Partnership’s internal control over financial reporting as of December 31, ~~2017~~2021 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in its report which is included herein.

ITEM 9B. OTHER INFORMATION

Not applicable.

ITEM 9C.DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

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Not applicable.

PART III

ITEM 10. TRUSTEES, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

We have adopted a Code of Ethics for all of our employees, officers and trustees, including our principal executive officer and principal financial officer, which is available on our website at www.cubesmart.com. We intend to disclose any amendment to, or a waiver from, a provision of our Code of Ethics on our website within four business days following the date of the amendment or waiver.

The remaining information required by this item regarding trustees, executive officers and corporate governance is hereby incorporated by reference to the material appearing in the Parent Company’s Proxy Statement for the Annual Shareholders Meeting to be held in ~~2018~~2022 (the “Proxy Statement”) under the captions “Proposal 1: Election of Trustees,” “Executive Officers,” “Meetings and Committees of the Board of Trustees,” and “Shareholder Proposals and Nominations for the ~~2018~~2022 Annual Meeting.” The information required by this item regarding compliance with Section 16(a) of the Exchange Act is hereby incorporated by reference to the material appearing in the Parent Company’s Proxy Statement under the caption ~~“Section~~“Delinquent Section 16(a) ~~Beneficial Ownership Reporting Compliance.~~Reports.”

ITEM 11. EXECUTIVE COMPENSATION

The information required by this item is hereby incorporated by reference to the material appearing in the Parent Company’s Proxy Statement under the captions “Compensation Committee Report,” “Meetings and Committees of the Board of Trustees Compensation Committee Interlocks and Insider Participation,” “Compensation Discussion and Analysis,” “Executive Compensation,” ~~“Severence~~“Severance Plan and Potential Payments Upon Termination or Change in Control,” and “Trustee Compensation.”

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS

The following table sets forth certain information regarding our equity compensation plans as of December 31, ~~2017.~~2021.

Number of securities remaining

Number of securities to

Weighted-average

available for future issuance under

be issued upon exercise

exercise price of

equity compensation plans

of outstanding options,

outstanding options,

(excluding securities

Number of securities remaining

Number of securities to

Weighted average

available for future issuance under

be issued upon exercise

exercise price of

equity compensation plans

of outstanding options,

outstanding options,

(excluding securities

Plan Category

warrants and rights

reflected in column(a))

warrants and rights

reflected in column(a))

(a)

(b)

(c)

(a)

(b)

(c)

Equity compensation plans approved by shareholders

1,833,173

(1)

16.55

(2)

4,936,124

2,263,804

29.63

⁽¹⁾

2,448,384

Equity compensation plans not approved by shareholders

—

Total

1,833,173

16.55

4,936,124

2,263,804

29.63

2,448,384

(1)

~~Excludes 470,048 shares subject to outstanding restricted share unit awards.~~

~~(2)~~

This number reflects the ~~weighted-average~~weighted average exercise price of outstanding options and has been calculated exclusive of outstanding restricted unit awards.

The information regarding security ownership of certain beneficial owners and management required by this item is hereby incorporated by reference to the material appearing in the Parent Company’s Proxy Statement under the caption “Security Ownership of Management” and “Security Ownership of Beneficial Owners.”

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 Parent Company’s Proxy Statement under the captions “Corporate Governance - Independence of Trustees,” “Policies and Procedures Regarding Review, Approval or Ratification of Transactions With Related Persons,” and “Transactions With Related Persons.”

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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this item is hereby incorporated by reference to the material appearing in the Parent Company’s Proxy Statement under the captions “Audit Committee Matters - Fees Paid to Our Independent Registered Public Accounting Firm” and “- Audit Committee Pre-Approval Policies and Procedures.”

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Documents filed as part of this report:

1. Financial Statements.

The response to this portion of Item 15 is submitted as a separate section of this report.

2. Financial Statement Schedules.

The response to this portion of Item 15 is submitted as a separate section of this report.

3. Exhibits.

The list of exhibits filed with this Report is set forth in response to Item 15(b). The required exhibit index has been filed with the exhibits.

(b) Exhibits. The following documents are filed as exhibits to this report:



3.1*		Articles of Amendment to the Declaration of Trust of CubeSmart, incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on May 28, 2015.

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3.2*		Articles of Restatement of the Declaration of Trust of CubeSmart, incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K, filed on May 28, 2015.

3.3*		Articles Supplementary to Declaration of Trust of CubeSmart classifying and designating CubeSmart’s 7.75% Series A Cumulative Redeemable Preferred Shares of Beneficial Interest, incorporated by reference to Exhibit 3.3 to CubeSmart’s Form 8-A, filed on October 31, 2011.

3.4*		Articles of Amendment to the Declaration of Trust of CubeSmart, incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed on November 3, 2016.

3.5*		~~Third Amended and Restated Bylaws of CubeSmart, effective September 14, 2011, incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K, filed on September 16, 2011.~~

3.6*		Certificate of Limited Partnership of U-Store-It, L.P., incorporated by reference to Exhibit 3.1 to CubeSmart, L.P.’s Registration Statement on Form 10, filed on July 15, 2011.

3.73.6		Amendment No. 1 to Certificate of Limited Partnership of CubeSmart, L.P., dated September 14, 2011, incorporated by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K, filed on September 16, 2011.

3.83.7		Second Amended and Restated Agreement of Limited Partnership of U-Store-It, L.P. dated as of October 27, 2004, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on November 2, 2004.

3.93.8		Amendment No. 1 to Second Amended and Restated Agreement of Limited Partnership of CubeSmart, L.P. dated as of September 14, 2011, incorporated by reference to Exhibit 3.4 to the Company’s Current Report on Form 8-K, filed on September 16, 2011.

3.103.9		Amendment No. 2 to Second Amended and Restated Agreement of Limited Partnership of CubeSmart, L.P. dated as of November 2, 2011, incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K, filed on November 2, 2011.

3.113.10		Class C Unit Supplement No. 1 to Second Amended and Restated Agreement of ~~Limites~~Limited Partnership of CubeSmart, L.P. dates as of April 12, 2017, incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed on April 18, 2017.

3.123.11		Articles of Amendment to the Declaration of Trust of CubeSmart, incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed on June 2, 2017.

3.133.12		~~First Amendment to Third~~Fourth Amended and Restated Bylaws of CubeSmart, effective ~~June 1, 2017,~~August 5, 2020, incorporated by reference to Exhibit ~~3.2~~3.1 to the Company’s ~~Current~~Quarterly Report on Form ~~8-K,~~10-Q, filed on ~~June 2, 2017.~~August 7, 2020.

4.1*		Form of Common Share Certificate, incorporated by reference to Exhibit 4.1 to Amendment No. 3 to the Company’s Registration Statement on Form S-11, filed on October 20, 2004, File No. 333-117848.

4.2*		Form of Certificate for CubeSmart’s 7.75% Series A Cumulative Redeemable Preferred Shares of Beneficial Interest, incorporated by reference to Exhibit 4.1 to CubeSmart’s Form 8-A, filed on October 31, 2011.

4.3*		Indenture, dated as of September 16, 2011, among CubeSmart, L.P., CubeSmart and U.S. Bank National Association, incorporated by reference to Exhibit 4.5 to the Company’s Registration Statement on Form S-3, filed on September 16, 2011.

4.4*		First Supplemental Indenture, dated as of June 26, 2012, among the Company, the Operating Partnership and U.S. Bank National Association, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on June 26, 2012.

4.5*		Form of $250 million aggregate principal amount of 4.80% senior note due July 15, 2022, incorporated herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed on June 26, 2012.

4.6*		~~Form of CubeSmart Notation of Guarantee, incorporated herein by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K, filed on June 26, 2012.~~

4.7*		Second Supplemental Indenture, dated as of December 17, 2013, among the Company, the Operating Partnership and U.S. Bank National Association, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on December 17, 2013.

4.84.6		Form of $250 million aggregate principal amount of 4.375% senior notes due December 15, 2023, incorporated herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed on December 17, 2013.

4.9*		~~Form of CubeSmart Notation of Guarantee, incorporated herein by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K, filed on December 17, 2013.~~

4.10*		Third Supplemental Indenture, dated as of October 26, 2015, among CubeSmart, CubeSmart, L.P. and U.S. Bank National Association, incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on October 26, 2015.

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4.114.7		Form of $250 million aggregate principal amount of 4.000% senior note due November 15, 2025, incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed on October 26, 2015.

4.124.8		Fourth Supplemental Indenture, dated as of August 15, 2016, among CubeSmart, CubeSmart, L.P. and U.S. Bank National Association, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on August 15, 2016.

4.134.9		Form of $300 million aggregate principal amount of 3.125% senior notes due September 1, 2026, incorporated herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed on August 15, 2016.

4.144.10		Form of CubeSmart Notation of Guarantee, incorporated herein by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K, filed on August 15, 2016.

4.154.11		Form of $50 million aggregate principal amount of 4.375% senior notes due December 15, 2023, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on April 5, 2017.

4.16*		Form of $50 million aggregate principal amount of 4.000% senior notes due November 15, 2025, incorporated herein by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K, filed on April 5, 2017.

4.174.12		Fifth Supplemental Indenture, dated as of April 4, 2017, among CubeSmart, CubeSmart, L.P. and U.S. Bank National Association, incorporated herein by reference to Exhibit 4.5 to the Company’s Current Report on Form 8-K, filed on April 5, 2017.

~~10.1†~~4.13		Form of $350 million aggregate principal amount of 4.375% senior notes due February 15, 2029, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on January 30, 2019.

4.14*		Sixth Supplemental Indenture, dated as of January 30, 2019, among CubeSmart, CubeSmart, L.P. and U.S. Bank National Association, incorporated herein by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K, filed on January 30, 2019.

4.15*		Form of $350 million aggregate principal amount of 3.000% senior notes due February 15, 2030, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on October 11, 2019.

4.16*		Form of CubeSmart Notation of Guarantee, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on October 11, 2019.

4.17*		Seventh Supplemental Indenture, dated of as October 11, 2019, among CubeSmart, CubeSmart, L.P. and U.S. Bank National Association, incorporated herein by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K, filed on October 11, 2019.

4.18*		Form of $450 million aggregate principal amount of 2.000% senior notes due February 15, 2031, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on October 6, 2020.

4.19*		Form of CubeSmart Guarantee, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on October 6, 2020.

4.20*		Eighth Supplemental Indenture, dated of as October 6, 2020, among CubeSmart, CubeSmart, L.P. and U.S. Bank National Association, incorporated herein by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K, filed on October 6, 2020.

4.21*		Description of Registrant’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934, incorporated herein by reference to Exhibit 4.23 to the Company’s Annual Report on Form 10-K, filed on February 21, 2020.

4.22*		Ninth Supplemental Indenture, dated of as November 30, 2021, among CubeSmart, CubeSmart, L.P. and U.S. Bank National Association, incorporated herein by reference to Exhibit 4.4 to the Company’s Current Report on Form 8-K, filed on November 30, 2021.

4.23*		Form of $550 million aggregate principal amount of 2.25% senior notes due December 15, 2028, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on November 30, 2021.

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4.24*		Form of CubeSmart Guarantee, incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed on November 30, 2021.

4.25*		Form of $500 million aggregate principal amount of 2.50% senior notes due February 15, 2032, incorporated herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed on November 30, 2021.

4.26*		Form of CubeSmart Guarantee, incorporated herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed on November 30, 2021.

4.27*		Tenth Supplemental Indenture, dated of as November 30, 2021, among CubeSmart, CubeSmart, L.P. and U.S. Bank National Association, incorporated herein by reference to Exhibit 4.6 to the Company’s Current Report on Form 8-K, filed on November 30, 2021.

10.1*†		Indemnification Agreement, dated as of October 27, 2004, by and among U-Store-It Trust, U-Store-It, L.P. and David J. LaRue (substantially identical agreements have been entered into with ~~Dean Jernigan,~~ Christopher P. Marr, Timothy M. Martin, Jeffrey P. Foster, ~~William M. Diefenderfer III,~~Joel D. Keaton, Piero Bussani, Dorothy Dowling, John W. Fain, Marianne M. Keler, John F. Remondi, Jeffrey F. Rogatz and Deborah R. Salzberg), incorporated by reference to Exhibit 10.19 to the Company’s Current Report on Form 8-K, filed on November 2, 2004.

10.2*†		Nonqualified Share Option Agreement, dated as of June 5, 2006, by and between U-Store-It Trust and Christopher P. Marr, incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2006, filed on August 8, 2006.

~~10.3*†~~		Nonqualified Share Option Agreement, dated as of April 19, 2006, by and between U-Store-It Trust and Dean Jernigan, incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K, filed on April 24, 2006.

~~10.4*†~~		Form of Restricted Share Agreement for Non-Employee Trustees under the U-Store-It Trust 2007 Equity Incentive Plan, incorporated by reference to Exhibit 10.83 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2007, filed on February 29, 2008.

10.510.3†		Form of Nonqualified Share Option Agreement under the U-Store-It Trust 2004 Equity Incentive Plan, incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2007, filed on May 10, 2007.

10.610.4†		Form of Restricted Share Agreement under the U-Store-It Trust 2004 Equity Incentive Plan, incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2007, filed on May 10, 2007.

10.710.5†		Form of Nonqualified Share Option Agreement under the U-Store-It Trust 2007 Equity Incentive Plan, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on January 25, 2008.

10.810.6†		Form of Restricted Share Agreement under the U-Store-It Trust 2007 Equity Incentive Plan, incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed on January 25, 2008.

10.910.7†		U-Store-It Trust Trustees Deferred Compensation Plan, amended and restated effective January 1, 2009, incorporated by reference to Exhibit 10.78 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, filed on March 2, 2009.

10.1010.8†		U-Store-It Trust Executive Deferred Compensation Plan, amended and restated effective January 1, 2009, incorporated by reference to Exhibit 10.79 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2008, filed on March 2, 2009.

10.1110.9†		U-Store-It Trust Deferred Trustees Plan, effective as of May 31, 2005, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on June 6, 2005.

10.1210.10†		Term Loan Agreement dated as of June 20, 2011 by and among U-Store-It, L.P., as Borrower, U-Store-It Trust, and Wells Fargo Securities, LLC and PNC Capital Markets LLC, as joint lead arrangers and joint bookrunners, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on June 23, 2011.

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10.13*		Credit Agreement dated as of December 9, 2011 by and among CubeSmart, L.P., CubeSmart, Wells Fargo Securities, LLC and Merrill Lynch, Pierce Fenner & Smith Incorporated, as Revolver and Tranche A joint lead arrangers and joint bookrunners and Wells Fargo Securities, LLC, as Tranche B sole lead arranger and sole bookrunner, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on December 14, 2011.

~~10.14*†~~		Form of Restricted Share Agreement under the CubeSmart 2007 Equity Incentive Plan, incorporated herein by reference to Exhibit 10.42 to the Company’s Annual Report on Form 10-K, filed on February 28, 2013.

10.1510.11†		Form of Non-Qualified Share Option Agreement under the CubeSmart 2007 Equity Incentive Plan, incorporated herein by reference to Exhibit 10.43 to the Company’s Annual Report on Form 10-K, filed on February 28, 2013.

10.1610.12†		Form of 2012 Performance-Vested Restricted Share Unit Award Agreement under the CubeSmart 2007 Equity Incentive Plan, incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on January 31, 2012.

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10.1710.13†		First Amendment to Credit Agreement, dated as of April 5, 2012, by and among CubeSmart, L.P., CubeSmart, Wells Fargo Bank, National Association and each of the lenders party to the credit agreement dated December 9, 2011, incorporated herein by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012, filed on May 7, 2012.

~~10.18*†~~		Form of Restricted Share Unit Award Agreement (2-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, incorporated herein by reference to Exhibit 10.47 to the Company’s Annual Report on Form 10-K, filed on February 28, 2013.

10.1910.14†		Form of Performance-Vested Restricted Share Unit Award Agreement under the CubeSmart 2007 Equity Incentive Plan, incorporated herein by reference to Exhibit 10.48 to the Company’s Annual Report on Form 10-K, filed on February 28, 2013.

10.2010.15		Waiver of Ownership Limitation, incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013, filed on May 6, 2013.

10.2110.16†		Form of Equity Distribution Agreement, dated May 7, 2013, by and among CubeSmart, CubeSmart, L.P. and each of Wells Fargo Securities, LLC, BMO Capital Markets Corp., Jefferies LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and RBC Capital Markets, LLC, incorporated by reference to Exhibit 1.1. to the Company’s Current Report on Form 8-K, filed on May 7, 2013.

10.22*		Second Amendment to Credit Agreement dated as of June 18, 2013 by and among CubeSmart, L.P., CubeSmart, Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders, incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on June 19, 2013.

10.23*		Second Amendment to Term Loan Agreement dated as of June 18, 2013 by and among CubeSmart, L.P., CubeSmart, Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders, incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K, filed on June 19, 2013.

~~10.24*†~~		Advisory Agreement, incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2013, filed on November 8, 2013.

10.2510.17†		Executive Employment Agreement, entered into as of January 24, 2014 and effective as of January 1, 2014, by and between CubeSmart and Christopher P. Marr, incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on January 28, 2014.

~~10.26*†~~		Form of Non-Qualified Share Option Agreement for Executive Officers (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, incorporated by reference to Exhibit 10.58 to the Company’s Annual Report on Form 10-K, filed on February 28, 2014.

10.2710.18†		Form of Non-Qualified Share Option Agreement (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, incorporated by reference to Exhibit 10.59 to the Company’s Annual Report on Form 10-K, filed on February 28, 2014.

10.2810.19†		Form of Performance Share Award Agreement for Executive Officers (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, incorporated by reference to Exhibit 10.60 to the Company’s Annual Report on Form 10-K, filed on February 28, 2014.

10.2910.20†		Form of Performance Share Award Agreement (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, incorporated by reference to Exhibit 10.61 to the Company’s Annual Report on Form 10-K, filed on February 28, 2014.

10.3010.21†		Form of Restricted Share Award Agreement for Executive Officers (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, incorporated by reference to Exhibit 10.63 to the Company’s Annual Report on Form 10-K, filed on February 28, 2014.

10.3110.22†		Form of Restricted Share Award Agreement (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, incorporated by reference to Exhibit 10.64 to the Company’s Annual Report on Form 10-K, filed on February 28, 2014.

10.3210.23†		Form of Restricted Share Award Agreement (5-Year Vesting) under the CubeSmart 2004 Equity Incentive Plan, incorporated by reference to Exhibit 10.65 to the Company’s Annual Report on Form 10-K, filed on February 28, 2014.

10.3310.24†		Form of Amendment No. 1 to Equity Distribution Agreement, dated May 5, 2014, by and among CubeSmart, CubeSmart, L.P. and each of the Sales Agents (as defined therein), incorporated by reference to Exhibit 1.1. to the Company’s Current Report on Form 8-K, filed on May 5, 2014.

10.34*		Form of Amendment No. 2 to Equity Distribution Agreement, dated October 2, 2014, by and among CubeSmart, CubeSmart, L.P. and each of the Sales Agents (as defined therein), incorporated by reference to Exhibit 1.1. to the Company’s Current Report on Form 8-K, filed on October 2, 2014.

10.35*		Third Amendment to Credit Agreement, dated as of April 22, 2015, by and among CubeSmart, L.P., CubeSmart, Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders party thereto, incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on April 27, 2015.

10.36*		Fourth Amendment to Term Loan Agreement, dated as of April 22, 2015, by and among CubeSmart, L.P., CubeSmart, Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders party thereto, incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K, filed on April 27, 2015.

10.37*		Equity Distribution Agreement, dated December 30, 2015, by and among CubeSmart, CubeSmart, L.P. and Barclays Capital Inc., incorporated by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K, filed on December 30, 2015.

10.38*		Form of Amendment No. 3 to Equity Distribution Agreement, dated December 30, 2015, by and among CubeSmart, CubeSmart, L.P. and each of the Initial Sales Agents (as defined therein), incorporated by reference to Exhibit 1.2 to the Company’s Current Report on Form 8-K, filed on December 30, 2015.

~~10.39*†~~		Amended and Restated CubeSmart 2007 Equity Incentive Plan, effective June 1, 2016, incorporated by reference to Appendix A to the Company’s Definitive Proxy Statement, filed on April 14, 2016.

10.4010.25†		First Amendment to Executive Employment Agreement, dated as of September 30, 2016, by and between CubeSmart and Chistopher P. Marr, incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on September 30, 2016.

~~10.41*†~~		CubeSmart Executive Severance Plan, effective January 1, 2017, incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on November 4, 2016.

10.4210.26†		Form of Non-Qualified Share Option Agreement for Executive Officers (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.42 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.4310.27†		Form of Non-Qualified Share Option Agreement (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.43 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.4410.28†		Form of Restricted Share Award Agreement for Executive Officers (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.44 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

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10.4510.29†		Form of Restricted Share Award Agreement (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.45 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.4610.30†		Form of Restricted Share Award Agreement (5-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.46 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.4710.31†		Form of Restricted Share Unit Award Agreement for Executive Officers (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.47 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.4810.32†		Form of Restricted Share Unit Award Agreement (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.48 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.4910.33†		Form of Performance-Vested Restricted Share Award Agreement for Executive Officers (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.49 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.5010.34†		Form of Performance-Vested Restricted Share Award Agreement (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.50 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.5110.35†		Form of Performance-Vested Restricted Share Unit Award Agreement for Executive Officers (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.51 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.5210.36†		Form of Performance-Vested Restricted Share Unit Award Agreement (3-Year Vesting) under the CubeSmart 2007 Equity Incentive Plan, as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 10.52 to the Company’s Annual Report on Form 10-K, filed on February 17, 2017.

10.5310.37†		Form of ~~Amendment No. 4~~Restricted Share Agreement under the CubeSmart 2007 Equity Incentive Plan,as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed on January 3, 2019.

10.38*†		Form of Non-Qualified Share Option Agreement under the CubeSmart 2007 Equity Incentive Plan,as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K, filed on January 3, 2019.

10.39*†		Form of Performance-Vested Restricted Share Agreement under the CubeSmart 2007 Equity Incentive Plan,as amended and restated, effective June 1, 2016, incorporated by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K, filed on January 3, 2019.

10.40*		Amended and Restated Credit Agreement, dated as of June 19, 2019, by and among CubeSmart, L.P., CubeSmart, the lenders referred to therein, and Wells Fargo Bank, National Association, as administrative agent for the Lenders, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on June 21, 2019.

10.41*		Second Amended and Restated Equity Distribution Agreement, dated March ~~17, 2017,~~4, 2020, by and among CubeSmart, CubeSmart, L.P. and ~~each of the Managers (as defined therein),~~Wells Fargo Securities, LLC, incorporated by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K, filed on March ~~17, 2017.~~4, 2020.

~~12.1~~10.42*		~~Statement regarding Computation of Ratios of CubeSmart.~~Second Amended and Restated Equity Distribution Agreement, dated March 4, 2020, by and among CubeSmart, CubeSmart, L.P. and BofA Securities, Inc., incorporated by reference to Exhibit 1.2 to the Company’s Current Report on Form 8-K, filed on March 4, 2020.

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10.43*		Second Amended and Restated Equity Distribution Agreement, dated March 4, 2020, by and among CubeSmart, CubeSmart, L.P. and BMO Capital Markets Corp., incorporated by reference to Exhibit 1.3 to the Company’s Current Report on Form 8-K, filed on March 4, 2020.

~~12.2~~10.44*		~~Statement regarding Computation of Ratios of~~Second Amended and Restated Equity Distribution Agreement, dated March 4, 2020, by and among CubeSmart, CubeSmart, L.P. and Jefferies LLC, incorporated by reference to Exhibit 1.4 to the Company’s Current Report on Form 8-K, filed on March 4, 2020.

~~21.1~~10.45*		~~List of Subsidiaries.~~Second Amended and Restated Equity Distribution Agreement, dated March 4, 2020, by and among CubeSmart, CubeSmart, L.P. and Barclays Capital Inc., incorporated by reference to Exhibit 1.5 to the Company’s Current Report on Form 8-K, filed on March 4, 2020.

~~23.1~~10.46*		Agreement and Plan of Merger, by and among LAACO, Ltd., CubeSmart, L.P., CS West Merger Sub, L.P. and Stability LLC, dated as of November 15, 2021, incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K, filed on November 15, 2021.

21.1		List of Subsidiaries.

23.1		Consent of KPMG LLP relating to financial statements of CubeSmart.

23.2		Consent of KPMG LLP relating to financial statements of CubeSmart, L.P.

31.1		Certification of Chief Executive Officer of CubeSmart required by Rule 13a-14(a)/15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Chief Financial Officer of CubeSmart required by Rule 13a-14(a)/15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.3		Certification of Chief Executive Officer of CubeSmart, L.P. required by Rule 13a-14(a)/15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.4		Certification of Chief Financial Officer of CubeSmart, L.P. required by Rule 13a-14(a)/15d-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of Chief Executive Officer and Chief Financial Officer of CubeSmart pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Chief Executive Officer and Chief Financial Officer of CubeSmart, L.P. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99.1		Material United States Federal Income Tax Considerations.

101		The following CubeSmart and CubeSmart, L.P. financial information for the year ended December 31, ~~2017,~~2021, formatted in Inline XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statement of Equity, (iv) the Consolidated Statements of Cash Flows and (v) Notes to Consolidated Financial Statements, detailed tagged and filed herewith.

104		Cover Page Interactive Data File – embedded within the Inline XBRL document (included as Exhibit 101).


*		Incorporated herein by reference as above indicated.

†		Denotes a management contract or compensatory plan, contract or arrangement.

ITEM 16. FORM 10-K SUMMARY

None.

6555

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SIGNATURES

~~SIGNATURES~~

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.


	CUBESMART

	By:	/s/ Timothy M. Martin
		Timothy M. Martin
		Chief Financial Officer

Date: February ~~16, 2018~~25, 2022

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, 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
~~Signature~~	~~Title~~	~~Date~~

/s/ ~~William~~Marianne M. ~~Diefenderfer III~~Keler	~~Chairman~~Chair of the Board of Trustees	February ~~16, 2018~~25, 2022
~~William~~Marianne M. ~~Diefenderfer III~~Keler

/s/ Christopher P. Marr	Chief Executive Officer and Trustee	February ~~16, 2018~~25, 2022
Christopher P. Marr	(Principal Executive Officer)

/s/ Timothy M. Martin	Chief Financial Officer	February ~~16, 2018~~25, 2022
Timothy M. Martin	(Principal Financial and Accounting Officer)

/s/ Piero Bussani	Trustee	February ~~16, 2018~~25, 2022
Piero Bussani

/s/ Dorothy Dowling	Trustee	February ~~16, 2018~~25, 2022
Dorothy Dowling

/s/ John W. Fain	Trustee	February ~~16, 2018~~25, 2022
John W. Fain

~~/s/ Marianne M. Keler~~	~~Trustee~~	~~February 16, 2018~~
~~Marianne M. Keler~~

/s/ John F. Remondi	Trustee	February ~~16, 2018~~25, 2022
John F. Remondi

/s/ Jeffrey F. Rogatz	Trustee	February ~~16, 2018~~25, 2022
Jeffrey F. Rogatz

/s/ Deborah Ratner Salzberg	Trustee	February ~~16, 2018~~25, 2022
Deborah Ratner Salzberg

6656

FINANCIAL STATEMENTS
INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS


		Page No.
		~~Page No.~~
Consolidated Financial Statements of CUBESMART and CUBESMART, L.P. (the “Company”)

Management’s Report on CubeSmart Internal Control Over Financial Reporting		F-2

Management’s Report on CubeSmart, L.P. Internal Control Over Financial Reporting		F-3

Reports of Independent Registered Public Accounting Firm (PCAOB ID 185)		F-4

CubeSmart and Subsidiaries Consolidated Balance Sheets as of December 31, ~~2017~~2021 and ~~2016~~2020		~~F-8~~F-10

CubeSmart and Subsidiaries Consolidated Statements of Operations for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019		~~F-9~~F-11

CubeSmart and Subsidiaries Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019		~~F-10~~F-12

CubeSmart and Subsidiaries Consolidated Statements of Equity for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019		~~F-11~~F-13

CubeSmart and Subsidiaries Consolidated Statements of Cash Flows for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019		~~F-12~~F-14

CubeSmart, L.P. and Subsidiaries Consolidated Balance Sheets as of December 31, ~~2017~~2021 and ~~2016~~2020		~~F-13~~F-15

CubeSmart, L.P. and Subsidiaries Consolidated Statements of Operations for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019		~~F-14~~F-16

CubeSmart, L.P. and Subsidiaries Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019		~~F-15~~F-17

CubeSmart, L.P. and Subsidiaries Consolidated Statements of Capital for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019		~~F-16~~F-18

CubeSmart, L.P. and Subsidiaries Consolidated Statements of Cash Flows for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019		~~F-17~~F-19

Notes to Consolidated Financial Statements		~~F-18~~F-20

F-1

MANAGEMENT’S REPORT ON CUBESMART INTERNAL CONTROL OVER FINANCIAL REPORTING

Management of CubeSmart (the “REIT”) is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under Section 404 of the Sarbanes-Oxley Act of 2002, the REIT’s management is required to assess the effectiveness of the REIT’s internal control over financial reporting as of the end of each fiscal year, and report on the basis of that assessment whether the REIT’s internal control over financial reporting is effective.

The REIT’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 U.S. generally accepted accounting principles. The REIT’s internal control over financial reporting includes those policies and procedures that:

●

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and the disposition of the assets of the REIT;

●

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that the receipts and expenditures of the REIT are being made only in accordance with the authorization of the REIT’s management and its Board of Trustees; and

●

provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the REIT’s assets that could have a material effect on the financial statements.

There are inherent limitations in the effectiveness of any system of internal control, including the possibility of human error and the circumvention or overriding of controls. Accordingly, even an effective internal control system can provide only reasonable assurance with respect to financial statement preparation. Further, because of changes in conditions, the effectiveness of an internal control system may vary over time.

Under the supervision, and with the participation, of the REIT’s management, including the principal executive officer and principal financial officer, management conducted a review, evaluation and assessment of the effectiveness of our internal control over financial reporting as of December 31, ~~2017,~~2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In performing its assessment of the effectiveness of internal control over financial reporting, management has concluded that, as of December 31, ~~2017,~~2021, the REIT’s internal control over financial reporting was effective based on the COSO framework.

The effectiveness of our internal control over financial reporting as of December 31, ~~2017,~~2021, has been audited by KPMG LLP (Philadelphia, Pennsylvania; PCAOB ID #185), an independent registered public accounting firm, as stated in their report that appears herein.

February ~~16, 2018~~25, 2022

F-2

MANAGEMENT’S REPORT ON CUBESMART, L.P. INTERNAL CONTROL OVER FINANCIAL REPORTING

Management of CubeSmart, L.P. (the “Partnership”) is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Under Section 404 of the Sarbanes-Oxley Act of 2002, the Partnership’s management is required to assess the effectiveness of the Partnership’s internal control over financial reporting as of the end of each fiscal year, and report on the basis of that assessment whether the Partnership’s internal control over financial reporting is effective.

The Partnership’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. The Partnership’s internal control over financial reporting includes those policies and procedures that:

●

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and the disposition of the assets of the Partnership;

●

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that the receipts and expenditures of the Partnership are being made only in accordance with the authorization of the Partnership’s management and its Board of Trustees; and

●

provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Partnership’s assets that could have a material effect on the financial statements.

Under the supervision, and with the participation, of the Partnership’s management, including the principal executive officer and principal financial officer, management conducted a review, evaluation and assessment of the effectiveness of our internal control over financial reporting as of December 31, ~~2017,~~2021, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In performing its assessment of the effectiveness of internal control over financial reporting, management has concluded that, as of December 31, ~~2017,~~2021, the Partnership’s internal control over financial reporting was effective based on the COSO framework.

February ~~16, 2018~~25, 2022

F-3

Report of Independent ~~Registered~~Registered Public Accounting Firm

To the Shareholders and Board of Trustees of

CubeSmart:

Opinion on the ConsolidatedFinancial Statements

We have audited the accompanying consolidated balance sheets of CubeSmart and subsidiaries (the ~~“Company”)~~Company) as of December 31, ~~2017~~2021 and ~~2016,~~2020, the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the years in the ~~three‑year~~three-year period ended December 31, ~~2017,~~2021, and the related notes and financial statement schedule III (collectively, the ~~“consolidated~~consolidated financial ~~statements”)~~statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, ~~2017~~2021 and ~~2016,~~2020, and the results of its operations and its cash flows for each of the years in the ~~three‑year~~three-year period ended December 31, ~~2017,~~2021, 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”)~~(PCAOB), the Company’s internal control over financial reporting as of December 31, ~~2017,~~2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February ~~16, 2018~~25, 2022 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated 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 consolidated 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 consolidated 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 consolidated 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 consolidated 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 consolidated 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 consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a 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.

Evaluation of storage properties for impairment

As discussed in notes 2 and 3 to the consolidated financial statements, the Company had $6.1 billion of storage properties, net of accumulated depreciation as of December 31, 2021. The Company performs an impairment assessment whenever events or changes in circumstances indicate that there may be an impairment. This involves comparing the undiscounted future net operating cash flows plus a terminal value to the carrying amount of the storage property.

We identified the evaluation of storage properties for impairment as a critical audit matter. The Company uses revenue and expense growth rates, and terminal value capitalization rate assumptions in determining estimated future cash flows as part of its impairment assessment. Changes to these assumptions could have a significant impact on the determination of recoverability of the carrying amount of a storage property and involved subjective auditor judgement.

The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls over the Company’s storage property impairment process, including controls related to the use of the revenue and expense growth rates, and terminal value capitalization rate. We assessed the Company’s forecasted growth rates against the Company’s historical growth rates and published reports of industry data. We evaluated the

F-4

Company’s expected terminal value capitalization rates by comparing them to published reports of industry data and historical transactions of the Company. We also identified the threshold rates at which the revenue and expense growth rates and terminal value capitalization rate assumptions would indicate the storage property may be impaired and analyzed those threshold rates against the published industry data and historical results.

/s/ KPMG LLP

We have served as the Company’s auditor since 2009.

Philadelphia, Pennsylvania

February ~~16, 2018~~25, 2022

~~F-4~~F-5

Report of Independent Registered Public Accounting Firm

To the Partners of

CubeSmart, L.P.: and the Board of Trustees of CubeSmart:

Opinion on the ConsolidatedFinancial Statements

We have audited the accompanying consolidated balance sheets of CubeSmart L.P. and subsidiaries (the ~~“Company”)~~Partnership) as of December 31, ~~2017~~2021 and ~~2016,~~2020, the related consolidated statements of operations, comprehensive income (loss), capital, and cash flows for each of the years in the ~~three‑year~~three-year period ended December 31, ~~2017,~~2021, and the related notes and financial statement schedule III (collectively, the ~~“consolidated~~consolidated financial ~~statements”)~~statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the ~~Company~~Partnership as of December 31, ~~2017~~2021 and ~~2016,~~2020, and the results of its operations and its cash flows for each of the years in the ~~three‑year~~three-year period ended December 31, ~~2017,~~2021, 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”)~~(PCAOB), the ~~Company’s~~Partnership’s internal control over financial reporting as of December 31, ~~2017,~~2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February ~~16, 2018~~25, 2022 expressed an unqualified opinion on the effectiveness of the ~~Company’s~~Partnership’s internal control over financial reporting.

Basis for Opinion

These consolidated financial statements are the responsibility of the ~~Company’s~~Partnership’s management. Our responsibility is to express an opinion on these consolidated 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~~Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Critical Audit Matter

Evaluation of storage properties for impairment

As discussed in notes 2 and 3 to the consolidated financial statements, the Partnership had $6.1 billion of storage properties, net of accumulated depreciation as of December 31, 2021. The Partnership performs an impairment assessment whenever events or changes in circumstances indicate that there may be an impairment. This involves comparing the undiscounted future net operating cash flows plus a terminal value to the carrying amount of the storage property.

We identified the evaluation of storage properties for impairment as a critical audit matter. The Partnership uses revenue and expense growth rates, and terminal value capitalization rate assumptions in determining estimated future cash flows as part of its impairment assessment. Changes to these assumptions could have a significant impact on the determination of recoverability of the carrying amount of a storage property and involved subjective auditor judgement.

The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls over the Partnership’s storage property impairment process, including controls related to the use of the revenue and expense growth rates, and terminal value capitalization rate. We assessed the Partnership’s forecasted growth rates against the Partnership’s historical growth rates and published reports of industry data. We evaluated the

F-6

Partnership’s expected terminal value capitalization rates by comparing them to published reports of industry data and historical transactions of the Partnership. We also identified the threshold rates at which the revenue and expense growth rates and terminal value capitalization rate assumptions would indicate the storage property may be impaired and analyzed those threshold rates against the published industry data and historical results.

/s/ KPMG LLP

We have served as the ~~Company’s~~Partnership’s auditor since 2009.

Philadelphia, Pennsylvania

February ~~16, 2018~~25, 2022

~~F-5~~F-7

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees of

CubeSmart:

Opinion on Internal Control Over Financial Reporting

We have audited CubeSmart and ~~subsidiaries’~~subsidiaries' (the ~~“Company”)~~Company) internal control over financial reporting as of December 31, ~~2017,~~2021, based on criteria established inInternal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, ~~2017,~~2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ~~(“PCAOB”)~~(PCAOB), the consolidated balance sheets of the Company as of December 31, ~~2017~~2021 and ~~2016,~~2020, the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the years in the three-year period ended December 31, ~~2017,~~2021, and the related notes and financial statement schedule III (collectively, the consolidated financial statements), and our report dated February ~~16, 2018~~25, 2022 expressed an unqualified opinion on those consolidated financial statements.

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~~Management's Report on ~~CubeSmart~~ 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 of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included 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/ KPMG LLP

Philadelphia, Pennsylvania

February ~~16, 2018~~25, 2022

~~F-6~~F-8

Report of Independent Registered Public Accounting Firm

To the Partners of

CubeSmart, L.P.: and the Board of Trustees of CubeSmart:

Opinion on Internal Control Over Financial Reporting

We have audited CubeSmart L.P. and ~~subsidiaries’~~subsidiaries' (the ~~“Company”)~~Partnership) internal control over financial reporting as of December 31, ~~2017, based on criteria established in~~Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017,2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Partnership maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ~~(“PCAOB”)~~(PCAOB), the consolidated balance sheets of the ~~Company~~Partnership as of December 31, ~~2017~~2021 and ~~2016,~~2020, the related consolidated statements of operations, comprehensive income (loss), capital, and cash flows for each of the years in the three-year period ended December 31, ~~2017,~~2021, and the related notes and financial statement schedule III (collectively, the consolidated financial statements), and our report dated February ~~16, 2018~~25, 2022 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

The ~~Company’s~~Partnership’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying ~~Management’s~~Management's Report on CubeSmart L.P. Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the ~~Company’s~~Partnership’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the ~~Company~~Partnership in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Definition and Limitations of Internal Control Over Financial Reporting

/s/ KPMG LLP

Philadelphia, Pennsylvania

February ~~16, 2018~~25, 2022

~~F-7~~F-9

CUBESMART AND SUBSIDIARIES

CONSOLIDATED BALANCE ~~SHEETS~~SHEETS

(in thousands, except share data)

December 31,

December 31,

2017

2016

ASSETS

Storage properties

$
4,161,715

$
3,998,180

Less: Accumulated depreciation

(752,925)

(671,364)

Storage properties, net (including VIE assets of $291,496 and $208,048, respectively)

3,408,790

3,326,816

Cash and cash equivalents

5,268

2,973

Restricted cash

3,890

7,893

Loan procurement costs, net of amortization

1,592

2,150

Investment in real estate ventures, at equity

91,206

98,682

Other assets, net

34,590

36,514

Total assets

$
3,545,336

$
3,475,028

LIABILITIES AND EQUITY

Unsecured senior notes, net

$
1,142,460

$
1,039,076

Revolving credit facility

81,700

43,300

Unsecured term loans, net

299,396

398,749

Mortgage loans and notes payable, net

111,434

114,618

Accounts payable, accrued expenses and other liabilities

143,344

93,764

Distributions payable

55,297

49,239

Deferred revenue

21,529

20,226

Security deposits

486

412

Total liabilities

1,855,646

1,759,384

Noncontrolling interests in the Operating Partnership

54,320

54,407

Commitments and contingencies

Equity

Common shares $.01 par value, 400,000,000 shares authorized, 182,215,735 and 180,083,111 shares issued and outstanding at December 31, 2017 and December 31, 2016, respectively

1,822

1,801

Additional paid-in capital

2,356,620

2,314,014

Accumulated other comprehensive income (loss)

3

(1,850)

Accumulated deficit

(729,311)

(658,583)

Total CubeSmart shareholders’ equity

1,629,134

1,655,382

Noncontrolling interests in subsidiaries

6,236

5,855

Total equity

1,635,370

1,661,237

Total liabilities and equity

$
3,545,336

$
3,475,028


	December 31,
	2021		2020

ASSETS
Storage properties	$	7,183,494	$	5,489,754
Less: Accumulated depreciation		(1,085,824)		(983,940)
Storage properties, net (including VIE assets of $149,467 and $119,345, respectively)		6,097,670		4,505,814
Cash and cash equivalents		11,140		3,592
Restricted cash		2,178		2,637
Loan procurement costs, net of amortization		2,322		3,275
Investment in real estate ventures, at equity		119,751		92,071
Assets held for sale		49,313		—
Other assets, net		265,705		170,753
Total assets	$	6,548,079	$	4,778,142

LIABILITIES AND EQUITY
Unsecured senior notes, net	$	2,768,209	$	2,030,372
Revolving credit facility		209,900		117,800
Mortgage loans and notes payable, net		167,676		216,504
Lease liabilities - finance leases		65,801		65,599
Accounts payable, accrued expenses and other liabilities		199,985		159,140
Distributions payable		97,417		68,301
Deferred revenue		37,144		29,087
Security deposits		1,065		1,077
Liabilities held for sale		2,502		—
Total liabilities		3,549,699		2,687,880

Noncontrolling interests in the Operating Partnership		108,220		249,414

Commitments and contingencies

Equity
Common shares $.01 par value, 400,000,000 shares authorized, 223,917,993 and 197,405,989 shares issued and outstanding at December 31, 2021 and 2020, respectively		2,239		1,974
Additional paid-in capital		4,088,392		2,805,673
Accumulated other comprehensive loss		(570)		(632)
Accumulated deficit		(1,218,498)		(974,799)
Total CubeSmart shareholders’ equity		2,871,563		1,832,216
Noncontrolling interests in subsidiaries		18,597		8,632
Total equity		2,890,160		1,840,848
Total liabilities and equity	$	6,548,079	$	4,778,142

See accompanying notes to the consolidated financial statements.

~~F-8~~F-10

CUBESMART AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF ~~OPERATIONS~~OPERATIONS

(in thousands, except per share data)

For the year ended December 31,

2017

2016

2015

REVENUES

Rental income

$
489,043

$
449,601

$
392,476
Other property related income

55,001

50,255

45,189
Property management fee income

14,899

10,183

6,856
Total revenues

558,943

510,039

444,521
OPERATING EXPENSES

Property operating expenses

181,508

165,847

153,172
Depreciation and amortization

145,681

161,865

151,789
General and administrative

34,745

32,823

28,371
Acquisition related costs

1,294

6,552

3,301
Total operating expenses

363,228

367,087

336,633
OPERATING INCOME

195,715

142,952

107,888
OTHER (EXPENSE) INCOME

Interest:

Interest expense on loans

(56,952)

(50,399)

(43,736)
Loan procurement amortization expense

(2,638)

(2,577)

(2,324)
Equity in losses of real estate ventures

(1,386)

(2,662)

(411)
Gains from sale of real estate, net

—

—

17,567
Other

872

1,062

(228)
Total other expense

(60,104)

(54,576)

(29,132)
NET INCOME

135,611

88,376

78,756
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS

Noncontrolling interests in the Operating Partnership

(1,593)

(941)

(960)
Noncontrolling interest in subsidiaries

270

470

(84)
NET INCOME ATTRIBUTABLE TO THE COMPANY

134,288

87,905

77,712
Distribution to preferred shareholders

—

(5,045)

(6,008)
Preferred share redemption charge

—

(2,937)

—
NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS

$
134,288

$
79,923

$
71,704

Basic earnings per share attributable to common shareholders

$
0.74

$
0.45

$
0.43
Diluted earnings per share attributable to common shareholders

$
0.74

$
0.45

$
0.42

Weighted-average basic shares outstanding

180,525

178,246

168,640
Weighted-average diluted shares outstanding

181,448

179,533

170,191


	For the year ended December 31,
	2021		2020		2019

REVENUES
Rental income	$	707,751	$	581,009	$	552,404
Other property related income		83,605		70,723		67,558
Property management fee income		31,208		27,445		23,953
Total revenues		822,564		679,177		643,915
OPERATING EXPENSES
Property operating expenses		252,104		223,634		209,739
Depreciation and amortization		232,049		156,573		163,547
General and administrative		47,809		41,423		38,560
Total operating expenses		531,962		421,630		411,846
OTHER (EXPENSE) INCOME
Interest:
Interest expense on loans		(78,448)		(75,890)		(72,525)
Loan procurement amortization expense		(8,168)		(2,674)		(2,819)
Loss on early extinguishment of debt		(20,328)		(18,020)		—
Equity in earnings of real estate ventures		25,275		178		11,122
Gains from sales of real estate, net		32,698		6,710		1,508
Other		(10,818)		(240)		1,416
Total other expense		(59,789)		(89,936)		(61,298)
NET INCOME		230,813		167,611		170,771
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
Noncontrolling interests in the Operating Partnership		(7,873)		(1,825)		(1,708)
Noncontrolling interest in subsidiaries		542		(165)		54
NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS	$	223,482	$	165,621	$	169,117

Basic earnings per share attributable to common shareholders	$	1.10	$	0.85	$	0.89
Diluted earnings per share attributable to common shareholders	$	1.09	$	0.85	$	0.88

Weighted average basic shares outstanding		203,832		194,147		190,874
Weighted average diluted shares outstanding		205,009		194,943		191,576

See accompanying notes to the consolidated financial statements.

~~F-9~~F-11

CUBESMART AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ~~(LOSS)~~(LOSS)

(in thousands)

For the year ended December 31,

2017

2016

2015

NET INCOME

$
135,611

$
88,376

$
78,756

Other comprehensive income (loss):

Unrealized gains (losses) on interest rate swaps

195

(1,247)

(3,409)

Reclassification of realized losses on interest rate swaps

1,680

4,412

6,263

Unrealized loss on foreign currency translation

—

—

(249)

Reclassification of realized loss on foreign currency translation

—

—

1,199

OTHER COMPREHENSIVE INCOME

1,875

3,165

3,804

COMPREHENSIVE INCOME

137,486

91,541

82,560

Comprehensive income attributable to noncontrolling interests in the Operating Partnership

(1,615)

(978)

(992)

Comprehensive loss (income) attributable to noncontrolling interest in subsidiaries

270

470

(75)

COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY

$
136,141

$
91,033

$
81,493


	For the year ended December 31,
	2021		2020		2019

NET INCOME	$	230,813	$	167,611	$	170,771
Other comprehensive income:
Unrealized gains on interest rate swaps		—		—		232
Reclassification of realized losses on interest rate swaps		81		81		70
OTHER COMPREHENSIVE INCOME:		81		81		302
COMPREHENSIVE INCOME		230,894		167,692		171,073
Comprehensive income attributable to noncontrolling interests in the Operating Partnership		(7,892)		(1,809)		(1,710)
Comprehensive loss (income) attributable to noncontrolling interest in subsidiaries		542		(165)		54
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY	$	223,544	$	165,718	$	169,417

See accompanying notes to the consolidated financial statements.

~~F-10~~F-12

CUBESMART AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF ~~EQUITY~~EQUITY

(in thousands)

Noncontrolling

Interests

Common

Preferred

Additional

Accumulated Other

Total

Noncontrolling

in the

Shares

Shares

Paid-in

Comprehensive

Accumulated

Shareholders’

Interests in

Total

Operating

Number

Amount

Number

Amount

Capital

(Loss) Income

Deficit

Equity

Subsidiaries

Equity

Partnership

Balance at December 31, 2014

163,957

$
1,639

3,100

$
31

$
1,974,308

$
(8,759)

$
(519,193)

$
1,448,026

$
1,592

$
1,449,618

$
49,823

Contributions from noncontrolling interest in subsidiaries

178

178

Distributions to noncontrolling interests in subsidiaries

(319)

(319)

Issuance of common shares, net

8,978

91

233,970

234,061

234,061

Issuance of restricted shares

161

1

1

1

Issuance of OP Shares

500

Conversion from units to shares

118

2

3,273

3,275

3,275

(3,275)

Exercise of stock options

1,454

14

17,475

17,489

17,489

Amortization of restricted shares

1,166

1,166

1,166

Share compensation expense

989

989

989

Adjustment for noncontrolling interests in the Operating Partnership

(19,619)

(19,619)

(19,619)

19,619

Net income

77,712

77,712

84

77,796

960

Other comprehensive income (loss), net:

3,781

3,781

(9)

3,772

32

Preferred share distributions

(6,008)

(6,008)

(6,008)

Common share distributions

(117,546)

(117,546)

(117,546)

(1,531)

Balance at December 31, 2015

174,668

$
1,747

3,100

$
31

$
2,231,181

$
(4,978)

$
(584,654)

$
1,643,327

$
1,526

$
1,644,853

$
66,128

Contributions from noncontrolling interest in subsidiaries

4,799

4,799

Issuance of common shares, net

4,408

44

136,077

136,121

136,121

Issuance of restricted shares

123

1

1

1

Issuance of OP Shares

1,500

Conversion from units to shares

188

2

4,874

4,876

4,876

(4,876)

Exercise of stock options

696

7

13,276

13,283

13,283

Amortization of restricted shares

1,952

1,952

1,952

Share compensation expense

1,260

1,260

1,260

Adjustment for noncontrolling interests in the Operating Partnership

7,388

7,388

7,388

(7,388)

Net income (loss)

87,905

87,905

(470)

87,435

941

Other comprehensive income, net:

3,128

3,128

3,128

37

Preferred share distributions

(5,045)

(5,045)

(5,045)

Preferred share redemption

(3,100)

(31)

(74,606)

(2,937)

(77,574)

(77,574)

Common share distributions

(161,240)

(161,240)

(161,240)

(1,935)

Balance at December 31, 2016

180,083

$
1,801

—

$
—

$
2,314,014

$
(1,850)

$
(658,583)

$
1,655,382

$
5,855

$
1,661,237

$
54,407

Contributions from noncontrolling interest in subsidiaries

1,058

1,058

Acquisition of noncontrolling interest in subsidiary

(8,626)

(8,626)

(407)

(9,033)

Issuance of common shares, net

1,036

10

29,632

29,642

29,642

Issuance of restricted shares

106

1

1

1

Issuance of OP Shares

12,324

Conversion from units to shares

594

6

15,700

15,706

15,706

(15,706)

Exercise of stock options

397

4

2,360

2,364

2,364

Amortization of restricted shares

2,009

2,009

2,009

Share compensation expense

1,531

1,531

1,531

Adjustment for noncontrolling interests in the Operating Partnership

(3,965)

(3,965)

(3,965)

3,965

Net income (loss)

134,288

134,288

(270)

134,018

1,593

Other comprehensive income, net:

1,853

1,853

1,853

22

Common share distributions

(201,051)

(201,051)

(201,051)

(2,285)

Balance at December 31, 2017

182,216

$
1,822

—

$
—

$
2,356,620

$
3

$
(729,311)

$
1,629,134

$
6,236

$
1,635,370

$
54,320


																Noncontrolling
																Interests
	Common			Additional		Accumulated Other				Total		Noncontrolling				in the
	Shares			Paid-in		Comprehensive		Accumulated		Shareholders’		Interests in		Total		Operating
	Number	Amount		Capital		Income (Loss)		Deficit		Equity		Subsidiaries		Equity		Partnership
Balance at December 31, 2018	187,145	$	1,871	$	2,500,751	$	(1,029)	$	(791,915)	$	1,709,678	$	6,771	$	1,716,449	$	55,819
Contributions from noncontrolling interest in subsidiaries													7,376		7,376
Distributions paid to noncontrolling interest in subsidiaries													(188)		(188)
Acquisition of noncontrolling interest in subsidiary					(34,690)						(34,690)		(5,915)		(40,605)
Issuance of common shares, net	5,899		60		196,244						196,304				196,304
Issuance of restricted shares	52
Issuance of OP units																	3,576
Conversion from units to shares	80		1		2,485						2,486				2,486		(2,486)
Exercise of stock options	381		4		3,682						3,686				3,686
Amortization of restricted shares					4,487						4,487				4,487
Share compensation expense					1,786						1,786				1,786
Adjustment for noncontrolling interests in the Operating Partnership									(5,918)		(5,918)				(5,918)		5,918
Net income (loss)									169,117		169,117		(54)		169,063		1,708
Other comprehensive income, net							300				300				300		2
Common share distributions ($1.29 per share)									(247,890)		(247,890)				(247,890)		(2,449)
Balance at December 31, 2019	193,557	$	1,936	$	2,674,745	$	(729)	$	(876,606)	$	1,799,346	$	7,990	$	1,807,336	$	62,088
Contributions from noncontrolling interest in subsidiaries													682		682
Distributions paid to noncontrolling interest in subsidiaries													(205)		(205)
Issuance of common shares, net	3,627		37		120,690						120,727				120,727
Issuance of restricted shares	60
Issuance of OP units																	186,933
Conversion from units to shares	100		1		2,823						2,824				2,824		(2,824)
Exercise of stock options	62				961						961				961
Amortization of restricted shares					4,502						4,502				4,502
Share compensation expense					1,952						1,952				1,952
Adjustment for noncontrolling interests in the Operating Partnership									(4,230)		(4,230)				(4,230)		4,230
Net income									165,621		165,621		165		165,786		1,825
Other comprehensive income (loss), net							97				97				97		(16)
Common share distributions ($1.33 per share)									(259,584)		(259,584)				(259,584)		(2,822)
Balance at December 31, 2020	197,406	$	1,974	$	2,805,673	$	(632)	$	(974,799)	$	1,832,216	$	8,632	$	1,840,848	$	249,414
Contributions from noncontrolling interest in subsidiaries													11,404		11,404
Distributions paid to noncontrolling interest in subsidiaries													(246)		(246)
Acquisition of noncontrolling interest in subsidiary					(2,746)						(2,746)		(651)		(3,397)
Issuance of common shares, net	20,508		205		965,433						965,638				965,638
Issuance of restricted shares	66
Conversion from units to shares	5,519		56		304,959						305,015				305,015		(305,015)
Exercise of stock options	419		4		7,861						7,865				7,865
Amortization of restricted shares					4,941						4,941				4,941
Share compensation expense					2,271						2,271				2,271
Adjustment for noncontrolling interests in the Operating Partnership									(164,109)		(164,109)				(164,109)		164,109
Net income (loss)									223,482		223,482		(542)		222,940		7,873
Other comprehensive income, net							62				62				62		19
Common share distributions ($1.45 per share)									(303,072)		(303,072)				(303,072)		(8,180)
Balance at December 31, 2021	223,918	$	2,239	$	4,088,392	$	(570)	$	(1,218,498)	$	2,871,563	$	18,597	$	2,890,160	$	108,220

See accompanying notes to the consolidated financial statements.

~~F-11~~F-13

CUBESMART AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH ~~FLOWS~~FLOWS

(in thousands)


	For the year ended December 31,
	2021		2020		2019
Operating Activities
Net income	$	230,813	$	167,611	$	170,771
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		240,217		159,247		166,366
Non-cash portion of interest expense related to finance leases		202		—		—
Loss on early extinguishment of debt		20,328		18,020		—
Equity in earnings of real estate ventures		(25,275)		(178)		(11,122)
Gains from sales of real estate, net		(32,698)		(6,710)		(1,508)
Equity compensation expense		8,088		7,140		6,694
Accretion of fair market value adjustment of debt		(2,037)		(259)		(718)
Changes in other operating accounts:
Other assets		(9,247)		(9,674)		(6,578)
Accounts payable and accrued expenses		14,871		13,922		6,042
Other liabilities		3,923		1,914		1,821
Net cash provided by operating activities	$	449,185	$	351,033	$	331,768
Investing Activities
Acquisitions of storage properties		(151,547)		(417,988)		(117,998)
Acquisition of LAACO, Ltd., net of cash acquired		(1,678,984)		—		—
Additions and improvements to storage properties		(34,608)		(49,857)		(37,569)
Development costs		(69,887)		(55,286)		(102,826)
Cash paid for partner's interest in real estate venture, net of cash, cash equivalents and restricted cash acquired		—		—		(117,959)
Investment in real estate ventures		(28,261)		(7,022)		(10,264)
Cash distributed from real estate ventures		66,593		6,246		7,096
Proceeds from sale of real estate, net		44,026		12,466		3,856
Net cash used in investing activities	$	(1,852,668)	$	(511,441)	$	(375,664)
Financing Activities
Proceeds from:
Unsecured senior notes		1,043,427		445,833		696,426
Revolving credit facility		906,571		429,085		859,313
Principal payments on:
Unsecured senior notes		(300,000)		(250,000)		—
Revolving credit facility		(814,471)		(311,285)		(1,158,776)
Unsecured term loans		—		—		(200,000)
Mortgage loans and notes payable		(87,263)		(46,093)		(11,652)
Loan procurement costs		(12,548)		(3,764)		(6,023)
Debt prepayment costs		(20,023)		(17,584)		—
Settlement of hedge transactions		—		—		(807)
Acquisition of noncontrolling interest in subsidiary, net		(3,397)		—		(35,777)
Proceeds from issuance of common shares, net		965,638		120,727		196,304
Cash paid upon vesting of restricted shares		(876)		(686)		(421)
Exercise of stock options		7,865		961		3,686
Contributions from noncontrolling interests in subsidiaries		8,031		—		48
Distributions paid to noncontrolling interests in subsidiaries		(246)		(205)		(188)
Distributions paid to common shareholders		(273,839)		(256,253)		(243,859)
Distributions paid to noncontrolling interests in Operating Partnership		(8,297)		(2,540)		(2,419)
Net cash provided by financing activities	$	1,410,572	$	108,196	$	95,855
Change in cash, cash equivalents and restricted cash		7,089		(52,212)		51,959
Cash, cash equivalents and restricted cash at beginning of period		6,229		58,441		6,482
Cash, cash equivalents and restricted cash at end of period	$	13,318	$	6,229	$	58,441
Supplemental Cash Flow and Noncash Information
Cash paid for interest, net of interest capitalized	$	79,148	$	80,792	$	69,283
Supplemental disclosure of noncash activities:
Acquisitions of storage properties	$	—	$	(2,623)	$	—
Proceeds held in escrow from real estate venture's sale of real estate (see note 4)	$	—	$	—	$	8,288
Noncash consideration for acquisition of partner's interest in real estate venture (see note 4)	$	—	$	—	$	(8,288)
Right-of-use assets obtained in exchange for lease liabilities	$	—	$	61,423	$	—
Discount on issuance of unsecured senior notes	$	6,573	$	4,167	$	3,574
Noncash drawdown on revolving credit facility	$	—	$	—	$	103,938
Mortgage loan assumptions	$	40,880	$	169,056	$	—
Repayment of unsecured term loan through noncash drawdown on revolving credit facility	$	—	$	—	$	(100,000)
Accretion of put liability	$	9,777	$	7,917	$	5,895
Derivative valuation adjustment	$	81	$	81	$	302
Loan procurement costs	$	—	$	—	$	(3,770)
Issuance of OP units (see note 4)	$	—	$	186,933	$	3,576
Acquisition of noncontrolling interest in subsidiary	$	—	$	—	$	(4,828)
Contributions from noncontrolling interests in subsidiaries	$	3,373	$	682	$	7,328

See accompanying notes to the consolidated financial statements.

For the year ended December 31,

2017

2016

2015

Operating Activities

Net income

$
135,611

$
88,376

$
78,756

Adjustments to reconcile net income to cash provided by operating activities:

Depreciation and amortization

148,319

164,442

154,113

Equity in losses of real estate ventures

1,386

2,662

411

Gains from sale of real estate, net

—

—

(17,567)

Equity compensation expense

5,586

4,850

3,722

Accretion of fair market value adjustment of debt

(559)

(1,138)

(1,429)

Changes in other operating accounts:

Restricted cash

(60)

591

743

Other assets

(8,845)

(3,930)

(2,519)

Accounts payable and accrued expenses

10,846

7,862

(438)

Other liabilities

1,154

1,449

1,480

Net cash provided by operating activities

$
293,438

$
265,164

$
217,272

Investing Activities

Acquisitions of storage properties

(69,629)

(366,666)

(275,726)

Additions and improvements to storage properties

(28,962)

(30,971)

(24,695)

Development costs

(64,659)

(143,713)

(81,315)

Investment in real estate ventures, at equity

(301)

(12,176)

(8,433)

Cash distributed from real estate ventures

15,784

8,113

6,451

Proceeds from sale of real estate, net

—

—

9,041

Fundings of notes receivable

—

—

(4,100)

Proceeds from notes receivable

—

—

4,100

Change in restricted cash

(57)

942

69

Net cash used in investing activities

$
(147,824)

$
(544,471)

$
(374,608)

Financing Activities

Proceeds from:

Unsecured senior notes

103,192

298,512

249,338

Revolving credit facility

628,400

958,200

731,320

Principal payments on:

Revolving credit facility

(590,000)

(914,900)

(809,320)

Unsecured term loans

(100,000)

—

—

Mortgage loans and notes payable

(8,666)

(37,260)

(84,905)

Loan procurement costs

(953)

(2,467)

(4,433)

Acquisition of noncontrolling interest in subsidiary

(9,033)

—

—

Proceeds from issuance of common shares, net

29,643

136,122

234,062

Cash paid upon vesting of restricted shares

(2,046)

(1,638)

(1,567)

Redemption of preferred shares

—

(77,574)

—

Exercise of stock options

2,364

13,283

17,489

Contributions from noncontrolling interests in subsidiaries

1,058

4,799

178

Distributions paid to noncontrolling interests in subsidiaries

—

—

(319)

Distributions paid to common shareholders

(195,006)

(149,280)

(107,093)

Distributions paid to preferred shareholders

—

(6,545)

(6,008)

Distributions paid to noncontrolling interests in Operating Partnership

(2,272)

(1,841)

(1,438)

Net cash (used in) provided by financing activities

$
(143,319)

$
219,411

$
217,304

Change in cash and cash equivalents

2,295

(59,896)

59,968

Cash and cash equivalents at beginning of year

2,973

62,869

2,901

Cash and cash equivalents at end of year

$
5,268

$
2,973

$
62,869

Supplemental Cash Flow and Noncash Information

Cash paid for interest, net of interest capitalized

$
63,407

$
53,085

$
46,216

Supplemental disclosure of noncash activities:

Restricted cash - acquisition of storage properties

$
—

$
(22,019)

$
(14,353)

Restricted cash - disposition of real estate

$
—

$
—

$
36,372

Accretion of liability

$
35,122

$
31,426

$
16,929

Derivative valuation adjustment

$
1,875

$
3,165

$
2,854

Foreign currency translation adjustment

$
—

$
—

$
(249)

Discount on issuance of unsecured senior notes

$
—

$
1,488

$
662

Mortgage loan assumptions

$
6,201

$
41,513

$
2,695

Preferred share redemption

$
—

$
2,863

$
—

Issuance of OP units

$
12,324

$
—

$
—

Liability for acquisition of storage property

$
1,470

$
—

$
—

Contribution of storage property to real estate venture

$
9,400

$
—

$
—

F-14

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands)


	December 31,
	2021		2020


ASSETS
Storage properties	$	7,183,494	$	5,489,754
Less: Accumulated depreciation		(1,085,824)		(983,940)
Storage properties, net (including VIE assets of $149,467 and $119,345, respectively)		6,097,670		4,505,814
Cash and cash equivalents		11,140		3,592
Restricted cash		2,178		2,637
Loan procurement costs, net of amortization		2,322		3,275
Investment in real estate ventures, at equity		119,751		92,071
Assets held for sale		49,313		—
Other assets, net		265,705		170,753
Total assets	$	6,548,079	$	4,778,142

LIABILITIES AND CAPITAL
Unsecured senior notes, net	$	2,768,209	$	2,030,372
Revolving credit facility		209,900		117,800
Mortgage loans and notes payable, net		167,676		216,504
Lease liabilities - finance leases		65,801		65,599
Accounts payable, accrued expenses and other liabilities		199,985		159,140
Distributions payable		97,417		68,301
Deferred revenue		37,144		29,087
Security deposits		1,065		1,077
Liabilities held for sale		2,502		—
Total liabilities		3,549,699		2,687,880

Limited Partnership interests of third parties		108,220		249,414

Commitments and contingencies

Capital
Operating Partner		2,872,133		1,832,848
Accumulated other comprehensive loss		(570)		(632)
Total CubeSmart, L.P. capital		2,871,563		1,832,216
Noncontrolling interests in subsidiaries		18,597		8,632
Total capital		2,890,160		1,840,848
Total liabilities and capital	$	6,548,079	$	4,778,142

See accompanying notes to the consolidated financial statements.

~~F-12~~F-15

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

~~CONSOLIDATED BALANCE SHEETS~~

(in ~~thousands)~~thousands, except per common unit data)

December 31,

December 31,

2017

2016

ASSETS

Storage properties

$
4,161,715

$
3,998,180

Less: Accumulated depreciation

(752,925)

(671,364)

Storage properties, net (including VIE assets of $291,496 and $208,048, respectively)

3,408,790

3,326,816

Cash and cash equivalents

5,268

2,973

Restricted cash

3,890

7,893

Loan procurement costs, net of amortization

1,592

2,150

Investment in real estate ventures, at equity

91,206

98,682

Other assets, net

34,590

36,514

Total assets

$
3,545,336

$
3,475,028

LIABILITIES AND CAPITAL

Unsecured senior notes, net

$
1,142,460

$
1,039,076

Revolving credit facility

81,700

43,300

Unsecured term loans, net

299,396

398,749

Mortgage loans and notes payable, net

111,434

114,618

Accounts payable, accrued expenses and other liabilities

143,344

93,764

Distributions payable

55,297

49,239

Deferred revenue

21,529

20,226

Security deposits

486

412

Total liabilities

1,855,646

1,759,384

Limited Partnership interests of third parties

54,320

54,407

Commitments and contingencies

Capital

Operating Partner

1,629,131

1,657,232

Accumulated other comprehensive income (loss)

3

(1,850)

Total CubeSmart, L.P. capital

1,629,134

1,655,382

Noncontrolling interests in subsidiaries

6,236

5,855

Total capital

1,635,370

1,661,237

Total liabilities and capital

$
3,545,336

$
3,475,028


	For the year ended December 31,
	2021		2020		2019

REVENUES
Rental income	$	707,751	$	581,009	$	552,404
Other property related income		83,605		70,723		67,558
Property management fee income		31,208		27,445		23,953
Total revenues		822,564		679,177		643,915
OPERATING EXPENSES
Property operating expenses		252,104		223,634		209,739
Depreciation and amortization		232,049		156,573		163,547
General and administrative		47,809		41,423		38,560
Total operating expenses		531,962		421,630		411,846
OTHER (EXPENSE) INCOME
Interest:
Interest expense on loans		(78,448)		(75,890)		(72,525)
Loan procurement amortization expense		(8,168)		(2,674)		(2,819)
Loss on early extinguishment of debt		(20,328)		(18,020)		—
Equity in earnings of real estate ventures		25,275		178		11,122
Gains from sales of real estate, net		32,698		6,710		1,508
Other		(10,818)		(240)		1,416
Total other expense		(59,789)		(89,936)		(61,298)
NET INCOME		230,813		167,611		170,771
NET LOSS (INCOME) ATTRIBUTABLE TO NONCONTROLLING INTERESTS
Noncontrolling interest in subsidiaries		542		(165)		54
NET INCOME ATTRIBUTABLE TO CUBESMART L.P.		231,355		167,446		170,825
Operating Partnership interests of third parties		(7,873)		(1,825)		(1,708)
NET INCOME ATTRIBUTABLE TO COMMON UNITHOLDERS	$	223,482	$	165,621	$	169,117

Basic earnings per unit attributable to common unitholders	$	1.10	$	0.85	$	0.89
Diluted earnings per unit attributable to common unitholders	$	1.09	$	0.85	$	0.88

Weighted average basic units outstanding		203,832		194,147		190,874
Weighted average diluted units outstanding		205,009		194,943		191,576

See accompanying notes to the consolidated financial statements.

~~F-13~~F-16

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF ~~OPERATIONS~~COMPREHENSIVE INCOME (LOSS)

(in ~~thousands, except per common unit data)~~thousands)

For the year ended December 31,

2017

2016

2015

REVENUES

Rental income

$
489,043

$
449,601

$
392,476

Other property related income

55,001

50,255

45,189

Property management fee income

14,899

10,183

6,856

Total revenues

558,943

510,039

444,521

OPERATING EXPENSES

Property operating expenses

181,508

165,847

153,172

Depreciation and amortization

145,681

161,865

151,789

General and administrative

34,745

32,823

28,371

Acquisition related costs

1,294

6,552

3,301

Total operating expenses

363,228

367,087

336,633

OPERATING INCOME

195,715

142,952

107,888

OTHER (EXPENSE) INCOME

Interest:

Interest expense on loans

(56,952)

(50,399)

(43,736)

Loan procurement amortization expense

(2,638)

(2,577)

(2,324)

Equity in losses of real estate ventures

(1,386)

(2,662)

(411)

Gains from sale of real estate, net

—

—

17,567

Other

872

1,062

(228)

Total other expense

(60,104)

(54,576)

(29,132)

NET INCOME

135,611

88,376

78,756

NET LOSS (INCOME) ATTRIBUTABLE TO NONCONTROLLING INTERESTS

Noncontrolling interest in subsidiaries

270

470

(84)

NET INCOME ATTRIBUTABLE TO CUBESMART L.P.

135,881

88,846

78,672

Operating Partnership interests of third parties

(1,593)

(941)

(960)

NET INCOME ATTRIBUTABLE TO OPERATING PARTNER

134,288

87,905

77,712

Distribution to preferred unitholders

—

(5,045)

(6,008)

Preferred unit redemption charge

—

(2,937)

—

NET INCOME ATTRIBUTABLE TO COMMON UNITHOLDERS

$
134,288

$
79,923

$
71,704








Basic earnings per unit attributable to common unitholders

$
0.74

$
0.45

$
0.43

Diluted earnings per unit attributable to common unitholders

$
0.74

$
0.45

$
0.42

Weighted-average basic units outstanding

180,525

178,246

168,640

Weighted-average diluted units outstanding

181,448

179,533

170,191


	For the year ended December 31,
	2021		2020		2019

NET INCOME	$	230,813	$	167,611	$	170,771
Other comprehensive income:
Unrealized gains on interest rate swaps		—		—		232
Reclassification of realized losses on interest rate swaps		81		81		70
OTHER COMPREHENSIVE INCOME:		81		81		302
COMPREHENSIVE INCOME		230,894		167,692		171,073
Comprehensive income attributable to Operating Partnership interests of third parties		(7,892)		(1,809)		(1,710)
Comprehensive loss (income) attributable to noncontrolling interest in subsidiaries		542		(165)		54
COMPREHENSIVE INCOME ATTRIBUTABLE TO OPERATING PARTNER	$	223,544	$	165,718	$	169,417

See accompanying notes to the consolidated financial statements.

~~F-14~~F-17

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF ~~COMPREHENSIVE INCOME (LOSS)~~CAPITAL

(in thousands)

For the year ended December 31,

2017

2016

2015

NET INCOME

$
135,611

$
88,376

$
78,756

Other comprehensive income (loss):

Unrealized gains (losses) on interest rate swaps

195

(1,247)

(3,409)

Reclassification of realized losses on interest rate swaps

1,680

4,412

6,263

Unrealized loss on foreign currency translation

—

—

(249)

Reclassification of realized loss on foreign currency translation

—

—

1,199

OTHER COMPREHENSIVE INCOME

1,875

3,165

3,804

COMPREHENSIVE INCOME

137,486

91,541

82,560

Comprehensive income attributable to Operating Partnership interests of third parties

(1,615)

(978)

(992)

Comprehensive loss (income) attributable to noncontrolling interest in subsidiaries

270

470

(75)

COMPREHENSIVE INCOME ATTRIBUTABLE TO OPERATING PARTNER

$
136,141

$
91,033

$
81,493



	Number of Common OP			Accumulated Other		Total		Noncontrolling				Operating Partnership
	Units		Operating	Comprehensive		CubeSmart L.P.		Interest in		Total		Interests
	Outstanding		Partner	Income (Loss)		Capital		Subsidiaries		Capital		of Third Parties
Balance at December 31, 2018	187,145	$	1,710,707	$	(1,029)	$	1,709,678	$	6,771	$	1,716,449	$	55,819
Contributions from noncontrolling interest in subsidiaries									7,376		7,376
Distributions paid to noncontrolling interest in subsidiaries									(188)		(188)
Acquisition of noncontrolling interest in subsidiary			(34,690)				(34,690)		(5,915)		(40,605)
Issuance of common OP units, net	5,899		196,304				196,304				196,304
Issuance of restricted OP units	52
Issuance of OP units													3,576
Conversion from OP units to shares	80		2,486				2,486				2,486		(2,486)
Exercise of OP unit options	381		3,686				3,686				3,686
Amortization of restricted OP units			4,487				4,487				4,487
OP unit compensation expense			1,786				1,786				1,786
Adjustment for Operating Partnership interests of third parties			(5,918)				(5,918)				(5,918)		5,918
Net income (loss)			169,117				169,117		(54)		169,063		1,708
Other comprehensive income, net					300		300				300		2
Common OP unit distributions ($1.29 per unit)			(247,890)				(247,890)				(247,890)		(2,449)
Balance at December 31, 2019	193,557	$	1,800,075	$	(729)	$	1,799,346	$	7,990	$	1,807,336	$	62,088
Contributions from noncontrolling interest in subsidiaries									682		682
Distributions paid to noncontrolling interest in subsidiaries									(205)		(205)
Issuance of common OP units, net	3,627		120,727				120,727				120,727
Issuance of restricted OP units	60
Issuance of OP units													186,933
Conversion from OP units to shares	100		2,824				2,824				2,824		(2,824)
Exercise of OP unit options	62		961				961				961
Amortization of restricted OP units			4,502				4,502				4,502
OP unit compensation expense			1,952				1,952				1,952
Adjustment for Operating Partnership interests of third parties			(4,230)				(4,230)				(4,230)		4,230
Net income			165,621				165,621		165		165,786		1,825
Other comprehensive income (loss), net					97		97				97		(16)
Common OP unit distributions ($1.33 per unit)			(259,584)				(259,584)				(259,584)		(2,822)
Balance at December 31, 2020	197,406	$	1,832,848	$	(632)	$	1,832,216	$	8,632	$	1,840,848	$	249,414
Contributions from noncontrolling interest in subsidiaries									11,404		11,404
Distributions paid to noncontrolling interest in subsidiaries									(246)		(246)
Acquisition of noncontrolling interest in subsidiary			(2,746)				(2,746)		(651)		(3,397)
Issuance of common OP units, net	20,508		965,638				965,638				965,638
Issuance of restricted OP units	66
Conversion from OP units to shares	5,519		305,015				305,015				305,015		(305,015)
Exercise of OP unit options	419		7,865				7,865				7,865
Amortization of restricted OP units			4,941				4,941				4,941
OP unit compensation expense			2,271				2,271				2,271
Adjustment for Operating Partnership interests of third parties			(164,109)				(164,109)				(164,109)		164,109
Net income (loss)			223,482				223,482		(542)		222,940		7,873
Other comprehensive income, net					62		62				62		19
Common OP unit distributions ($1.45 per unit)			(303,072)				(303,072)				(303,072)		(8,180)
Balance at December 31, 2021	223,918	$	2,872,133	$	(570)	$	2,871,563	$	18,597	$	2,890,160	$	108,220

See accompanying notes to the consolidated financial statements.

~~F-15~~F-18

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

~~CONSOLIDATED STATEMENTS OF CAPITAL~~

(in thousands)

Number of Common OP

Number of Preferred OP

Accumulated Other

Total

Noncontrolling

Operating Partnership

Units

Units

Operating

Comprehensive

CubeSmart L.P.

Interest in

Total

Interests

Outstanding

Outstanding

Partner

(Loss) Income

Capital

Subsidiaries

Capital

of Third Parties

Balance at December 31, 2014

163,957

3,100

$
1,456,785

$
(8,759)

$
1,448,026

$
1,592

$
1,449,618

$
49,823

Contributions from noncontrolling interest in subsidiaries

178

178

Distributions to noncontrolling interests in subsidiaries

(319)

(319)

Issuance of common OP units, net

8,978

234,061

234,061

234,061

Issuance of restricted OP units

161

1

1

1

Issuance of OP Shares

500

Conversion from OP units to shares

118

3,275

3,275

3,275

(3,275)

Exercise of OP unit options

1,454

17,489

17,489

17,489

Amortization of restricted OP units

1,166

1,166

1,166

OP unit compensation expense

989

989

989

Adjustment for Operating Partnership interests of third parties

(19,619)

(19,619)

(19,619)

19,619

Net income

77,712

77,712

84

77,796

960

Other comprehensive income (loss), net:

3,781

3,781

(9)

3,772

32

Preferred OP unit distributions

(6,008)

(6,008)

(6,008)

Common OP unit distributions

(117,546)

(117,546)

(117,546)

(1,531)

Balance at December 31, 2015

174,668

3,100

$
1,648,305

$
(4,978)

$
1,643,327

$
1,526

$
1,644,853

$
66,128

Contributions from noncontrolling interest in subsidiaries

4,799

4,799

Issuance of common OP units, net

4,408

136,121

136,121

136,121

Issuance of restricted OP units

123

1

1

1

Issuance of OP Shares

188

4,876

4,876

4,876

1,500

Conversion from OP units to shares

(4,876)

Exercise of OP unit options

696

13,283

13,283

13,283

Amortization of restricted OP units

1,952

1,952

1,952

OP unit compensation expense

1,260

1,260

1,260

Adjustment for Operating Partnership interests of third parties

7,388

7,388

7,388

(7,388)

Net income (loss)

87,905

87,905

(470)

87,435

941

Other comprehensive income, net:

3,128

3,128

3,128

37

Preferred OP unit distributions

(5,045)

(5,045)

(5,045)

Preferred OP unit redemption

(3,100)

(77,574)

(77,574)

(77,574)

Common OP unit distributions

(161,240)

(161,240)

(161,240)

(1,935)

Balance at December 31, 2016

180,083

—

$
1,657,232

$
(1,850)

$
1,655,382

$
5,855

$
1,661,237

$
54,407

Contributions from noncontrolling interest in subsidiaries

1,058

1,058

Acquisition of noncontrolling interest in subsidiary

(8,626)

(8,626)

(407)

(9,033)

Issuance of common OP units, net

1,036

29,642

29,642

29,642

Issuance of restricted OP units

106

1

1

1

Issuance of OP Shares

12,324

Conversion from OP units to shares

594

15,706

15,706

15,706

(15,706)

Exercise of OP unit options

397

2,364

2,364

2,364

Amortization of restricted OP units

2,009

2,009

2,009

OP unit compensation expense

1,531

1,531

1,531

Adjustment for Operating Partnership interests of third parties

(3,965)

(3,965)

(3,965)

3,965

Net income (loss)

134,288

134,288

(270)

134,018

1,593

Other comprehensive income, net:

1,853

1,853

1,853

22

Common OP unit distributions

(201,051)

(201,051)

(201,051)

(2,285)

Balance at December 31, 2017

182,216

—

$
1,629,131

$
3

$
1,629,134

$
6,236

$
1,635,370

$
54,320


	For the year ended December 31,
	2021		2020		2019
Operating Activities
Net income	$	230,813	$	167,611	$	170,771
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		240,217		159,247		166,366
Non-cash portion of interest expense related to finance leases		202		—		—
Loss on early extinguishment of debt		20,328		18,020		—
Equity in earnings of real estate ventures		(25,275)		(178)		(11,122)
Gains from sales of real estate, net		(32,698)		(6,710)		(1,508)
Equity compensation expense		8,088		7,140		6,694
Accretion of fair market value adjustment of debt		(2,037)		(259)		(718)
Changes in other operating accounts:
Other assets		(9,247)		(9,674)		(6,578)
Accounts payable and accrued expenses		14,871		13,922		6,042
Other liabilities		3,923		1,914		1,821
Net cash provided by operating activities	$	449,185	$	351,033	$	331,768
Investing Activities
Acquisitions of storage properties		(151,547)		(417,988)		(117,998)
Acquisition of LAACO, Ltd., net of cash acquired		(1,678,984)		—		—
Additions and improvements to storage properties		(34,608)		(49,857)		(37,569)
Development costs		(69,887)		(55,286)		(102,826)
Cash paid for partner's interest in real estate venture, net of cash, cash equivalents and restricted cash acquired		—		—		(117,959)
Investment in real estate ventures		(28,261)		(7,022)		(10,264)
Cash distributed from real estate ventures		66,593		6,246		7,096
Proceeds from sale of real estate, net		44,026		12,466		3,856
Net cash used in investing activities	$	(1,852,668)	$	(511,441)	$	(375,664)
Financing Activities
Proceeds from:
Unsecured senior notes		1,043,427		445,833		696,426
Revolving credit facility		906,571		429,085		859,313
Principal payments on:
Unsecured senior notes		(300,000)		(250,000)		—
Revolving credit facility		(814,471)		(311,285)		(1,158,776)
Unsecured term loans		—		—		(200,000)
Mortgage loans and notes payable		(87,263)		(46,093)		(11,652)
Loan procurement costs		(12,548)		(3,764)		(6,023)
Debt prepayment costs		(20,023)		(17,584)		—
Settlement of hedge transactions		—		—		(807)
Acquisition of noncontrolling interest in subsidiary, net		(3,397)		—		(35,777)
Proceeds from issuance of common OP units		965,638		120,727		196,304
Cash paid upon vesting of restricted OP units		(876)		(686)		(421)
Exercise of OP unit options		7,865		961		3,686
Contributions from noncontrolling interests in subsidiaries		8,031		—		48
Distributions paid to noncontrolling interests in subsidiaries		(246)		(205)		(188)
Distributions paid to common OP unitholders		(282,136)		(258,793)		(246,278)
Net cash provided by financing activities	$	1,410,572	$	108,196	$	95,855
Change in cash, cash equivalents and restricted cash		7,089		(52,212)		51,959
Cash, cash equivalents and restricted cash at beginning of period		6,229		58,441		6,482
Cash, cash equivalents and restricted cash at end of period	$	13,318	$	6,229	$	58,441
Supplemental Cash Flow and Noncash Information
Cash paid for interest, net of interest capitalized	$	79,148	$	80,792	$	69,283
Supplemental disclosure of noncash activities:
Acquisitions of storage properties	$	—	$	(2,623)	$	—
Proceeds held in escrow from real estate venture's sale of real estate (see note 4)	$	—	$	—	$	8,288
Noncash consideration for acquisition of partner's interest in real estate venture (see note 4)	$	—	$	—	$	(8,288)
Right-of-use assets obtained in exchange for lease liabilities	$	—	$	61,423	$	—
Discount on issuance of unsecured senior notes	$	6,573	$	4,167	$	3,574
Noncash drawdown on revolving credit facility	$	—	$	—	$	103,938
Mortgage loan assumptions	$	40,880	$	169,056	$	—
Repayment of unsecured term loan through noncash drawdown on revolving credit facility	$	—	$	—	$	(100,000)
Accretion of put liability	$	9,777	$	7,917	$	5,895
Derivative valuation adjustment	$	81	$	81	$	302
Loan procurement costs	$	—	$	—	$	(3,770)
Issuance of OP units (see note 4)	$	—	$	186,933	$	3,576
Acquisition of noncontrolling interest in subsidiary	$	—	$	—	$	(4,828)
Contributions from noncontrolling interests in subsidiaries	$	3,373	$	682	$	7,328

See accompanying notes to the consolidated financial statements.

F-19

~~F-16~~

~~CUBESMART, L.P. AND SUBSIDIARIES~~

~~CONSOLIDATED STATEMENTS OF CASH FLOWS~~

~~(in thousands)~~

For the year ended December 31,

2017

2016

2015

Operating Activities

Net income

$
135,611

$
88,376

$
78,756

Adjustments to reconcile net income to cash provided by operating activities:

Depreciation and amortization

148,319

164,442

154,113

Equity in losses of real estate ventures

1,386

2,662

411

Gains from sale of real estate, net

—

—

(17,567)

Equity compensation expense

5,586

4,850

3,722

Accretion of fair market value adjustment of debt

(559)

(1,138)

(1,429)

Changes in other operating accounts:

Restricted cash

(60)

591

743

Other assets

(8,845)

(3,930)

(2,519)

Accounts payable and accrued expenses

10,846

7,862

(438)

Other liabilities

1,154

1,449

1,480

Net cash provided by operating activities

$
293,438

$
265,164

$
217,272

Investing Activities

Acquisitions of storage properties

(69,629)

(366,666)

(275,726)

Additions and improvements to storage properties

(28,962)

(30,971)

(24,695)

Development costs

(64,659)

(143,713)

(81,315)

Investment in real estate ventures, at equity

(301)

(12,176)

(8,433)

Cash distributed from real estate ventures

15,784

8,113

6,451

Proceeds from sale of real estate, net

—

—

9,041

Fundings of notes receivable

—

—

(4,100)

Proceeds from notes receivable

—

—

4,100

Change in restricted cash

(57)

942

69

Net cash used in investing activities

$
(147,824)

$
(544,471)

$
(374,608)

Financing Activities

Proceeds from:

Unsecured senior notes

103,192

298,512

249,338

Revolving credit facility

628,400

958,200

731,320

Principal payments on:

Revolving credit facility

(590,000)

(914,900)

(809,320)

Unsecured term loans

(100,000)

—

—

Mortgage loans and notes payable

(8,666)

(37,260)

(84,905)

Loan procurement costs

(953)

(2,467)

(4,433)

Acquisition of noncontrolling interest in subsidiary

(9,033)

—

—

Proceeds from issuance of common OP units

29,643

136,122

234,062

Cash paid upon vesting of restricted OP units

(2,046)

(1,638)

(1,567)

Redemption of preferred units

—

(77,574)

—

Exercise of OP unit options

2,364

13,283

17,489

Contributions from noncontrolling interests in subsidiaries

1,058

4,799

178

Distributions paid to noncontrolling interests in subsidiaries

—

—

(319)

Distributions paid to common OP unitholders

(197,278)

(151,121)

(108,531)

Distributions paid to preferred OP unitholders

—

(6,545)

(6,008)

Net cash (used in) provided by financing activities

$
(143,319)

$
219,411

$
217,304

Change in cash and cash equivalents

2,295

(59,896)

59,968

Cash and cash equivalents at beginning of year

2,973

62,869

2,901

Cash and cash equivalents at end of year

$
5,268

$
2,973

$
62,869

Supplemental Cash Flow and Noncash Information

Cash paid for interest, net of interest capitalized

$
63,407

$
53,085

$
46,216

Supplemental disclosure of noncash activities:

Restricted cash - acquisition of storage properties

$
—

$
(22,019)

$
(14,353)

Restricted cash - disposition of real estate

$
—

$
—

$
36,372

Accretion of liability

$
35,122

$
31,426

$
16,929

Derivative valuation adjustment

$
1,875

$
3,165

$
2,854

Foreign currency translation adjustment

$
—

$
—

$
(249)

Discount on issuance of unsecured senior notes

$
—

$
1,488

$
662

Mortgage loan assumptions

$
6,201

$
41,513

$
2,695

Preferred unit redemption

$
—

$
2,863

$
—

Issuance of OP units

$
12,324

$
—

$
—

Liability for acquisition of storage property

$
1,470

$
—

$
—

Contribution of storage property to real estate venture

$
9,400

$
—

$
—

~~See accompanying notes to the consolidated financial statements.~~

~~F-17~~

CUBESMART AND CUBESMART L.P.

~~NOTES~~

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. ORGANIZATION AND NATURE OF OPERATIONS

CubeSmart (the “Parent Company”) operates as a self-managed and self-administered real estate investment trust (“REIT”) with its operations conducted solely through CubeSmart, L.P. and its subsidiaries. CubeSmart, L.P., a Delaware limited partnership (the “Operating Partnership”), operates through an umbrella partnership structure, with the Parent Company, a Maryland REIT, as its sole general partner. In the notes to the consolidated financial statements, we use the terms the “Company”, “we”, or “our” to refer to the Parent Company and the Operating Partnership together, unless the context indicates otherwise. As of December 31, ~~2017,~~2021, the Company owned (or partially owned and consolidated) self-storage properties located in 23the District of Columbia and 24 states throughout the United States ~~and in the District of Columbia~~ which are presented under ~~one~~1 reportable segment: the Company owns, operates, develops, manages and acquires self-storage properties.

As of December 31, ~~2017,~~2021, the Parent Company owned approximately ~~99.0%~~99.2% of the partnership interests (“OP Units”) of the Operating Partnership. The remaining OP Units, consisting exclusively of limited partner interests, are held by persons who contributed their interests in properties to usthe Operating Partnership in exchange for OP Units. Under the partnership agreement, these persons have the right to tender their OP Units for redemption to the Operating Partnership at any time (except, as disclosed in note 4, in the case of the Class C OP Units issued on April 12, 2017, such right became exercisable on October 12, 2017 and, in the case of the 440,160 OP Units issued on May 9, 2017, such right may be exercised at any time on or after May 9, 2018)following a specified restricted period for cash equal to the fair value of an equivalent number of common shares of the Parent ~~Company or, in the case of Class C OP Units, the stated value of such Class C OP Units.~~Company. In lieu of delivering cash, however, the Parent Company, as the Operating Partnership’s general partner, may, at its option, choose to acquire any OP Units so tendered by issuing common shares in exchange for the tendered OP Units. If the Parent Company so chooses, its common shares will be exchanged for OP Units on a ~~one-for-one basis, or in the case of Class C OP Units, for common shares with a fair value equal to the stated value of such Class C OP Units.~~1-for-one basis. This ~~one-for-one~~1-for-one exchange ratio is subject to adjustment to prevent dilution. With each such exchange or redemption, the Parent Company’s percentage ownership in the Operating Partnership will increase. In addition, whenever the Parent Company issues common or other classes of its shares, it contributes the net proceeds it receives from the issuance to the Operating Partnership and the Operating Partnership issues to the Parent Company an equal number of OP Units or other partnership interests having preferences and rights that mirror the preferences and rights of the shares issued. This structure is commonly referred to as an umbrella partnership REIT or “UPREIT”.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation

The accompanying consolidated financial statements include all of the accounts of the Company and its majority-owned and/or controlled subsidiaries. The portion of these entities not owned by the Company is presented as noncontrolling interests as of and during the periods consolidated. All significant intercompany accounts and transactions have been eliminated in consolidation.

When the Company obtains an economic interest in an entity, the Company evaluates the entity to determine if the entity is deemed a variable interest entity (“VIE”), and if the Company is deemed to be the primary beneficiary in accordance with authoritative guidance issued on the consolidation of VIEs. To the extent that the Company (i) has the power to direct the activities of the VIE that most significantly impact the economic performance of the VIE and (ii) has the obligation or rights to absorb the VIE's losses or receive its benefits, then the Company is considered the primary beneficiary. When an entity is not deemed to be a VIE, the Company considers the provisions of additional guidance to determine whether a general partner, or the general partners as a group, controls a limited partnership or similar entity when the limited partners have certain rights. The Company consolidates (i) entities that are VIEs and of which the Company is deemed to be the primary beneficiary, and (ii) entities that are non-VIEs which the Company controls and which the limited partners do not have the ability to dissolve or remove the Company without cause nor substantive participating rights.

The Company adopted Accounting Standard Update (“ASU”) No. 2015-02, Consolidation – Amendments to the Consolidation Analysis, as of January 1, 2016. The Company evaluated the application of this guidance and concluded that there were no changes to any previous conclusions with respect to consolidation accounting for any of its interests in less than wholly owned joint ventures. However, the Operating Partnership ~~now~~ meets the criteria as a VIE. The Parent Company’s sole significant asset is its investment in the Operating Partnership. As a result, substantially all of the Parent Company’s assets and liabilities represent those assets and liabilities of the Operating Partnership. All of the Parent Company’s debt is an obligation of the Operating Partnership.

Noncontrolling Interests

The Financial Accounting Standards Board (“FASB”) issued authoritative guidance regarding noncontrolling interests in consolidated financial statements which was effective on January 1, 2009. The guidance states that noncontrolling interests are the portion of equity

~~F-18~~

~~(net~~ (net assets) in a subsidiary not attributable, directly or indirectly, to a parent. The ownership interests in the subsidiary that are held by owners other than the parent are noncontrolling interests. Under the guidance, such noncontrolling interests are reported on the consolidated balance sheets within equity, separately from the Company’s equity. On the consolidated statements of operations, revenues, expenses and net income or loss from controlled or consolidated entities that are less than wholly owned are reported at the consolidated

F-20

amounts, including both the amounts attributable to the Company and noncontrolling interests. Presentation of consolidated equity activity is included for both quarterly and annual financial statements, including beginning balances, activity for the period and ending balances for shareholders’ equity, noncontrolling interests and total equity.

However, per the FASB issued authoritative guidance on the classification and measurement of redeemable securities, securities that are redeemable for cash or other assets at the option of the holder, not solely within the control of the issuer, must be classified outside of permanent equity. This would result in certain outside ownership interests being included as redeemable noncontrolling interests outside of permanent equity in the consolidated balance sheets. The Company makes this determination based on terms in applicable agreements, specifically in relation to redemption provisions. Additionally, with respect to noncontrolling interests for which the Company has a choice to settle the contract by delivery of its own shares, the Company considered the FASB issued guidance on accounting for derivative financial instruments indexed to, and potentially settled in, a Company’s own stock to evaluate whether the Company controls the actions or events necessary to issue the maximum number of shares that could be required to be delivered under share settlement of the contract. The guidance also requires that noncontrolling interests are adjusted each period so that the carrying value equals the greater of its carrying value based on the accumulation of historical cost or its redemption fair value.

The consolidated results of the Company include results attributable to units of the Operating Partnership that are not owned by the Company. These interests were issued in the form of OP units and were a component of the consideration the Company paid to acquire certain self-storage properties. Limited partners who acquired OP units have the right to require the Operating Partnership to redeem part or all of their OP units for, at the Company’s option, an equivalent number of common shares of the Company or cash based upon the fair value of an equivalent number of common shares of the Company. However, the operating agreement contains certain circumstances that could result in a net cash settlement outside the control of the Company, as the Company does not have the ability to settle in unregistered shares. Accordingly, consistent with the guidance discussed above, the Company will continue to record these noncontrolling interests outside of permanent equity in the consolidated balance sheets. Net income or loss related to these noncontrolling interests is excluded from net income or loss in the consolidated statements of operations. The Company has adjusted the carrying value of its noncontrolling interests subject to redemption value to the extent applicable. Based on the Company’s evaluation of the redemption value of the redeemable noncontrolling interests, the Operating Partnership reflected these interests at their redemption value as of December 31, ~~2017,~~2021, as the estimated redemption value exceeded their carrying value. The Operating Partnership recorded an increase to OP Units owned by third parties and a corresponding decrease to capital of ~~$4.0~~$164.1 million as of December 31, ~~2017.~~2021. Disclosure of such redemption provisions is provided in note 12.

Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Although ~~we believe~~management believes the assumptions and estimates we made are reasonable and appropriate, as discussed in the applicable sections throughout these consolidated financial statements, different assumptions and estimates could materially impact ~~our~~the Company’s reported results. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions, and changes in market conditions could impact ~~our~~the Company’s future operating results.

Self-Storage Properties

Self-storage properties are carried at historical cost less accumulated depreciation and impairment losses. The cost of self-storage properties reflects their purchase price or development cost. Acquisition costs are accounted for in accordance with Accounting Standard Update (“ASU”) No. 2017-01 - Business Combinations (Topic 805): Clarifying the Definition of a Business, which was adopted on January 1, 2018, and are generally capitalized. Costs incurred for the renovation of a store are capitalized to the Company’s investment in that store. ~~Acquisition costs and ordinary~~Ordinary repairs and maintenance are expensed as ~~incurred; major~~incurred. Major replacements and betterments, which improve or extend the life of the asset, are capitalized and depreciated over their estimated useful lives. The costs to develop self-storage properties are capitalized to construction in progress while the ~~project is~~projects are under development.

Purchase Price Allocation

When stores are acquired, the purchase price is allocated to the tangible and intangible assets acquired and liabilities assumed based on estimated fair values. When a portfolio of stores is acquired, the purchase price is allocated to the individual stores based upon the fair value determined using an income approach or a cash flow analysis using appropriate risk adjusted capitalization rates, which take into

~~F-19~~

~~account the relative size, age and location of the individual store along with current and projected occupancy and rental rate levels or appraised values, if available.~~ Allocations to land, building and improvements and equipment are recorded based upon their respective fair values as estimated by management.

~~In allocating~~ If appropriate, the ~~purchase price for an acquisition, the Company determines whether the acquisition includes intangible assets or liabilities. The~~ Company allocates a portion of the purchase price to an intangible asset attributed to the value of in-place leases. This intangible is generally amortized to expense over the expected remaining term of the respective

F-21

leases. Substantially all of the storage leases in place at acquired stores are at market rates, as the majority of the leases are month-to-month contracts. Accordingly, to date, no0 portion of the purchase price has been allocated to above- or below-market lease ~~intangibles.~~intangibles associated with storage leases assumed at acquisition. Above- or below- market lease intangibles associated with assumed leases in which the Company serves as lessee are recorded as an adjustment to the right-of-use asset and reflect the difference between the contractual amounts to be paid pursuant to each in-place lease and management’s estimate of fair market lease rates. These amounts are amortized over the term of the lease. To date, no intangible asset has been recorded for the value of customer relationships, because the Company does not have any concentrations of significant customers and the average customer turnover is fairly frequent.

Depreciation and Amortization

The costs of self-storage properties and improvements are depreciated using the straight-line method based on useful lives ranging from five to 39 years. Right-of-use assets associated with finance leases are amortized from the lease commencement date to the earlier of the useful life of the right-to-use asset or the end of the lease term.Fully depreciated or amortized assets and the associated accumulated depreciation or amortization are written off. The Company wrote off fully depreciated or amortized real estate assets and in-place lease intangible assets of $52.7 million and $59.9 million, respectively, for the year ended December 31, 2021, and $83.4 million and $20.5 million, respectively, for the year ended December 31, 2020.

Impairment of Long-Lived Assets

We evaluate long-lived assets for impairment when events and circumstances such as declines in occupancy and operating results indicate that there may be an impairment. The carrying value of these long-lived assets is compared to the undiscounted future net operating cash flows, plus a terminal value, attributable to the assets to determine if the store’s basis is recoverable. If a store’s basis is not considered recoverable, an impairment loss is recorded to the extent the net carrying value of the asset exceeds the fair value. The impairment loss recognized equals the excess of net carrying value over the related fair value of the asset. There were 0 impairment losses recognized during the years ended December 31, 2021, 2020 and 2019.

Long-Lived Assets Held for Sale

We consider long-lived assets to be “held for sale” upon satisfaction of the following criteria: (a) management commits to a plan to sell a store (or group of stores), (b) the store is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such stores, (c) an active program to locate a buyer and other actions required to complete the plan to sell the store have been initiated, (d) the sale of the store is probable and transfer of the asset is expected to be completed within one year, (e) the store is being actively marketed for sale at a price that is reasonable in relation to its current fair value and (f) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

Typically these criteria are all met when the relevant asset is under contract, significant non-refundable deposits have been made by the potential buyer, the assets are immediately available for transfer, and there are no contingencies related to the sale that may prevent the transaction from closing. However, each potential transaction is evaluated based on its separate facts and circumstances. Stores classified as held for sale are reported at the lesser of carrying value or fair value less estimated costs to ~~sell.~~sell and are not depreciated. The Club Operations (defined below) acquired through our acquisition of LAACO (defined below) have been classified as held for sale as of December 31, 2021. There were no stores classified as held for sale as of December 31, 2021.

Cash and Cash Equivalents

Cash and cash equivalents are highly-liquid investments with original maturities of three months or less. The Company may maintain cash equivalents in financial institutions in excess of insured limits, but believes this risk is mitigated by only investing in or through major financial institutions.

Restricted Cash

Restricted cash generally consists of ~~purchase deposits and~~ cash deposits required for debt service, ~~requirements,~~ capital replacement and expense reserves in connection with the ~~requirements~~terms of our loan agreements.

Loan Procurement Costs

Loan procurement costs related to borrowings were ~~$21.4~~$50.1 million and ~~$24.7~~$38.1 million as of December 31, ~~2017~~2021 and ~~2016,~~2020, respectively, and are reported net of accumulated amortization of ~~$11.1~~$14.3 million and ~~$9.7~~$13.1 million as of December 31, ~~2017~~2021 and ~~2016,~~2020, respectively. In

F-22

accordance with ASU No. 2015-03, Loan procurement costs, net are presented as a direct deduction from the carrying amount of the related debt liability. If there is not an associated debt liability recorded on the consolidated balance sheets, the costs are recorded as an asset net of accumulated amortization. Loan procurement costs associated with the Company’s revolving credit facility remain in Loan

~~F-20~~

procurement costs, net of amortization on the Company’s consolidated balance sheets. The costs are amortized over the estimated life of the related debt using the effective interest method and are reported as Loan procurement amortization expense on the Company’s consolidated statements of operations.

Other Assets

Other assets are comprised of the following as of December 31, ~~2017~~2021 and ~~2016 (in thousands):~~2020:


	December 31,
	2021		2020

	(in thousands)
Intangible assets, net of accumulated amortization of $12,760 and $2,123	$	108,794	$	57,820
Accounts receivable, net		8,145		5,829
Prepaid property taxes		6,938		6,334
Prepaid property and casualty insurance		3,352		2,626
Amounts due from affiliates (see note 14)		15,417		13,130
Assets related to deferred compensation arrangements		60,297		17,207
Right-of-use assets - operating leases (see note 13)		54,741		55,302
Equity investment recorded at cost ⁽¹⁾		—		5,000
Other		8,021		7,505
Total other assets, net	$	265,705	$	170,753

(1)

On September 5, 2018, the Company invested $5.0 million in exchange for 100% of the Class A preferred units of Capital Storage Partners, LLC (“Capital Storage”), a then newly formed venture that acquired 22 self-storage properties located in Florida (4), Oklahoma (5) and Texas (13). The Class A preferred units earned an 11% cumulative dividend prior to any other distributions. On August 24, 2021, the Class A preferred units and all accrued and unpaid dividends were redeemed and paid, respectively. Prior to this redemption, the Company’s investment in Capital Storage and the related dividends were included in Other assets, net on the Company’s consolidated balance sheets and in Other income on the Company’s consolidated statements of operations, respectively. The Company no longer has an ownership interest in Capital Storage.

December 31,

2017

2016

Intangible assets, net of accumulated amortization of $1,532 and $8,109

$
1,716

$
8,280

Accounts receivable

5,498

4,434

Deposits on future acquisitions

1,000

5,106

Prepaid real estate taxes

3,960

3,640

Prepaid insurance

2,105

1,053

Amounts due from affiliates (see note 13)

7,480

3,349

Assets held in trust related to deferred compensation arrangements

9,393

6,748

Other

3,438

3,904

Total other assets, net

$
34,590

$
36,514

Environmental Costs

Our practice is to conduct or obtain environmental assessments in connection with the acquisition or development of additional stores. Whenever the environmental assessment for one of ~~our~~the Company’s stores indicates that a store is impacted by soil or groundwater contamination from prior owners/operators or other sources, wethe Company will work with ~~our~~ environmental consultants and where appropriate, state governmental agencies, to ensure that the store is either cleaned up, that no cleanup is necessary because the low level of contamination poses no significant risk to public health or the environment or that the responsibility for cleanup rests with a third party.

Revenue Recognition

Management has determined that all of ~~our~~the Company’s leases are operating leases. Rental income is recognized in accordance with the terms of the leases, which generally are ~~month to month. Property management fee income is recognized monthly as services are performed and in accordance with the terms of the related management agreements.~~month-to-month.

The Company recognizes gains from ~~disposition~~sale of ~~stores only upon closing~~real estate in accordance with the guidance on ~~sales~~transfer of ~~real estate.~~nonfinancial assets. Payments received from purchasers prior to closing are recorded as deposits. Profit on real estate sold is recognized ~~using the full accrual method upon closing~~ when a valid contract exists, the collectability of the sales price is reasonably assured and the ~~Company is not obligated to perform significant activities after~~control of the ~~sale. Profit may be deferred in whole or part until the sale meets the requirements of profit recognition on sales under this guidance.~~property has transferred.

Advertising and Marketing Costs

The Company incurs advertising and marketing costs primarily attributable to internet marketing ~~campaigns~~ and other media advertisements. These costs are expensed as incurred. The Company incurred ~~$9.7~~$21.0 million, ~~$9.4~~$16.9 million and ~~$8.6~~$11.5 million in advertising and marketing expenses for the years ended December 31, ~~2017, 2016~~2021, 2020 and ~~2015,~~2019, respectively, which are included in Property operating expenses on the Company’s consolidated statements of operations.

F-23

Equity Offering Costs

Underwriting discounts and commissions, financial advisory fees and other offering costs are reflected as a reduction to additional paid-in capital. For the years ended December 31, ~~2017, 2016~~2021, 2020 and ~~2015,~~2019, the Company recognized ~~$0.6~~$28.3 million, ~~$1.6~~$1.5 million and ~~$2.5~~$2.1 million, respectively, of equity offering costs related to the issuance of common shares.

~~F-21~~

Other Property Related Income

Other property related income consists of late fees, administrative charges, customer ~~insurance~~storage protection plan fees, sales of storage supplies and other ancillary revenues and is recognized in the period that it is earned.

Capitalized Interest

The Company capitalizes interest incurred that is directly associated with construction activities until the asset is placed into service. Interest is capitalized to the related ~~assets~~asset(s) using ~~a weighted-average~~the weighted average rate of the Company’s outstanding debt. For the years ended December 31, ~~2017, 2016~~2021, 2020 and ~~2015,~~2019, the Company capitalized ~~$5.6~~$1.9 million, ~~$4.6~~$2.7 million and ~~$2.6~~$3.0 million, respectively, of interest incurred that is directly associated with construction activities.

Derivative Financial Instruments

The Company carries all derivatives on the balance sheet at fair value. The Company determines the fair value of derivatives by observable prices that are based on inputs not quoted on active markets, but corroborated by market data. The accounting for changes in the fair value of a derivative instrument depends on whether the derivative has been designated and qualifies as part of a hedging relationship and, if so, the reason for holding it. The Company’s use of derivative instruments has been limited to cash flow hedges of certain interest rate risks. The Company had ~~interest rate swap agreements for notional principal amounts aggregating $100.0 million and $300.0 million~~0 outstanding derivatives as of December 31, ~~2017 and 2016, respectively, the fair value of which are included in Accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets.~~2021 or 2020.

Income Taxes

The Company has elected to be taxed as a ~~real estate investment trust~~REIT under Sections 856-860 of the Internal Revenue Code since the Company’s commencement of operations in 2004. In management’s opinion, the requirements to maintain these elections are being met. Accordingly, no provision for federal income taxes has been reflected in the consolidated financial statements other than for operations conducted through our taxable REIT subsidiaries.

Earnings and profits, which determine the taxability of distributions to shareholders, differ from net income reported for financial reporting purposes due to differences in cost basis, the estimated useful lives used to compute depreciation, and the allocation of net income and loss for financial versus tax reporting purposes. The net tax basis in the Company’s assets was ~~$3.4 billion~~approximately $6,113.5 million and ~~$3.2 billion~~$4,384.1 million as of December 31, ~~2017~~2021 and ~~2016,~~2020, respectively.

Since the Company’s initial quarter as a publicly-traded REIT, it has made regular quarterly distributions to its shareholders. Distributions to shareholders are usually taxable as ordinary income, although a portion of the distribution may be designated as capital gain or may constitute a tax-free return of capital. Annually, the Company provides each of its shareholders a statement detailing the tax characterization of dividends paid during the preceding year as ordinary income, capital gain or return of capital. The characterization of the Company’s dividends for ~~2017~~2021 consisted of ~~an 86.602%~~a 92.6365% ordinary income distribution and a ~~0.495%~~7.3635% capital gain ~~distribution, and a 12.903% return of capital distribution from earnings and profits.~~distribution.

The Company is subject to a 4% federal excise tax if sufficient taxable income is not distributed within prescribed time limits. The excise tax equals 4% of the annual amount, if any, by which the sum of (a) 85% of the Company’s ordinary income, (b) 95% of the Company’s net capital gains and (c) 100% of prior taxable income exceeds cash distributions and certain taxes paid by the Company. NoNaN excise tax was incurred in ~~2017, 2016,~~2021, 2020 or ~~2015.~~2019.

Taxable REIT subsidiaries are subject to federal and state income taxes. Our taxable REIT subsidiaries had a net deferred tax ~~asset related to expenses which are deductible for tax purposes in future periods~~liability of ~~$1.4 million and $1.3~~$0.7 million as of December 31, ~~2017~~2021 and ~~2016, respectively.~~

~~Legislation commonly known~~a net deferred tax asset of $0.4 million as ~~the Tax Cuts and Jobs Act (“TCJA”) was signed into law on December 22, 2017. The TCJA makes significant changes to the U.S. federal income tax rules for taxation~~ of ~~individuals and corporations (including REITs), generally effective for taxable years beginning after~~ December 31, ~~2017.~~2020.

Earnings per Share and Unit

Basic earnings per share and unit are calculated based on the weighted average number of common shares and restricted shares outstanding during the period. Diluted earnings per share and unit is calculated by further adjusting for the dilutive impact of share

~~F-22~~

options, unvested restricted shares and contingently issuable shares outstanding during the period using the treasury stock method.

F-24

Potentially dilutive securities calculated under the treasury stock method were ~~923,000; 1,287,000,~~1,176,000, 796,000 and ~~1,551,000 in 2017, 2016,~~702,000 for the years ended December 31, 2021, 2020 and ~~2015,~~2019, respectively.

Share-Based Payments

We apply the fair value method of accounting for contingently issued shares and share options issued under our incentive award plan. Accordingly, share compensation expense is recorded ratably over the vesting period relating to such contingently issued shares and options. The Company has recognized compensation expense on a straight-line method over the requisite service period, which is included in general and administrative expense on the Company’s consolidated statement of operations.

~~Foreign Currency~~

The financial statements of foreign subsidiaries are translated to U.S. Dollars using the period-end exchange rate for assets and liabilities and an average exchange rate for each period for revenues, expenses, and capital expenditures. The local currency is the functional currency for the Company’s foreign subsidiaries. Translation adjustments for foreign subsidiaries are recorded as a component of accumulated other comprehensive loss in shareholders’ equity. The Company recognizes ~~transaction gains and losses arising from fluctuations in currency exchange rates~~forfeitures on ~~transactions denominated in currencies other than the functional currency in earnings~~share-based payments as incurred. The Pound, which represents the functional currency used by USIFB, LLP (“USIFB”), our joint venture in England, was translated at October 2, 2015, the date that the venture’s remaining asset was sold. The exchange rate was approximately 1.521600 U.S Dollars per Pound on October 2, 2015. The Pound was translated at an average exchange rate of 1.529755 for the period from January 1, 2015 to October 2, 2015. In connection with the sale of the remaining asset, the Company recorded a realized loss on foreign currency exchange of $1.2 million, which is included in Gains from sale of real estate, net on the Company’s consolidated statements of operations.they occur.

Investments in Unconsolidated Real Estate Ventures

The Company accounts for its investments in unconsolidated real estate ventures under the equity method of ~~accounting.~~accounting when it is determined that the Company has the ability to exercise significant influence over the venture. Under the equity method, investments in unconsolidated ~~joint~~real estate ventures are recorded initially at cost, as investments in real estate ventures, and subsequently adjusted for equity in earnings (losses), cash contributions, less ~~distributions.~~distributions and impairments. On a periodic basis, management ~~also~~ assesses whether there are any indicators that the value of the Company’s investments in unconsolidated real estate ventures may be other than temporarily impaired. An investment is impaired only if the fair value of the investment, as estimated by management, is less than the carrying value of the investment and the decline is other than temporary. To the extent impairment that is other than temporary has occurred, the loss shall be measured as the excess of the carrying amount of the investment over the fair value of the investment, as estimated by management.

~~Reclassifications~~

~~During~~The determination as to whether impairment exists requires significant management judgment about the ~~first quarter~~fair value of ~~2017,~~ the ~~Company adopted ASU No. 2016-09 – Compensation – Stock Compensation (Topic 718): Improvements~~Company’s ownership interest. Fair value is determined through various valuation techniques, including but not limited to, ~~Employee Share-Based Payment Accounting, which requires retrospective application for the~~discounted cash flow ~~presentation~~models, quoted market values and third-party appraisals. There were 0 impairment losses related to the Company’s investments in unconsolidated real estate ventures recognized during the years ended December 31, 2021 and 2020.

Differences between the Company's net investment in unconsolidated real estate ventures and its underlying equity in the net assets of ~~cash withheld upon restricted stock vesting and paid by~~ the ~~Company to a taxing authority to satisfy the employee’s related tax obligation. See~~ ~~“Recent Accounting Pronouncements”~~ ~~below. As~~ventures are primarily a result of ~~adopting~~ the ~~new guidance, $1.6 million~~Company acquiring interests in existing unconsolidated real estate ventures. As of ~~vested restricted shares that~~December 31, 2021, the Company’s net investment in unconsolidated real estate ventures was greater than its underlying equity in the net assets of the unconsolidated real estate ventures by an aggregate of $33.6 million. There were ~~withheld to satisfy employee tax obligations and paid to~~no such differences as of December 31, 2020. These differences are amortized over the ~~taxing authorities, were reclassified from operating activities to financing activities within~~lives of the self-storage properties owned by the real estate ventures. This amortization is included in equity in earnings of real estate ventures on the Company’s consolidated statements of ~~cash flows for each of the years ended December 31, 2016 and 2015.~~operations.

Recent Accounting Pronouncements

In August ~~2017,~~2020, the FASB issued ASU No. ~~2017-12~~2020-06 – Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging ~~(Topic 815): Targeted Improvements to Accounting~~– Contracts in an Entity’s Own Equity (Subtopic 815-40). The new guidance eliminates the beneficial conversion and cash conversion accounting models for ~~Hedging Activities. The purpose~~convertible instruments. It also amends the accounting for certain contracts in an entity’s own equity that are currently accounted for as derivatives because of this updated guidance is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. The transition guidance provides companies with the option of early adopting the new standard using a modified retrospective transition method in any interim period after issuance of the update, or alternatively requires adoption for fiscal years beginning after December 15, 2018. This adoption method will require the Company to recognize the cumulative effect of initially applyingcertain settlement provisions. In addition, the new guidance ~~as an adjustment to accumulated other comprehensive income with a corresponding adjustment to~~modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the ~~opening balance of retained~~diluted earnings ~~as of the beginning of the fiscal year that the Company adopts the update.~~per share computation. The ~~Company is in the process of evaluating the impact of this new guidance.~~

~~In February 2017, as part of the new revenue~~ standard the FASB issued ASU No. 2017-05 – Other Income – Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance, which focuses on recognizing gains and losses from the transfer of nonfinancial assets in contracts with non-customers. Specifically, the new guidance

~~F-23~~

defines “in substance nonfinancial asset”, unifies guidance related to partial sales of nonfinancial assets, eliminates rules specifically addressing sales of real estate, removes exceptions to the financial asset derecognition model, and clarifies the accounting for contributions of nonfinancial assets to joint ventures. The new guidance becamewas effective on January 1, 2018 when the entity adopted the new revenue standard. Upon adoption, the majority of its sale transactions are now treated as dispositions of nonfinancial assets rather than dispositions of a business given the FASB’s recently revised definition of a business (see ASU No. 2017-01 below). Additionally, in partial sale transactions where the Company sells a controlling interest in real estate but retains a noncontrolling interest, the Company will now fully recognize a gain or loss on the fair value measurement of the retained interest as the new guidance eliminates the partial profit recognition model.

In November 2016, the FASB issued ASU No. 2016-18 - Statement of Cash Flows (Topic 230): Restricted Cash, which requires the statement of cash flows to explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. The new guidance also requires entities to reconcile such total to amounts on the balance sheet and disclose the nature of the restrictions. The standard became effective on January 1, 2018. The standard requires the use of the retrospective transition method.2022. The adoption of this guidance will not have a material impact on the Company’s consolidated financial ~~statements as the update primarily relates to financial statement presentation and disclosures.~~statements.

In August 2016, the FASB issued ASU No. 2016-15 – Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. The eight items that the ASU provides classification guidance on include (1) debt prepayment and extinguishment costs, (2) settlement of zero-coupon debt instruments, (3) contingent consideration payments made after a business combination, (4) proceeds from the settlement of insurance claims, (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, (6) distributions received from equity method investments, (7) beneficial interests in securitization transactions, and (8) separately identifiable cash flows and application of the predominance principle. The standard became effective on January 1, 2018. The standard requires the use of the retrospective transition method. The adoption of this guidance will not have a material impact on the Company’s consolidated financial statements as the update primarily relates to financial statement presentation and disclosures.

In March 2016, the FASB issued ASU No. 2016-09 - Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, which is intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. The new guidance requires entities to make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. The Company has elected to account for forfeitures when they occur. In addition, the guidance allows employers to withhold shares to satisfy minimum statutory tax withholding requirements up to the employees’ maximum individual tax rate without causing the award to be classified as a liability. The guidance also stipulates that cash paid by an employer to a taxing authority when directly withholding shares for tax-withholding purposes should be classified as a financing activity on the statement of cash flows. The new standard became effective for the Company on January 1, 2017. The adoption of this guidance did not have a material impact on the Company’s consolidated financial position or results of operations.

In February 2016, the FASB issued ASU No. 2016-02 - Leases (Topic 842), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e. lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either financing or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. The standard is effective on January 1, 2019, however early adoption is permitted. The Company is currently assessing the impact of the adoption of the new standard on the Company’s consolidated financial statements and related disclosures but at this time, it expects the primary impact to be related to its ten ground leases in which it serves as the ground lessee (see note 14).

~~F-24~~

In May 2014, the FASB issued ASU No. 2014-09 - Revenue from Contracts with Customers (Topic 606), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The new guidance outlines a five-step process for customer contract revenue recognition that focuses on transfer of control as opposed to transfer of risk and rewards. The new guidance also requires enhanced disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows from contracts with customers. In May 2016, the FASB issued ASU 2016-12 - Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients, which amends ASU 2014-09 and is intended to address implementation issues that were raised by stakeholders. ASU 2016-12 provides practical expedients on collectability, noncash consideration, presentation of sales tax and contract modifications and completed contracts in transition. Both standards became effective on January 1, 2018. The Company finalized the impact of the adoption of ASU No. 2014-09 and ASU No. 2016-12 on the Company’s consolidated financial statements and related disclosures and adopted the standards using the modified retrospective transition method. The standards will not have a material impact on the Company’s consolidated statements of financial position or results of operations primarily because most of its revenue is derived from lease contracts, which are excluded from the scope of the new guidance. The Company’s insurance fee revenue, property management fee revenue, and merchandise sale revenue are included in the scope of the new guidance, however, the Company identified similar performance obligations under this standard as compared with deliverables and separate units of account identified under its previous revenue recognition methodology. Accordingly, revenue recognized under the new guidance will not differ materially from revenue recognized under previous guidance and there will be no material prior year impact.

Concentration of Credit Risk

The Company’s stores are located in major metropolitan and rural areas and have numerous customers per store. No single customer represents a significant concentration of our revenues. The stores in ~~Florida,~~ New York, Florida, Texas and California provided ~~total revenues of~~ approximately ~~17%~~19%, ~~16%~~15%, ~~10%,~~9% and 8%, respectively, ~~for each~~ of the ~~years ended December 31, 2017 and 2016. The stores in Florida, New York, Texas, and California provided~~Company’s total revenues ~~of approximately 18%, 16%, 10%, and 8%, respectively,~~ for the year ended December 31, ~~2015.~~2021. The stores in New York, Florida, Texas and California provided approximately 16%, 15%, 9% and 8%, respectively, of the Company’s total revenues for the year ended December 31, 2020. The stores in New York, Florida, Texas and California provided approximately 16%, 16%, 10% and 8%, respectively, of the Company’s total revenues for the year ended December 31, 2019.

F-25

3. STORAGE PROPERTIES

The book value of the Company’s real estate assets is summarized as follows:


					December 31,
					2021		2020

	December 31,		December 31,
	2017		2016
	(in thousands)
					(in thousands)
Land	$	711,140	$	649,744	$	1,565,463	$	1,093,503
Buildings and improvements		3,086,252		2,928,275		5,368,383		4,122,995
Equipment		182,958		217,867		129,531		123,044
Construction in progress		181,365		202,294		78,221		108,316
Right-of-use assets - finance leases						41,896		41,896
Storage properties		4,161,715		3,998,180		7,183,494		5,489,754
Less: Accumulated depreciation		(752,925)		(671,364)		(1,085,824)		(983,940)
Storage properties, net	$	3,408,790	$	3,326,816	$	6,097,670	$	4,505,814

~~F-25~~F-26

The following table summarizes the Company’s acquisition and disposition activity for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015:~~2019:


			Number of	Purchase / Sale Price

								Number of	Purchase / Sale Price
Asset/Portfolio	Market	Transaction Date	Stores	(in thousands)		Metropolitan Statistical Area	Transaction Date	Stores	(in thousands)

2017 Acquisitions:


2021 Acquisitions:

Minnesota Asset ⁽¹⁾						Minneapolis-St. Paul-Bloomington, MN-WI	April 2021	1	$	12,000
Maryland Asset						Baltimore-Towson, MD	June 2021	1		22,075
New Jersey/Pennsylvania Assets						Philadelphia-Camden-Wilmington, PA-NJ-DE-MD	July 2021	2		33,000
Florida Asset						Miami-Fort Lauderdale-Pompano Beach, FL	November 2021	1		14,750
Georgia Asset						Atlanta-Sandy Springs-Marietta, GA	November 2021	1		15,200
Pennsylvania Asset						Philadelphia-Camden-Wilmington, PA-NJ-DE-MD	November 2021	1		24,500
Nevada Asset						Las Vegas-Paradise, NV	December 2021	1		21,000
Storage West Assets						Various (see note 4)	December 2021	57		1,648,426	⁽²⁾
Illinois Asset	Chicago	April 2017	1	$	11,200	Chicago-Naperville-Joliet, IL-IN-WI	December 2021	1		10,300
								66	$	1,801,251

2021 Dispositions:

Colorado/Nevada Assets						Denver-Aurora, CO / Las Vegas-Paradise, NV	September 2021	2	$	16,900
North Carolina Assets						Burlington, NC	September 2021	2		21,700
Texas Asset						Houston-Sugar Land-Baytown, TX	November 2021	1		5,200
								5	$	43,800

2020 Acquisitions:

Texas Asset						San Antonio, TX	February 2020	1	$	9,025
Maryland Asset	Baltimore / DC	May 2017	1		18,200	Baltimore-Towson, MD	April 2020	1		17,200
California Asset	Sacramento	May 2017	1		3,650
Texas Asset	Texas Markets - Major	October 2017	1		4,050
New Jersey Asset						New York-Northern New Jersey-Long Island, NY-NJ-PA	April 2020	1		48,450
Florida Asset	Florida Markets - Other	October 2017	1		14,500	Palm Bay-Melbourne-Titusville, FL	November 2020	1		3,900
Illinois Asset	Chicago	November 2017	1		11,300
Florida Asset	Florida Markets - Other	December 2017	1		17,750
			7	$	80,650

2016 Acquisitions:

Metro DC Asset	Baltimore / DC	January 2016	1	$	21,000
Texas Assets	Texas Markets - Major	January 2016	2		24,800
New York Asset	New York / Northern NJ	January 2016	1		48,500
Texas Asset	Texas Markets - Major	January 2016	1		11,600
Connecticut Asset	Connecticut	February 2016	1		19,000
Texas Asset	Texas Markets - Major	March 2016	1		11,600
Florida Assets	Florida Markets - Other	March 2016	3		47,925
Colorado Asset	Denver	April 2016	1		11,350
Texas Asset	Texas Markets - Major	April 2016	1		11,600
Texas Asset	Texas Markets - Major	May 2016	1		10,100
Texas Asset	Texas Markets - Major	May 2016	1		10,800
Illinois Asset	Chicago	May 2016	1		12,350
Illinois Asset	Chicago	May 2016	1		16,000
Massachusetts Asset	Massachusetts	June 2016	1		14,300
Nevada Assets	Las Vegas	July 2016	2		23,200
Arizona Asset	Phoenix	August 2016	1		14,525
Minnesota Asset	Minneapolis	August 2016	1		15,150
Colorado Asset	Denver	August 2016	1		15,600
Texas Asset	Texas Markets - Major	September 2016	1		6,100	Austin-Round Rock, TX	November 2020	1		10,750
Texas Asset	Texas Markets - Major	September 2016	1		5,300	Dallas-Fort Worth-Arlington, TX	November 2020	1		10,150
Nevada Asset	Las Vegas	October 2016	1		13,250	Las Vegas-Paradise, NV	December 2020	1		16,800
North Carolina Asset	Charlotte	November 2016	1		10,600
New York Asset						New York-Northern New Jersey-Long Island, NY-NJ-PA	December 2020	1		6,750
Florida Asset						Tampa-St. Petersburg-Clearwater, FL	December 2020	1		10,000
Virginia Asset						Washington-Arlington-Alexandria, DC-VA-MD-WV	December 2020	1		17,350
Storage Deluxe Assets						New York-Northern New Jersey-Long Island, NY-NJ-PA	December 2020	8		540,000
Florida Assets						Orlando-Kissimmee, FL / Deltona-Daytona Beach-Ormond Beach, FL	December 2020	3		45,500
								21	$	735,875

2020 Disposition:

New York Asset						New York-Northern New Jersey-Long Island, NY-NJ-PA	December 2020	1	$	12,750
								1	$	12,750
2019 Acquisitions:

Maryland Asset						Baltimore-Towson, MD	March 2019	1	$	22,000
Florida Assets						Cape Coral-Fort Myers, FL	April 2019	2		19,000
Arizona Asset	Phoenix	November 2016	1		14,000	Phoenix-Mesa-Scottsdale, AZ	May 2019	1		1,550
Nevada Asset	Las Vegas	December 2016	1		14,900
			28	$	403,550

2015 Acquisitions:

HVP III Assets						Various (see note 4)	June 2019	18		128,250	⁽³⁾
Georgia Asset						Atlanta-Sandy Springs-Marietta, GA	August 2019	1		14,600
South Carolina Asset						Charleston-North Charleston, SC	August 2019	1		3,300
Texas Asset	Texas Markets - Major	February 2015	1	$	7,295	Dallas-Fort Worth-Arlington, TX	October 2019	1		7,300
HSRE Assets	Chicago	March 2015	4		27,500
Arizona Asset	Arizona / Las Vegas	March 2015	1		7,900
Tennessee Asset	Tennessee	March 2015	1		6,575
Florida Assets						Orlando-Kissimmee, FL	November 2019	3		32,100
California Asset						Los Angeles-Long Beach-Santa Ana, CA	December 2019	1		18,500
								29	$	246,600

2019 Disposition:

Texas Asset	Texas Markets - Major	April 2015	1		15,795	College Station-Bryan, TX	October 2019	1	$	4,146
Florida Asset	Florida Markets - Other	May 2015	1		7,300
Arizona Asset	Arizona / Las Vegas	June 2015	1		10,100
Florida Asset	Florida Markets - Other	June 2015	1		10,500
Texas Asset	Texas Markets - Major	July 2015	1		14,200
Maryland Asset	Baltimore / DC	July 2015	1		17,000
Maryland Asset	Baltimore / DC	July 2015	1		19,200
New York/New Jersey Assets	New York / Northern NJ	August 2015	2		24,823
New Jersey Asset	New York / Northern NJ	December 2015	1		14,350
PSI Assets	Various (see note 4)	December 2015	12		109,824
			29	$	292,362

2015 Dispositions:

Texas Assets	Texas Markets - Major	October 2015	7	$	28,000
Florida Asset	Florida Markets - Other	October 2015	1		9,800
			8	$	37,800

								1	$	4,146

(1)

Acquired by a consolidated joint venture in which the Company holds a 50% interest.

(2)

Purchase price represents the acquisition of all 167,557 outstanding partnership units of LAACO, Ltd. (“LAACO”) for $9,838 per unit. At the time of the acquisition, LAACO owned 57 storage properties (the “Storage West Assets”) and 50% ownership interests in 2 separate joint ventures. Through this acquisition, the Company also acquired LAACO’s wholly-owned subsidiaries, the Los Angeles Athletic Club and the California Yacht Club (the “Club Operations”), which are classified as held for sale on the Company’s consolidated balance sheets as of December 31, 2021 (see note 4).

(3)

Amount represents the purchase price for 90% of the ownership interest in 191 III CUBE LLC (“HVP III”), which at the time of the acquisition, owned 18 storage properties (see note 4).

~~F-26~~F-27

4. INVESTMENT ACTIVITY

~~2017~~LAACO Acquisition

On December 9, 2021, the Company acquired all outstanding partnership units of LAACO, the owner of the Storage West Assets and, as a result, LAACO became a wholly-owned subsidiary of the Company. The 57 Storage West Assets are located in Arizona (17), California (20), Nevada (13) and Texas (7). Through its acquisition of LAACO, the Company also acquired a 50% interest in 2 separate unconsolidated joint ventures, each of which own 1 storage property in California (see note 5). In addition, through this acquisition, the Company also acquired the Club Operations, which included the Los Angeles Athletic Club (consisting of athletic facilities, food and beverage operations and a hotel) and the California Yacht Club (consisting of sports facilities, food and beverage operations and a marina). As of December 31, 2021, the Club Operations have been classified as held for sale on the Company’s consolidated balance sheets.

The following summarizes the relevant components contemplated in the acquisition of LAACO:


	Amount
	(in thousands)
Costs contemplated:
Capitalized costs:
LAACO partnership units ⁽¹⁾	$	1,648,426
Long-term debt assumed and repaid at closing		40,880
Payments to LAACO management (capitalized) ⁽²⁾		16,807
Other transaction costs ⁽³⁾		13,407
Total capitalized costs	$	1,719,520
Payments and anticipated payments to LAACO management (expensed) ⁽²⁾		25,144
Total costs contemplated	$	1,744,664

Estimated fair value of Club Operations (included in total costs contemplated above)	$	46,800

(1)

Represents the acquisition of all 167,557 outstanding partnership units for $9,838 per unit.

(2)

Upon the acquisition of LAACO, the Company assumed severance obligations payable to certain employees pursuant to pre-existing agreements. Based on the specific details of the arrangements, $16.8 million in costs were capitalized to the basis of the acquired properties while $25.1 million were considered post-combination compensation expenses. Of this $25.1 million, $14.8 million was included in the component of other income (expense) designated as other for the year ended December 31, 2021, with the remainder expected to be expensed during the six months ended June 30, 2022.

(3)

Includes consulting fees, legal fees, and other costs.

The Company accounted for the acquisition of LAACO as an asset acquisition. As a result, the capitalized costs noted above were allocated to LAACO’s real estate assets, intangible assets and real estate venture investments on a relative fair value basis. All other assets acquired and liabilities assumed were recorded at fair value. The following summarizes the accounting for the LAACO acquisition:


	Amount
	(in thousands)
Storage properties	$	1,517,243
Cash and cash equivalents		18,291
Investment in real estate ventures, at equity		35,737
Assets held for sale		50,435
Other assets, net		143,599
Accounts payable, accrued expenses and other liabilities		(38,350)
Deferred revenue		(3,764)
Security deposits		(36)
Liabilities held for sale		(3,635)
Total	$	1,719,520

F-28

Intangible assets (included above in Other assets, net) consisted of in-place leases, which aggregated to $109.7 million at the time of the acquisition and prior to amortization of such amounts. The estimated life of these in-place leases is 12 months and the amortization expense that was recognized during the year ended December 31, 2021 was approximately $9.1 million.

Other 2021 Acquisitions

During the year ended December 31, ~~2017,~~2021, the Company acquired ~~six~~8 additional stores located ~~throughout the United States, including two stores upon completion of construction~~in Florida (1), Georgia (1), Illinois (1), Maryland (1), Nevada (1), New Jersey (1) and ~~the issuance of a certificate of occupancy,~~Pennsylvania (2) for an aggregate purchase price of approximately ~~$69.5~~$140.8 million. Also, a consolidated joint venture, in which the Company holds a 50% interest, acquired a store in Minnesota for a purchase price of $12.0 million (see note 12). In connection with these transactions, which were accounted for as asset acquisitions, the Company allocated ~~a portion of~~ the purchase price and acquisition-related costs to the tangible and intangible assets acquired based on fair value. Intangible assets ~~consist~~consisted of in-place leases, which aggregated ~~$3.2~~to $11.9 million at the time of the acquisitions and prior to ~~any~~ amortization of such amounts. The estimated life of these in-place leases ~~was~~is 12 months and the amortization expense that was recognized during 2017 was approximately $1.5 million. In connection with one of the acquired stores, the Company assumed mortgage debt that was recorded at a fair value of $6.2 million, which fair value includes an outstanding principal balance totaling $5.9 million and a net premium of $0.3 million to reflect the estimated fair value of the debt at the time of assumption. As part of the acquisition of that same store, the Company issued OP Units that were valued at approximately $12.3 million as consideration for the remainder of the purchase price (see note 12).

~~During~~ the year ended December 31, ~~2017, the Company also acquired a store in Illinois upon completion of construction and the issuance of a certificate of occupancy for $11.2~~2021 was approximately $3.6 million. ~~The purchase price was satisfied with $9.7 million of cash and 58,400 newly created Class C OP Units.~~ Each Class C OP Unit has a stated value of $25 and bears an annual distribution rate of 3% of the stated value. The holder has the option to tender the Class C OP Units to the Operating Partnership at any time, and on or after April 12, 2018, the Operating Partnership will have the option to redeem the Class C OP Units, in each case at a redemption price of $25 per Class C OP Unit. The Company has the right to settle the redemption in cash or, at the Company’s option, common shares of CubeSmart, or a combination of cash and common shares, with the common shares valued at their closing price on the redemption date. Because the Class C OP Units represent an unconditional obligation that the Company may settle by issuing a variable number of its common shares with a monetary value that is known at inception, they have been classified as a liability in Accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets.

The following table summarizes the Company’s revenue and earnings associated with the 2017 acquisitions from the respective acquisition dates, that are included in the consolidated statements of operations for the year ended December 31, 2017:

Year Ended December 31, 2017

(in thousands)

Total revenue

$
1,572

Net loss

(1,330)

As of December 31, ~~2017,~~2021, the Company had made aggregate deposits of approximately $0.5 million associated with 1 store that was under contract ~~and had made deposits of $1.0 million associated with two stores, including one store~~ to be acquired ~~after the completion of construction and the issuance of the certificate of occupancy,~~ for an ~~aggregate~~ acquisition price of ~~$33.0 million.~~$32.0 million (see note 18). The deposits are reflected in Other assets, net on the Company’s consolidated balance sheets. ~~The purchase of~~

2021 Dispositions

During the store under construction is expected to occur during the second quarter of 2018 after the completion of construction and the issuance of a certificate of occupancy. This acquisition is subject to due diligence and other customary closing conditions and no assurance can be provided that it will be completed on the terms described, or at all. On Januaryyear ended December 31, ~~2018,~~2021, the Company ~~acquired~~sold 5 stores in Colorado (1), Nevada (1), North Carolina (2) and Texas (1) for an aggregate sales price of $43.8 million. In conjunction with the ~~remaining store~~sales, the Company recorded gains that ~~was under contract as of December 31, 2017 (see note 19).~~totaled $32.7 million.

~~Development~~Assets Held for Sale

As of December 31, ~~2017,~~2021, the Company determined that the Club Operations assumed through the acquisition of LAACO met the criteria to be classified as assets held for sale. Accordingly, the assets and liabilities associated with the Club Operations have been categorized as held for sale within the Company’s December 31, 2021 consolidated balance sheets. As of December 31, 2021, the estimated fair value less selling costs of the Club Operations was greater than the carrying value of the Club Operations, and therefore 0 loss has been recorded in the current period.

Development Activity

As of December 31, 2021, the Company had invested in joint ventures to develop ~~six~~3 self-storage properties located in ~~Massachusetts (1) New Jersey (1), and~~ New York ~~(4)~~(2) and Virginia (1). Construction for all projects is expected to be completed by the ~~third~~first quarter of ~~2019.~~2023 (see note 12). As of December 31, ~~2017,~~2021, development costs incurred to date for these projects totaled ~~$121.0~~$66.7 million. Total construction costs for these projects are expected to be ~~$232.6~~$97.3 million. These costs are capitalized to construction in progress while the projects are under development and are reflected in Storage properties on the Company’s consolidated balance sheets.

F-29

The Company has completed the construction of and opened for operation the following stores since January 1, ~~2015.~~2019. The costs associated with the construction of these stores are capitalized to land, building and improvements, as well as equipment and are reflected in Storage properties on the Company’s consolidated balance sheets.


			CubeSmart
	Number of		Ownership	Total
Store Location	Stores	Date Opened	Interest	Construction Costs
				(in thousands)

Newton, MA ⁽¹⁾	1	Q4 2021	100%	$	20,800
East Meadow, NY ⁽²⁾	1	Q2 2021	100%		25,900
King of Prussia, PA	1	Q2 2021	70%		22,800
Arlington, VA ⁽³⁾	1	Q1 2021	90%		26,400
Brooklyn, NY ⁽²⁾	1	Q2 2020	100%		45,900
Waltham, MA⁽¹⁾	1	Q3 2019	100%		18,000
Queens, NY⁽²⁾	1	Q2 2019	100%		47,500
Bayonne, NJ ^{(2) (4)}	1	Q2 2019	100%		25,100
	8			$	232,400

~~F-27~~

CubeSmart

Number of

Ownership

Total
Store Location

Stores

Date Opened

Interest

Construction Costs

(in thousands)
Brooklyn, NY

1

Q4 2017

51%

$
49,300
Washington, D.C.

1

Q3 2017

100%

27,800
New York, NY

1

Q3 2017

90%

81,200
North Palm Beach, FL

1

Q1 2017

100%

9,700
Bronx, NY (1) (2)

1

Q2 2016

100%

32,200
Queens, NY (1)

1

Q1 2016

100%

31,800
Brooklyn, NY (3)

1

Q4 2015

100%

14,800
Queens, NY

1

Q4 2015

90%

17,400
Arlington, VA

1

Q2 2015

90%

17,100

9

$
281,300

(1)

~~These stores~~During the third quarter of 2019 and fourth quarter of 2021, the Company, through 2 separate joint ventures in which it owned a 90% interest in each and that were previously ~~owned through two separate~~ consolidated, ~~joint ventures,~~completed the construction of ~~which~~and opened for operation a store located in Waltham, MA and a store located in Newton, MA, respectively. On September 6, 2019, the Company ~~owned a 51%~~acquired the 10% interest ~~in each. On April 5, 2016,~~of the noncontrolling member in the venture that owned the ~~Queens, NY~~Waltham, MA store ~~put its 49% interest in the venture to~~for $2.6 million. On December 14, 2021, the Company ~~for $12.5 million. On August 12, 2016,~~acquired the 10% interest of the noncontrolling member in the venture that owned the ~~Bronx, NY~~Newton, MA store ~~put its 49% interest in the venture~~for $3.4 million. Prior to ~~the Company for $17.0 million.~~

~~(2)~~

~~This store is subject to a ground lease.~~

~~(3)~~

During the fourth quarter of 2015, the Company, through a joint venture in which the Company owned a 90% interest and that it previously consolidated, completed the construction and opened for operation a store located in Brooklyn, NY. On June 2, 2017, the Company acquiredthese transactions, the noncontrolling member’s ~~10%~~ interest in ~~the~~each venture ~~for $9.0 million. Prior to this transaction, the noncontrolling member’s interest~~ was reported in Noncontrolling interests in subsidiaries on the consolidated balance sheets. Since the Company retained its controlling interest in ~~the joint~~each venture and the ~~store is~~stores are now wholly owned, ~~this transaction was~~these transactions were accounted for as an equity ~~transaction. The~~transactions. In each case, the carrying amount of the noncontrolling interest was reduced to ~~zero~~0 to reflect the purchase and the ~~$8.6 million~~ difference between the purchase price paid by the Company and the carrying amount of the noncontrolling interest was recorded as an adjustment to equity attributable to the ~~Company. In conjunction~~Company, with 0 gain or loss recorded. This adjustment was $2.0 million for the ~~Company’s acquisition of~~Waltham, MA store and $2.7 million for the ~~noncontrolling interest, the $9.8~~Newton, MA store. The $10.5 million related party loan extended by the Company to the venture ~~during~~that owned the ~~construction period was~~Waltham, MA store and the $13.2 million related party loan extended by the Company to the venture that owned the Newton, MA store were repaid in ~~full.~~

conjunction with the Company’s acquisitions of the noncontrolling member’s ownership interests.

(2)

These stores were previously owned by 4 separate consolidated joint ventures, of which the Company held a 51% ownership interest in each. On June 25, 2019, the noncontrolling member in the venture that owned the Bayonne, NJ store put its 49% interest in the venture to the Company for $11.5 million. On September 17, 2019, the noncontrolling member in the venture that owned the Queens, NY store put its 49% interest in the venture to the Company for $15.2 million. On September 29, 2020, the noncontrolling member in the venture that owned the Brooklyn, NY store put its 49% interest in the venture to the Company for $10.0 million, of which $1.0 million was paid in cash. The Company issued 276,497 OP Units that were valued at approximately $9.0 million as consideration for the remainder of the purchase price (see note 12). On June 29, 2021, the noncontrolling member in the venture that owned the East Meadow, NY store put its 49% interest in the venture to the Company for $6.6 million. The cash payments related to these transactions are included in Development costs in the consolidated statements of cash flows.

(3)

This store is located adjacent to an existing consolidated joint venture store. Given their proximity to each other, the stores have been combined in our store count, as well as for operational and reporting purposes (see note 12).

(4)

This store is subject to a ground lease.

F-30

2020 Acquisitions

~~2016 Acquisitions~~

~~During the year ended December 31, 2016, the~~The Company acquired 28a portfolio of 8 stores ~~including three stores upon completion~~located in the outer boroughs of ~~construction and the issuance of a certificate of occupancy, located throughout the United States~~New York City (the “Storage Deluxe Assets”), in 2 separate tranches during December 2020, for an aggregate purchase price of ~~approximately $403.6~~$540.0 million. In connection with ~~these acquisitions,~~the acquisition of the Storage Deluxe Assets, the Company assumed 6 mortgage loans with an aggregate outstanding principal amount of $154.4 million at the time of acquisition, one of which had an outstanding principal balance of $33.2 million and was repaid immediately. The assumed mortgage debt was recorded at a fair value of $169.2 million, which includes an aggregate net premium of $14.8 million to reflect the estimated fair value of the debt at the time of assumption. The remainder of the purchase price was funded with $210.5 million of cash and $175.1 million through the issuance of 5,272,023 OP Units (see note 12). In connection with the acquisition of the Storage Deluxe Assets, which was accounted for as an asset acquisition, the Company allocated ~~a portion of~~ the purchase price and acquisition related costs to the tangible and intangible assets acquired based on fair value. Intangible assets ~~consist~~consisted of in-place leases, which aggregated ~~$18.8~~to $48.6 million at the time of the acquisition and prior to amortization of such amounts. The estimated life of these in-place leases was 12 months and the amortization expense that was recognized during the year ended December 31, 2021 was approximately $48.6 million. Additionally, as part of the transaction, the Company assumed 3 existing ground leases as lessee, 2 of which have been classified as finance leases and 1 of which has been classified as an operating lease (see note 13).

During the year ended December 31, 2020, the Company acquired 13 additional stores located in Florida (5), Maryland (1), Nevada (1), New Jersey (1), New York (1), Texas (3) and Virginia (1) for an aggregate purchase price of approximately $195.9 million. In connection with these transactions, which were accounted for as asset acquisitions, the Company allocated the purchase price and acquisition related costs to the tangible and intangible assets acquired based on fair value. Intangible assets consisted of in-place leases, which aggregated to $11.4 million at the time of the acquisitions and prior to ~~any~~ amortization of such amounts. The estimated life of these in-place leases was 12 months and the amortization expense that was recognized during the years ended December 31, ~~2017~~2021 and ~~2016~~2020 was approximately ~~$8.3~~$9.3 million and ~~$10.5~~$2.1 million, respectively.

Additionally, on July 20, 2020, the Company acquired land underlying a wholly-owned store located in the Bronx, New York for $9.5 million. The land was previously subject to a ground lease in which the Company served as lessee. As a result of the transaction, which was accounted for as an asset acquisition, the Company was released from its obligations under the ground lease, and the right-of-use asset and lease liability totaling $5.1 million and $5.0 million, respectively, were removed from the Company’s consolidated balance sheets.

2020 Disposition

On December 22, 2020, the Company sold a self-storage property located in New York for a sales price of $12.8 million. The Company recorded a $6.7 million gain in connection with the sale.

2019 Acquisitions

During the year ended December 31, 2019, the Company acquired 11 stores located in Arizona (1), California (1), Florida (5), Georgia (1), Maryland (1), South Carolina (1) and Texas (1) for an aggregate purchase price of approximately $118.3 million. In connection with one of the acquired stores, the Company assumed mortgage debt that was recorded at a fair value of $6.5 million, which fair value includes an outstanding principal balance totaling $6.3 million and a net premium of $0.2 million to reflect the estimated fair value of the debt at the time of assumption.

~~2015 Acquisitions~~

On December 15, 2015, the Company acquired all of the issued and outstanding uncertificated shares of common stock of a privately held self-storage REIT (“PSI”) for $115.8 million. As of the date of the acquisition, PSI owned real property consisting of 12 fully operational self-storage propertiesthese transactions, which were ~~acquired~~accounted for $109.8 million, and one self-storage property that was under construction, which was acquired for $6.0 million (the “PSI Assets”). The PSI Assets are located in Arizona, Florida, Georgia, Massachusetts, New York, North Carolina, Tennessee, and Texas. In connection with this acquisition,as asset acquisitions, the Company allocated ~~a portion of~~ the purchase price and acquisition related costs to the tangible and intangible ~~value~~assets acquired based on fair value. Intangible assets consisted of in-place leases, which aggregated to ~~$6.7~~$6.2 million at the time of the ~~acquisition~~acquisitions and prior to ~~any~~ amortization of such amounts. The estimated life of these in-place leases was 12 months and the amortization expense that was recognized during the years ended December 31, ~~2016~~2020 and ~~2015~~2019 was approximately ~~$6.1~~$4.3 million and ~~$0.6~~$1.9 million, respectively.

~~F-28~~

~~During 2014,~~ There was 0 amortization expense recognized during the ~~Operating Partnership entered into an Agreement~~year ended December 31, 2021 for Purchase and Sale with certain limited liability companies controlled by HSRE REIT I and HSRE REIT II, both Maryland real estate investment trusts, to acquire (the “HSRE Acquisition”) 26 self-storage properties for an aggregate purchase price of $223.0 million plus customary closing costs. During 2014, the Company closed on the first tranche of 22 stores comprising the HSRE Acquisition, for an aggregate purchase price of $195.5 million. On March 18, 2015, the Company closed on the second tranche of the remaining four stores comprising the HSRE Acquisition, for an aggregate purchase price of $27.5 million. The four stores purchased in the second tranche are located in Illinois.these in-place leases. In connection with ~~this~~one of the acquisitions, the Company paid $14.9 million of cash and issued OP Units that were valued at approximately $3.6 million as consideration for the purchase price (see note 12).

Additionally, on June 6, 2019, the Company acquired its partner’s 90% ownership interest in HVP III, an unconsolidated real estate venture in which the Company previously owned a 10% noncontrolling interest and that was accounted for under the equity method of accounting. As of the date of acquisition, HVP III owned 18 stores located in Georgia (1), Massachusetts (7), North Carolina (1), South Carolina (7) and Tennessee (2) (the “HVP III Assets”). The purchase price for the 90% ownership interest was $128.3 million, which was comprised of cash consideration of $120.0 million and $8.3 million of the Company’s escrowed proceeds from HVP III’s sale of 50 properties to an unaffiliated buyer on June 5, 2019 (see note 5). The HVP III Assets were recorded by the Company at $137.5 million, which consisted of the $128.3 million purchase price plus the Company’s $10.6 million carryover basis of its previously held equity interest in HVP III, offset by $1.4 million of acquired cash. As a result of the transaction, which was accounted for as an asset acquisition, the HVP III Assets became wholly-owned by the Company and are now consolidated within its financial statements. No gain or loss was recognized as a result of the transaction. In connection with the transaction, the Company allocated ~~a portion~~the value of the ~~purchase price~~HVP III

F-31

Assets and acquisition related costs to the tangible and intangible ~~value~~assets acquired based on fair value. Intangible assets consisted of in-place leases, which aggregated to ~~$2.7~~$14.3 million at the time of the acquisition and prior to ~~any~~ amortization of such amounts. The estimated life of these in-place leases was 12 months and the amortization expense that was recognized during the years ended December 31, ~~2016~~2020 and ~~2015~~2019 was approximately ~~$0.7~~$6.0 million and ~~$2.0~~$8.3 million, respectively.

~~During~~ There was no amortization expense recognized for these in-place leases during the year ended December 31, 2015, the Company acquired 13 additional self-storage properties, including one store upon completion of construction and the issuance of a certificate of occupancy, located throughout the United States for an aggregate purchase price of approximately $155.0 million. In connection with these acquisitions, the Company allocated a portion of the purchase price to the tangible and intangible assets acquired based on fair value. Intangible assets consist of in-place leases, which aggregated $10.7 million at the time of the acquisitions and prior to any amortization of such amounts. The estimated life of these in-place leases was 12 months, and the amortization expense that was recognized during the years ended December 31, 2016 and 2015 was approximately $6.0 million and $4.7 million, respectively. In connection with one of the acquired stores, the Company assumed mortgage debt that was recorded at a fair value of $2.7 million, which fair value includes an outstanding principal balance totaling $2.5 million and a net premium of $0.2 million to reflect the estimated fair value of the debt at the time of assumption.2021.

~~2015 Dispositions~~2019 Disposition

On October ~~8, 2015,~~7, 2019, the Company sold ~~seven stores~~a self-storage property located in Texas ~~and one store~~for a sales price of $4.1 million. The Company recorded a $1.5 million gain in connection with the sale.

5. INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

The Company’s investments in real estate ventures, consisting of common ownership interests, are summarized as follows (dollars in thousands):


	CubeSmart	Number of Stores as of		Carrying Value of Investment as of
	Ownership	December 31,		December 31,
Unconsolidated Real Estate Ventures	Interest	2021	2020	2021		2020
Fontana Self Storage, LLC ("Fontana") ⁽¹⁾	50%	1	-	$	14,225	$	-
Rancho Cucamonga Self Storage, LLC ("RCSS") ⁽¹⁾	50%	1	-		21,536		-
191 V CUBE LLC ("HVP V") ⁽²⁾	20%	5	-		16,080		-
191 IV CUBE Southeast LLC ("HVPSE") ⁽³⁾	10%	14	14		4,541		5,015
191 IV CUBE LLC ("HVP IV") ⁽⁴⁾	20%	28	21		23,223		21,760
CUBE HHF Northeast Venture LLC ("HHFNE") ⁽⁵⁾	10%	13	13		1,291		1,628
CUBE HHF Limited Partnership ("HHF") ⁽⁶⁾	50%	28	35		38,855		63,668
		90	83	$	119,751	$	92,071

(1)

On December 9, 2021, the Company completed the acquisition of LAACO, which included a 50% interest in Fontana and RCSS, each of which owns 1 self-storage property in California. As of the date of acquisition, the Company recognized differences between the Company’s equity investment in Fontana and RCSS and the underlying equity reflected at the venture level. As of December 31, 2021, this difference was $13.5 million for Fontana and $20.1 million for RCSS. These differences are being amortized over the expected useful life of the self-storage properties owned by the ventures.

(2)

On March 17, 2021, the Company invested a 20% ownership interest in a newly-formed real estate venture that acquired its initial self-storage property located in Florida. As of December 31, 2021, HVP V owned 5 self-storage properties located in Florida (2), New Jersey (2) and New York (1). HVP V paid an aggregate of $143.7 million for these properties, of which $2.2 million was allocated to the value of the in-place leases. These acquisitions were funded initially through pro-rata contributions by the Company and its unaffiliated joint venture partner. The Company’s total contribution to HVP V related to these acquisitions was $22.6 million. During the year ended December 31, 2021, the venture closed on an $80.6 million secured term loan. The loan bears interest at SOFR plus 2.05% and matures on September 30, 2025 with an option to extend the maturity date through September 30, 2026, subject to satisfaction of certain conditions and payment of the extension fees as stipulated in the loan agreement.

(3)

The stores owned by HVPSE are located in Florida (2), Georgia (8) and South Carolina (4). HVPSE paid $135.3 million for these stores, of which $7.7 million was allocated to the value of the in-place lease intangible. The acquisition was funded primarily through the venture’s $81.6 million secured term loan. The remainder of the purchase price was contributed pro-rata by the Company and its unaffiliated joint venture partner. The Company’s total contribution to HVPSE related to this portfolio acquisition was $5.6 million. The secured loan bears interest at LIBOR plus 1.60% and matures on March 19, 2023 with options to extend the maturity date through March 19, 2025, subject to satisfaction of certain conditions and payment of the extension fees as stipulated in the loan agreement.

(4)

The stores owned by HVP IV are located in Arizona (2), Connecticut (3), Florida (4), Georgia (2), Illinois (5), Maryland (2), Minnesota (1), Pennsylvania (1) and Texas (8). The Company’s total contribution to HVP IV in connection with these store acquisitions was $32.0 million. During the year ended December 31, 2021, HVP IV entered into a new $221.6 million secured

F-32

loan, which bears interest at LIBOR plus 1.95% per annum, and matures on April 19, 2025. HVP IV used the proceeds from this loan to repay its existing loans (totaling $137.7 million) in full.

(5)

The stores owned by HHFNE are located in Connecticut (3), Massachusetts (6), Rhode Island (2) and Vermont (2). The Company’s total contribution to HHFNE in connection with these store acquisitions was $3.8 million. As of December 31, 2021, HHFNE had an outstanding $45.0 million secured loan facility, which bears interest at LIBOR plus 1.20% per annum and matures on December 16, 2024.

(6)

The stores owned by HHF are located in North Carolina (1) and Texas (27). On October 5, 2021, HHF sold 7 stores in Texas for an aggregate sales price of approximately $85.0 million. The venture recorded gains which aggregated to approximately $46.9 million in connection with the sale. On January 21, 2021, HHF entered into a new $105.0 million secured loan, which bears interest at 2.58% per annum and matures on February 5, 2028. HHF used the proceeds from the new loan to repay its existing outstanding $100.0 million loan in full.

On June 5, 2019, HVP III, a venture in which the Company held a 10% interest, sold 50 stores located in Florida (3), Georgia (4), Michigan (17), North Carolina (3), South Carolina (15) and Tennessee (8), to an unaffiliated third-party buyer for an aggregate sales price of $293.5 million. As of the transaction date, HVP III had 5 mortgage loans with an aggregate outstanding balance of $22.9 million, as well as $179.5 million outstanding on its $185.5 million loan facility, all of which were defeased or repaid in full at the time of the sale. Net proceeds to the venture from the transaction totaled $82.9 million. The venture recorded gains which aggregated to approximately ~~$37.8 million. In~~$106.7 million in connection with ~~these sales,~~ the ~~Company recorded gains that totaled $14.4 million. The proceeds from these sales were held in escrow~~sale. Subsequent to fund future acquisitions under a tax free like kind exchange. The total net proceeds of $36.4 million were subsequently applied to three separate acquisitions, of which one closed in December 2015 and two closed in January 2016.

On October 2, 2015, USIFB, a consolidated real estate joint venture in which the Company owned a 97% interest, sold its remaining asset in London, England, for an aggregate sales price of £6.5 million (approximately $9.9 million). In connection with the sale, the Company ~~recorded a gain of $3.0 million net of a foreign currency translation loss of $1.2 million.~~

~~5. INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES~~

~~191 IV CUBE LLC (“HVP IV”)~~

~~On October 16, 2017, the Company~~ acquired ~~a self-storage property located in Texas for~~ ~~$9.4 million, which it then~~ ~~contributed to a newly-formed joint venture on November 1, 2017.In return for contributing the property to HVP IV, the Company received approximately $7.5 million in cash and a 20%~~its partner’s 90% ownership interest in ~~the venture.~~ ~~Subsequent to December 31, 2017, HVP IV acquired two self-storage properties in Arizona (1) and Texas (1) for an aggregate purchase price of $20.5 million.~~

~~CUBE HHF Northeast Venture LLC (“HHFNE”)~~

On December 15, 2016, the Company invested a 10% ownership interest in a newly-formed joint venture that acquired 13 self-storage properties located in Connecticut (3), Massachusetts (6), Rhode Island (2), and Vermont (2). HHFNE paid $87.5 million for these stores, of which $6.0 million was allocated to the value of the in-place lease intangible. The acquisition was funded primarily through an advance totaling $44.5 million on the venture’s loan facility. The remainder of the purchase price was contributed pro-rata by the Company and its unaffiliated joint venture partner. ~~The Company’s total contribution to HHFNE related to this portfolio acquisition was $3.8 million.~~ The loan bears interest at LIBOR plus 1.90% and matures on December 15, 2019 with options to extend the maturity date through December 15, 2021, subject to satisfaction of certain conditions and payment of the extension fees as stipulated in the loan agreement.

~~191 III CUBE LLC (“HVP III”)~~

During the fourth quarter of 2015, the Company invested a 10% ownership interest in a newly-formed joint venture that agreed to acquire a property portfolio comprised of 37 self-storage properties located in Michigan (17), Tennessee (10), Massachusetts (7), and Florida (3). HVP III, ~~paid $242.5 million for these 37 stores, of~~ which ~~$18.9 million was allocated to the value of the in-place lease~~

~~F-29~~

intangible. HVP III acquired 30 of the stores on December 8, 2015 for $193.7 million, one of the stores on January 26, 2016 for $5.7 million, five of the stores on April 21, 2016 for $36.1 million, and one store on June 15, 2016 for $7.0 million. In connection with six of the acquired stores, HVP III assumed mortgage debt that was recorded at a fair value of $25.3 million, which includes an outstanding principal balance totaling $23.7 million and a net premium of $1.6 million to reflect the estimated fair value of the debt at the time of ~~assumption. The remainder of~~ the ~~purchase price was funded through advances totaling $116.0 million on~~acquisition, owned the venture’s $122.0 million loan facility and amounts contributed pro-rata by the Company and its unaffiliated joint venture partner. The Company’s total contribution to HVP III related to this portfolio acquisition was $10.7 million. The loan facility bears interest at LIBOR plus 2.00% per annum and matures on December 7, 2018 with options to extend the maturity date through December 7, 2020, subject to satisfaction of certain conditions and payment of the extension fees as stipulated in the loan agreement.remaining 18 storage properties (see note 4).

During the first quarter of 2016, HVP III agreed to acquire a portfolio comprised of 31 self-storage properties located in South Carolina (22), Georgia (5), and North Carolina (4) that were previously managed by the Company. HVP III paid $115.5 million for these 31 stores, of which $10.6 million was allocated to the value of the in-place lease intangible. HVP III acquired 30 of the stores on March 30, 2016 for $112.8 million and one of the stores on November 29, 2016 for $2.7 million. In conjunction with the acquisitions, HVP III refinanced its existing loan facility by entering into an increased amended and restated loan facility not to exceed $185.5 million. The acquisitions were funded primarily through advances totaling $63.5 million on the venture’s amended and restated loan facility. The remainder of the purchase price was contributed pro-rata by the Company and its unaffiliated joint venture partner. The Company’s total contribution to HVP III related to this portfolio acquisition was $5.4 million, bringing its total investment in HVP III to $16.1 million as of December 31, 2016. The amended and restated loan facility bears interest at LIBOR plus 2.00% per annum. The initial maturity date was extended to March 30, 2019 with options to extend through March 30, 2021, subject to satisfaction of certain conditions and payment of the extension fees as stipulated in the amended and restated loan agreement.

~~CUBE HHF Limited Partnership (“HHF”)~~

On December 10, 2013, the Company invested a 50% ownership interest in a newly-formed joint venture that acquired 35 self-storage properties located in Texas (34) and North Carolina (1). HHF paid $315.7 million for these stores, of which $12.1 million was allocated to the value of the in-place lease intangible. The Company and the unaffiliated joint venture partner each contributed cash equal to 50% of the capital required to fund the acquisition. On May 1, 2014, HHF obtained a $100.0 million loan secured by the 34 self-storage properties located in Texas that are owned by the venture. There is no recourse to the Company, subject to customary exceptions to non-recourse provisions. The loan bears interest at 3.59% per annum and matures on April 30, 2021. This financing completed the planned capital structure of HHF and proceeds (net of closing costs) of $99.2 million were distributed proportionately to the partners.

Based upon the facts and circumstances at acquisition of Fontana and RCSS and formation of HVP V, HVPSE, HVP IV, HHFNE, ~~HVP~~ ~~III~~, and HHF (the “Ventures”), the Company determined that the Ventures are not VIEs in accordance with the accounting standard for the consolidation of VIEs. As a result, the Company used the voting interest model under the accounting standard for consolidation in order to determine whether to consolidate the Ventures. Based upon each member's substantive participating rights over the activities of each entity as stipulated in the operating agreements, the Ventures are not consolidated by the Company and are accounted for under the equity method of ~~accounting.~~accounting (except for HVP III, which was consolidated as of June 6, 2019). The Company’s investments in the Ventures are included in Investment in real estate ventures, at equity on the Company’s consolidated balance sheets and the Company’s earnings from its investments in the Ventures are presented in Equity in ~~losses~~earnings of real estate ventures on the Company’s consolidated statements of operations.

The amounts reflected in the following table are based on the historical financial information of the Ventures. The following is a summary of the financial position of the Ventures as of December 31, ~~2017~~2021 and ~~2016 (in thousands):~~2020:


	December 31,
	2021		2020

Assets	(in thousands)
Storage properties, net	$	850,250	$	662,833
Other assets		34,760		18,112
Total assets	$	885,010	$	680,945

Liabilities and equity
Debt	$	526,972	$	359,985
Other liabilities		14,500		11,588
Equity
CubeSmart		86,083		92,071
Joint venture partners		257,455		217,301
Total liabilities and equity	$	885,010	$	680,945

~~F-30~~F-33

December 31,

December 31,

2017

2016

Assets

Storage properties, net

$
647,668

$
667,975

Other assets

8,284

17,003

Total assets

$
655,952

$
684,978

Liabilities and equity

Other liabilities

$
6,853

$
6,516

Debt

346,475

345,631

Equity

CubeSmart

91,206

98,682

Joint venture partners

211,418

234,149

Total liabilities and equity

$
655,952

$
684,978

The following is a summary of results of operations of the Ventures for the years ended December 31, ~~2017, 2016~~2021, 2020 and ~~2015 (in thousands):~~2019:


							For the year ended December 31,
							2021		2020		2019

	Year ended December 31,
	2017		2016		2015

							(in thousands)
Total revenues	$	81,058	$	64,931	$	31,249	$	88,449	$	67,239	$	72,582
Operating expenses		34,705		29,900		15,042		(37,967)		(30,755)		(32,134)
Other expenses								(1,138)		(430)		(3,227)
Interest expense, net		11,703		9,432		3,846		(12,031)		(11,585)		(14,927)
Depreciation and amortization		45,086		53,701		16,214		(37,805)		(33,086)		(30,107)
Net loss		(10,436)		(28,102)		(3,853)
Company’s share of net loss		(1,386)		(2,662)		(411)
Gains from sale of real estate, net								46,966		—		106,667
Net income (loss)							$	46,474	$	(8,617)	$	98,854
Company’s share of net income (loss)							$	25,275	$	178	$	11,122

The results of operations above include the periods from ~~November~~January 1, ~~2017~~2019 through June 6, 2019 (date of ~~acquisition) through December 31, 2017~~consolidation) for HVP ~~IV, December 15, 2016 (date of acquisition) through December 31, 2017 for HHFNE, and December 8, 2015 (date of acquisition) through December 31, 2017 for HVP~~ ~~III~~.III.

6. UNSECURED SENIOR NOTES

The Company’s unsecured senior notes are summarized as follows (collectively referred to as the “Senior Notes”):


	December 31,		December 31,		Effective		Issuance	Maturity

									December 31,				Effective		Issuance	Maturity
Unsecured Senior Notes	2017		2016		Interest Rate		Date	Date	2021		2020		Interest Rate		Date	Date
	(in thousands)
$250M 4.800% Guaranteed Notes due 2022	$	250,000	$	250,000	4.82	%	Jun-12	Jul-22
$300M 4.375% Guaranteed Notes due 2023 (1)		300,000		250,000	4.33	%	Various (1)	Dec-23
									(in thousands)
$300M 4.375% Guaranteed Notes due 2023 ⁽¹⁾ ⁽²⁾									$	—	$	300,000	4.33	%	Various ⁽²⁾	Dec-23
$300M 4.000% Guaranteed Notes due 2025 ~~(2)~~(3)		300,000		250,000	3.99	%	Various (2)	Nov-25		300,000		300,000	3.99	%	Various ⁽³⁾	Nov-25
$300M 3.125% Guaranteed Notes due 2026		300,000		300,000	3.18	%	Aug-16	Sep-26		300,000		300,000	3.18	%	Aug-16	Sep-26
$550M 2.250% Guaranteed Notes due 2028										550,000		—	2.33	%	Nov-21	Dec-28
$350M 4.375% Guaranteed Notes due 2029										350,000		350,000	4.46	%	Jan-19	Feb-29
$350M 3.000% Guaranteed Notes due 2030										350,000		350,000	3.04	%	Oct-19	Feb-30
$450M 2.000% Guaranteed Notes due 2031										450,000		450,000	2.10	%	Oct-20	Feb-31
$500M 2.500% Guaranteed Notes due 2032										500,000		—	2.59	%	Nov-21	Feb-32
Principal balance outstanding		1,150,000		1,050,000						2,800,000		2,050,000
Less: Discount on issuance of unsecured senior notes, net		(617)		(3,971)						(13,455)		(7,470)
Less: Loan procurement costs, net		(6,923)		(6,953)						(18,336)		(12,158)
Total unsecured senior notes, net	$	1,142,460	$	1,039,076					$	2,768,209	$	2,030,372

(1)

On December 23, 2021, the Operating Partnership redeemed, in full, its $300.0 million of outstanding 4.375% senior notes due 2023 (the “2023 Notes”), with a portion of the net proceeds from its $550.0 million of 2.250% senior notes due 2028 and its $500.0 million of 2.500% senior notes due 2032 issued on November 30, 2021. In connection with the redemption of the 2023 Notes, the Operating Partnership recognized a loss on early debt extinguishment of $20.3 million, of which $20.0 million represents a prepayment premium and $0.3 represents the write-off of unamortized loan procurement costs.

(2)

~~(2)~~

(3)

~~F-31~~

principal amount to yield 3.811% and 4.032%, respectively, to maturity. The combined ~~weighted-average~~weighted average effective interest rate of the 2025 notes is 3.994%.

F-34

secured debt leverage ratio not to exceed 40% after giving effect to the incurrence of the debt. The indenture also contains other financial and customary covenants, including a covenant not to own unencumbered assets with a value less than 150% of the unsecured indebtedness of the Operating Partnership and its consolidated subsidiaries. As of and for the year ended December 31, ~~2017,~~2021, the Operating Partnership was in compliance with all of the financial covenants under the Senior Notes.

7. REVOLVING CREDIT FACILITY AND UNSECURED TERM LOANS

On December 9, 2011, the Company entered into a credit agreement (the “Credit Facility”),. On June 19, 2019, the Company amended and restated, in its entirety, the Credit Facility (the “Amended and Restated Credit Facility”) which, ~~was subsequently amended on April 5, 2012, June 18, 2013,~~subsequent to the amendment and ~~April 22, 2015 to provide for, amongst other things,~~restatement, is comprised of a ~~$500.0~~$750.0 million unsecured revolving credit facility (the “Revolver”) ~~with a maturity date of April 22, 2020. Pricing~~maturing on June 19, 2024. Under the Amended and Restated Credit Facility, pricing on the Revolver is dependent onupon the Company’s unsecured debt credit ratings. At the Company’s current Baa2/BBB level, amounts drawn under the Revolver are priced at ~~1.25%~~1.10% over LIBOR, inclusive of a facility fee of 0.15%.

Under the Amended and Restated Credit Facility, the Company’s ability to borrow under the Revolver is subject to ongoing compliance with certain financial covenants which include, among other things, (1) a maximum total indebtedness to total asset value of 60.0%, and (2) a minimum fixed charge coverage ratio of 1.5:1.0. As of and for the year ended December 31, ~~2017,~~2021, the ~~Company also had a $200.0 million unsecured term loan outstanding under the Credit Facility, which is included~~Operating Partnership was in ~~the table below.~~compliance with all of its financial covenants.

On June 20, 2011, the Company entered into an unsecured term loan agreement (the “Term Loan Facility”), which was subsequently amended on June 18, 2013 and August 5, 2014, consisting of, among other things, a $100.0 million unsecured term loan ~~with a five-year maturity~~that was scheduled to mature in January 2020. On June 19, 2019, the Company used an initial advance at closing of the Amended and ~~a $100.0 million unsecured term loan with a seven-year maturity.~~

~~The Company’s unsecured term loans~~Restated Credit Facility to repay all of the outstanding indebtedness under the ~~Credit Facility and Term Loan Facility are summarized below:~~

~~(1)~~

Pricing on the Term Loan Facility and the unsecured term loan under the Credit Facility is dependent on the Company’s unsecured debt credit ratings. At the Company’s current Baa2/BBB level, amounts drawn under the term loan scheduled to mature in January 2019 are priced at 1.30% over LIBOR, while amounts drawn under the term loan scheduled to mature in January 2020 are priced at 1.15% over LIBOR, excluding the impact of interest rate swaps. As of December 31, 2017, borrowings under the Credit Facility, inclusive of the Revolver, and Term Loan Facility, as amended and after giving effect to the interest rate swaps, had an effective weighted average interest rate of 3.05%.

~~(2)~~

~~On April 6, 2017, the Company used the net proceeds from the issuance of $50.0 million of its 4.375% Senior Notes due 2023 and $50.0 million of its 4.000% Senior Notes due 2025 to repay~~ ~~all of the outstanding indebtedness~~ ~~under its unsecured term loan that was scheduled to mature in June 2018. Unamortized loan procurement costs of $0.2 million were written off in conjunction with the repayment.~~

~~(3)~~

~~As of December 31, 2017, the Company had interest rate swaps in place on these borrowings that fix 30-day LIBOR (see note 10).~~

~~F-32~~

The Term Loan Facility and the unsecured term loan under the Credit Facility were fully drawn as of December 31, 2017 and no further borrowings may be made under the term loans. The Company’s ability to borrow under the Revolver is subject to ongoing compliance with certain financial covenants which include:

~~Maximum total indebtedness to total asset value of 60.0% at any time;~~

~~Minimum fixed charge coverage ratio of 1.50:1.00; and~~

~~Minimum tangible net worth of $821,211,200 plus 75% of net proceeds from equity issuances after June 30, 2010.~~

Further, under the Credit Facility and Term Loan Facility, the Company is restricted from paying distributions on the Parent Company’s common shares in excess of the greater of (i) 95% of funds from operations, and (ii) such amount as may be necessary to maintain the Parent Company’s REIT status.

As of December 31, 2017, the Company was in compliance with all of its financial covenants and it anticipates being in compliance with all of its financial covenants through the terms of the Credit Facility and Term Loan Facility. Unamortized loan procurement costs of $0.1 million were written off in conjunction with the repayment.

8. MORTGAGE LOANS AND NOTES PAYABLE

The Company’s mortgage loans and notes payable are summarized as follows:



	Carrying Value as of December 31,				Effective		Maturity
Mortgage Loans and Notes Payable	2021		2020		Interest Rate		Date

	(in thousands)
Bronx IX, NY ⁽¹⁾	$	—	$	21,030	4.85	%	Jun-21
Bronx X, NY ⁽¹⁾		—		23,148	4.64	%	Jun-21
Nashville V, TN		2,206		2,261	3.85	%	Jun-23
New York, NY		29,340		29,981	3.51	%	Jun-23
Annapolis I, MD		5,099		5,283	3.78	%	May-24
Brooklyn XV, NY		15,423		15,713	2.15	%	May-24
Long Island City IV, NY		12,580		12,852	2.15	%	May-24
Long Island City II, NY		18,714		19,094	2.25	%	Jul-26
Long Island City III, NY		18,723		19,106	2.25	%	Aug-26
Flushing II, NY		54,300		54,300	2.15	%	Jul-29
Principal balance outstanding		156,385		202,768
Plus: Unamortized fair value adjustment		12,981		15,879
Less: Loan procurement costs, net		(1,690)		(2,143)
Total mortgage loans and notes payable, net	$	167,676	$	216,504

(1)

These mortgage loans were repaid in full on March 1, 2021.

Carrying Value as of:


December 31,

December 31,

Effective

Maturity

Mortgage Loans and Notes Payable

2017

2016

Interest Rate

Date

(in thousands)

YSI 67

$
—

$
6,216

2.55
%

Mar-17

YSI 33

9,547

9,860

6.42
%

Jul-19

YSI 26

8,228

8,423

4.56
%

Nov-20

YSI 57

2,889

2,957

4.61
%

Nov-20

YSI 55

22,508

22,952

4.85
%

Jun-21

YSI 24

25,700

26,464

4.64
%

Jun-21

YSI 65

2,411

2,457

3.85
%

Jun-23

YSI 66

31,727

32,257

3.51
%

Jun-23

YSI 68

5,786

—

3.78
%

May-24

Principal balance outstanding

108,796

111,586

Plus: Unamortized fair value adjustment

3,286

3,742

Less: Loan procurement costs, net

(648)

(710)

Total mortgage loans and notes payable, net

$
111,434

$
114,618

F-35

As of December 31, ~~2017~~2021 and ~~2016,~~2020, the Company’s mortgage loans and notes payable were secured by certain of its self-storage properties with net book values of approximately ~~$236.9~~$450.7 million and ~~$233.1~~$539.2 million, respectively. The following table represents the future principal payment requirements on the outstanding mortgage loans and notes payable as of December 31, ~~2017~~2021 (in thousands):


2018	$	2,650
2019		11,652
2020		12,791
2021		45,057

2022		923	$	2,426
2023 and thereafter		35,723
2023				32,591
2024				32,329
2025				979
2026				33,760
2027 and thereafter				54,300
Total mortgage payments		108,796		156,385
Plus: Unamortized fair value adjustment		3,286		12,981
Less: Loan procurement costs, net		(648)		(1,690)
Total mortgage loans and notes payable, net	$	111,434	$	167,676

~~F-33~~

9. ACCUMULATED OTHER COMPREHENSIVE ~~INCOME (LOSS)~~LOSS

Accumulated other comprehensive loss represents unrealized losses on interest rate swaps (see note 10). The following table summarizes the changes in accumulated other comprehensive ~~income (loss) by component~~loss for the ~~year~~years ended December 31, ~~2017 (in thousands):~~2021 and 2020.

Unrealized losses

on interest rate

swaps

Other comprehensive gain before reclassifications

$
192

Amounts reclassified from accumulated other comprehensive loss

1,661
(1)
Net current-period other comprehensive gain

1,853

Balance at December 31, 2016

(1,850)

Balance at December 31, 2017

$
3


	December 31,
	2021		2020

		(in thousands)
Beginning balance	$	(656)	$	(737)
Reclassification of realized losses on interest rate swaps ⁽¹⁾		81		81
Ending balance		(575)		(656)
Less: portion included in noncontrolling interests in the Operating Partnership		5		24
Total accumulated other comprehensive loss included in equity	$	(570)	$	(632)

(1)

See note 10 for additional information about the effects of the amounts reclassified.

10. RISK MANAGEMENT AND USE OF FINANCIAL INSTRUMENTS

The Company’s use of derivative instruments is limited to the utilization of interest rate swap agreements or other instruments to manage interest rate risk exposures and not for speculative purposes. The principal objective of such arrangements is to minimize the risks and/or costs associated with the Company’s operating and financial structure, as well as to hedge specific transactions. The counterparties to these arrangements are major financial institutions with which the Company and its subsidiaries may also have other financial relationships. The Company is potentially exposed to credit loss in the event of non-performance by these counterparties. However, because of the high credit ratings of the counterparties, the Company does not anticipate that any of the counterparties will fail to meet these obligations as they come due. The Company does not hedge credit or property value market risks.

The Company has entered into interest rate swap agreements that qualify and are designated as cash flow hedges designed to reduce the impact of interest rate changes on its variable rate debt. Therefore, the interest rate swaps are recorded in the consolidated balance sheet at fair value, and the related gains or losses are deferred in shareholders’ equity as accumulated other comprehensive loss. These deferred gains and losses are amortized into interest expense during the period or periods in which the related interest payments affect earnings. However, to the extent that the interest rate swaps are not perfectly effective in offsetting the change in value of the interest payments being hedged, the ineffective portion of these contracts is recognized in earnings immediately.

The Company formally assesses, both at inception of a hedge and on an on-going basis, whether each derivative is highly-effective in offsetting changes in cash flows of the hedged item. If management determines that athe derivative is highly-effective as a hedge, then the Company accounts for the derivative using hedge accounting, pursuant to which gains or losses inherent in the derivative do not impact the Company’s results of operations. If management determines that athe derivative is not highly-effective as a hedge or if a derivative ceases to be a highly-effective hedge, the Company ~~will discontinue~~discontinues hedge accounting prospectively and ~~will reflect~~reflects in its consolidated statement of operations realized and unrealized gains and losses inwith respect ofto the derivative.

~~The following table summarizes the terms and fair values of the Company’s derivative financial instruments as~~ As of December 31, ~~2017~~2021 and ~~2016 (in thousands):~~

Hedge

Hedge

Notional Amount

Effective

Fair Value

Product

Type (1)

December 31, 2017

December 31, 2016

Strike

Date

Maturity

December 31, 2017

December 31, 2016

Swap

Cash flow

$
—

$
75,000

1.3360
%

12/30/2011

3/31/2017

$
—

$
(103)

Swap

Cash flow

—

50,000

1.3360
%

12/30/2011

3/31/2017

—

(69)

Swap

Cash flow

—

50,000

1.3360
%

12/30/2011

3/31/2017

—

(69)

Swap

Cash flow

—

25,000

1.3375
%

12/30/2011

3/31/2017

—

(34)

Swap

Cash flow

40,000

40,000

2.4590
%

6/20/2011

6/20/2018

(161)

(797)

Swap

Cash flow

40,000

40,000

2.4725
%

6/20/2011

6/20/2018

(163)

(804)

Swap

Cash flow

20,000

20,000

2.4750
%

6/20/2011

6/20/2018

(82)

(404)

$
100,000

$
300,000

$
(406)

$
(2,280)

~~(1)~~

~~Hedging unsecured variable rate debt by fixing 30-day LIBOR.~~

~~F-34~~

~~The Company measures its~~2020, all derivative instruments entered into by the Company had been settled.

On December 24, 2018, the Company entered into interest rate swap agreements with notional amounts that aggregated to $150.0 million (the “Interest Rate Swaps”) to protect the Company against adverse fluctuations in interest rates by reducing exposure to variability in cash flows relating to interest payments on a forecasted issuance of long-term debt. The Interest Rate Swaps qualified and were designated as cash flow hedges. Accordingly, the Interest Rate Swaps were recorded on the consolidated balance sheet at fair value and ~~records them~~the related gains or losses were deferred in ~~the balance sheet~~shareholders’ equity as either an asset or liability. As of December 31, 2017 and 2016, all derivative instruments were included in Accounts payable, accrued expenses, and other liabilities in the accompanying consolidated balance sheets. The effective portions of changes in the fair value of the derivatives are reported in accumulated other comprehensive income ~~(loss). Amounts reported~~or loss. These deferred gains and losses were amortized into interest expense during the period or periods in which the related interest payments affected earnings. On January 24, 2019, in conjunction with the issuance of $300.0 million of outstanding 4.375% senior notes due 2029 (the “2029 Notes”),

F-36

the Company settled the Interest Rate Swaps for $0.8 million. The $0.8 million termination premium will be reclassified from accumulated other comprehensive ~~income (loss) related to derivatives will be reclassified~~loss as an increase to interest expense ~~as interest payments are made~~over the life of the 2029 Notes, which mature on ~~the Company’s variable-rate debt.~~February 15, 2029. The change in unrealized losses on interest rate swaps reflects a reclassification of ~~$1.7~~$0.1 million of unrealized losses from accumulated other comprehensive loss as an increase to interest expense during ~~2017.~~2021. The Company estimates that ~~$0.4~~$0.1 million will be reclassified as an increase to interest expense in ~~2018.~~2022.

11. FAIR VALUE MEASUREMENTS

The Company applies the methods of determining fair value, as described in authoritative guidance, to value its financial assets and liabilities. As defined in the guidance, fair value is based on the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, the guidance establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.

Level 2: Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

In determining fair value, the Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs, to the extent possible, as well as considering counterparty credit risk in its assessment of fair value.

~~Financial~~There were 0 financial assets ~~and~~or liabilities carried at fair value as of December 31, ~~2017 are classified in the table below in one of the three categories described above (dollars in thousands):~~2021 and 2020.

Level 1

Level 2

Level 3

Interest rate swap derivative liabilities

$
—

$
406

$
—

Total liabilities at fair value

$
—

$
406

$
—

~~Financial assets and liabilities carried at fair value as of December 31, 2016 are classified in the table below in one of the three categories described above (dollars in thousands):~~

Level 1

Level 2

Level 3

Interest rate swap derivative liabilities

$
—

$
2,280

$
—

Total liabilities at fair value

$
—

$
2,280

$
—

Financial assets and liabilities carried at fair value were classified as Level 2 inputs. For financial liabilities that utilize Level 2 inputs, the Company utilizes both direct and indirect observable price quotes, including LIBOR yield curves, bank price quotes for forward starting swaps, NYMEX futures pricing, and common stock price quotes. Below is a summary of valuation techniques for Level 2 financial liabilities:

Interest rate swap derivative assets and liabilities — valued using LIBOR yield curves at the reporting date. Counterparties to these contracts are most often highly rated financial institutions, none of which experienced any significant downgrades in 2017 that would reduce the amount owed by the Company. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with the Company’s derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and the counterparties. However, as of December 31, 2017, the Company has assessed the significance of the effect

~~F-35~~

of the credit valuation adjustments on the overall valuation of its derivative positions and has determined that the credit valuation adjustments are not significant to the overall valuation of its derivatives. As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy.

The fair values of financial instruments, including cash and cash equivalents, accounts receivable and accounts payable approximate their respective carrying values as of December 31, 2017 and 2016. The aggregatefollowing table summarizes the carrying value ~~of the Company’s debt was $1.6 billion as of December 31, 2017~~ and ~~2016. The~~ estimated fair value of the Company’s debt ~~was $1.7 billion and $1.6 billion~~ as of December 31, ~~2017~~2021 and ~~2016, respectively. These~~2020:


	December 31, 2021		December 31, 2020

		(in thousands)
Carrying value	$	3,145,785	$	2,364,676
Fair value		3,256,128		2,571,300

The fair value of debt estimates were based on a discounted cash flow analysis assuming market interest rates for comparable obligations as of December 31, ~~2017~~2021 and ~~2016.~~2020. The Company estimates the fair value of its ~~fixed rate~~fixed-rate debt and the credit spreads over variable market rates on its ~~variable rate~~variable-rate debt by discounting the future cash flows of each instrument at estimated market rates or credit spreads consistent with the maturity of the debt obligation with similar credit policies, which is classified within level 2 of the fair value hierarchy. Rates and credit spreads take into consideration general market conditions and maturity.

12. NONCONTROLLING INTERESTS

Interests in Consolidated ~~Real Estate~~ Joint Ventures

Noncontrolling interests in subsidiaries represent the ownership interests of third parties in the Company’s consolidated ~~real estate~~joint ventures. The ~~Company has determined that these~~following table summarizes the Company’s consolidated joint ventures, each of which are variable interest entities, and that the Company is the primary beneficiary. Accordingly, the Company consolidates the assets, liabilities, and results of operations of the real estate ventures in the table below (dollars in thousands):accounted for as VIEs:


				CubeSmart
	Number		Date Opened /	Ownership	December 31, 2021
Consolidated Joint Ventures	of Stores	Location	Acquired ⁽¹⁾	Interest	Total Assets		Total Liabilities

					(in thousands)
Astoria Investors, LLC ("Astoria") ⁽²⁾	1	Queens, NY	Q1 2023 (est.)	70%	$	21,020	$	25
CS Vienna, LLC ("Vienna") ⁽³⁾	1	Vienna, VA	Q2 2022 (est.)	72%		25,667		14,497
CS 750 W Merrick Rd, LLC ("Merrick") ⁽⁴⁾	1	Valley Stream, NY	Q1 2022 (est.)	51%		31,050		16,656
CS Valley Forge Village Storage, LLC ("VFV") ⁽⁵⁾	1	King of Prussia, PA	Q2 2021	70%		21,128		14,050
CS Lock Up Anoka, LLC ("Anoka") ⁽⁶⁾	1	Anoka, MN	Q2 2021	50%		11,739		5,567
SH3, LLC ("SH3") ⁽⁷⁾	1	Arlington, VA	Q2 2015/Q1 2021	90%		38,922		192
	6				$	149,526	$	50,987

Date Opened /

CubeSmart

Number

Estimated

Ownership

December 31, 2017

Development Ventures

of Stores

Location

Opening

Interest

Total Assets

Total Liabilities


CS 1158 McDonald Ave, LLC ("McDonald Ave") (1)

1

Brooklyn, NY

Q3 2019 (est.)

51%

$
18,472

$
2,429

CS SJM E 92nd Street, LLC ("92nd St") (3)

1

New York, NY

Q2 2019 (est.)

90%

1,366

1,096

CS 160 East 22nd St, LLC ("22nd St") (1)

1

Bayonne, NJ

Q1 2019 (est.)

51%

5,533

3,382

2225 46th St, LLC ("46th St") (1)

1

Queens, NY

Q4 2018 (est.)

51%

27,130

9,551

CS SDP Waltham, LLC ("Waltham") (3)

1

Waltham, MA

Q4 2018 (est.)

90%

5,981

704

2880 Exterior St, LLC ("Exterior St") (1)

1

Bronx, NY

Q3 2018 (est.)

51%

62,763

31,575

3068 Cropsey Avenue, LLC ("Cropsey Ave") (1)

1

Brooklyn, NY

Q4 2017

51%

47,952

22,189

444 55th Street Holdings, LLC ("55th St") (2)

1

New York, NY

Q3 2017

90%

82,216

33,858

186 Jamaica Avenue, LLC ("Jamaica Ave") (3)

1

Brooklyn, NY

Q4 2015

90%

18,478

13,289

Shirlington Rd, LLC ("SRLLC") (3)

1

Arlington, VA

Q2 2015

90%

16,320

12,819

10

$
286,211

$
130,892

F-37

(1)

Anoka was formed to acquire an existing store that had commenced operations, while all other consolidated joint ventures were formed to develop, own and operate new stores.

(2)

On August 17, 2021, the Company contributed $14.7 million in exchange for a 70% ownership interest in Astoria, which acquired land for future development of a self-storage property in Queens, NY for $20.0 million. The Company has a related party loan commitment to Astoria of $27.1 million to fund all or a portion of the construction costs.

(3)

On December 23, 2020, the Company and the noncontrolling member contributed a previously wholly-owned operating property (the “Vienna Operating Property”) and a parcel of land (the “Vienna Land”), respectively, to Vienna. The Vienna Operating Property and the Vienna Land are located in close proximity to each other in Vienna, VA. The members intend to construct a new store on the Vienna Land, which, upon completion, will be combined with the Vienna Operating Property and operated by the venture as a single store. The Company has a related party commitment to Vienna to fund all or a portion of the construction costs. As of December 31, 2021, the Company has funded $13.2 million of a total $17.0 million loan commitment to Vienna, which is included in the total liabilities amount within the table above. This loan and the related interest were eliminated for consolidation purposes.

(4)

The noncontrolling ~~members~~member of ~~McDonald Ave, 22nd St, 46th St, Exterior St, and Cropsey Ave have~~Merrick has the option to put their ownership interest in the ~~ventures~~venture to the Company for ~~$10.0~~$17.1 million ~~$11.5 million, $14.2 million, $37.8 million and $20.4 million, respectively,~~(the “Put Option”) within the ~~one-year~~two-year period after construction of ~~each~~the store is substantially ~~complete. Additionally,~~complete (the “Put Option Period”). In the event the Put Option is not exercised, the Company has a one-year option to call the ownership interest of the noncontrolling ~~members of McDonald Ave, 22nd St, 46th St, Exterior St, and Cropsey Ave~~member for ~~$10.0~~$17.1 million, ~~$11.5 million, $14.2 million, $37.8 million and $20.4 million, respectively,~~ beginning ontwelve months after the ~~second anniversary~~end of the ~~respective store’s construction being substantially complete.~~Put Option Period. The Company, at its sole discretion, may pay cash and/or issue OP Units, in exchange for the noncontrolling member’s interest. The Company is accreting ~~the respective liabilities~~this liability during the development ~~periods~~period and, as of December 31, ~~2017,~~2021, has accrued ~~$2.2 million, $3.3 million, $8.2 million, $28.9 million~~$14.7 million. This amount is included in Accounts payable, accrued expenses and ~~$20.4 million related to McDonald Ave, 22nd St, 46th St, Exterior St, and Cropsey Ave, respectively.~~

other liabilities on the Company’s consolidated balance sheets.

~~(2)~~

(5)

~~In connection with the acquired property, 55~~th St assumed mortgage debt that was recorded at a fair value of $35.0 million, which fair value includes an outstanding principal balance totaling $32.5 million and a net premium of $2.5 million to reflect the estimated fair value of the debt at the time of assumption. The loan accrues interest at a fixed rate of 4.68%, matures on June 7, 2023, and is fully guaranteed by the Company.

~~(3)~~

The Company has a related party commitment to ~~these ventures~~VFV that was used to fund ~~all or~~ a portion of the construction costs. As of December 31, ~~2017,~~2021, the Company has ~~fully funded its $12.8~~an outstanding loan of $13.7 million ~~loan commitment~~ to ~~Jamaica Ave and $12.7 million of a total $14.6 million loan commitment to SRLLC,~~VFV, which ~~are~~is included in the total liability ~~amounts~~amount within the table above. ~~These loans~~This loan and the related interest were eliminated ~~during consolidation. As~~for consolidation purposes.

(6)

On April 16, 2021, the Company contributed $3.4 million in exchange for a 50% ownership interest in Anoka, which acquired a self-storage property located in Minnesota for $12.0 million. In addition, as of December 31, ~~2017,~~2021, the Company has ~~not~~ funded ~~any~~$5.5 million of ~~its $10.8~~a $6.1 million ~~or $6.2 million~~related party loan ~~commitments~~commitment to ~~Waltham~~Anoka, which is included in the total liability amount within the table above. This loan and ~~92nd St, respectively.~~

the related interest were eliminated for consolidation purposes.

(7)

SH3 owns 2 stores located in close proximity to each other in Arlington, VA, the first of which was developed and opened for operation in April 2015 (“Shirlington I”) and the second of which was developed and opened for operation in March 2021 (“Shirlington II”). Given their close proximity to each other, the 2 stores were combined in our store count, as well as for operational and reporting purposes, upon the opening of Shirlington II in March 2021.

~~F-36~~

~~See note 4 for details regarding the Company’s June 2, 2017 acquisition of the noncontrolling interest in a previously consolidated joint venture that developed and owned a store in Brooklyn, NY.~~

USIFB was formed to own, operate, acquire, and develop self-storage properties in England. The Company owned a 97% interest in USIFB through a wholly-owned subsidiary, and USIFB commenced operations at two stores in London, England during 2008. The Company determined that USIFB is a variable interest entity, and that the Company is the primary beneficiary. Accordingly, the Company consolidates the assets, liabilities, and results of operations of USIFB. On December 31, 2013 the Company provided a $6.8 million (£4.1 million) loan secured by a mortgage on real estate assets of USIFB. On June 30, 2014, one of the assets was sold for net proceeds of $7.0 million and the loan was repaid with proceeds from the sale. The loan and any related interest were eliminated during consolidation. On October 2, 2015, USIFB sold its remaining asset in London, England, for an aggregate sales price of £6.5 million (approximately $9.9 million). In connection with the sale, the Company recorded a gain of $3.0 million net of a foreign currency translation loss of $1.2 million.

Operating Partnership Ownership

The Company follows guidance regarding the classification and measurement of redeemable securities. Under this guidance, securities that are redeemable for cash or other assets, at the option of the holder and not solely within the control of the issuer, must be classified outside of permanent equity/capital. This classification results in certain outside ownership interests being included as redeemable noncontrolling interests outside of permanent equity/capital in the consolidated balance sheets. The Company makes this determination based on terms in applicable agreements, specifically in relation to redemption provisions.

Additionally, with respect to redeemable ownership interests in the Operating Partnership held by third parties for which CubeSmart has a choice to settle the redemption by delivery of its own shares, the Operating Partnership considered the guidance regarding accounting for derivative financial instruments indexed to, and potentially settled in, a company’s own shares, to evaluate whether CubeSmart controls the actions or events necessary to presume share settlement. The guidance also requires that noncontrolling interests classified outside of permanent capital be adjusted each period to the greater of the carrying value based on the accumulation of historical cost or the redemption value.

Approximately ~~1.0%~~0.8% and ~~1.1%~~3.6% of the outstanding OP Units as of December 31, ~~2017~~2021 and ~~December 31, 2016,~~2020, respectively, were not owned by CubeSmart, the sole general partner. The interests in the Operating Partnership represented by these OP Units were a component of the consideration that the Operating Partnership paid to acquire certain self-storage properties. The holders of the OP Units are limited

F-38

partners in the Operating Partnership and have the right to require CubeSmart to redeem all or part of their OP Units for, at the general partner’s option, an equivalent number of common shares of CubeSmart or cash based upon the fair value of an equivalent number of common shares of CubeSmart. However, the partnership agreement contains certain provisions that could result in a cash settlement outside the control of CubeSmart and the Operating Partnership, as CubeSmart does not have the ability to settle in unregistered shares. Accordingly, consistent with the guidance, the Operating Partnership records the OP Units owned by third parties outside of permanent capital in the consolidated balance sheets. Net income or loss related to the OP Units owned by third parties is excluded from net income or loss attributable to Operating Partner in the consolidated statements of operations.

~~On May 14, 2015,~~In 2 separate tranches during December 2020, the Company ~~closed on~~acquired the Storage Deluxe Assets for an aggregate purchase price of $540.0 million. In connection with the acquisition of ~~real property that has been developed into a self-storage property in Washington, D.C. In conjunction with~~ the ~~closing,~~Storage Deluxe Assets, the Company issued ~~20,408~~5,272,023 OP Units valued at approximately ~~$0.5~~$175.1 million to ~~pay~~fund a portion of the consideration. On April 18, 2016, upon completion of certain milestones, the Company issued 61,224 additional OP Units, valued at approximately $1.5 million, to pay the remaining consideration. The store commenced operations during the third quarter of 2017.purchase price.

On ~~May 9, 2017,~~September 29, 2020, the Company acquired the noncontrolling interest in a previously consolidated joint venture that owned a store in ~~Maryland~~New York for $18.2 million and assumed an existing mortgage loan with an outstanding balance of approximately $5.9 million. In conjunction with the closing, the Company issued 440,160 OP Units, valued at approximately $12.3 million, to pay the remaining consideration.

~~On April 12, 2017, the Company acquired a store in Illinois for $11.2~~$10.0 million. In conjunction with the closing, the Company paid ~~$9.7~~$1.0 million in cash and issued ~~58,400 Class C~~276,497 OP Units, valued at approximately $9.0 million, to pay the remaining consideration.

On December 16, 2019, the Company acquired a store in California for $18.5 million. In conjunction with the closing, the Company paid $14.9 million and issued 106,738 OP Units, valued at approximately $3.6 million, to pay the remaining consideration.

During the years ended December 31, 2021, 2020 and 2019, 5.5 million, 100,000 and 80,000 OP units, respectively, were redeemed for common shares of the Company.

As of December 31, ~~2017~~2021 and ~~2016, 1,878,253~~2020, 1,901,595 and ~~2,032,394~~7,420,828 OP Units, respectively, were held by third parties. The per unit cash redemption amount of the outstanding OP Units was calculated based upon the ~~average of the~~ closing ~~prices~~price of the common shares of CubeSmart on the New York Stock Exchange ~~for~~on the final 10 trading ~~days~~day of the year. Based on the Company’s evaluation of the redemption value of the redeemable noncontrolling interests, the Company has reflected these interests at ~~their~~the greater of the carrying value based on the accumulation of historical cost or the redemption value as of December 31, ~~2017~~2021 and ~~2016.~~2020. As of December 31, ~~2017,~~2021 and 2020, the Operating Partnership recorded an increase to OP Units owned by third

~~F-37~~

parties and a corresponding decrease to capital of ~~$4.0 million.~~ $164.1 million and $4.2 million, respectively.

13. LEASES

CubeSmart as Lessor

The Company derives revenue primarily from rents received from customers who rent cubes at its self-storage properties under month-to-month leases for personal or business use. The self-storage lease agreements utilized by the Company vary slightly to comply with state-specific laws and regulations, but, subject to such laws and regulations, generally provide for automatic monthly renewals, flexibility to increase rental rates over time as market conditions permit and the collection of contingent fees such as administrative and late fees. None of the self-storage lease agreements contain options that allow the customer to purchase the leased space at any time during, or at the expiration of, the lease term. All self-storage leases in which the Company serves as lessor have been classified as operating leases. Accordingly, storage cubes are carried at historical cost less accumulated depreciation and impairment, if any, and are included in Storage properties on the Company’s consolidated balance sheets. Operating lease income for amounts received under the Company’s self-storage lease agreements is recognized on a straight-line basis which, due to the month-to-month nature of the leases, results in the recognition of income during the initial term and each subsequent monthly renewal using the then-in-place rent amount. Operating lease income is included in Rental income within the Company’s consolidated statements of operations. Variable lease income related to the Company’s self-storage lease agreements consists of administrative and late fees charged to customers. For the years ended December 31, 2021 and 2020, administrative and late fees totaled $21.3 million and $20.0 million, respectively, and are included in Other property related income within the Company’s consolidated statements of operations.

CubeSmart as Lessee

The Company serves as lessee in lease agreements for land, office space, automobiles and certain equipment, which have remaining lease terms of up to 43 years. Certain of the Company’s leases (1) provide for one or more options to renew, with renewal options that can extend the lease up to 69 years, (2) allow for early termination at certain points during the lease term and/or (3) give the Company the option to purchase the leased property. In all cases, the exercise of the lease renewal, termination and purchase options, if provided for in the lease, are at the Company’s sole discretion. Certain of the Company’s lease agreements, particularly its land leases, require rental payments that are periodically adjusted for inflation using a defined index. None of the Company’s lease agreements contain any material

F-39

residual value guarantees or material restrictive covenants. Lease expense for payments related to the Company’s finance leases is recognized as interest expense using the interest method over the related lease term. Lease expense for payments related to the Company’s operating leases is recognized on a straight-line basis over the related lease term, which includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

Right-of-use assets represent the Company’s right to use an underlying asset during the lease term and lease liabilities represent the Company’s obligation to make lease payments as specified in the lease. Right-of-use assets and lease liabilities related to the Company’s operating leases are recognized at the lease commencement date based on the present value of the remaining lease payments over the lease term. As the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available surrounding the Company’s unsecured borrowing rates and implied secured spread at the lease commencement date in determining the present value of lease payments. The right-of-use asset also includes any lease payments made at or before lease commencement less any lease incentives.

For the years ended December 31, 2021 and 2020, the Company’s lease cost consists of the following components:


	Year Ended December 31,
	2021		2020

Finance lease cost:
Amortization of finance lease right-of-use assets	$	964	$	49
Interest expense related to finance lease liabilities		2,139		64
Operating lease cost		3,278		2,856
Short-term lease cost ⁽¹⁾		1,173		1,114
Total lease costs	$	7,554	$	4,083

Cash paid for amounts included in measurement of lease liabilities:
Operating cash outflows for finance leases	$	1,938	$	—
Operating cash outflows for operating leases		2,513		2,186
Total cash outflows for lease liability measurement	$	4,451	$	2,186

(1)

Represents automobile leases that have a lease term of 12 months. The Company has made an accounting policy election not to apply the recognition requirements of ASC 842 to this asset class. The lease cost associated with these leases is recognized on a straight-line basis over the related lease term.

The following table represents supplemental balance sheet information related to leases as of December 31, 2021 and 2020:


	December 31,
	2021			2020

	(dollars in thousands)
Finance Leases
Right-of-use assets included in Storage properties, net	$	40,932		$	41,896
Lease liabilities included in Lease liabilities - finance leases	$	65,801		$	65,599

Operating Leases
Right-of-use assets included in Other assets, net	$	54,741		$	55,302
Lease liabilities included in Accounts payable, accrued expenses and other liabilities	$	54,018		$	53,595

Weighted Average Lease Term (in years)
Finance leases		42.5			43.5
Operating leases		34.0			34.8

Weighted Average Discount Rate
Finance leases		3.25	%		3.25	%
Operating leases		4.46	%		4.46	%

F-40

The following table represents the future lease liability maturities as of December 31, 2021 (in thousands):


	Finance		Operating
2022	$	2,182	$	2,667
2023		2,183		2,719
2024		2,183		2,569
2025		2,224		2,568
2026		2,334		2,644
2027 and thereafter		120,598		97,655
Total lease payments		131,704		110,822
Less: Imputed interest		(65,903)		(56,804)
Present value of lease liabilities	$	65,801	$	54,018

As of December 31, ~~2016,~~2021, the ~~Operating Partnership recorded a decrease~~Company has not entered into any lease agreements that are set to ~~OP Units owned by third parties and a corresponding increase to capital of $7.4 million.~~ commence in the future.

~~13.~~14. RELATED PARTY TRANSACTIONS

~~Affiliated Real Estate Investments~~

The Company provides management services to certain joint ventures and other related parties. Management agreements provide for fee income to the Company based on a percentage of ~~reveneus~~revenues at the managed stores. Total management fees for unconsolidated ~~joint~~real estate ventures or other entities in which the Company held an ownership interest for the years ending December 31, ~~2017, 2016~~2021, 2020 and ~~2015~~2019 were $4.9 million, $3.8 million ~~$2.9 million~~ and ~~$1.0~~$4.0 million, respectively.

The management agreements for certain joint ventures, other related parties and third-party stores provide for the reimbursement to the Company for certain expenses incurred to manage the stores. These ~~amounts~~reimbursements consist of amounts due for management fees, payroll and other store expenses. The amounts due to the Company were ~~$7.5~~$15.4 million and ~~$3.3~~$13.1 million as of December 31, ~~2017~~2021 and ~~2016,~~2020, respectively, and are included in Other Assets, net inon the Company’s consolidated balance sheets. Additionally, as discussed in note 12, the Company had outstanding mortgage loans receivable from consolidated joint ventures of ~~$25.5~~$32.4 million and ~~$34.7~~$21.4 million as of December 31, ~~2017~~2021 and ~~2016,~~2020, respectively, which are eliminated for consolidation purposes. The Company believes that all of these related-party receivables are fully collectible.

The HVP ~~III~~, V, HVPSE, HVP IV and HHFNE operating agreements provide for acquisition, disposition and other fees payable from HVP ~~III~~, V, HVPSE, HVP IV and HHFNE to the Company ~~in an amount equal to 0.5% of~~upon the ~~purchase price upon~~ closing of ~~an acquisition~~a property transaction by ~~HVP~~ ~~III~~,HVPSE, HVP IV and HHFNE, or any of their subsidiaries and completion of certain measures as defined in the operating agreements. ~~The Company recognized $0.5 million and $1.8 million in acquisition fees during~~During the years ended December 31, ~~2017~~2021, 2020 and ~~2016,~~2019, the Company recognized $1.3 million, $0.7 million and $2.1 million, respectively, ~~which~~in fees associated with property transactions (including fees associated with HVP III). Property transaction fees are included in Other income on the consolidated statements of operations. ~~The Company did not recognize any acquisition fees during the year ended December 31, 2015.~~

~~14.~~15. COMMITMENTS AND CONTINGENCIES

~~Ground Leases~~

The Company currently owns eight operating self-storage properties and two self-storage properties currently under development that are subject to ground leases, and two other operating self-storage properties that have portions of land that are subject to ground leases. The Company recorded ground rent expense of approximately $3.4 million, $2.7 million, and $2.4 million for the years ended December 31, 2017, 2016 and 2015, respectively. Total future minimum rental payments under non-cancelable ground leases are as follows:

Ground Lease

Amount

(in thousands)

2018

$
2,500

2019

2,670

2020

2,743

2021

2,812

2022

2,971

2023 and thereafter

119,343

$
133,039

Development Commitments

The Company has ~~development~~ agreements with developers for the construction of ~~six~~3 new self-storage properties (see note 4), which will require payments of approximately ~~$82.7~~$37.3 million, due in installments upon completion of certain construction milestones, during ~~2018~~2022 and ~~2019.~~2023.

Litigation

~~The~~From time to time, the Company is involved in claims ~~from time to time,~~ which arise in the ordinary course of business. In accordance with applicable accounting guidance, management establishes an accrued liability for claim expenses, insurance retention and litigation costs when those matters present loss contingencies that are both probable and reasonably estimable. In such cases, there may be exposure to loss in excess of those amounts accrued. The estimated loss, if any, is based upon currently available information and is subject to significant judgment, a variety of assumptions and known and

~~F-38~~

unknown uncertainties. In the opinion of management, the Company has made adequate provisions for potential liabilities, arising from any such matters, which are included in Accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets. However, litigation is inherently unpredictable, and the costs and other effects of pending or future litigation, governmental investigations, legal and administrative cases and proceedings (whether civil or criminal), settlements, judgments and investigations, claims, and changes in any such matters, could have a material adverse effect on the Company’s business, financial condition, and operating results.

F-41

16. SHARE-BASED COMPENSATION PLANS

On July 13, 2015, a putative class action was filed against the Company in the Federal District Court of New Jersey seeking to obtain declaratory, injunctive and monetary relief for a class of New Jersey consumers based upon alleged violations by the Company of the New Jersey Truth in Customer Contract, Warranty and Notice Act and the New Jersey Consumer Fraud Act. On December 15, 2017, the court granted preliminary approval of a settlement for the class action. The settlement and associated expenses, which were previously reserved for, did not have a material impact on the Company’s consolidated financial position or results of operations.

~~Insurance Recovery~~

As a result of hurricanes that occurred during the third quarter of 2017, the Company incurred damage at certain stores located in Florida and Texas. During the year ended December 31, 2017, the Company recorded $1.1 million in charges based on the damage assessment and terms of the deductibles under the insurance policies, inclusive of its $0.1 million portion of the charge taken by HHF. These charges are comprised of $0.3 million in net book value write-offs related to damaged assets and $0.8 million in estimated deductibles related to costs incurred for repairs and cleanup. The Company has comprehensive insurance coverage and, after receipt of $0.3 million in October 2017, recorded a receivable of $1.0 million as of December 31, 2017 for the remaining anticipated insurance recoveries which is included in Other assets within the Company’s consolidated balance sheets. To the extent that insurance proceeds, which are on a replacement cost basis, ultimately exceed the net book value of the damaged assets, a gain will be recognized in the period in which all contingencies related to the insurance claim have been resolved. The estimated charges for the insurance deductibles and asset write-offs are included in Property operating expenses and Depreciation and amortization, respectively within the Company’s consolidated statements of operations. The Company’s portion of the charge taken by HHF is included in Equity in losses of real estate ventures within the Company’s consolidated statements of operations.

~~15. SHARE-BASED COMPENSATION PLANS~~

~~On June 1, 2016 the Company’s shareholders approved an amendment and restatement of the Company’s 2007 Equity Incentive Plan,~~ a share-based ~~employee~~ compensation plan ~~originally approved by shareholders on May 8, 2007~~(the “Plan”) which it utilizes to compensate certain employees and ~~subsequently amended with shareholder approval on June 2, 2010 (as~~non-employee trustees. The Plan was last amended and restated ~~the “2007 Plan”).~~in 2016. The purpose of the 2007 Plan is to attract and retain highly qualified executive officers, Trustees and key employees and other persons and to motivate such officers, Trustees, key employees, and other persons to serve the Company and its affiliates to expend maximum effort to improve the business results and earnings of the Company, by providing to such persons an opportunity to acquire or increase a direct proprietary interest in the operations and future success of the Company. To this end, the 2007 Plan provides for the grant of share options, share appreciation rights, restricted shares, ~~restricted share~~performance units, ~~performance awards,~~ which may be denominated in cash or shares, ~~included~~including restricted shares and restricted share units, and other share-based awards, including unrestricted common shares or awards denominated or payable in, or valued in whole or part by reference to, common shares. ~~Any of these awards may, but need not, be made as performance incentives to reward attainment of annual or long-term performance goals.~~ Share options granted under the ~~2007~~ Plan may be non-qualified share options or incentive share options.

Upon shareholder approval of the amendment and restatement of the ~~2007~~ Plan inon June 1, 2016, 4,500,000 additional common shares were made available for award under the ~~2007~~ Plan. As a result, these 4,500,000 additional shares, together with the 991,117 shares that remained available for future awards under the ~~2007~~ Plan at the time of the shareholder approval, plus any common shares that are restored to availability upon expiration or forfeiture of outstanding options or restricted share awards, would constitute the “Aggregate Share Reserve”. As of December 31, ~~2017:~~2021: (i) ~~4,936,124~~2,448,384 common shares remained available for future awards under the ~~2007~~ Plan; (ii) ~~465,045~~387,701 unvested restricted share awards were outstanding under the ~~2007~~ Plan; and (iii) ~~1,833,173~~2,263,804 common shares were subject to outstanding options under the ~~2007 Plan (with the outstanding options having a weighted average exercise price of $16.55 per share and a weighted average term to maturity of 5.26 years).~~

Prior to the June 2016 amendments, the 2007 Plan used a “Fungible Units” methodology for computing the maximum number of common shares available for issuance under the 2007 Plan. The Fungible Units methodology assigned weighted values to different types of awards under the 2007 Plan without assigning specific numerical limits for different types of awards. As amended in June 2016, the 2007 Plan provides that any common shares made the subject of awards under the 2007 Plan will count against the Aggregate Share Reserve as one (1) unit. The Aggregate Share Reserve and the computation of the number of common shares available for issuance is

~~F-39~~

subject to adjustment upon certain corporate transactions or events, including share splits, reverse share splits and recapitalizations. The number of shares counted against the Aggregate Share Reserve includes the full number of shares subject to the award, and is not reduced in the event shares are withheld to fund withholding tax obligations, or, in the case of options and share appreciation rights, where shares are applied to pay the exercise price. If an option or other award granted under the 2007 Plan expires, is forfeited or otherwise terminates, the common shares subject to any portion of the award that expires, is forfeited or that otherwise terminates, as the case may be, again becomes available for issuance under the 2007 Plan.

The ~~2007~~ Plan is administered by the Compensation Committee of the Company’s Board of Trustees (the “Compensation Committee”), which is appointed by the Board of Trustees. The Compensation Committee interprets the ~~2007~~ Plan and, subject to its right to delegate authority to grant awards, determines the terms and provisions of option grants and share awards.

Subject to adjustment upon certain corporate transactions or events, a participant (other than a non-employee trustee) may not receive awards under the 2007 Plan in any one calendar year covering more than 1,000,000 shares. Subject to adjustment upon certain corporate transactions or events, a non-employee trustee may not receive awards under the 2007 Plan in any one calendar year covering more than 250,000 shares.

Under the ~~2007~~ Plan, the Compensation Committee determines the vesting schedule of each share award and option, subject to a one-year minimum vesting requirement, but with permitted acceleration of vesting in the event of a participant’s death or disability, or in the event of a change in control or certain changes in our capital structure. Notwithstanding the foregoing one-year minimum vesting limitation, up to ~~five~~5 percent of the shares subject to the Aggregate Share Reserve may be subject to awards that are not subject to such limitation. The exercise price for options is equivalent to the fair value of the underlying common shares at the grant date. The Compensation Committee also determines the term of each option, which shall not exceed 10 years from the grant date.

On October 19, 2004, the Company’s sole shareholder approved a share-based employee compensation plan, the 2004 Equity Incentive Plan (the “2004 Plan”). The 2004 Plan expired in October 2014. Prior to its expiration, a total of 3.0 million common shares were reserved for issuance under the 2004 Plan. Subsequent to its expiration, no new equity awards may be granted under the 2004 Plan, and to the extent that options expire unexercised or are terminated, surrendered or canceled, the options and share awards no longer become available for future grants under the 2004 Plan. As of December 31, 2017, there were approximately five thousand shares outstanding under the 2004 Plan.

Share Options

The fair values for options granted in ~~2017, 2016,~~2021, 2020 and ~~2015~~2019 were estimated at the time the options were granted using the Black-Scholes option-pricing model applying the following weighted average assumptions:



Assumptions:	2017			2016			2015			2021			2020			2019
Risk-free interest rate		2.2	%		1.8	%		1.5	%		0.6	%		1.9	%		2.7	%
Expected dividend yield		3.5	%		2.7	%		2.6	%		3.8	%		3.9	%		3.9	%
Volatility (1)		33.00	%		33.00	%		33.00	%		25.00	%		20.00	%		32.00	%
Weighted average expected life of the options (2)		6.0	years		6.0	years		6.0	years		6.0	years		6.0	years		6.0	years
Weighted average grant date fair value of options granted per share	$	6.12		$	7.61		$	6.23		$	4.62		$	3.66		$	6.35
Term											10.0	years		10.0	years		10.0	years

(1)

Expected volatility is based upon the ~~level of volatility historically experienced.~~

Company’s historical daily share prices.

(2)

~~Expected~~The expected life is based ~~upon our expectations~~on the contractual term of ~~share option recipients’ expected exercise and termination patterns.~~

the options as well as the vesting period.

~~The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options.~~ In ~~addition, option-pricing models require the input of highly subjective assumptions, including the expected share price volatility. Volatility for the 2017, 2016~~2021, 2020 and ~~2015 grants was based on the trading history of the Company’s shares.~~

~~In 2017, 2016, and 2015,~~2019 the Company recognized compensation expense related to options issued to employees and executives of approximately ~~$1.5~~$2.3 million, ~~$1.3~~$2.0 million and ~~$1.0~~$1.8 million, respectively, which is included in General and administrative expense on the Company’s consolidated statements of operations. ~~During 2017, 289,104 share options were issued for which the fair value of the options at their respective grant dates was approximately $1.8 million.~~ The share options vest ratably over three years. As of December 31, ~~2017,~~2021, the Company had approximately ~~$1.8~~$2.5 million of unrecognized option compensation cost related to all grants that will be ~~recorded~~recognized over ~~the next three~~a weighted average period of 1.7 years.

~~F-40~~F-42

The table below summarizes the option activity under the ~~2004 Plan and the 2007~~ Plan for the ~~years~~year ended December 31, ~~2017, 2016 and 2015:~~2021:


				Weighted Average
	Number of Shares	Weighted Average		Remaining
	Under Option	Strike Price		Contractual Term
Balance at December 31, 2014	3,692,301	$	11.76	4.16

					Options	Weighted Average Strike Price		Weighted Average Remaining Contractual Term (Years)
Balance at December 31, 2020					2,118,090	$	26.37	6.39
Options granted	202,485		25.00	9.08	592,456		33.70	9.01
Options canceled	(18,230)		19.75	—	(27,743)		32.33	—
Options exercised	(1,454,612)		11.31	2.38	(418,999)		18.77	3.08
Balance at December 31, 2015	2,421,944	$	13.07	4.08
Options granted	213,008		30.32	9.07
Options exercised	(695,262)		18.69	0.29
Balance at December 31, 2016	1,939,690	$	12.94	4.85
Options granted	289,104		26.30	9.07
Options exercised	(395,621)		5.98	1.14
Balance at December 31, 2017	1,833,173	$	16.55	5.26

Vested or expected to vest at December 31, 2017	1,833,173	$	16.55	5.26
Exercisable at December 31, 2017	1,337,280	$	12.58	4.04
Balance at December 31, 2021					2,263,804	$	29.63	6.82

Vested or expected to vest at December 31, 2021					2,263,804	$	29.63	6.82
Exercisable at December 31, 2021					1,202,882	$	27.17	5.37

As of December 31, ~~2017,~~2021, the aggregate intrinsic value ~~of options outstanding, of options that vested or expected to vest, and~~ of options that were exercisable was approximately ~~$35.3~~$35.8 million. As of that date, the aggregate intrinsic value of options that had vested or were expected to vest was approximately $61.8 million. The aggregate intrinsic value of options exercised was approximately ~~$8.8~~$10.6 million, $0.9 million and $9.1 million for the ~~year~~years ended December 31, ~~2017.~~2021, 2020 and 2019, respectively.

Restricted Shares & Performance Units

The Company applies the fair value method of accounting for contingently issued shares. As such, each grant is recognized ratably over the related vesting period. Approximately 166,000 restricted sharesDuring 2021, 2020 and share units were issued during 2017 for which the fair value of the restricted shares and share units at their respective grant dates was approximately $4.7 million, which vest over three to five years. During 2016, approximately 155,000 restricted shares and share units were issued for which the fair value of the restricted shares and share units at their respective grant dates was approximately $5.2 million. As of December 31, 20172019 the Company ~~had approximately $5.2 million of remaining unrecognized~~granted restricted share and share unit compensation costs that will be recognized over the next five years. Restricted share awards are considered to be performance awards and are valued using the share price on the grant date. The compensation expense recognized related to these awards and remaining unrecognized compensation costs are included in the amounts disclosed above.

~~In 2017, 2016 and 2015, the Company recognized compensation expense related to restricted~~ shares ~~and share units issued~~ to employees and ~~Trustees of approximately $4.1 million, $3.6 million,~~trustees and ~~$2.7 million, respectively; these amounts were recorded in general and administrative expense.~~ also granted performance units to certain executives.

The ~~following table presents non-vested~~fair values for restricted share ~~and share unit activity during 2017:~~awards made under the Plan were valued at the grant date fair value, which is the market price of the underlying common shares. The shares vest over either a 3-year or 5-year period beginning with the first anniversary of the grant.


		~~Number of Non-~~
		~~Vested Restricted~~
		~~Shares and Share Units~~
~~Non-Vested at January 1, 2017~~		~~323,022~~
~~Granted~~		~~165,709~~
~~Vested~~		~~(130,500)~~
~~Forfeited~~		~~(5,769)~~
~~Non-Vested at December 31, 2017~~		~~352,462~~

~~On January 23, 2017, 52,426 restricted share~~Performance units ~~were granted~~represent the right to ~~certain executives.~~earn common shares. The ~~restricted share~~performance units were granted in the form of deferred share units with a market condition, entitling the holders thereof to receive common shares at a future date. The ~~deferred share~~performance units ~~will be~~are awarded based on the Company’s total return to shareholders with respect to a specified peer group consisting of publicly traded REITs over a three-year period. The ~~fair value~~performance units cliff vest upon the third anniversary of the ~~restricted share units on the grant date was approximately $1.8 million.~~effective date. The Company used a Monte Carlo simulation analysis to estimate the fair value of the ~~awards. The restricted share units will cliff vest upon~~awards, the ~~third anniversary~~key assumptions of which are as follows:


Assumptions:	2021			2020			2019
Risk-free interest rate		0.2	%		1.7	%		2.6	%
Volatility ⁽¹⁾		28.00	%		19.00	%		23.00	%

(1)

Expected volatility is based upon the Company’s historical daily share prices.

During the ~~effective date, or~~years ended December 31, ~~2019. The~~2021, 2020 and 2019, the Company recognized compensation expense ~~recognized~~ related to ~~these awards~~restricted shares and ~~remaining unrecognized compensation costs are~~performance units of approximately $5.8 million, $5.2 million and $4.9 million, respectively, which is included in ~~the amounts disclosed above.~~

~~F-41~~

On January 22, 2016, 37,008 restricted share units were granted to certain executives. The restricted share units were granted in the form of deferred share units with a market condition, entitling the holders thereof to receive common shares at a future date. The deferred share units will be awarded basedGeneral and administrative expense on the Company’s ~~total return to shareholders with respect to a specified peer group consisting~~consolidated statements of ~~publicly traded REITs over a three-year period.~~operations. The following table presents non-vested restricted share and performance unit activity under the Plan for the year ended December 31, 2021:


		Number of Non-
		Vested Restricted
		Shares and Performance Units
Non-Vested at January 1, 2021		382,901
Granted		176,825
Vested		(160,549)
Forfeited		(11,476)
Non-Vested at December 31, 2021		387,701

The weighted average fair value of restricted shares and performance units granted during the ~~restricted share units on the grant date~~years ended December 31, 2021, 2020 and 2019 was ~~approximately $1.6 million.~~$39.37, $32.39 and $32.22, respectively. The ~~Company used a Monte Carlo simulation analysis to estimate the~~total fair value of restricted shares and performance units vested during the ~~awards. The~~years ended December 31, 2021, 2020 and 2019 was $7.0 million, $6.1 million and $5.8 million, respectively. As of December 31, 2021 the Company had approximately $6.7 million of remaining unrecognized restricted share ~~units will cliff vest upon the third anniversary of the effective date, or December 31, 2018. The compensation expense recognized related to these awards~~ and ~~remaining unrecognized~~performance unit compensation costs that are ~~included in the amounts disclosed above.~~

~~On January 23, 2015, 35,614 restricted share units were granted~~expected to certain executives. The restricted share units were granted in the form of deferred share units with a market condition, entitling the holders thereof to receive common shares at a future date. The deferred share units will be ~~awarded based on the Company’s total return to shareholders with respect to a specified peer group consisting of publicly traded REITs~~recognized over a ~~three-year period. The fair value~~weighted average period of the restricted share units on the grant date was approximately $1.3 million. The Company used a Monte Carlo simulation analysis to estimate the fair value of the awards. The restricted share units will cliff vest upon the third anniversary of the effective date, or December 31, 2017. The compensation expense recognized related to these awards and remaining unrecognized compensation costs are included in the amounts disclosed above.

2.0 years.

~~F-42~~F-43

~~16.~~

17. EARNINGS PER SHARE AND UNIT AND SHAREHOLDERS’ EQUITY AND CAPITAL

Earnings per common share and shareholders’ equity

The following is a summary of the elements used in calculating basic and diluted earnings per common share:


							For the year ended December 31,
							2021		2020		2019

	For the year ended December 31,
	2017		2016		2015
	(Dollars and shares in thousands, except per share amounts)

							(dollars and shares in thousands, except per share amounts)
Net income	$	135,611	$	88,376	$	78,756	$	230,813	$	167,611	$	170,771
Noncontrolling interests in the Operating Partnership		(1,593)		(941)		(960)		(7,873)		(1,825)		(1,708)
Noncontrolling interest in subsidiaries		270		470		(84)		542		(165)		54
Distributions to preferred shareholders (1)		—		(5,045)		(6,008)
Preferred share redemption charge		—		(2,937)		—
Net income attributable to the Company’s common shareholders	$	134,288	$	79,923	$	71,704	$	223,482	$	165,621	$	169,117

Weighted-average shares outstanding		180,525		178,246		168,640

Weighted average basic shares outstanding								203,832		194,147		190,874
Share options and restricted share units		923		1,287		1,551		1,177		796		702
Weighted-average diluted shares outstanding (2)		181,448		179,533		170,191

Weighted average diluted shares outstanding ⁽¹⁾								205,009		194,943		191,576

Basic earnings per share attributable to common shareholders	$	0.74	$	0.45	$	0.43	$	1.10	$	0.85	$	0.89
Diluted earnings per share attributable to common shareholders	$	0.74	$	0.45	$	0.42

Diluted earnings per share attributable to common shareholders ⁽²⁾							$	1.09	$	0.85	$	0.88

Earnings per common unit and capital

The following is a summary of the elements used in calculating basic and diluted earnings per common unit:

For the year ended December 31,

2017

2016

2015

(Dollars and units in thousands, except per unit amounts)












Net income

$
135,611

$
88,376

$
78,756

Operating Partnership interests of third parties

(1,593)

(941)

(960)

Noncontrolling interest in subsidiaries

270

470

(84)

Distribution to preferred unitholders (1)

—

(5,045)

(6,008)

Preferred unit redemption charge

—

(2,937)

—

Net income attributable to common unitholders

$
134,288

$
79,923

$
71,704

Weighted-average units outstanding

180,525

178,246

168,640

Unit options and restricted share units

923

1,287

1,551

Weighted-average diluted units outstanding (2)

181,448

179,533

170,191

Basic earnings per unit attributable to common unitholders

$
0.74

$
0.45

$
0.43

Diluted earnings per unit attributable to common unitholders

$
0.74

$
0.45

$
0.42


	For the year ended December 31,
	2021		2020		2019

	(dollars and units in thousands, except per unit amounts)
Net income	$	230,813	$	167,611	$	170,771
Operating Partnership interests of third parties		(7,873)		(1,825)		(1,708)
Noncontrolling interest in subsidiaries		542		(165)		54
Net income attributable to common unitholders	$	223,482	$	165,621	$	169,117

Weighted average basic units outstanding		203,832		194,147		190,874
Unit options and restricted share units		1,177		796		702
Weighted average diluted units outstanding ⁽¹⁾		205,009		194,943		191,576

Basic earnings per unit attributable to common unitholders	$	1.10	$	0.85	$	0.89
Diluted earnings per unit attributable to common unitholders ⁽²⁾	$	1.09	$	0.85	$	0.88

(1)

For the year ended December 31, 2016, the Company declared cash dividends per preferred share/unit of $1.626 prior to redemption of the preferred shares on November 2, 2016. For the year ended December 31, 2015, the Company declared cash dividends per preferred share/unit of $1.938.

~~(2)~~

For the years ended December 31, ~~2017, 2016~~2021, 2020 and ~~2015,~~2019, the Company declared cash dividends per common share/unit of ~~$1.11, $0.90,~~$1.45, $1.33 and ~~$0.69,~~$1.29, respectively.

(2)

The amounts of anti-dilutive options that were excluded from the computation of diluted earnings per share/unit as the exercise price was higher than the average share price of the Company for the years ended December 31, 2020 were 0.8 million. There were 0 anti-dilutive options for the years ended December 31, 2021 or 2019.

The OP units and common units have essentially the same economic characteristics as they share equally in the total net income or loss and distributions of the Operating Partnership. An Operating Partnership unit may be redeemed for cash, or at the Company’s option, common units on a one-for-one basis. Outstanding noncontrolling interest units in the Operating Partnership were ~~1,878,253; 2,032,394~~1,901,595; 7,420,828 and ~~2,159,650~~1,972,308 as of December 31, ~~2017, 2016~~2021, 2020 and ~~2015,~~2019, respectively. There were ~~182,215,735; 180,083,111~~223,917,993; 197,405,989 and ~~174,667,870~~193,557,024 common units outstanding as of December 31, ~~2017, 2016~~2021, 2020 and ~~2015,~~2019, respectively.

~~F-43~~F-44

Common Shares

~~Common and Preferred Shares~~

On November ~~2, 2016, the Company redeemed all 3.1~~19, 2021, we closed an underwritten offering of 15.5 million ~~outstanding~~common shares ~~of 7.75% Series A Cumulative Redeemable Preferred Shares (the “Series A Preferred Shares”)~~ at a ~~cash redemption~~public offering price of ~~$25.00~~$51.00 per share, ~~plus accumulated and unpaid dividends up to and including the date~~resulting in net proceeds of ~~redemption of $0.17374 per share. The redemption price of $77.5~~$765.6 million, for the redemption of the Series A Preferred Shares was paid by the Company from available cash balances. In connection with the redemption, the Company recognized a charge of $2.9 million related to excess redemption costs over the original net proceeds.after deducting offering costs.

The Company maintains an at-the-market equity program that enables it to offer and sell up to ~~40.0~~60.0 million common shares through sales agents pursuant to equity distribution agreements (the “Equity Distribution Agreements”). The Company’s sales activity under the program for the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019 is summarized below:


	For the year ended December 31,
	2021		2020		2019

	(dollars and shares in thousands, except per share amounts)
Number of shares sold		4,982		3,627		5,899
Average sales price per share	$	40.57	$	33.69	$	33.64
Net proceeds after deducting offering costs	$	199,977	$	120,727	$	196,304

The proceeds from the sales ~~conducted~~of common shares under the program during the years ended December 31, ~~2017, 2016,~~2021, 2020 and ~~2015~~2019 were used to fund ~~acquisitions~~the acquisition and development of ~~storage~~self-storage properties and for general corporate purposes. As of December 31, ~~2017, 2016,~~2021, 2020 and ~~2015, 4.7~~2019, 5.9 million common shares, ~~5.8~~10.9 million common shares and ~~10.2~~4.6 million common shares, respectively, remained available for issuance under the Equity Distribution Agreements.

~~17. INCOME TAXES~~

Deferred income taxes are established for temporary differences between financial reporting basis and tax basis of assets and liabilities at the enacted tax rates expected to be in effect when the temporary differences reverse. A valuation allowance for deferred tax assets is provided if the Company believes that it is more likely than not that all or some portion of the deferred tax asset will not be realized. No valuation allowance was recorded as of December 31, 2017 or 2016. The Company had net deferred tax assets of $1.4 million and $1.3 million, which are included in other assets on the Company’s consolidated balance sheets as of December 31, 2017 and 2016, respectively. The Company believes it is more likely than not the deferred tax assets will be realized.

18. ~~PRO FORMA FINANCIAL INFORMATION (UNAUDITED)~~

During the years ended December 31, 2017 and 2016, the Company acquired seven self-storage properties for an aggregate purchase price of approximately $80.7 million (see note 3) and 28 stores for an aggregate purchase price of approximately $403.6 million, respectively.

The condensed consolidated pro forma financial information set forth below reflects adjustments to the Company’s historical financial data to give effect to each of the acquisitions and related financing activity (including the issuance of common shares) that occurred during 2017 and 2016 as if each had occurred as of January 1, 2016 and 2015, respectively. The unaudited pro forma information presented below does not purport to represent what the Company’s actual results of operations would have been for the periods indicated, nor does it purport to represent the Company’s future results of operations.

~~F-44~~

~~The following table summarizes, on a pro forma basis, the Company’s consolidated results of operations for the year ended December 31, 2017 and 2016 based on the assumptions described above:~~

Year ended December 31,

2017

2016

(in thousands, except per share data)

Pro forma revenues

$
560,852

$
523,821

Pro forma net income

$
145,941

$
115,269

Earnings per share attributable to common shareholders:

Basic - as reported

$
0.74

$
0.45

Diluted - as reported

$
0.74

$
0.45

Basic - as pro forma

$
0.80

$
0.63

Diluted - as pro forma

$
0.80

$
0.62

~~19.~~ SUBSEQUENT EVENTS

Subsequent to December 31, ~~2017,~~2021, the Company acquired ~~one~~a self-storage property located in ~~Texas~~Maryland for ~~a purchase price of $12.2~~$32.0 million. The purchase price was funded with $7.4 million of cash and $4.8 million through the issuance of 168,011 common units. Following a 13-month lock-up period, the holder may tender the common units for redemption by the Operating Partnership for a cash amount per common unit equal to the market value of an equivalent number of common shares of the Company. The Company has the right, but not the obligation, to assume and satisfy the redemption obligation of the Operating Partnership by issuing one common share in exchange for each common unit tendered for redemption.

~~20. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)~~

~~The following is a summary of quarterly financial information for the years ended December 31, 2017 and 2016 (in thousands, except per share data):~~

Three months ended


March 31,

June 30,

September 30,

December 31,

2017

2017

2017

2017

Total revenues

$
133,037

$
138,559

$
143,865

$
143,482

Total operating expenses

92,646

91,025

91,586

87,971

Net income attributable to the Company

24,986

32,458

37,297

39,547

Basic earnings per share

0.14

0.18

0.21

0.22

Diluted earnings per share

0.14

0.18

0.21

0.22

Three months ended


March 31,

June 30,

September 30,

December 31,

2016

2016

2016

2016

Total revenues

$
118,871

$
126,526

$
132,096

$
132,546

Total operating expenses

90,145

93,509

92,585

90,848

Net income attributable to the Company

15,750

20,424

24,884

26,847

Basic earnings per share

0.08

0.11

0.13

0.13

Diluted earnings per share

0.08

0.11

0.13

0.13

~~The sum of quarterly earnings per share amounts do not necessarily equal the full year amounts.~~

F-45

Table of Contents

CUBESMART

~~CUBESMART~~

SCHEDULE III

REAL ESTATE AND RELATED DEPRECIATION

December 31, ~~2017~~2021

(~~Dollars~~dollars in thousands)

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2017






Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(B)

Developed

Chandler I, AZ

47,680

327

1,257

399

327

1,480

1,807

608

2005

Chandler II, AZ

82,915

1,518

7,485

108

1,518

7,592

9,110

1,045

2013

Gilbert I, AZ

57,200

951

4,688

90

951

4,779

5,730

730

2013

Gilbert II, AZ

114,080

1,199

11,846

152

1,199

11,998
��
13,197

383

2016

Glendale, AZ

56,807

201

2,265

1,195

418

2,899

3,317

1,356

1998

Green Valley, AZ

25,050

298

1,153

196

298

1,139

1,437

437

2005

Mesa I, AZ

52,575

920

2,739

311

921

2,603

3,524

1,034

2006

Mesa II, AZ

45,511

731

2,176

284

731

2,132

2,863

854

2006

Mesa III, AZ

59,629

706

2,101

254

706

1,971

2,677

805

2006

Peoria, AZ

110,835

1,436

7,082

241

1,436

7,322

8,758

596

2015

Phoenix I, AZ

101,275

1,134

3,376

560

1,135

3,284

4,419

1,315

2006

Phoenix II, AZ

83,160

756

2,251

1,636

847

3,187

4,034

1,210

2006/2011

Phoenix III, AZ

121,730

2,115

10,429

130

2,115

10,559

12,674

1,295

2014

Phoenix IV, AZ

69,610

930

12,277

85

930

12,363

13,293

454

2016

Queen Creek, AZ

94,462

1,159

5,716

84

1,159

5,800

6,959

513

2015

Scottsdale, AZ

80,725

443

4,879

1,758

883

5,521

6,404

2,638

1998

Surprise , AZ

72,325

584

3,761

107

584

3,868

4,452

256

2015

Tempe I, AZ

53,890

749

2,159

575

749

2,424

3,173

846

2005

Tempe II, AZ

68,409

588

2,898

2,153

588

5,051

5,639

761

2013

Tucson I, AZ

59,800

188

2,078

1,076

384

2,650

3,034

1,258

1998

Tucson II, AZ

43,950

188

2,078

1,090

391

2,683

3,074

1,241

1998

Tucson III, AZ

49,820

532

2,048

258

533

1,945

2,478

771

2005

Tucson IV, AZ

48,040

674

2,595

371

675

2,545

3,220

984

2005

Tucson V, AZ

45,134

515

1,980

357

515

1,981

2,496

786

2005

Tucson VI, AZ

40,790

440

1,692

229

430

1,623

2,053

648

2005

Tucson VII, AZ

52,663

670

2,576

324

670

2,486

3,156

994

2005

Tucson VIII, AZ

46,650

589

2,265

336

589

2,250

2,839

888

2005

Tucson IX, AZ

67,496

724

2,786

469

725

2,734

3,459

1,075

2005

Tucson X, AZ

46,350

424

1,633

327

425

1,650

2,075

629

2005

Tucson XI, AZ

42,700

439

1,689

416

439

1,814

2,253

767

2005

Tucson XII, AZ

42,275

671

2,582

343

672

2,497

3,169

965

2005

Tucson XIII, AZ

45,800

587

2,258

350

587

2,238

2,825

886

2005

Tucson XIV, AZ

48,995

707

2,721

468

708

2,641

3,349

1,058

2005

Benicia, CA

74,770

2,392

7,028

305

2,392

6,249

8,641

2,426

2005

Citrus Heights, CA

75,620

1,633

4,793

234

1,634

4,253

5,887

1,720

2005

Corona, CA

94,975

2,107

10,385

78

2,107

10,462

12,569

1,054

2014

Diamond Bar, CA

103,558

2,522

7,404

273

2,524

6,585

9,109

2,645

2005

Escondido, CA

143,645

3,040

11,804

223

3,040

9,669

12,709

3,140

2007

Fallbrook, CA

45,926

133

1,492

1,849

432

2,832

3,264

1,333

1997

Fremont, CA

51,324

1,158

5,711

164

1,158

5,876

7,034

743

2014

Lancaster, CA

60,475

390

2,247

1,059

556

2,571

3,127

1,034

2001

Long Beach, CA

124,571

3,138

14,368

903

3,138

13,335

16,473

4,995

2006

Murrieta, CA

49,775

1,883

5,532

249

1,903

4,915

6,818

1,910

2005

North Highlands, CA

57,094

868

2,546

429

868

2,517

3,385

1,021

2005

Ontario, CA

93,590

1,705

8,401

345

1,705

8,745

10,450

897

2014

Orangevale, CA

50,542

1,423

4,175

312

1,423

3,813

5,236

1,546

2005

Pleasanton, CA

83,600

2,799

8,222

215

2,799

7,194

9,993

2,789

2005

Rancho Cordova, CA

53,978

1,094

3,212

390

1,095

3,059

4,154

1,201

2005

Rialto I, CA

57,391

899

4,118

212

899

3,758

4,657

1,434

2006

Rialto II, CA

99,783

277

3,098

1,756

672

4,057

4,729

2,030

1997

Riverside I, CA

67,220

1,351

6,183

598

1,351

5,949

7,300

2,232

2006

Riverside II, CA

85,176

1,170

5,359

372

1,170

4,941

6,111

1,900

2006

Roseville, CA

59,944

1,284

3,767

425

1,284

3,593

4,877

1,459

2005

Sacramento I, CA

50,664

1,152

3,380

324

1,152

3,144

4,296

1,266

2005

Sacramento II, CA

111,736

2,085

6,750

327

2,086

6,413

8,499

1,547

2005/2017

San Bernardino I, CA

31,070

51

572

1,188

182

1,432

1,614

660

1997

San Bernardino II, CA

41,546

112

1,251

1,359

306

2,067

2,373

952

1997

San Bernardino III, CA

35,416

98

1,093

1,321

242

1,918

2,160

889

1997

San Bernardino IV, CA

83,227

1,872

5,391

219

1,872

4,894

6,766

1,882

2005

San Bernardino V, CA

56,745

783

3,583

571

783

3,628

4,411

1,394

2006

San Bernardino VII, CA

78,809

1,475

6,753

309

1,290

6,315

7,605

2,444

2006

San Bernardino VIII, CA

103,567

1,691

7,741

603

1,692

6,391

8,083

2,501

2006

San Marcos, CA

37,425

775

2,288

175

776

2,093

2,869

835

2005

Santa Ana, CA

63,916

1,223

5,600

436

1,223

5,258

6,481

1,985

2006

South Sacramento, CA

52,390

790

2,319

344

791

2,244

3,035

891

2005

Spring Valley, CA

55,035

1,178

5,394

848

1,178

5,498

6,676

2,075

2006

Temecula I, CA

81,340

660

4,735

1,001

899

5,165

6,064

2,307

1998

Temecula II, CA

84,520

3,080

5,839

708

3,080

5,612

8,692

1,736

2007

Vista I, CA

74,238

711

4,076

2,346

1,118

5,099

6,217

2,059

2001

Vista II, CA

147,753

4,629

13,599

174

4,629

11,712

16,341

4,590

2005

Walnut, CA

50,708

1,578

4,635

326

1,595

4,223

5,818

1,644

2005

West Sacramento, CA

39,765

(A)

1,222

3,590

216

1,222

3,239

4,461

1,278

2005

Westminster, CA

68,393

1,740

5,142

379

1,743

4,634

6,377

1,880

2005

Aurora, CO

75,717

1,343

2,986

559

1,343

2,996

4,339

1,102

2005

Centennial, CO

62,400

1,281

8,958

92

1,281

9,049

10,330

452

2016

Colorado Springs I, CO

47,975

771

1,717

409

771

1,783

2,554

683

2005

Colorado Springs II, CO

62,400

657

2,674

269

656

2,435

3,091

934

2006

Denver I, CO

59,200

673

2,741

227

646

2,490

3,136

1,010

2006

Denver II, CO

74,390

1,430

7,053

120

1,430

7,172

8,602

1,213

2012

Denver III, CO

76,025

1,828

12,109

65

1,828

12,174

14,002

496

2016

Federal Heights, CO

54,770

878

1,953

275

879

1,830

2,709

702

2005

Golden, CO

87,800

1,683

3,744

564

1,684

3,636

5,320

1,367

2005

Littleton, CO

53,490

1,268

2,820

388

1,268

2,701

3,969

983

2005

Northglenn, CO

43,102

862

1,917

432

662

2,135

2,797

750

2005

Bloomfield, CT

48,700

78

880

2,408

360

2,678

3,038

1,180

1997

~~F-46~~

~~Table of Contents~~

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2017








Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(B)

Developed

Branford, CT

50,629

217

2,433

1,516

504

3,236

3,740

1,587

1995

Bristol, CT

47,725

1,819

3,161

104

1,819

2,801

4,620

1,211

2005

East Windsor, CT

45,966

744

1,294

508

744

1,531

2,275

680

2005

Enfield, CT

52,875

424

2,424

460

473

2,107

2,580

890

2001

Gales Ferry, CT

54,905

240

2,697

1,550

489

3,555

4,044

1,878

1995

Manchester I, CT

46,925

540

3,096

476

563

2,576

3,139

1,019

2002

Manchester II, CT

52,725

996

1,730

325

996

1,748

2,744

739

2005

Manchester III, CT

60,113

671

3,308

157

671

3,465

4,136

444

2014

Milford, CT

44,885

87

1,050

1,210

274

1,767

2,041

849

1996

Monroe, CT

58,500

2,004

3,483

656

2,004

3,454

5,458

1,557

2005

Mystic, CT

50,825

136

1,645

2,071

410

2,958

3,368

1,406

1996

Newington I, CT

42,620

1,059

1,840

272

1,059

1,818

2,877

764

2005

Newington II, CT

36,140

911

1,584

291

911

1,601

2,512

685

2005

Norwalk I, CT

30,160

646

3,187

58

646

3,244

3,890

569

2012

Norwalk II, CT

78,175

1,171

15,422

108

1,171

15,530

16,701

784

2016

Old Saybrook I, CT

87,000

3,092

5,374

706

3,092

5,226

8,318

2,247

2005

Old Saybrook II, CT

26,425

1,135

1,973

254

1,135

1,899

3,034

850

2005

Shelton, CT

78,405

1,613

9,032

217

1,613

8,165

9,778

1,614

2011

South Windsor, CT

72,025

90

1,127

1,493

272

2,228

2,500

1,018

1996

Stamford, CT

28,907

1,941

3,374

188

1,941

3,022

4,963

1,273

2005

Wilton, CT

84,515

2,409

12,261

404

2,421

12,727

15,148

2,353

2012

Washington I, DC

62,685

(A)

871

12,759

536

894

10,573

11,467

3,328

2008

Washington II, DC

82,697

3,152

13,612

202

3,154

12,039

15,193

2,302

2011

Washington III, DC

78,340

4,469

15,438

58

4,469

15,497

19,966

894

2016

Washington IV, DC

71,971

6,359

20,417

2

6,359

20,419

26,778

133

2017

Boca Raton, FL

37,968

529

3,054

1,605

813

3,551

4,364

1,459

2001

Boynton Beach I, FL

61,725

667

3,796

1,927

958

4,392

5,350

1,795

2001

Boynton Beach II, FL

61,514

1,030

2,968

443

1,030

2,973

4,003

1,145

2005

Boynton Beach III, FL

67,393

1,225

6,037

247

1,225

6,285

7,510

718

2014

Boynton Beach IV, FL

76,098

1,455

7,171

54

1,455

7,226

8,681

576

2015

Bradenton I, FL

68,398

1,180

3,324

250

1,180

3,053

4,233

1,216

2004

Bradenton II, FL

88,063

1,931

5,561

1,131

1,931

5,596

7,527

2,221

2004

Cape Coral I, FL

76,857

472

2,769

2,574

830

4,040

4,870

1,997

2000

Cape Coral II, FL

67,955

1,093

5,387

99

1,093

5,485

6,578

545

2014

Coconut Creek I, FL

78,846

1,189

5,863

173

1,189

6,035

7,224

1,030

2012

Coconut Creek II, FL

90,147

1,937

9,549

174

1,937

9,723

11,660

1,223

2014

Dania Beach, FL

180,588

3,584

10,324

1,656

3,584

10,442

14,026

4,087

2004

Dania, FL

58,165

205

2,068

1,519

481

2,888

3,369

1,431

1996

Davie, FL

80,985

1,268

7,183

1,240

1,373

6,152

7,525

2,384

2001

Deerfield Beach, FL

57,230

946

2,999

2,001

1,311

4,490

5,801

2,044

1998

Delray Beach I, FL

67,833

798

4,539

822

883

4,075

4,958

1,707

2001

Delray Beach II, FL

75,710

957

4,718

222

957

4,940

5,897

737

2013

Delray Beach III, FL

94,377

2,086

10,286

155

2,086

10,442

12,528

1,174

2014

Delray Beach IV, FL

97,945

2,208

14,384

5

2,208

14,388

16,596

36

2017

Ft. Lauderdale I, FL

70,093

937

3,646

2,490

1,384

5,455

6,839

2,490

1999

Ft. Lauderdale II, FL

49,577

862

4,250

86

862

4,337

5,199

557

2013

Ft. Myers I, FL

67,534

303

3,329

940

328

3,269

3,597

1,504

1999

Ft. Myers II, FL

83,375

1,030

5,080

135

1,030

5,215

6,245

592

2014

Ft. Myers III, FL

81,554

1,148

5,658

155

1,148

5,814

6,962

657

2014

Jacksonville I, FL

79,705

1,862

5,362

156

1,862

4,836

6,698

1,742

2005

Jacksonville II, FL

64,970

950

7,004

170

950

5,626

6,576

1,822

2007

Jacksonville III, FL

65,840

860

7,409

1,010

1,670

6,018

7,688

1,960

2007

Jacksonville IV, FL

77,525

870

8,049

1,159

1,651

7,133

8,784

2,297

2007

Jacksonville V, FL

82,523

1,220

8,210

362

1,220

6,835

8,055

2,230

2007

Jacksonville VI, FL

67,375

755

3,725

122

755

3,846

4,601

384

2014

Kendall, FL

75,495

(A)

2,350

8,106

476

2,350

6,808

9,158

2,156

2007

Lake Worth I, FL

160,622

183

6,597

7,507

354

10,905

11,259

4,972

1998

Lake Worth II, FL

86,924

1,552

7,654

176

1,552

7,829

9,381

922

2014

Lake Worth III, FL

92,510

957

4,716

211

957

4,928

5,885

421

2015

Lakeland, FL

49,095

81

896

1,247

256

1,556

1,812

737

1994

Leisure City, FL

56,225

409

2,018

164

409

2,181

2,590

384

2012

Lutz I, FL

66,795

901

2,478

264

901

2,356

3,257

928

2004

Lutz II, FL

69,232

992

2,868

400

992

2,773

3,765

1,077

2004

Margate I, FL

53,660

161

1,763

2,202

399

3,285

3,684

1,603

1996

Margate II, FL

65,380

132

1,473

1,859

383

2,712

3,095

1,286

1996

Merritt Island, FL

50,261

716

2,983

667

796

2,738

3,534

1,038

2002

Miami I, FL

46,500

179

1,999

1,850

484

2,850

3,334

1,373

1996

Miami II, FL

66,960

253

2,544

1,619

561

3,332

3,893

1,649

1996

Miami III, FL

151,620

4,577

13,185

867

4,577

12,228

16,805

4,537

2005

Miami IV, FL

76,695

1,852

10,494

936

1,963

9,869

11,832

2,126

2011

Miramar, FL

80,130

1,206

5,944

80

1,206

6,025

7,231

881

2013

Naples I, FL

48,100

90

1,010

2,631

270

3,100

3,370

1,469

1996

Naples II, FL

65,850

148

1,652

4,294

558

5,252

5,810

2,535

1997

Naples III, FL

80,021

139

1,561

4,147

598

4,079

4,677

1,994

1997

Naples IV, FL

40,625

262

2,980

613

407

2,996

3,403

1,473

1998

New Smyrna Beach, FL

81,454

1,261

6,215

193

1,261

6,407

7,668

647

2014

North Palm Beach, FL

46,275

1,374

7,649

29

1,374

7,679

9,053

234

2017

Oakland Park, FL

63,231

3,007

10,145

11

3,007

10,157

13,164

47

2017

Ocoee, FL

76,150

1,286

3,705

198

1,286

3,386

4,672

1,280

2005

Orange City, FL

59,580

1,191

3,209

230

1,191

2,952

4,143

1,180

2004

Orlando II, FL

63,184

1,589

4,576

202

1,589

4,138

5,727

1,565

2005

Orlando III, FL

101,510

1,209

7,768

742

1,209

7,122

8,331

2,408

2006

Orlando IV, FL

76,601

633

3,587

184

633

3,268

3,901

734

2010

Orlando V, FL

75,327

950

4,685

127

950

4,811

5,761

803

2012

Orlando VI, FL

67,275

640

3,154

141

640

3,295

3,935

334

2014

Oviedo, FL

49,276

440

2,824

607

440

2,759

3,199

963

2006

Palm Coast I, FL

47,400

555

2,735

110

555

2,845

3,400

366

2014

Palm Coast II, FL

122,490

1,511

7,450

353

1,511

7,804

9,315

999

2014

Palm Harbor, FL

82,685

2,457

16,178

118

2,457

16,297

18,754

782

2016

Pembroke Pines, FL

67,321

337

3,772

2,808

953

5,434

6,387

2,633

1997

Royal Palm Beach II, FL

81,238

1,640

8,607

301

1,640

7,247

8,887

2,358

2007

Sanford I, FL

61,810

453

2,911

187

453

2,532

2,985

848

2006

Sanford II, FL

69,755

1,003

4,944

215

1,003

5,159

6,162

526

2014

~~F-47~~

~~Table of Contents~~

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2017








Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(B)

Developed

Sarasota, FL

71,142

333

3,656

1,399

529

3,842

4,371

1,739

1999

St. Augustine, FL

59,725

135

1,515

3,411

383

4,322

4,705

2,126

1996

St. Petersburg, FL

66,025

2,721

10,173

422

2,721

10,594

13,315

508

2016

Stuart, FL

86,756

324

3,625

3,185

685

5,823

6,508

2,781

1997

SW Ranches, FL

64,975

1,390

7,598

284

1,390

6,020

7,410

1,938

2007

Tampa I, FL

83,938

2,670

6,249

258

2,670

5,154

7,824

1,659

2007

Tampa II, FL

74,790

2,291

10,262

123

2,291

10,385

12,676

495

2016

West Palm Beach I, FL

66,906

719

3,420

1,667

835

3,841

4,676

1,602

2001

West Palm Beach II, FL

94,353

2,129

8,671

439

2,129

7,805

9,934

3,132

2004

West Palm Beach III, FL

77,410

804

3,962

74

804

4,036

4,840

655

2012

West Palm Beach IV, FL

102,742

1,499

7,392

318

1,499

7,709

9,208

883

2014

Winter Park, FL

54,416

866

4,268

92

866

4,360

5,226

446

2014

Alpharetta, GA

90,501

806

4,720

1,060

967

4,032

4,999

1,622

2001

Atlanta, GA

66,625

822

4,053

73

822

4,127

4,949

706

2012

Austell, GA

83,655

1,635

4,711

381

1,643

4,436

6,079

1,485

2006

Decatur, GA

145,320

616

6,776

400

616

6,183

6,799

3,118

1998

Duluth, GA

70,885

373

2,044

216

373

1,935

2,308

400

2011

Lawrenceville, GA

73,740

546

2,903

424

546

2,910

3,456

614

2011

Lithia Springs, GA

66,750

748

5,552

125

748

5,675

6,423

380

2015

Norcross I, GA

85,420

514

2,930

954

632

2,969

3,601

1,171

2001

Norcross II, GA

52,595

366

2,025

224

366

1,965

2,331

414

2011

Norcross III, GA

46,955

938

4,625

70

938

4,696

5,634

876

2012

Norcross IV, GA

57,505

576

2,839

117

576

2,956

3,532

503

2012

Peachtree City I, GA

49,875

435

2,532

788

529

2,541

3,070

997

2001

Peachtree City II, GA

59,950

398

1,963

120

398

2,084

2,482

350

2012

Smyrna, GA

57,015

750

4,271

318

750

3,471

4,221

1,414

2001

Snellville, GA

79,950

1,660

4,781

355

1,660

4,473

6,133

1,477

2007

Suwanee I, GA

85,125

1,737

5,010

343

1,737

4,653

6,390

1,534

2007

Suwanee II, GA

80,340

800

6,942

93

622

5,831

6,453

1,897

2007

Villa Rica, GA

65,281

757

5,616

147

757

5,763

6,520

385

2015

Addison, IL

31,575

428

3,531

475

428

3,505

3,933

1,369

2004

Aurora, IL

73,985

644

3,652

203

644

3,335

3,979

1,311

2004

Bartlett, IL

51,395

931

2,493

306

931

2,395

3,326

944

2004

Bellwood, IL

86,350

1,012

5,768

1,070

1,012

5,103

6,115

2,004

2001

Blue Island, IL

55,125

633

3,120

47

633

3,167

3,800

281

2015

Bolingbrook, IL

82,425

1,675

8,254

175

1,675

8,430

10,105

860

2014

Chicago I, IL

95,845

2,667

13,118

953

2,667

14,070

16,737

1,453

2014

Chicago II, IL

78,585

833

4,035

73

833

4,108

4,941

416

2014

Chicago III, IL

84,990

2,427

11,962

813

2,427

12,775

15,202

1,327

2014

Chicago IV, IL

60,495

1,296

6,385

56

1,296

6,442

7,738

564

2015

Chicago V, IL

51,775

1,044

5,144

53

1,044

5,197

6,241

456

2015

Chicago VI, IL

71,785

1,596

9,535

47

1,596

9,582

11,178

483

2016

Chicago VII, IL

91,292

—

11,191

290

—

11,481

11,481

58

2017

Countryside, IL

97,356

2,607

12,684

185

2,607

12,870

15,477

1,303

2014

Des Plaines, IL

69,450

1,564

4,327

815

1,564

4,503

6,067

1,703

2004

Downers Grove, IL

71,625

1,498

13,153

23

1,498

13,176

14,674

678

2016

Elk Grove Village, IL

64,054

1,446

3,535

306

1,446

3,311

4,757

1,348

2004

Evanston, IL

57,715

1,103

5,440

218

1,103

5,657

6,760

848

2013

Glenview, IL

100,085

3,740

10,367

578

3,740

9,478

13,218

3,719

2004

Gurnee, IL

80,300

1,521

5,440

380

1,521

5,056

6,577

2,004

2004

Hanover, IL

41,190

1,126

2,197

307

1,126

2,166

3,292

862

2004

Harvey, IL

60,090

869

3,635

354

869

3,447

4,316

1,324

2004

Joliet, IL

72,865

547

4,704

251

547

4,296

4,843

1,703

2004

Kildeer, IL

74,463

2,102

2,187

4,570

1,997

6,554

8,551

979

2004

Lombard, IL

58,241

1,305

3,938

932

1,305

4,264

5,569

1,679

2004

Maywood, IL

60,225

749

3,689

31

749

3,720

4,469

325

2015

Mount Prospect, IL

64,950

1,701

3,114

645

1,701

3,306

5,007

1,249

2004

Mundelein, IL

44,700

1,498

2,782

412

1,498

2,778

4,276

1,052

2004

North Chicago, IL

53,400

1,073

3,006

510

1,073

3,031

4,104

1,183

2004

Plainfield I, IL

53,900

1,770

1,715

346

1,740

1,768

3,508

667

2004

Plainfield II, IL

51,900

694

2,000

285

694

1,952

2,646

702

2005

Riverwoods, IL

73,915

1,585

7,826

92

1,585

7,918

9,503

199

2017

Schaumburg, IL

31,160

538

645

257

538

765

1,303

287

2004

Streamwood, IL

64,305

1,447

1,662

491

1,447

1,841

3,288

702

2004

Warrenville, IL

48,796

1,066

3,072

505

1,066

3,145

4,211

1,112

2005

Waukegan, IL

79,500

1,198

4,363

650

1,198

4,360

5,558

1,668

2004

West Chicago, IL

48,175

1,071

2,249

497

1,071

2,388

3,459

909

2004

Westmont, IL

53,400

1,155

3,873

318

1,155

3,650

4,805

1,408

2004

Wheeling I, IL

54,210

857

3,213

458

857

3,199

4,056

1,255

2004

Wheeling II, IL

67,825

793

3,816

550

793

3,814

4,607

1,510

2004

Woodridge, IL

50,232

943

3,397

303

943

3,225

4,168

1,248

2004

Schererville, IN

67,604

1,134

5,589

54

1,134

5,643

6,777

645

2014

Boston I, MA

33,286

538

3,048

266

538

2,890

3,428

651

2010

Boston II, MA

60,470

1,516

8,628

726

1,516

6,899

8,415

2,597

2002

Boston III, MA

108,205

3,211

15,829

706

3,211

16,535

19,746

1,682

2014

Brockton, MA

59,296

577

4,394

34

577

4,427

5,004

293

2015

Haverhill, MA

60,589

669

6,610

54

669

6,664

7,333

444

2015

Lawrence, MA

34,672

585

4,737

263

585

5,000

5,585

331

2015

Leominster, MA

54,073

90

1,519

2,533

338

3,411

3,749

1,564

1998

Medford, MA

58,685

1,330

7,165

374

1,330

6,046

7,376

1,793

2007

Stoneham, MA

61,300

1,558

7,679

319

1,558

7,998

9,556

1,150

2013

Tewksbury, MA

62,402

1,537

7,579

276

1,537

7,854

9,391

902

2014

Walpole, MA

74,890

634

13,069

324

634

13,393

14,027

594

2016

Annapolis, MD

92,332

5,786

2,643

13,938

38

2,643

13,976

16,619

271

2017

Baltimore, MD

93,750

1,050

5,997

1,443

1,173

5,297

6,470

2,116

2001

Beltsville, MD

63,687

1,277

6,295

72

1,268

6,375

7,643

937

2013

California, MD

77,840

1,486

4,280

341

1,486

4,030

5,516

1,558

2004

Capitol Heights, MD

79,600

2,704

13,332

43

2,704

13,376

16,080

1,028

2015

Clinton, MD

84,225

2,182

10,757

133

2,182

10,890

13,072

1,417

2013

District Heights, MD

78,240

1,527

8,313

540

1,527

7,728

9,255

1,578

2011

Elkridge, MD

63,475

1,155

5,695

239

1,155

5,934

7,089

790

2013

Gaithersburg I, MD

87,045

3,124

9,000

480

3,124

8,218

11,342

3,215

2005

Gaithersburg II, MD

74,150

2,383

11,750

69

2,383

11,819

14,202

913

2015

~~F-48~~

~~Table of Contents~~

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2017








Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(B)

Developed

Hyattsville, MD

52,830

1,113

5,485

100

1,113

5,586

6,699

819

2013

Laurel, MD

162,896

1,409

8,035

3,673

1,928

8,853

10,781

3,644

2001

Temple Hills I, MD

97,270

1,541

8,788

2,596

1,800

8,886

10,686

3,573

2001

Temple Hills II, MD

84,225

2,229

10,988

54

2,229

11,042

13,271

1,378

2014

Timonium, MD

66,717

2,269

11,184

199

2,269

11,382

13,651

1,426

2014

Upper Marlboro, MD

62,290

1,309

6,455

99

1,309

6,552

7,861

968

2013

Bloomington, MN

101,028

1,598

12,298

124

1,598

12,424

14,022

458

2016

Belmont, NC

81,850

385

2,196

959

451

2,339

2,790

939

2001

Burlington I, NC

109,300

498

2,837

875

498

2,898

3,396

1,222

2001

Burlington II, NC

42,165

320

1,829

442

340

1,731

2,071

709

2001

Cary, NC

112,402

543

3,097

827

543

3,228

3,771

1,350

2001

Charlotte I, NC

69,000

782

4,429

1,537

1,068

4,510

5,578

1,722

2002

Charlotte II, NC

53,736

821

8,764

55

821

8,818

9,639

284

2016

Cornelius, NC

59,270

2,424

4,991

929

2,424

5,920

8,344

374

2015

Pineville, NC

77,747

2,490

9,169

140

2,490

9,309

11,799

622

2015

Raleigh, NC

48,675

209

2,398

422

296

2,344

2,640

1,106

1998

Bordentown, NJ

50,550

457

2,255

170

457

2,424

2,881

399

2012

Brick, NJ

51,720

234

2,762

1,466

485

3,395

3,880

1,737

1996

Cherry Hill I, NJ

51,500

222

1,260

182

222

1,260

1,482

300

2010

Cherry Hill II, NJ

65,500

471

2,323

317

471

2,640

3,111

420

2012

Clifton, NJ

105,550

4,346

12,520

300

4,340

11,140

15,480

4,177

2005

Cranford, NJ

91,280

290

3,493

2,757

779

5,055

5,834

2,370

1996

East Hanover, NJ

107,679

504

5,763

4042

1,315

7,873

9,188

3,984

1996

Egg Harbor I, NJ

36,025

104

510

66

104

565

669

125

2010

Egg Harbor II, NJ

70,400

284

1,608

278

284

1,666

1,950

397

2010

Elizabeth, NJ

38,830

751

2,164

692

751

2,533

3,284

918

2005

Fairview, NJ

27,876

246

2,759

583

246

2,736

2,982

1,335

1997

Freehold, NJ

81,420

1,086

5,355

203

1,086

5,558

6,644

946

2012

Hamilton, NJ

70,550

1,885

5,430

498

1,893

5,160

7,053

1,721

2006

Hoboken, NJ

34,130

1,370

3,947

774

1,370

4,087

5,457

1,622

2005

Linden, NJ

100,425

517

6,008

2,522

1,043

6,994

8,037

3,339

1996

Lumberton, NJ

96,025

987

4,864

315

987

5,178

6,165

873

2012

Morris Township, NJ

72,226

500

5,602

2,984

1,072

6,947

8,019

3,292

1997

Parsippany, NJ

84,655

475

5,322

5,740

844

9,723

10,567

3,115

1997

Rahway, NJ

83,121

1,486

7,326

660

1,486

7,986

9,472

1,119

2013

Randolph, NJ

52,565

855

4,872

1,358

1,108

4,541

5,649

1,811

2002

Ridgefield, NJ

67,803

1,810

8,925

315

1,810

9,239

11,049

700

2015

Roseland, NJ

53,569

1,844

9,759

145

1,844

9,904

11,748

665

2015

Sewell, NJ

57,826

484

2,766

1,414

706

3,102

3,808

1,267

2001

Somerset, NJ

57,485

1,243

6,129

205

1,243

6,333

7,576

1,056

2012

Whippany, NJ

92,070

2,153

10,615

131

2,153

10,746

12,899

1,581

2013

Albuquerque I, NM

65,927

1,039

3,395

356

1,039

3,168

4,207

1,289

2005

Albuquerque II, NM

58,798

1,163

3,801

268

1,163

3,446

4,609

1,432

2005

Albuquerque III, NM

57,536

664

2,171

364

664

2,145

2,809

887

2005

Henderson, NV

75,150

1,246

6,143

100

1,246

6,241

7,487

635

2014

Las Vegas I, NV

48,732

1,851

2,986

581

1,851

3,155

5,006

1,353

2006

Las Vegas II, NV

48,850

3,354

5,411

435

3,355

5,265

8,620

2,261

2006

Las Vegas III, NV

84,600

1,171

10,034

110

1,171

10,144

11,315

396

2016

Las Vegas IV, NV

91,557

1,116

8,575

92

1,116

8,665

9,781

355

2016

Las Vegas V, NV

107,226

1,460

9,560

176

1,460

9,736

11,196

338

2016

Las Vegas VI, NV

92,707

1,386

12,299

98

1,386

12,397

13,783

361

2016

Baldwin, NY

61,380

1,559

7,685

624

1,559

8,309

9,868

626

2015

Bronx I, NY

67,864

2,014

11,411

1,021

2,014

10,840

12,854

2,539

2010

Bronx II, NY

99,046

—

28,289

1,697

—

29,451

29,451

5,659

2011

Bronx III, NY

105,900

6,459

36,180

185

6,460

32,018

38,478

6,261

2011

Bronx IV, NY

74,580

—

22,074

124

—

19,543

19,543

3,836

2011

Bronx V, NY

54,704

—

17,556

208

—

15,653

15,653

3,075

2011

Bronx VI, NY

45,970

—

16,803

361

—

15,132

15,132

2,959

2011

Bronx VII, NY

78,625

8,228

—

22,512

186

—

22,807

22,807

4,227

2012

Bronx VIII, NY

30,550

2,889

1,245

6,137

163

1,251

6,330

7,581

1,181

2012

Bronx IX, NY

147,870

22,508

7,967

39,279

1,332

7,967

40,610

48,577

7,374

2012

Bronx X, NY

159,805

25,700

9,090

44,816

475

9,090

45,291

54,381

7,838

2012

Bronx XI, NY

46,425

—

17,130

265

—

17,396

17,396

1,733

2014

Bronx XII, NY

89,785

—

31,603

73

—

31,674

31,674

1,564

2016

Brooklyn I, NY

57,566

1,795

10,172

329

1,795

9,084

10,879

2,097

2010

Brooklyn II, NY

60,920

1,601

9,073

494

1,601

8,269

9,870

1,943

2010

Brooklyn III, NY

41,510

2,772

13,570

142

2,772

13,794

16,566

2,712

2011

Brooklyn IV, NY

37,545

2,283

11,184

164

2,284

11,411

13,695

2,251

2011

Brooklyn V, NY

47,020

2,374

11,636

109

2,374

11,798

14,172

2,307

2011

Brooklyn VI, NY

74,920

4,210

20,638

100

4,211

20,845

25,056

4,076

2011

Brooklyn VII, NY

72,750

5,604

27,452

192

5,604

27,809

33,413

5,447

2011

Brooklyn VIII, NY

61,555

4,982

24,561

89

4,982

24,649

29,631

2,882

2014

Brooklyn IX, NY

46,980

2,966

14,620

106

2,966

14,726

17,692

1,721

2014

Brooklyn X, NY

55,875

3,739

7,703

2,916

4,885

9,472

14,357

622

2015

Brooklyn XI, NY

110,075

10,093

35,385

226

10,093

35,610

45,703

2,069

2016

Brooklyn XII, NY

131,588

1,077

6,057

—

1,077

6,056

7,133

—

2017

Holbrook, NY

60,397

2,029

10,737

57

2,029

10,794

12,823

719

2015

Jamaica I, NY

88,385

2,043

11,658

1,802

2,043

10,739

12,782

4,408

2001

Jamaica II, NY

92,805

5,391

26,413

386

5,391

26,942

32,333

5,259

2011

Long Island City, NY

88,825

5,700

28,101

43

5,700

28,144

33,844

2,759

2014

New Rochelle I, NY

43,596

1,673

4,827

1,212

1,673

5,380

7,053

1,872

2005

New Rochelle II, NY

63,300

3,167

2,713

434

3,762

18,980

22,742

3,521

2012

New York, NY

94,912

31,727

42,022

38,753

—

42,022

38,753

80,775

405

2017

North Babylon, NY

78,350

225

2,514

4,230

568

5,595

6,163

2,615

1998

Patchogue, NY

47,759

1,141

5,624

48

1,141

5,672

6,813

574

2014

Queens I, NY

74,188

5,158

12,339

757

5,160

13,094

18,254

928

2015

Queens II, NY

90,728

6,208

25,815

6

6,208

25,822

32,030

1,661

2016

Riverhead, NY

38,490

1,068

1,149

204

1,068

1,075

2,143

487

2005

Southold, NY

59,945

2,079

2,238

347

2,079

2,181

4,260

951

2005

Staten Island, NY

96,573

1,919

9,463

848

1,919

10,312

12,231

1,429

2013

Tuckahoe, NY

50,978

2,363

17,411

286

2,363

11,926

14,289

2,322

2011

West Hempstead, NY

83,395

2,237

11,030

159

2,237

11,188

13,425

1,889

2012

White Plains, NY

85,864

3,295

18,049

1,020

3,295

16,577

19,872

3,522

2011

~~F-49~~

~~Table of Contents~~

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2017








Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(B)

Developed

Woodhaven, NY

50,665

2,015

11,219

90

2,015

10,012

12,027

1,960

2011

Wyckoff, NY

60,210

1,961

11,113

325

1,961

9,956

11,917

2,221

2010

Yorktown, NY

78,879

2,382

11,720

193

2,382

11,927

14,309

2,342

2011

Cleveland I, OH

46,000

525

2,592

270

524

2,512

3,036

1,009

2005

Cleveland II, OH

58,325

290

1,427

230

289

1,404

1,693

573

2005

Columbus I, OH

71,905

1,234

3,151

148

1,239

2,823

4,062

1,084

2006

Columbus II, OH

36,409

769

3,788

209

769

3,997

4,766

407

2014

Columbus III, OH

51,200

326

1,607

118

326

1,725

2,051

179

2014

Columbus IV, OH

60,950

443

2,182

99

443

2,281

2,724

236

2014

Columbus V, OH

73,325

838

4,128

114

838

4,242

5,080

430

2014

Columbus VI, OH

63,525

701

3,454

99

701

3,553

4,254

362

2014

Grove City, OH

89,290

1,756

4,485

280

1,761

4,147

5,908

1,553

2006

Hilliard, OH

89,290

1,361

3,476

255

1,366

3,243

4,609

1,232

2006

Lakewood, OH

39,332

405

854

637

405

1,335

1,740

997

1989

Lewis Center, OH

76,024

1,056

5,206

141

1,056

5,346

6,402

544

2014

Middleburg Heights, OH

93,200

63

704

2,316

332

2,352

2,684

1,063

1980

North Olmsted I, OH

48,672

63

704

1,520

214

1,737

1,951

822

1979

North Olmsted II, OH

47,850

290

1,129

1,229

469

2,032

2,501

1,637

1988

North Randall, OH

80,297

515

2,323

3,246

898

4,303

5,201

2,017

1998

Reynoldsburg, OH

67,245

1,290

3,295

338

1,295

3,178

4,473

1,213

2006

Strongsville, OH

43,683

570

3,486

418

570

3,071

3,641

1,018

2007

Warrensville Heights, OH

90,281

525

766

3,249

935

3,417

4,352

1,511

1980

Westlake, OH

62,750

509

2,508

260

508

2,379

2,887

985

2005

Conshohocken, PA

81,285

1,726

8,508

174

1,726

8,682

10,408

1,479

2012

Exton, PA

57,750

541

2,668

124

519

2,814

3,333

476

2012

Langhorne, PA

64,938

1,019

5,023

343

1,019

5,366

6,385

898

2012

Levittown, PA

76,130

926

5,296

1,267

926

4,842

5,768

1,956

2001

Malvern, PA

18,848

2,959

18,198

1,657

2,959

19,853

22,812

2,182

2013

Montgomeryville, PA

84,145

975

4,809

221

975

5,029

6,004

871

2012

Norristown, PA

61,746

662

3,142

776

638

4,048

4,686

850

2011

Philadelphia I, PA

96,016

1,461

8,334

1,913

1,461

6,904

8,365

2,832

2001

Philadelphia II, PA

68,279

1,012

4,990

163

1,012

5,153

6,165

636

2014

Exeter, RI

41,275

547

2,697

126

547

2,823

3,370

290

2014

Johnston, RI

77,275

1,061

5,229

101

1,061

5,331

6,392

541

2014

Wakefield, RI

45,745

823

4,058

50

823

4,108

4,931

413

2014

Woonsocket, RI

72,900

1,049

5,172

143

1,049

5,315

6,364

541

2014

Antioch, TN

75,985

588

4,906

350

588

4,489

5,077

1,734

2005

Nashville I, TN

107,850

405

3,379

773

405

3,563

3,968

1,346

2005

Nashville II, TN

83,174

593

4,950

221

593

4,476

5,069

1,758

2005

Nashville III, TN

101,525

416

3,469

289

416

3,425

3,841

1,331

2006

Nashville IV, TN

102,450

992

8,274

377

992

7,409

8,401

2,858

2006

Nashville V, TN

74,560

2,411

895

4,311

802

895

5,113

6,008

415

2015

Nashville VI, TN

72,436

2,749

8,443

97

2,749

8,539

11,288

570

2015

Allen, TX

62,170

714

3,519

113

714

3,632

4,346

631

2012

Austin I, TX

59,645

2,239

2,038

275

2,239

1,964

4,203

737

2005

Austin II, TX

64,415

(A)

734

3,894

377

738

3,709

4,447

1,321

2006

Austin III, TX

70,585

1,030

5,468

326

1,035

5,135

6,170

1,791

2006

Austin IV, TX

65,308

862

4,250

332

862

4,582

5,444

554

2014

Austin V, TX

67,850

1,050

5,175

240

1,050

5,415

6,465

571

2014

Austin VI, TX

62,850

1,150

5,669

262

1,150

5,932

7,082

605

2014

Austin VII, TX

71,023

1,429

6,263

132

1,429

6,394

7,823

426

2015

Austin VIII, TX

61,075

2,935

7,007

49

2,935

7,057

9,992

427

2016

Bryan, TX

60,400

1,394

1,268

561

1,396

1,592

2,988

509

2005

Carrollton, TX

77,380

661

3,261

137

661

3,398

4,059

545

2012

Cedar Park, TX

88,700

3,350

7,950

39

3,350

7,989

11,339

483

2016

College Station, TX

26,550

812

740

199

813

752

1,565

275

2005

Cypress, TX

58,161

360

1,773

145

360

1,919

2,279

341

2012

Dallas I, TX

58,582

2,475

2,253

482

2,475

2,288

4,763

866

2005

Dallas II, TX

76,673

940

4,635

229

940

4,864

5,804

646

2013

Dallas III, TX

83,427

2,608

12,857

253

2,608

13,110

15,718

1,283

2014

Dallas IV, TX

114,550

2,369

11,850

65

2,369

11,914

14,283

1,061

2015

Dallas V, TX

54,499

—

11,604

84

—

11,689

11,689

906

2015

Denton, TX

60,846

553

2,936

305

569

2,746

3,315

923

2006

Fort Worth I, TX

50,416

1,253

1,141

353

1,253

1,256

2,509

444

2005

Fort Worth II, TX

72,900

868

4,607

392

874

4,331

5,205

1,547

2006

Fort Worth III, TX

80,445

1,000

4,928

128

1,000

5,057

6,057

455

2015

Fort Worth IV, TX

77,329

1,274

7,693

31

1,274

7,724

8,998

423

2016

Frisco I, TX

50,854

1,093

3,148

193

1,093

2,883

3,976

1,080

2005

Frisco II, TX

71,599

1,564

4,507

202

1,564

4,093

5,657

1,531

2005

Frisco III, TX

74,665

1,147

6,088

572

1,154

5,850

7,004

2,050

2006

Frisco IV, TX

75,175

719

4,072

281

719

3,795

4,514

893

2010

Frisco V, TX

74,415

1,159

5,714

133

1,159

5,846

7,005

708

2014

Frisco VI, TX

69,176

1,064

5,247

170

1,064

5,417

6,481

556

2014

Garland I, TX

70,100

751

3,984

590

767

3,981

4,748

1,402

2006

Garland II, TX

68,425

862

4,578

297

862

4,278

5,140

1,447

2006

Grapevine, TX

78,019

1,211

8,559

112

1,211

8,671

9,882

469

2016

Houston III, TX

61,590

575

524

388

576

799

1,375

316

2005

Houston IV, TX

43,750

960

875

677

961

1,352

2,313

436

2005

Houston V, TX

124,279

1,153

6,122

1,336

991

6,709

7,700

2,140

2006

Houston VI, TX

54,690

575

524

5,783

983

4,985

5,968

1,044

2011

Houston VII, TX

46,991

681

3,355

179

681

3,534

4,215

666

2012

Houston VIII, TX

54,209

1,294

6,377

375

1,294

6,753

8,047

1,170

2012

Houston IX, TX

51,208

296

1,459

129

296

1,588

1,884

278

2012

Humble, TX

70,702

706

5,727

95

706

5,822

6,528

389

2015

Katy, TX

71,308

1,329

6,552

84

1,329

6,637

7,966

861

2013

Keller, TX

88,060

1,330

7,960

316

1,331

7,660

8,991

1,584

2006/2017

Lewisville I, TX

67,340

476

2,525

418

492

2,506

2,998

865

2006

Lewisville II, TX

127,659

1,464

7,217

328

1,464

7,545

9,009

1,052

2013

Lewisville III, TX

93,855

1,307

15,025

175

1,307

15,201

16,508

824

2016

Little Elm I, TX

60,065

892

5,529

127

892

5,657

6,549

319

2016

Little Elm II, TX

96,896

1,219

9,864

83

1,219

9,948

11,167

542

2016

Mansfield I, TX

63,025

837

4,443

267

843

4,129

4,972

1,479

2006


											Gross Carrying Amount at
		Total				Initial Cost			Costs		December 31, 2021
		Rentable					Buildings		Subsequent				Buildings				Accumulated
	Number of	Square Feet					&		to				&				Depreciation
State	Stores	(unaudited)	Encumbrances		Land		Improvements		Acquisition		Land		Improvements		Total		(A)
Arizona	48	3,070,755	$	—	$	98,442	$	389,514	$	23,213	$	99,495	$	397,612	$	497,107	$	38,951
California	63	4,741,051		—		371,460		683,683		33,337		373,302		663,731		1,037,033		83,657
Colorado	10	654,265		—		11,812		46,755		4,131		11,787		44,903		56,690		12,426
Connecticut	22	1,197,402		—		22,023		82,375		19,620		23,568		86,979		110,547		32,682
Florida	90	6,801,203		—		104,987		531,360		88,420		112,652		553,950		666,602		167,579
Georgia	21	1,562,380		—		18,394		100,856		9,933		18,518		99,513		118,031		28,392
Illinois	43	2,761,024		—		54,493		221,022		27,543		54,358		224,665		279,023		64,522
Indiana	1	70,380		—		1,134		5,589		199		1,134		5,783		6,917		1,374
Maryland	19	1,585,705		5,099		37,055		188,989		13,098		37,912		189,926		227,838		44,095
Massachusetts	20	1,256,014		—		31,948		159,000		9,476		32,197		163,387		195,584		27,862
Minnesota	2	176,296		—		2,621		21,655		379		2,621		22,034		24,655		2,084
Nevada	22	1,700,457		—		71,702		394,023		4,536		71,703		396,643		468,346		11,695
New Jersey	28	1,983,294		—		45,864		188,139		36,373		49,372		205,843		255,215		59,133
New Mexico	3	182,261		—		2,866		9,367		1,615		2,867		7,804		10,671		3,212
New York	58	4,593,319		149,080		416,337		1,300,288		45,488		428,549		1,317,425		1,745,974		247,167
North Carolina	9	611,298		—		10,349		44,680		6,242		10,788		47,409		58,197		12,034
Ohio	20	1,294,303		—		13,529		51,265		17,460		14,938		54,746		69,684		20,461
Pennsylvania	12	890,594		—		18,769		99,196		10,424		18,723		104,434		123,157		18,784
Rhode Island	4	247,305		—		3,480		17,156		1,574		3,480		18,729		22,209		4,241
South Carolina	8	432,389		—		6,117		31,039		1,159		6,117		32,199		38,316		2,387
Tennessee	9	755,595		2,206		9,117		54,403		4,897		9,117		52,047		61,164		12,905
Texas	75	5,358,803		—		108,310		458,473		31,746		108,628		465,154		573,782		89,494
Utah	4	293,988		—		10,763		2,844		2,676		10,622		4,102		14,724		1,800
Virginia	11	965,100		—		32,731		122,391		4,498		32,732		119,686		152,418		28,717
Washington D.C.	5	409,484		—		28,759		80,996		2,232		28,803		78,709		107,512		15,704
Other Corporate Assets	—	—		—		—		—		12,450		1,480		10,970		12,450		2,511
	607	43,594,665	$	156,385	$	1,533,062	$	5,285,058	$	412,719	$	1,565,463	$	5,368,383	$	6,933,846	$	1,033,869

~~F-50~~

~~Table of Contents~~

(A)

~~(A)~~

~~This store is part of the YSI 33 Loan portfolio, with a balance of $9,547 as of December 31, 2017.~~

~~(B)~~

Depreciation on the buildings and improvements is recorded on a straight-line basis over their estimated useful lives, which range from five to 39 years.

F-46

Table of Contents

Activity in storage properties during ~~2017 and 2016~~the period from January 1, 2019 through December 31, 2021 was as follows (in thousands):

2017

2016

Storage properties*

Balance at beginning of year

$
3,998,180

$
3,467,032

Acquisitions & improvements

247,546

490,980

Fully depreciated assets

(53,903)

(61,232)

Dispositions and other

(9,179)

—

Construction in progress, net

(20,929)

101,400

Balance at end of year

$
4,161,715

$
3,998,180

Accumulated depreciation*

Balance at beginning of year

$
671,364

$
594,049

Depreciation expense

135,732

138,547

Fully depreciated assets

(53,903)

(61,232)

Dispositions and other

(268)

—

Balance at end of year

$
752,925

$
671,364

Storage properties, net

$
3,408,790

$
3,326,816


	2021		2020		2019
Storage properties*
Balance at beginning of year	$	5,489,754	$	4,699,844	$	4,463,455
Acquisitions & improvements		1,795,965		825,247		364,324
Fully depreciated assets		(52,722)		(83,418)		(81,717)
Dispositions and other		(19,408)		(8,533)		(3,033)
Construction in progress, net		(30,095)		14,718		(43,185)
Right-of-use assets - finance leases		—		41,896		—
Balance at end of year	$	7,183,494	$	5,489,754	$	4,699,844

Accumulated depreciation*
Balance at beginning of year	$	983,940	$	925,359	$	862,487
Depreciation expense		160,933		143,952		145,233
Fully depreciated assets		(52,722)		(83,418)		(81,717)
Dispositions and other		(6,327)		(1,953)		(644)
Balance at end of year	$	1,085,824	$	983,940	$	925,359
Storage properties, net	$	6,097,670	$	4,505,814	$	3,774,485

*These amounts include equipment that is housed at the Company’s stores which is excluded from Schedule III above.

As of December 31, 2021, the aggregate cost of Storage properties for federal income tax purposes was approximately $7,452.8 million.

~~F-51~~F-47

PART I		5

Item 1.	Business	6

Item 1A.	Risk Factors	12 16

Item 1B.	Unresolved Staff Comments	24 30

Item 2.	Properties	25 30

Item 3.	Legal Proceedings	37 32

Item 4.	Mining Safety Disclosures	37 32

PART II		37 32

Item 5.	Market for Registrant’s Common Equity, Related Shareholder Matters, and Issuer Purchases of Equity Securities	37 32

Item 6.	Selected Financial Data	39 34

Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	44 34

Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	61 46

Item 8.	Financial Statements and Supplementary Data	61 47

Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	61 47

Item 9A.	Controls and Procedures	61 47

Item 9B.	Other Information	62 48

~~PART III~~Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	63 48

~~Item 10.~~PART III		48

Item 10.	Trustees, Executive Officers, and Corporate Governance	63 48

Item 11.	Executive Compensation	63 48

Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters	63 49

Item 13.	Certain Relationships and Related Transactions, and Trustee Independence	63 49

Item 14.	Principal Accountant Fees and Services	64 49

PART IV		64 49

Item 15.	Exhibits and Financial Statement Schedules	64 49

Item 16.	Form 10-K Summary	70 55


	Year
	Acquired /		Rentable				Manager	% Climate
	Developed		Square	Occupancy			Apartment	Controlled
Store Location	(1)	Year Built	Feet	(2)		Cubes	(3)	(4)
Chandler I, AZ	2005	1985	47,680	81.6	%	456	Y	12.7	%
Chandler II, AZ	2013	2008	82,915	82.5	%	1,175	N	73.9	%
Gilbert I, AZ	2013	2010	57,200	84.0	%	443	Y	84.0	%
Gilbert II, AZ	2016	2005/14	114,080	81.1	%	835	Y	43.8	%
Glendale, AZ	1998	1987	56,807	90.1	%	534	Y	0.0	%
Green Valley, AZ	2005	1985	25,050	97.9	%	266	N	9.0	%
Mesa I, AZ	2006	1985	52,575	91.7	%	512	N	0.0	%
Mesa II, AZ	2006	1981	45,511	94.8	%	412	Y	16.7	%
Mesa III, AZ	2006	1986	59,629	94.2	%	527	Y	15.7	%
Peoria, AZ	2015	2005	110,835	94.6	%	926	N	35.4	%
Phoenix I, AZ	2006	1987	101,275	82.2	%	782	Y	24.8	%
Phoenix II, AZ	2006/11	1974	83,160	93.0	%	814	Y	6.6	%
Phoenix III, AZ	2014	2009	121,730	91.9	%	817	N	74.3	%
Phoenix IV, AZ	2016	2008	69,610	92.5	%	696	Y	100.0	%
Queen Creek, AZ	2015	2013	94,462	87.8	%	628	Y	61.3	%
Scottsdale, AZ	1998	1995	80,725	93.9	%	658	Y	20.5	%
Surprise, AZ	2015	2006	72,325	96.1	%	604	N	100.0	%
Tempe I, AZ	2005	1975	53,890	91.8	%	409	Y	18.8	%
Tempe II, AZ	2013	2007	68,409	90.9	%	735	Y	86.7	%
Tucson I, AZ	1998	1974	59,800	94.9	%	500	Y	0.0	%
Tucson II, AZ	1998	1988	43,950	92.6	%	537	Y	100.0	%
Tucson III, AZ	2005	1979	49,820	93.1	%	499	N	0.0	%
Tucson IV, AZ	2005	1982	48,040	92.5	%	505	Y	13.5	%
Tucson V, AZ	2005	1982	45,134	95.4	%	423	Y	11.3	%
Tucson VI, AZ	2005	1982	40,790	92.3	%	418	Y	13.6	%
Tucson VII, AZ	2005	1982	52,663	93.8	%	609	Y	6.9	%
Tucson VIII, AZ	2005	1979	46,650	92.4	%	463	Y	0.0	%
Tucson IX, AZ	2005	1984	67,496	93.7	%	609	Y	5.9	%
Tucson X, AZ	2005	1981	46,350	91.0	%	425	N	0.0	%
Tucson XI, AZ	2005	1974	42,700	95.3	%	413	Y	0.0	%
Tucson XII, AZ	2005	1974	42,275	90.4	%	446	Y	3.8	%
Tucson XIII, AZ	2005	1974	45,800	94.5	%	501	Y	0.0	%
Tucson XIV, AZ	2005	1976	48,995	94.5	%	558	Y	17.9	%
Benicia, CA	2005	1988/93/05	74,770	93.3	%	722	Y	0.0	%
Citrus Heights, CA	2005	1987	75,620	91.6	%	684	Y	0.0	%
Corona, CA	2014	2014	94,975	94.6	%	971	N	6.9	%
Diamond Bar, CA	2005	1988	103,558	92.2	%	916	Y	0.0	%
Escondido, CA	2007	2002	143,645	96.4	%	1,269	Y	12.0	%
Fallbrook, CA	1997	1985/88	45,926	90.4	%	451	Y	0.0	%
Fremont, CA	2014	1987	51,324	90.2	%	526	Y	0.0	%
Lancaster, CA	2001	1987	60,475	96.6	%	371	Y	0.0	%
Long Beach, CA	2006	1974	124,571	93.7	%	1,378	Y	0.0	%
Murrieta, CA	2005	1996	49,775	91.5	%	453	Y	5.1	%
North Highlands, CA	2005	1980	57,094	88.8	%	476	Y	0.0	%
Ontario, CA	2014	1986	93,590	93.4	%	849	Y	0.0	%


		Rentable Square	Average Occupancy
Year Acquired (1)	# of Stores	Feet	2017		2016		2015

2014 and earlier	413	28,307,299	92.9	%	92.6	%	91.7	%
2015	32	2,258,773	88.8	%	82.8	%	77.2	%
2016	30	2,430,230	79.9	%	67.8	%	—
2017	9	763,460	39.1	%	—		—
All Stores Owned as of December 31, 2017	484	33,759,762	91.2	%	90.7	%	91.3	%


		Rent per Square Foot
Year Acquired (1)	# of Stores	2017		2016		2015

2014 and earlier	413	$	16.92	$	16.29	$	15.36
2015	32		16.36		14.94		14.84
2016	30		15.36		15.24		—
2017	9		19.11		—		—
All Stores Owned as of December 31, 2017	484	$	16.80	$	16.14	$	15.34


	Total Number of Shares Purchased (1)	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs

October 1 - October 31	83	$	25.97	N/A	3,000,000
November 1 - November 30	80	$	28.99	N/A	3,000,000
December 1 - December 31	253	$	28.94	N/A	3,000,000
Total	416	$	28.36	N/A	3,000,000


					Cash Dividends
					Declared per
	High		Low		Share
2016
First quarter	$	33.30	$	27.70	$	0.21
Second quarter	$	33.28	$	29.18	$	0.21
Third quarter	$	32.07	$	26.43	$	0.21
Fourth quarter	$	26.96	$	23.88	$	0.27

2017
First quarter	$	27.38	$	25.12	$	0.27
Second quarter	$	27.96	$	23.81	$	0.27
Third quarter	$	26.84	$	22.94	$	0.27
Fourth quarter	$	29.65	$	25.63	$	0.30


	Period Ending
Index	12/31/2012	12/31/2013	12/31/2014	12/31/2015	12/31/2016	12/31/2017
CubeSmart	100.00	112.51	160.37	228.41	205.93	229.74
S&P 500 Index	100.00	132.39	150.51	152.59	170.84	208.14
Russell 2000 Index	100.00	138.82	145.62	139.19	168.85	193.58
NAREIT All Equity REIT Index	100.00	102.86	131.68	135.40	147.09	159.85


	At December 31,
	2017			2016			2015			2014			2013

Balance Sheet Data (in thousands):
Storage properties, net	$	3,408,790		$	3,326,816		$	2,872,983		$	2,625,129		$	2,155,170
Total assets		3,545,336			3,475,028			3,104,164			2,776,906			2,347,819
Unsecured senior notes, net		1,142,460			1,039,076			741,904			493,957			493,283
Revolving credit facility		81,700			43,300			—			78,000			38,600
Unsecured term loans, net		299,396			398,749			398,183			397,617			397,261
Mortgage loans and notes payable, net		111,434			114,618			111,455			194,844			198,869
Total liabilities		1,855,646			1,759,384			1,393,183			1,277,465			1,218,337
Noncontrolling interests in the Operating Partnership		54,320			54,407			66,128			49,823			36,275
Total CubeSmart shareholders' equity		1,629,134			1,655,382			1,643,327			1,448,026			1,092,276
Noncontrolling interests in subsidiaries		6,236			5,855			1,526			1,592			931
Total liabilities and equity		3,545,336			3,475,028			3,104,164			2,776,906			2,347,819

Other Data:
Number of stores		484			475			445			421			366
Total rentable square feet (in thousands)		33,760			32,858			30,361			28,622			24,662
Occupancy percentage		89.2	%		89.7	%		90.2	%		89.1	%		88.3	%
Cash dividends declared per common share (2)	$	1.11		$	0.90		$	0.69		$	0.55		$	0.46


											Non Same-Store						Other/
	Same-Store Property Portfolio										Properties						Eliminations				Total Portfolio
							Increase/		%																		Increase/		%
	2017			2016			(Decrease)		Change		2017			2016			2017		2016		2017			2016			(Decrease)		Change
REVENUES:
Rental income	$	444,290		$	424,977		$	19,313	4.5	%	$	44,753		$	24,624		$	—	$	—	$	489,043		$	449,601		$	39,442	8.8	%
Other property related income		46,131			44,689			1,442	3.2	%		4,643			2,574			4,227		2,992		55,001			50,255			4,746	9.4	%
Property management fee income		—			—			—	0.0	%		—			—			14,899		10,183		14,899			10,183			4,716	46.3	%
Total revenues		490,421			469,666			20,755	4.4	%		49,396			27,198			19,126		13,175		558,943			510,039			48,904	9.6	%

OPERATING EXPENSES:
Property operating expenses		139,092			135,366			3,726	2.8	%		18,858			11,936			23,558		18,545		181,508			165,847			15,661	9.4	%
NET OPERATING INCOME (LOSS):		351,329			334,300			17,029	5.1	%		30,538			15,262			(4,432)		(5,370)		377,435			344,192			33,243	9.7	%

Store count		432			432							52			43							484			475
Total square footage		29,561			29,561							4,199			3,297							33,760			32,858
Period End Occupancy (1)		91.7	%		91.8	%						71.7	%		71.4	%						89.2	%		89.7	%
Period Average Occupancy (2)		93.1	%		92.9	%
Realized annual rent per occupied sq. ft. (3)	$	16.15		$	15.48

Depreciation and amortization																						145,681			161,865			(16,184)	(10.0)	%
General and administrative																						34,745			32,823			1,922	5.9	%
Acquisition related costs																						1,294			6,552			(5,258)	(80.3)	%
Subtotal																						181,720			201,240			(19,520)	(9.7)	%
OPERATING INCOME																						195,715			142,952			52,763	36.9	%

OTHER (EXPENSE) INCOME
Interest:
Interest expense on loans																						(56,952)			(50,399)			(6,553)	(13.0)	%
Loan procurement amortization expense																						(2,638)			(2,577)			(61)	(2.4)	%
Equity in losses of real estate ventures																						(1,386)			(2,662)			1,276	47.9	%
Other																						872			1,062			(190)	(17.9)	%
Total other expense																						(60,104)			(54,576)			(5,528)	(10.1)	%

NET INCOME																						135,611			88,376			47,235	53.4	%
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
Noncontrolling interests in the Operating Partnership																						(1,593)			(941)			(652)	(69.3)	%
Noncontrolling interests in subsidiaries																						270			470			(200)	(42.6)	%
NET INCOME ATTRIBUTABLE TO THE COMPANY																					$	134,288		$	87,905		$	46,383	52.8	%
Distribution to preferred shareholders																						—			(5,045)			5,045	100.0	%
Preferred share redemption charge																						—			(2,937)			2,937	100.0	%
NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS																					$	134,288		$	79,923		$	54,365	68.0	%


	Year Ended December 31,
Net cash provided by (used in):	2017		2016		Change
	(in thousands)

Operating activities	$	293,438	$	265,164	$	28,274
Investing activities	$	(147,824)	$	(544,471)	$	396,647
Financing activities	$	(143,319)	$	219,411	$	(362,730)


	Carrying Value as of:				Effective Interest
	December 31,		December 31,		Rate as of		Maturity
Unsecured Term Loans	2017		2016		December 31, 2017 (1)		Date
	(in thousands)
Credit Facility
Unsecured term loan	$	200,000	$	200,000	2.86	%	Jan-19
Term Loan Facility
Unsecured term loan (2)		—		100,000	—	%	Jun-18
Unsecured term loan (3)		100,000		100,000	3.62	%	Jan-20
Principal balance outstanding		300,000		400,000
Less: Loan procurement costs, net		(604)		(1,251)
Total unsecured term loans, net	$	299,396	$	398,749


	Payments Due by Period
													2023 and
	Total		2018		2019		2020		2021		2022		thereafter
Mortgage loans and notes payable (1)	$	108,796	$	2,650	$	11,652	$	12,791	$	45,057	$	923	$	35,723
Revolving credit facility and unsecured term loans		381,700		—		200,000		181,700		—		—		—
Unsecured senior notes		1,150,000		—		—		—		—		250,000		900,000
Interest payments		349,168		63,793		58,157		52,275		49,437		42,719		82,787
Ground leases		133,039		2,500		2,670		2,743		2,812		2,971		119,343
Software and service contracts		600		497		73		30		—		—		—
Development commitments		82,728		70,199		12,529		—		—		—		—
	$	2,206,031	$	139,639	$	285,081	$	249,539	$	97,306	$	296,613	$	1,137,853


																			Noncontrolling
																			Interests
	Common			Preferred			Additional		Accumulated Other				Total		Noncontrolling				in the
	Shares			Shares			Paid-in		Comprehensive		Accumulated		Shareholders’		Interests in		Total		Operating
	Number	Amount		Number	Amount		Capital		(Loss) Income		Deficit		Equity		Subsidiaries		Equity		Partnership
Balance at December 31, 2014	163,957	$	1,639	3,100	$	31	$	1,974,308	$	(8,759)	$	(519,193)	$	1,448,026	$	1,592	$	1,449,618	$	49,823
Contributions from noncontrolling interest in subsidiaries																178		178
Distributions to noncontrolling interests in subsidiaries																(319)		(319)
Issuance of common shares, net	8,978		91					233,970						234,061				234,061
Issuance of restricted shares	161		1											1				1
Issuance of OP Shares																				500
Conversion from units to shares	118		2					3,273						3,275				3,275		(3,275)
Exercise of stock options	1,454		14					17,475						17,489				17,489
Amortization of restricted shares								1,166						1,166				1,166
Share compensation expense								989						989				989
Adjustment for noncontrolling interests in the Operating Partnership												(19,619)		(19,619)				(19,619)		19,619
Net income												77,712		77,712		84		77,796		960
Other comprehensive income (loss), net:										3,781				3,781		(9)		3,772		32
Preferred share distributions												(6,008)		(6,008)				(6,008)
Common share distributions												(117,546)		(117,546)				(117,546)		(1,531)
Balance at December 31, 2015	174,668	$	1,747	3,100	$	31	$	2,231,181	$	(4,978)	$	(584,654)	$	1,643,327	$	1,526	$	1,644,853	$	66,128
Contributions from noncontrolling interest in subsidiaries																4,799		4,799
Issuance of common shares, net	4,408		44					136,077						136,121				136,121
Issuance of restricted shares	123		1											1				1
Issuance of OP Shares																				1,500
Conversion from units to shares	188		2					4,874						4,876				4,876		(4,876)
Exercise of stock options	696		7					13,276						13,283				13,283
Amortization of restricted shares								1,952						1,952				1,952
Share compensation expense								1,260						1,260				1,260
Adjustment for noncontrolling interests in the Operating Partnership												7,388		7,388				7,388		(7,388)
Net income (loss)												87,905		87,905		(470)		87,435		941
Other comprehensive income, net:										3,128				3,128				3,128		37
Preferred share distributions												(5,045)		(5,045)				(5,045)
Preferred share redemption				(3,100)		(31)		(74,606)				(2,937)		(77,574)				(77,574)
Common share distributions												(161,240)		(161,240)				(161,240)		(1,935)
Balance at December 31, 2016	180,083	$	1,801	—	$	—	$	2,314,014	$	(1,850)	$	(658,583)	$	1,655,382	$	5,855	$	1,661,237	$	54,407
Contributions from noncontrolling interest in subsidiaries																1,058		1,058
Acquisition of noncontrolling interest in subsidiary								(8,626)						(8,626)		(407)		(9,033)
Issuance of common shares, net	1,036		10					29,632						29,642				29,642
Issuance of restricted shares	106		1											1				1
Issuance of OP Shares																				12,324
Conversion from units to shares	594		6					15,700						15,706				15,706		(15,706)
Exercise of stock options	397		4					2,360						2,364				2,364
Amortization of restricted shares								2,009						2,009				2,009
Share compensation expense								1,531						1,531				1,531
Adjustment for noncontrolling interests in the Operating Partnership												(3,965)		(3,965)				(3,965)		3,965
Net income (loss)												134,288		134,288		(270)		134,018		1,593
Other comprehensive income, net:										1,853				1,853				1,853		22
Common share distributions												(201,051)		(201,051)				(201,051)		(2,285)
Balance at December 31, 2017	182,216	$	1,822	—	$	—	$	2,356,620	$	3	$	(729,311)	$	1,629,134	$	6,236	$	1,635,370	$	54,320



	Number of Common OP	Number of Preferred OP			Accumulated Other		Total		Noncontrolling				Operating Partnership
	Units	Units		Operating	Comprehensive		CubeSmart L.P.		Interest in		Total		Interests
	Outstanding	Outstanding		Partner	(Loss) Income		Capital		Subsidiaries		Capital		of Third Parties
Balance at December 31, 2014	163,957	3,100	$	1,456,785	$	(8,759)	$	1,448,026	$	1,592	$	1,449,618	$	49,823
Contributions from noncontrolling interest in subsidiaries										178		178
Distributions to noncontrolling interests in subsidiaries										(319)		(319)
Issuance of common OP units, net	8,978			234,061				234,061				234,061
Issuance of restricted OP units	161			1				1				1
Issuance of OP Shares														500
Conversion from OP units to shares	118			3,275				3,275				3,275		(3,275)
Exercise of OP unit options	1,454			17,489				17,489				17,489
Amortization of restricted OP units				1,166				1,166				1,166
OP unit compensation expense				989				989				989
Adjustment for Operating Partnership interests of third parties				(19,619)				(19,619)				(19,619)		19,619
Net income				77,712				77,712		84		77,796		960
Other comprehensive income (loss), net:						3,781		3,781		(9)		3,772		32
Preferred OP unit distributions				(6,008)				(6,008)				(6,008)
Common OP unit distributions				(117,546)				(117,546)				(117,546)		(1,531)
Balance at December 31, 2015	174,668	3,100	$	1,648,305	$	(4,978)	$	1,643,327	$	1,526	$	1,644,853	$	66,128
Contributions from noncontrolling interest in subsidiaries										4,799		4,799
Issuance of common OP units, net	4,408			136,121				136,121				136,121
Issuance of restricted OP units	123			1				1				1
Issuance of OP Shares	188			4,876				4,876				4,876		1,500
Conversion from OP units to shares														(4,876)
Exercise of OP unit options	696			13,283				13,283				13,283
Amortization of restricted OP units				1,952				1,952				1,952
OP unit compensation expense				1,260				1,260				1,260
Adjustment for Operating Partnership interests of third parties				7,388				7,388				7,388		(7,388)
Net income (loss)				87,905				87,905		(470)		87,435		941
Other comprehensive income, net:						3,128		3,128				3,128		37
Preferred OP unit distributions				(5,045)				(5,045)				(5,045)
Preferred OP unit redemption		(3,100)		(77,574)				(77,574)				(77,574)
Common OP unit distributions				(161,240)				(161,240)				(161,240)		(1,935)
Balance at December 31, 2016	180,083	—	$	1,657,232	$	(1,850)	$	1,655,382	$	5,855	$	1,661,237	$	54,407
Contributions from noncontrolling interest in subsidiaries										1,058		1,058
Acquisition of noncontrolling interest in subsidiary				(8,626)				(8,626)		(407)		(9,033)
Issuance of common OP units, net	1,036			29,642				29,642				29,642
Issuance of restricted OP units	106			1				1				1
Issuance of OP Shares														12,324
Conversion from OP units to shares	594			15,706				15,706				15,706		(15,706)
Exercise of OP unit options	397			2,364				2,364				2,364
Amortization of restricted OP units				2,009				2,009				2,009
OP unit compensation expense				1,531				1,531				1,531
Adjustment for Operating Partnership interests of third parties				(3,965)				(3,965)				(3,965)		3,965
Net income (loss)				134,288				134,288		(270)		134,018		1,593
Other comprehensive income, net:						1,853		1,853				1,853		22
Common OP unit distributions				(201,051)				(201,051)				(201,051)		(2,285)
Balance at December 31, 2017	182,216	—	$	1,629,131	$	3	$	1,629,134	$	6,236	$	1,635,370	$	54,320


	Year Ended December 31, 2017
	(in thousands)
Total revenue	$	1,572
Net loss		(1,330)


			CubeSmart
	Number of		Ownership	Total
Store Location	Stores	Date Opened	Interest	Construction Costs
				(in thousands)
Brooklyn, NY	1	Q4 2017	51%	$	49,300
Washington, D.C.	1	Q3 2017	100%		27,800
New York, NY	1	Q3 2017	90%		81,200
North Palm Beach, FL	1	Q1 2017	100%		9,700
Bronx, NY (1) (2)	1	Q2 2016	100%		32,200
Queens, NY (1)	1	Q1 2016	100%		31,800
Brooklyn, NY (3)	1	Q4 2015	100%		14,800
Queens, NY	1	Q4 2015	90%		17,400
Arlington, VA	1	Q2 2015	90%		17,100
	9			$	281,300


	Unrealized losses
	on interest rate
	swaps

Other comprehensive gain before reclassifications	$	192
Amounts reclassified from accumulated other comprehensive loss		1,661	(1)
Net current-period other comprehensive gain		1,853
Balance at December 31, 2016		(1,850)
Balance at December 31, 2017	$	3


Hedge	Hedge	Notional Amount						Effective		Fair Value
Product	Type (1)	December 31, 2017		December 31, 2016		Strike		Date	Maturity	December 31, 2017		December 31, 2016

Swap	Cash flow	$	—	$	75,000	1.3360	%	12/30/2011	3/31/2017	$	—	$	(103)
Swap	Cash flow		—		50,000	1.3360	%	12/30/2011	3/31/2017		—		(69)
Swap	Cash flow		—		50,000	1.3360	%	12/30/2011	3/31/2017		—		(69)
Swap	Cash flow		—		25,000	1.3375	%	12/30/2011	3/31/2017		—		(34)
Swap	Cash flow		40,000		40,000	2.4590	%	6/20/2011	6/20/2018		(161)		(797)
Swap	Cash flow		40,000		40,000	2.4725	%	6/20/2011	6/20/2018		(163)		(804)
Swap	Cash flow		20,000		20,000	2.4750	%	6/20/2011	6/20/2018		(82)		(404)
		$	100,000	$	300,000					$	(406)	$	(2,280)


	Level 1		Level 2		Level 3

Interest rate swap derivative liabilities	$	—	$	406	$	—

Total liabilities at fair value	$	—	$	406	$	—


			Date Opened /	CubeSmart
	Number		Estimated	Ownership	December 31, 2017
Development Ventures	of Stores	Location	Opening	Interest	Total Assets		Total Liabilities

CS 1158 McDonald Ave, LLC ("McDonald Ave") (1)	1	Brooklyn, NY	Q3 2019 (est.)	51%	$	18,472	$	2,429
CS SJM E 92nd Street, LLC ("92nd St") (3)	1	New York, NY	Q2 2019 (est.)	90%		1,366		1,096
CS 160 East 22nd St, LLC ("22nd St") (1)	1	Bayonne, NJ	Q1 2019 (est.)	51%		5,533		3,382
2225 46th St, LLC ("46th St") (1)	1	Queens, NY	Q4 2018 (est.)	51%		27,130		9,551
CS SDP Waltham, LLC ("Waltham") (3)	1	Waltham, MA	Q4 2018 (est.)	90%		5,981		704
2880 Exterior St, LLC ("Exterior St") (1)	1	Bronx, NY	Q3 2018 (est.)	51%		62,763		31,575
3068 Cropsey Avenue, LLC ("Cropsey Ave") (1)	1	Brooklyn, NY	Q4 2017	51%		47,952		22,189
444 55th Street Holdings, LLC ("55th St") (2)	1	New York, NY	Q3 2017	90%		82,216		33,858
186 Jamaica Avenue, LLC ("Jamaica Ave") (3)	1	Brooklyn, NY	Q4 2015	90%		18,478		13,289
Shirlington Rd, LLC ("SRLLC") (3)	1	Arlington, VA	Q2 2015	90%		16,320		12,819
	10				$	286,211	$	130,892


	Ground Lease
	Amount
	(in thousands)

2018	$	2,500
2019		2,670
2020		2,743
2021		2,812
2022		2,971
2023 and thereafter		119,343
	$	133,039


	Three months ended
	March 31,		June 30,		September 30,		December 31,
	2017		2017		2017		2017
Total revenues	$	133,037	$	138,559	$	143,865	$	143,482
Total operating expenses		92,646		91,025		91,586		87,971
Net income attributable to the Company		24,986		32,458		37,297		39,547
Basic earnings per share		0.14		0.18		0.21		0.22
Diluted earnings per share		0.14		0.18		0.21		0.22


						Gross Carrying Amount at
			Initial Cost		Costs	December 31, 2017
				Buildings	Subsequent		Buildings			Accumulated	Year
	Square			&	to		&			Depreciation	Acquired/
Description	Footage	Encumbrances	Land	Improvements	Acquisition	Land	Improvements		Total	(B)	Developed
Chandler I, AZ	47,680		327	1,257	399	327	1,480		1,807	608	2005
Chandler II, AZ	82,915		1,518	7,485	108	1,518	7,592		9,110	1,045	2013
Gilbert I, AZ	57,200		951	4,688	90	951	4,779		5,730	730	2013
Gilbert II, AZ	114,080		1,199	11,846	152	1,199	11,998	��	13,197	383	2016
Glendale, AZ	56,807		201	2,265	1,195	418	2,899		3,317	1,356	1998
Green Valley, AZ	25,050		298	1,153	196	298	1,139		1,437	437	2005
Mesa I, AZ	52,575		920	2,739	311	921	2,603		3,524	1,034	2006
Mesa II, AZ	45,511		731	2,176	284	731	2,132		2,863	854	2006
Mesa III, AZ	59,629		706	2,101	254	706	1,971		2,677	805	2006
Peoria, AZ	110,835		1,436	7,082	241	1,436	7,322		8,758	596	2015
Phoenix I, AZ	101,275		1,134	3,376	560	1,135	3,284		4,419	1,315	2006
Phoenix II, AZ	83,160		756	2,251	1,636	847	3,187		4,034	1,210	2006/2011
Phoenix III, AZ	121,730		2,115	10,429	130	2,115	10,559		12,674	1,295	2014
Phoenix IV, AZ	69,610		930	12,277	85	930	12,363		13,293	454	2016
Queen Creek, AZ	94,462		1,159	5,716	84	1,159	5,800		6,959	513	2015
Scottsdale, AZ	80,725		443	4,879	1,758	883	5,521		6,404	2,638	1998
Surprise , AZ	72,325		584	3,761	107	584	3,868		4,452	256	2015
Tempe I, AZ	53,890		749	2,159	575	749	2,424		3,173	846	2005
Tempe II, AZ	68,409		588	2,898	2,153	588	5,051		5,639	761	2013
Tucson I, AZ	59,800		188	2,078	1,076	384	2,650		3,034	1,258	1998
Tucson II, AZ	43,950		188	2,078	1,090	391	2,683		3,074	1,241	1998
Tucson III, AZ	49,820		532	2,048	258	533	1,945		2,478	771	2005
Tucson IV, AZ	48,040		674	2,595	371	675	2,545		3,220	984	2005
Tucson V, AZ	45,134		515	1,980	357	515	1,981		2,496	786	2005
Tucson VI, AZ	40,790		440	1,692	229	430	1,623		2,053	648	2005
Tucson VII, AZ	52,663		670	2,576	324	670	2,486		3,156	994	2005
Tucson VIII, AZ	46,650		589	2,265	336	589	2,250		2,839	888	2005
Tucson IX, AZ	67,496		724	2,786	469	725	2,734		3,459	1,075	2005
Tucson X, AZ	46,350		424	1,633	327	425	1,650		2,075	629	2005
Tucson XI, AZ	42,700		439	1,689	416	439	1,814		2,253	767	2005
Tucson XII, AZ	42,275		671	2,582	343	672	2,497		3,169	965	2005
Tucson XIII, AZ	45,800		587	2,258	350	587	2,238		2,825	886	2005
Tucson XIV, AZ	48,995		707	2,721	468	708	2,641		3,349	1,058	2005
Benicia, CA	74,770		2,392	7,028	305	2,392	6,249		8,641	2,426	2005
Citrus Heights, CA	75,620		1,633	4,793	234	1,634	4,253		5,887	1,720	2005
Corona, CA	94,975		2,107	10,385	78	2,107	10,462		12,569	1,054	2014
Diamond Bar, CA	103,558		2,522	7,404	273	2,524	6,585		9,109	2,645	2005
Escondido, CA	143,645		3,040	11,804	223	3,040	9,669		12,709	3,140	2007
Fallbrook, CA	45,926		133	1,492	1,849	432	2,832		3,264	1,333	1997
Fremont, CA	51,324		1,158	5,711	164	1,158	5,876		7,034	743	2014
Lancaster, CA	60,475		390	2,247	1,059	556	2,571		3,127	1,034	2001
Long Beach, CA	124,571		3,138	14,368	903	3,138	13,335		16,473	4,995	2006
Murrieta, CA	49,775		1,883	5,532	249	1,903	4,915		6,818	1,910	2005
North Highlands, CA	57,094		868	2,546	429	868	2,517		3,385	1,021	2005
Ontario, CA	93,590		1,705	8,401	345	1,705	8,745		10,450	897	2014
Orangevale, CA	50,542		1,423	4,175	312	1,423	3,813		5,236	1,546	2005
Pleasanton, CA	83,600		2,799	8,222	215	2,799	7,194		9,993	2,789	2005
Rancho Cordova, CA	53,978		1,094	3,212	390	1,095	3,059		4,154	1,201	2005
Rialto I, CA	57,391		899	4,118	212	899	3,758		4,657	1,434	2006
Rialto II, CA	99,783		277	3,098	1,756	672	4,057		4,729	2,030	1997
Riverside I, CA	67,220		1,351	6,183	598	1,351	5,949		7,300	2,232	2006
Riverside II, CA	85,176		1,170	5,359	372	1,170	4,941		6,111	1,900	2006
Roseville, CA	59,944		1,284	3,767	425	1,284	3,593		4,877	1,459	2005
Sacramento I, CA	50,664		1,152	3,380	324	1,152	3,144		4,296	1,266	2005
Sacramento II, CA	111,736		2,085	6,750	327	2,086	6,413		8,499	1,547	2005/2017
San Bernardino I, CA	31,070		51	572	1,188	182	1,432		1,614	660	1997
San Bernardino II, CA	41,546		112	1,251	1,359	306	2,067		2,373	952	1997
San Bernardino III, CA	35,416		98	1,093	1,321	242	1,918		2,160	889	1997
San Bernardino IV, CA	83,227		1,872	5,391	219	1,872	4,894		6,766	1,882	2005
San Bernardino V, CA	56,745		783	3,583	571	783	3,628		4,411	1,394	2006
San Bernardino VII, CA	78,809		1,475	6,753	309	1,290	6,315		7,605	2,444	2006
San Bernardino VIII, CA	103,567		1,691	7,741	603	1,692	6,391		8,083	2,501	2006
San Marcos, CA	37,425		775	2,288	175	776	2,093		2,869	835	2005
Santa Ana, CA	63,916		1,223	5,600	436	1,223	5,258		6,481	1,985	2006
South Sacramento, CA	52,390		790	2,319	344	791	2,244		3,035	891	2005
Spring Valley, CA	55,035		1,178	5,394	848	1,178	5,498		6,676	2,075	2006
Temecula I, CA	81,340		660	4,735	1,001	899	5,165		6,064	2,307	1998
Temecula II, CA	84,520		3,080	5,839	708	3,080	5,612		8,692	1,736	2007
Vista I, CA	74,238		711	4,076	2,346	1,118	5,099		6,217	2,059	2001
Vista II, CA	147,753		4,629	13,599	174	4,629	11,712		16,341	4,590	2005
Walnut, CA	50,708		1,578	4,635	326	1,595	4,223		5,818	1,644	2005
West Sacramento, CA	39,765	(A)	1,222	3,590	216	1,222	3,239		4,461	1,278	2005
Westminster, CA	68,393		1,740	5,142	379	1,743	4,634		6,377	1,880	2005
Aurora, CO	75,717		1,343	2,986	559	1,343	2,996		4,339	1,102	2005
Centennial, CO	62,400		1,281	8,958	92	1,281	9,049		10,330	452	2016
Colorado Springs I, CO	47,975		771	1,717	409	771	1,783		2,554	683	2005
Colorado Springs II, CO	62,400		657	2,674	269	656	2,435		3,091	934	2006
Denver I, CO	59,200		673	2,741	227	646	2,490		3,136	1,010	2006
Denver II, CO	74,390		1,430	7,053	120	1,430	7,172		8,602	1,213	2012
Denver III, CO	76,025		1,828	12,109	65	1,828	12,174		14,002	496	2016
Federal Heights, CO	54,770		878	1,953	275	879	1,830		2,709	702	2005
Golden, CO	87,800		1,683	3,744	564	1,684	3,636		5,320	1,367	2005
Littleton, CO	53,490		1,268	2,820	388	1,268	2,701		3,969	983	2005
Northglenn, CO	43,102		862	1,917	432	662	2,135		2,797	750	2005
Bloomfield, CT	48,700		78	880	2,408	360	2,678		3,038	1,180	1997