~~0001298675cube:SacramentoIICAMember2019-01-012019-12-31~~

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

For the fiscal year ended December 31, ~~2019~~2022

☐

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		Trading Symbol(s)		Name of Each Exchange on 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 every Interactive Data File required to be submitted 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 such files).

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, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “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	☐

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. ⌧

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

CubeSmart	◻
CubeSmart, L.P.	◻

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 ~~28, 2019,~~30, 2022, 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 ~~$6,407,986,013.~~$9,588,612,808. As of February ~~19, 2020,~~22, 2023, the number of common shares of CubeSmart outstanding was ~~193,582,271.~~

224,631,447.

As of June ~~28, 2019,~~30, 2022, the last business day of CubeSmart, L.P.’s most recently completed second fiscal quarter, the aggregate market value of the ~~1,865,570~~1,460,520 units of limited partnership (the “OP Units”) held by non-affiliates of CubeSmart, L.P. was ~~$62,384,661~~$62,393,414 based upon the last reported sale price of ~~$33.44~~$42.72 per share on the New York Stock Exchange on June ~~28, 2019~~30, 2022 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 ~~2020~~2023 Annual Meeting of Shareholders of CubeSmart to be filed subsequently with the SEC are incorporated by reference into Part III of this report.

Table of Contents

EXPLANATORY NOTE

This report combines the annual reports on Form 10-K for the year ended December 31, ~~2019~~2022 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, ~~2019,~~2022, owned a ~~99.0%~~99.4% interest in the Operating Partnership. The remaining ~~1.0%~~0.6% 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

Table of Contents

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 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.

Table of Contents

TABLE OF CONTENTS

PART I		5

Item 1.	Business	6

Item 1A.	Risk Factors	1215

Item 1B.	Unresolved Staff Comments	2628

Item 2.	Properties	2629

Item 3.	Legal Proceedings	2831

Item 4.	Mining Safety Disclosures	2831

PART II		2831

Item 5.	Market for Registrant’s Common Equity, Related Shareholder Matters, and Issuer Purchases of Equity Securities	2831

Item 6.	Selected Financial Data	3032

Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3533

Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	4644

Item 8.	Financial Statements and Supplementary Data	4745

Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	4745

Item 9A.	Controls and Procedures	4745

Item 9B.	Other Information	4846

Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	47

PART III		4847

Item 10.	Trustees, Executive Officers, and Corporate Governance	4847

Item 11.	Executive Compensation	4847

Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters	4847

Item 13.	Certain Relationships and Related Transactions, and Trustee Independence	4948

Item 14.	Principal Accountant Fees and Services	4948

PART IV		4948

Item 15.	Exhibits and Financial Statement Schedules	4948

Item 16.	Form 10-K Summary	5554

Table of Contents

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 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:

●

adverse changes in ~~the national and local~~ economic ~~business,~~conditions in the real estate industry and ~~other market conditions;~~in the markets in which we own and operate 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 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;

●

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 or future ~~indebtedness;~~

●

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

●

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

●

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

●

the failure of acquisitions and 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;

Table of Contents

●

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 occupancy laws or regulations;

~~Table of Contents~~

●

risks related to or a consequence of natural 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;

●

~~our~~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

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, ~~2019,~~2022, we owned ~~523~~(or partially owned and consolidated) 611 self-storage properties located in 24 states and in the District of Columbia containing an aggregate of approximately ~~36.6~~44.1 million rentable square feet. As of December 31, ~~2019,~~2022, approximately ~~89.5%~~90.3% of the rentable square footage at our owned stores was leased to approximately ~~306,000~~377,000 customers, and no single customer represented a significant concentration of our revenues. As of December 31, ~~2019,~~2022, we owned stores in the District of Columbia and the following 24 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, ~~2019,~~2022, we managed ~~649~~668 stores for third parties (including 9177 stores containing an aggregate of approximately ~~6.3~~5.6 million net rentable square feet as part of ~~four~~six separate unconsolidated real estate ventures) bringing the total number of stores we owned and/or managed to ~~1,172.~~1,279. As of December 31, ~~2019,~~2022, we managed stores for third parties in the District of Columbia and the following 38 states: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, ~~Kansas,~~ Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, ~~Oregon,~~ Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, ~~Utah,~~ Vermont, Virginia, Washington 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 ~~302,~~334, or approximately ~~57.7%~~54.7%, 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, ~~442,~~510, or approximately ~~84.5%~~83.5%, of our owned stores include climate-controlled cubes.

Table of Contents

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, ~~2019,~~2022, owned a ~~99.0%~~99.4% 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.

Table of Contents

Acquisition and Disposition Activity

As of December 31, ~~2019~~2022 and ~~2018,~~2021, we owned ~~523~~611 and ~~493~~607 stores, respectively, that contained an aggregate of ~~36.6~~44.1 million and ~~34.6~~43.6 million rentable square feet with occupancy levels of ~~89.5%~~90.3% and ~~89.0%~~92.0%, 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 ~~2019, 2018~~2022, 2021 and ~~2017~~2020 acquisition and disposition activity:

Number of

Purchase / Sale Price

Asset/Portfolio

Market

Transaction Date

Stores

(in thousands)

2019 Acquisitions:

Maryland Asset

Baltimore / DC

March 2019

1

$
22,000

Florida Assets

Florida Markets - Other

April 2019

2

19,000

Arizona Asset

Phoenix

May 2019

1

1,550

HVP III Assets

Various (see note 4)

June 2019

18

128,250
⁽¹⁾
Georgia Asset

Atlanta

August 2019

1

14,600

South Carolina Asset

Charleston

August 2019

1

3,300

Texas Asset

Texas Markets - Major

October 2019

1

7,300

Florida Assets

Florida Markets - Other

November 2019

3

32,100

California Asset

Los Angeles

December 2019

1

18,500

29

$
246,600

2019 Disposition:

Texas Asset

Texas Markets - Major

October 2019

1

$
4,146

1

$
4,146

2018 Acquisitions:

Texas Asset

Texas Markets - Major

January 2018

1

$
12,200

Texas Asset

Texas Markets - Major

May 2018

1

19,000

Metro DC Asset

Baltimore / DC

July 2018

1

34,200

Nevada Asset

Las Vegas

September 2018

1

14,350

North Carolina Asset

Charlotte

September 2018

1

11,000

California Asset

Los Angeles

October 2018

1

53,250

Texas Asset

Texas Markets - Major

October 2018

1

23,150

California Asset

San Diego

November 2018

1

19,118

New York Asset

New York / Northern NJ

November 2018

1

37,000

Illinois Asset

Chicago

December 2018

1

4,250

10

$
227,518

2018 Dispositions:

Arizona Assets

Phoenix

November 2018

2

$
17,502

2

$
17,502

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


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

2022 Acquisitions:

Maryland Asset	Washington-Arlington-Alexandria, DC-VA-MD-WV	February 2022	1	$	32,000
Texas Asset	San Antonio, TX	June 2022	1		23,000
Georgia Asset	Atlanta, GA	July 2022	1		20,700
			3	$	75,700

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

~~Table of Contents~~

(1)

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

(2)

Purchase price represents the ~~purchase price~~acquisition of all 167,557 outstanding partnership units of LAACO, Ltd. (“LAACO”) for ~~90% of the ownership interest in 191 III CUBE LLC (“HVP III”), which at~~$9,838 per unit. At the time of the acquisition, LAACO owned 1857 storage properties ~~(see~~(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”). The Los Angeles Athletic Club was sold by the Company during the year ended December 31, 2022. The California Yacht Club is classified as held for sale on the Company's consolidated balance sheets as of December 31, 2022. See note ~~4).~~4 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, ~~2019, 2018~~2022, 2021 and ~~2017,~~2020, we owned ~~523, 493~~(or partially owned and ~~484~~consolidated) 611, 607 and 543 self-storage properties and related assets, respectively. The following table summarizes the change in number of owned stores from January 1, ~~2017~~2020 through December 31, ~~2019:~~2022:

2019

2018

2017

Balance - January 1

493

484

475

Stores acquired

1

1

—

Stores developed

—

—

1

Balance - March 31

494

485

476

Stores acquired

21

1

3

Stores developed

2

—

—

Stores combined ⁽¹⁾

(1)

—

(1)

Balance - June 30

516

486

478

Stores acquired

2

3

—

Stores developed

1

1

2

Balance - September 30

519

490

480

Stores acquired

5

5

4

Stores developed

—

—

1

Stores combined ⁽¹⁾

—

—

(1)

Stores sold

(1)

(2)

—

Balance - December 31

523

493

484

Table of Contents

	2022	2021	2020

Balance - January 1	607	543	523
Stores acquired	1	—	1
Stores developed	—	1	—
Stores combined ⁽¹⁾	—	(1)	—
Balance - March 31	608	543	524
Stores acquired ⁽²⁾	1	2	2
Stores developed	1	2	1
Stores combined ⁽¹⁾	(1)	—	—
Balance - June 30	609	547	527
Stores acquired	1	2	—
Stores developed	1	—	—
Stores sold	—	(4)	—
Balance - September 30	611	545	527
Stores acquired	—	62	18
Stores developed	—	1	—
Stores combined ⁽³⁾	—	—	(1)
Stores sold	—	(1)	(1)
Balance - December 31	611	607	543

(1)

On ~~May 16, 2017, October 2, 2017~~June 21, 2022 and ~~May 24, 2019,~~March 3, 2021, we ~~acquired~~completed development of new stores located in ~~Sacramento, CA, Keller, TX~~Vienna, VA and ~~Tempe, AZ~~Arlington, VA for approximately ~~$3.7 million, $4.1~~$21.8 million and ~~$1.6~~$26.4 million, respectively. In each case, the developed store is located adjacent to an existing consolidated joint venture store. Given this proximity, each developed store has been combined with the adjacent existing store in our store count upon opening, 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 November 10, 2020, we acquired a store located in Merritt Island, FL for approximately $3.9 million. The store acquired is located ~~directly adjacent~~in near proximity to an existing wholly-owned store. Given their proximity to each other, ~~each~~the acquired store has been combined with the existing ~~adjacent~~ 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, ~~2019:~~2022:

●

~~Store Acquisitions.~~Acquisition Activity. ~~During 2019, we~~We acquired ~~11 self-storage properties~~three wholly-owned 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. Additionally, on June 6, 2019, we acquired our partner’s 90% ownership interest in 191 III CUBE LLC (“HVP III”), an unconsolidated real estate venture in which we previously owned a 10% noncontrolling interest, for $128.3 million. 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). As of December 31, 2019, we had two stores under contract for an aggregate purchase price of $57.5$75.7 million.

●

Development Activity. ~~During 2019, we~~We completed construction of and opened for operation ~~three~~two joint venture development properties located in ~~Massachusetts (1),~~ New ~~Jersey~~York (1) and ~~New York~~Virginia (1). for a total cost of $60.8 million. As of December 31, ~~2019,~~2022, we had ~~five~~two joint venture development properties under construction located in ~~Massachusetts~~New Jersey (1), and New York ~~(2)~~(1), ~~Pennsylvania (1) and Virginia (1)~~ which are expected to be completed by the second quarter of ~~2021.~~2024. As of December 31, ~~2019,~~2022, we had invested ~~$58.6~~$22.7 million of an expected ~~$131.9~~$57.1 million related to these ~~five~~two projects.

●

~~Consolidated Development Joint Venture Buy-outs.~~ During 2019, we acquired the noncontrolling members’ interest in six previously consolidated development joint ventures for an aggregate purchase price of $94.6 million. The stores are located in Massachusetts (1), New Jersey (1) and New York (4) and are wholly-owned by the Company as of December 31, 2019.

●

~~Store Disposition.~~ ~~On October 7, 2019, we sold a store in Texas for a sales price of approximately $4.1 million. We recorded a $1.5 million gain in connection with the sale.~~

●

Unconsolidated Real Estate Venture Activity. ~~During 2019,~~191 IVV CUBE LLC ("HVP V"), an existing unconsolidated real estate venture in which we own a 20% interest, acquired ~~eight stores~~one store located in New Jersey for ~~an aggregate~~a purchase price of ~~$122.5~~$33.2 million. We contributed $0.1 million oftowards this purchase, which was primarily funded by HVP V's secured term loan. 191 IV CUBE Southeast LLC (“HVPSE”), an existing unconsolidated real estate venture in which we ~~contributed $10.2 million.~~

~~Table of Contents~~

~~The acquired~~own a 10% interest, sold all 14 of its stores are located in Florida (1), Minnesota (1), Pennsylvania (1) and Texas (5). Additionally, on June 5, 2019, HVP III 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~~$235.0 million. ~~The venture~~These stores were located in Florida (2), Georgia (8) and South Carolina (4). HVPSE recorded gains which aggregated to approximately ~~$106.7~~$114.1 million in connection with the sale.

●

~~Debt Offerings.~~ On January 30, 2019, we issued $350.0 million in aggregate principal amount of unsecured senior notes due February 15, 2029, which bear interest at a rate of 4.375% per annum. Net proceeds from the offering were used to repay all of the outstanding indebtedness under the $200.0 million unsecured term loan portion of our credit facility that was scheduled to mature in January 2019. The remaining proceeds from the offering were used to repay a portion of the outstanding indebtedness under the revolving portion of our credit facility.Additionally, on October 11, 2019, we issued $350.0 million in aggregate principal amount of unsecured senior notes due February 15, 2030 which bear interest at a rate of 3.000% per annum. Net proceeds from the offering were used to repay all of the outstanding indebtedness under the revolving portion of our credit facility and for working capital and other corporate purposes.

●

Credit Facility Amendment.On ~~June 19, 2019,~~October 26, 2022, we amended and restated, in its entirety, our credit facility (the "Second Amended and Restated Credit Facility") which, subsequent to the amendment and restatement, is comprised of ~~a $750.0~~an $850.0 million unsecured revolving facility (the “Revolver”) maturing on ~~June 19, 2024.~~February 15, 2027. Under the Second Amended and Restated Credit Facility, pricing on the Revolver is dependent upon our unsecured debt credit ratings and leverage levels. At our current ~~Baa2/BBB level,~~unsecured debt credit ratings and leverage levels, amounts drawn under the Revolver are priced ~~at 1.10% over LIBOR, inclusive~~using a margin of 0.775% plus a facility fee of 0.15%. over the Secured Overnight Financing Rate ("SOFR") and a 0.10% SOFR adjustment.

Table of Contents

●

~~Term Loan Repayments.~~ During 2019, we repaid all $200.0 million of outstanding indebtedness under the unsecured term loan portion of our credit facility that was scheduled to mature in January 2019 and all $100.0 million of outstanding indebtedness under the unsecured term loan portion of our term loan facility that was scheduled to mature in January 2020.

●

~~Mortgage Loan Repayment.~~ ~~During 2019, we repaid one mortgage loan for $9.0 million.~~

●

At-The-Market Equity Program Activity. ~~During 2019, under~~Under our at-the-market equity program, we sold a total of ~~5.9~~0.1 million common shares at an average sales price of ~~$33.64~~$50.64 per share, resulting in net proceeds of ~~$196.3~~$4.9 million for the year, after deducting offering costs. As of December 31, ~~2019, 4.6~~2022, 5.8 million common shares remained available for sale under the program. We used the proceeds from the ~~2019~~2022 sales under the program to fund the acquisition and development of self-storage properties and for general corporate purposes.

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 ~~2020,~~2023, 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 ~~2020,~~2023, we intend to continue to evaluate opportunities to dispose of assets that have unattractive 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 and other investment opportunities.

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 four senior officers who oversee our investment process. Our investment process involves six stages — identification,

~~Table of Contents~~

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, but not exclusively limited to, ~~the Northeastern and Mid-Atlantic areas of~~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~~economies of ~~stores.~~scale

Segment

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

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 ~~2019~~2022 revenues. Our stores in ~~Florida,~~ New York, Florida, California and Texas provided approximately 16%, 15%, 11% and 9%, respectively, of our total revenues for the year ended December 31, 2022. Our stores in New York, Florida, Texas and California provided approximately 19%, 15%, 9% and 8%, respectively, of our total revenues for the year

Table of Contents

ended December 31, 2021. Our stores in New York, Florida, Texas and California provided approximately 16%, ~~16%~~15%, ~~10%~~9% and 8%, respectively, of our total revenues for the year ended December 31, ~~2019. Our stores in Florida, New York, Texas and California provided approximately 17%, 16%, 10% and 8%, respectively, of our total revenues for each of the years ended December 31, 2018 and 2017.~~2020.

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, ~~2019,~~2022, 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 ~~23.9%~~24.8% compared to approximately ~~24.4%~~19.7% as of December 31, ~~2018.~~2021. Our ratio of debt to the undepreciated cost of our total assets as of December 31, ~~2019~~2022 was approximately ~~39.0%~~39.6% compared to approximately ~~37.9%~~41.2% as of December 31, ~~2018.~~2021. 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 returns and use the sales proceeds to fund other acquisitions.

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-~~

~~Table of Contents~~

~~storage~~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 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

Table of Contents

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 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.

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.

~~Table of Contents~~

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 civil unrest, 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 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. Additionally, we use a combination of insurance products to 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.

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, ~~2019,~~2022, we employed ~~3,011~~2,804 teammates, all within the United States. Of the total employees, approximately 89% were hourly and approximately 11% were salaried. We have no union presence or collective bargaining agreements. Our average teammate tenure as of ~~whom 390~~December 31, 2022 was 3.63 years.

Table of Contents

Company Culture and Teammate Experience

We measure our teammates’ experience each year through our Teammate Engagement Survey. In 2022, our annual engagement survey participation rate was 88%. 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. Leaders whose team engagement is below a certain threshold are provided with coaching and set goals for improvement. Of the teams we identified as having engagement below the applicable threshold in 2021, 73% moved above that threshold in 2022 as a result of our support and focus. In addition to the survey and our commitment to support teams who need it, we have ongoing conversations and commit 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 2022, we provided an average of 16 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 1,505 teammates during the year ended December 31, 2022. Teammate referrals were ~~corporate executive~~a significant source for the candidates we hired, accounting for 20% of our new teammates. Additionally, 446 teammates were promoted into new roles and/or transitioned into new positions to further their career development.

We believe that career growth and ~~administrative personnel~~personal development is an important part of our teammates’ personal and ~~2,621~~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.

In April of 2022, we launched a program called Connections to help our teammates build relationships with others across the organization. Through this program, teammates are randomly paired and encouraged to make time for a brief meeting to learn about one another. As of December 31, 2022, 323 teammates were ~~property-level personnel.~~participating in this program.

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 with~~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 ~~employees are good. Our employees are not unionized.~~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, 2022, of our total teammate population, 56% were female and 44% were male. Approximately 48% 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 41.8; 36% of our teammates were 34 and younger while 40% of our teammates were 45 or older.

Table of Contents

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, 2020, 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 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.~~19355 or by telephoning 610-535-5000.

Table of Contents

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.

~~Table of Contents~~

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, paid time off and severance payments 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, ~~Texas~~Florida, California and ~~California~~Texas accounted for approximately 16%, ~~16%~~15%, ~~10%~~11% and 8%9%, respectively, of our total ~~2019~~2022 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 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 in the future be, impacted by the COVID-19 pandemic and other potential future pandemics and such impact could be materially adverse.

Since the first quarter of 2020, the world has been impacted by the COVID-19 pandemic, which has resulted in global business disruptions and significant volatility in U.S. and international debt and equity markets. The extent to which the COVID-19 pandemic and any other potential future pandemics ultimately impact our business, results of operations, financial condition and share price will depend on numerous evolving factors, including, among others: the duration and scope of such pandemic; actions that have been and continue to be taken by governmental entities, individuals and businesses in response to such pandemic; the impact on economic activity from such 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

Table of Contents

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:

●

acquisitions may fail to perform as expected;

●

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

●

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

●

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

●

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 instead rely on internal value ~~determinations by our senior management.~~determinations.

~~Table of Contents~~

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.~~financial performance.

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.

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:

●

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

●

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;

●

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

●

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

●

unexpected, competitive development that is proposed or announced after our development activities have begun.

Table of Contents

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 general market conditions, the market’s perception of our growth potential, our current and potential future earnings, our cash flow 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, 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 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.

~~Table of Contents~~

~~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 and governmental mandated benefits 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;~~

●

~~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~~re-lease 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~~re-leasing cubes as vacancies arise would reduce our revenues and harm our operating results. In addition, lower than expected rental rates upon ~~re-letting~~re-leasing 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 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.

~~Table of Contents~~

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 near or 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.~~shareholders or for satisfaction of our debt service obligations.

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.

~~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~~

Table of ~~our business.~~Contents

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.

~~Table of Contents~~

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 civil unrest, riots, war or acts of God, and, in some cases, 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. In particular, certain of our stores are located in areas that are prone to or at risk of flooding, including coastal flooding, and some of our stores have been previously damaged or otherwise impacted by hurricanes and other flooding events. Climate change may result in more frequent severe weather events, potential changes in precipitation patterns and extreme variability in weather patterns, which may affect those stores in areas prone to or at risk of flooding. 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 that ~~are~~may not be 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.

Potential liability for environmental contamination could result in substantial costs.

We are subject to federal, state and local environmental laws, ordinances and 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, ordinances and regulations, 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 or discoverable by us, that environmental conditions on neighboring properties

Table of Contents

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.

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 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 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

~~Table of Contents~~

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, 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.

We face system security risks as we depend upon automated processes and the internet, ~~which~~and breaches 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 or processes are penetrated.~~litigation.

We are increasingly dependent upon automated information technology processes and internet commerce, and many of our new customers come from the telephone or over the 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, ransomware 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 or make unavailable to us 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 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 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 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, 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.

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, 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:

~~Table of Contents~~

●

downturns in the national, regional and local economic climate;

●

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

●

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

●

inability to collect or delay in collecting rent from customers;

●

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

Table of Contents

●

changes in interest rates and availability of financing;

●

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

●

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;

●

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

●

the relative illiquidity of real estate investments.

In addition, prolonged periods of economic slowdown or recession, rising interest rates, 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.

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 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 may 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

~~Table of Contents~~

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.

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

Table of Contents

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 year 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, we owned a subsidiary REIT (“PSI”) that was liquidated on December 31, 2018. Prior to liquidation, PSI was independently subject to, and 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 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.

LAACO was a publicly traded partnership immediately prior to our acquisition of 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.

~~Table of Contents~~

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 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

Table of Contents

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 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 ismay be 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.

The TCJA made 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 TCJA 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 made 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.

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

~~Table of Contents~~

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~~Partnership tax audit rules ~~applicable to partnership tax audits.~~could have a material adverse effect on us.

~~The Bipartisan Budget Act of 2015, effective for taxable years beginning after December 31, 2017, requires our Operating Partnership and any subsidiary partnership to pay~~Under 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. Many uncertainties remain as to the application of these rules ~~including the application of the alternative method to partners that are REITs, and the impact they will have on us. However, it is possible that partnerships in which we invest may be subject~~applicable to U.S. federal income tax audits of partnerships, subject to certain exceptions, any audit adjustment to items of income, gain, loss, deduction, or credit of a partnership (and any partner’s distributive share thereof) is determined, and taxes, interest, or penalties attributable thereto could be assessed and collected, at the partnership level. Absent available elections, it is possible that the Operating Partnership, and any other partnership in which we directly or indirectly invest, could be required to pay additional taxes, interest and penalties ~~in the event of a U.S. federal income tax audit~~ as a result of an audit adjustment, and we, as a direct or indirect partner of a partnership, could be required to bear the economic burden of those taxes, interest, and penalties even though we may not otherwise have been required to pay additional taxes had we owned the assets of these ~~law changes.~~partnerships directly. There can be no assurance that these rules will not have a material adverse effect on us.

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 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.

Table of Contents

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;~~terms, and 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.

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

~~Table of Contents~~

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 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 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.

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

As23

Table of December 31, 2019, we did not have any outstanding debt that was indexed to the London Interbank Offered Rate (“LIBOR”), however future borrowings under our Revolver are subject to variable interest rates based on LIBOR. 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. It is not possible to predict the further effect of the FCA’s announcement, 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, ICE Benchmark Administration Limited, 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 is unavailable after 2021, 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.Contents

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. 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.

~~Table~~The loss of ~~Contents~~

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

Our performance depends on our ability to recruit and retain high-quality employees, both in our stores, in our sales staff and in our corporate headquarters. Our ability to attract and retain corporate, sales, store and other personnel is also acutely impacted in markets where the competition for a relatively small number of qualified employees is intense. Furthermore, we have experienced, and could continue to experience, a shortage of labor for certain positions, including due to market trends and conditions such as continued concerns around the COVID-19 pandemic, the availability of new telecommuting employment options and other factors, which could decrease the pool of available qualified talent for key functions.

As of December 31, ~~2019,~~2022, we had ~~2,621~~2,332 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~~

Competitive pressures and ~~retaining qualified and skilled personnel. Competitive pressures~~the impact of inflation 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.

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

●

“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.

Table of Contents

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.

~~Table of Contents~~

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 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.

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;

Table of Contents

●

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.

~~Table of Contents~~

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 fluctuation and may continue to fluctuate or decline. Between January 1, ~~2017~~2020 and December 31, ~~2019,~~2022, the closing price per share of our common shares has ranged from a high of ~~$36.31~~$57.02 (on ~~September 4, 2019)~~December 30, 2021) to a low of ~~$22.94~~$20.85 (on ~~July 10, 2017)~~March 23, 2020). 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, which could result in substantial costs and divert our management’s attention and resources from our business.

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.

We may incur impairment charges.

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;

Table of Contents

●

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.

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

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

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, our interests or the United States, 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

Table of Contents

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.

Environmental, social and governance (“ESG”) issues, including those related to climate change and sustainability, may have an adverse effect on our business, financial condition and results of operations and damage our reputation.

Companies across all industries are facing increasing scrutiny relating to their ESG policies. Concern over climate change may result in new or increased legal and regulatory requirements. Increased regulatory requirements related to environmental causes, and related ESG disclosure rules, including the SEC’s recent disclosure proposal on climate change, may result in increased compliance costs or increased energy and other costs.

In addition to environmental issues, these constituencies are also focused on social and other governance issues, including matters such as human capital and social issues. We have established several policies and procedures related to diversity, equity and inclusion as part of our ESG initiative. Our initiatives also extend from individuals to entire communities, including those we serve.

Any failure to achieve our ESG goals or a perception (whether or not valid) of our failure to act responsibly with respect to the environmental, social, or governance issues, or to effectively respond to new, or changes in, legal or regulatory requirements concerning ESG matters, or increased operating costs due to increased regulation or environmental causes could adversely affect our business, financial condition, results of operations, access to capital and reputation and increase our risk of litigation.

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.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

Table of Contents

ITEM 2. PROPERTIES

As of December 31, ~~2019,~~2022, we owned ~~523~~611 self-storage properties that contain approximately ~~36.6~~44.1 million rentable square feet and are located in 24 states and the District of Columbia. The following table sets forth summary information regarding our stores by state as of December 31, ~~2019.~~2022.


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

Florida	85	61,362	6,322,178	17.2	%	90.9	%	90	65,171	6,796,098	15.4	%	92.5	%
Texas	66	39,280	4,642,072	12.6	%	90.4	%	76	46,909	5,446,871	12.3	%	91.8	%
California								63	45,131	4,765,486	10.8	%	91.4	%
New York	48	64,397	3,664,270	9.9	%	84.3	%	59	83,893	4,742,378	10.8	%	90.5	%
California	43	29,439	3,124,044	8.5	%	91.1	%
Arizona								48	28,180	3,089,826	7.0	%	86.3	%
Illinois	42	25,265	2,695,389	7.4	%	91.7	%	43	25,916	2,760,969	6.3	%	92.2	%
Arizona	31	17,700	1,905,617	5.2	%	91.9	%
New Jersey	26	18,422	1,809,740	4.9	%	87.5	%	28	20,479	1,983,356	4.5	%	90.9	%
Nevada								22	14,645	1,702,416	3.9	%	86.9	%
Maryland								20	17,319	1,683,821	3.8	%	92.3	%
Georgia	20	12,426	1,454,927	4.0	%	87.3	%	22	14,082	1,657,378	3.8	%	87.4	%
Maryland	17	13,998	1,399,402	3.8	%	89.7	%
Ohio	20	11,069	1,290,003	3.5	%	91.4	%	20	11,130	1,294,303	2.9	%	91.3	%
Massachusetts								20	13,035	1,252,577	2.8	%	86.2	%
Connecticut	22	10,718	1,190,691	3.3	%	91.7	%	22	10,781	1,200,002	2.7	%	92.7	%
Massachusetts	19	11,969	1,172,820	3.2	%	83.0	%
Virginia	10	7,903	787,595	2.2	%	90.2	%	11	11,076	1,060,480	2.4	%	80.1	%
North Carolina	11	6,651	760,177	2.1	%	88.1	%
Pennsylvania								12	9,051	890,385	2.0	%	82.3	%
Tennessee	9	5,631	755,515	2.1	%	88.6	%	9	5,699	755,655	1.7	%	91.3	%
Colorado	11	6,020	697,299	1.9	%	89.5	%	10	5,544	654,252	1.5	%	90.9	%
Nevada	8	5,127	643,062	1.8	%	91.6	%
Pennsylvania	9	6,057	611,007	1.7	%	90.1	%
North Carolina								9	5,348	611,792	1.4	%	91.7	%
South Carolina	8	3,873	432,419	1.2	%	88.1	%	8	3,879	432,389	1.0	%	91.6	%
Washington D.C.	5	5,296	409,850	1.1	%	82.7	%	5	5,321	410,676	0.9	%	90.5	%
Rhode Island	4	2,010	245,545	0.7	%	89.9	%	4	2,037	247,305	0.6	%	90.6	%
Utah	4	2,308	239,198	0.7	%	90.4	%	4	2,351	239,388	0.5	%	90.4	%
New Mexico	3	1,683	182,261	0.5	%	93.0	%	3	1,694	182,261	0.4	%	90.9	%
Minnesota	1	1,033	100,928	0.3	%	88.0	%	2	1,828	176,296	0.4	%	85.1	%
Indiana	1	578	67,600	0.2	%	89.0	%	1	583	70,386	0.2	%	94.2	%
Total/Weighted average	523	370,215	36,603,609	100.0	%	89.5	%	611	451,082	44,106,746	100.0	%	90.3	%

~~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~~related to our stores owned as of December 31, ~~2019,~~2022, 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~~Acquired/Developed– Ending Occupancy

Rentable

Average Occupancy

Year Acquired ⁽¹⁾

# of Stores

Square Feet

2019

2018

2017

2016 and earlier

472

32,856,176

92.1
%
92.0
%
91.7
%
2017

9

762,926

68.3
%
45.9
%
39.1
%
2018

11

994,243

66.1
%
56.7
%
—

2019

31

1,990,264

74.2
%
—

—

All stores owned as of December 31, 2019

523

36,603,609

90.4
%
90.6
%
91.3
%


		Rentable	Ending Occupancy
Year Acquired/Developed ⁽¹⁾	# of Stores	Square Feet	2022		2021		2020

2019 and earlier	516	36,571,449	91.8	%	92.9	%	92.7	%
2020	21	1,851,162	89.3	%	87.6	%	83.7	%
2021	69	5,160,761	83.3	%	87.5	%	—
2022	5	523,374	55.5	%	—		—
All stores owned as of December 31, 2022	611	44,106,746	90.3	%	92.0	%	92.3	%

Table of Contents

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

Rent per Square Foot

Year Acquired ⁽¹⁾

# of Stores

2019

2018

2017

2016 and earlier

472

$
17.76

$
17.44

$
16.83

2017

9

21.14

19.99

19.11

2018

11

22.69

24.76

—

2019

31

15.18

—

—

All stores owned as of December 31, 2019

523

$
17.80

$
17.59

$
16.85


		Annual Rent per Square Foot
Year Acquired/Developed ⁽¹⁾	# of Stores	2022		2021		2020

2019 and earlier	516	$	22.35	$	19.79	$	17.89
2020	21		30.62		29.21		26.62
2021	69		20.99		19.71		—
2022	5		23.42		—		—
All stores owned as of December 31, 2022	611	$	22.44	$	20.00	$	18.10

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

Total Revenues

Year Acquired ⁽¹⁾

# of Stores

2019

2018

2017

2016 and earlier

472

$
570,381

$
557,719

$
535,552

2017

9

11,865

7,563

2,102

2018

11

15,730

4,137

—

2019

31

11,841

—

—

All stores owned as of December 31, 2019

523

$
609,817

$
569,419

$
537,654


		Total Revenues
Year Acquired/Developed ⁽¹⁾	# of Stores	2022		2021		2020

2019 and earlier	516	$	805,699	$	717,630	$	630,750
2020	21		53,194		46,822		4,337
2021	69		96,047		8,668		—
2022	5		4,436		—		—
All stores owned as of December 31, 2022	611	$	959,376	$	773,120	$	635,087

(1)

Represents the year ~~acquired~~acquired/developed 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 ~~$21.5~~$19.2 million, ~~$19.9~~$19.7 million and ~~$18.2~~$15.3 million for the periods ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017,~~2020, respectively.

Unconsolidated Real Estate Ventures

As of December 31, ~~2019,~~2022, we held ~~common~~ ownership interests ranging from 10% to 50% in ~~three~~seven unconsolidated real estate ventures for an aggregate investment ~~balance~~carrying value of ~~$91.1~~$106.0 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, ~~2019,~~2022, one of these ~~three~~unconsolidated joint ventures did not own any self-storage properties, while the other six unconsolidated real estate ventures owned 69a total of 77 self-storage properties that ~~contain~~contained an aggregate of approximately ~~4.8~~5.6 million net rentable square feet. The self-storage properties owned by these ~~three~~ real estate ventures are managed by us and are located in Arizona (2), California (2), Connecticut ~~(5)~~(6), Florida ~~(4)~~(6), Georgia (2), Illinois (5), Maryland ~~(1)~~(2), Massachusetts (6), Minnesota (1), New Jersey (3), New York (1), North Carolina (1), Pennsylvania (1), Rhode Island (2), Texas ~~(42)~~(35) and Vermont (2).

~~On September 5, 2018, we invested $5.0 million in exchange for 100%~~Each of the ~~Class A preferred units of Capital Storage Partners, LLC (“Capital Storage”), a newly formed venture that acquired 22 self-storage properties that contain an aggregate of approximately 1.6 million~~

~~Table of Contents~~

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 earn an 11% cumulative dividend prior to any other distributions.

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

We account for our investments in real estate ventures using the equity 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 which we account for using the equity method of accounting.

Capital Expenditures

We have a capital improvement program that ~~includes~~covers office upgrades, ~~adding~~addition of climate control to select cubes, construction of parking areas and other store upgrades. For ~~2020,~~2023, we anticipate spending approximately ~~$24.0~~$11.0 million to ~~$29.0~~$16.0 million associated with these capital expenditures. For ~~2020,~~2023, we also anticipate spending approximately ~~$14.0~~$15.0 million to ~~$19.0~~$20.0 million on recurring capital expenditures and approximately ~~$39.0~~$20.0 million to ~~$54.0~~$30.0 million on the development of new self-storage properties.

Table of Contents

ITEM 3. LEGAL PROCEEDINGS

To our knowledge, no legal proceedings are pending against us, other than routine actions and administrative proceedings, and other actions not deemed material, and which, in the aggregate, are not expected to have a material adverse effect on our financial condition, results of 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, ~~2019:~~2022:


	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	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	318	$	34.44	N/A	3,000,000	364	$	40.06	N/A	3,000,000
November 1 - November 30	37	$	31.04	N/A	3,000,000	121	$	40.17	N/A	3,000,000
December 1 - December 31	221	$	30.61	N/A	3,000,000	—	$	—	N/A	3,000,000
Total	576	$	32.75	N/A	3,000,000	485	$	40.09	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, ~~2019,~~2022, there were ~~136~~155 registered record holders of the Parent Company’s common shares and 1521 holders (other than the Parent Company) of the Operating Partnership’s common units. These 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.

Tax Characterization of Distributions

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 ~~2019~~2022 consisted of ~~a 78.413%~~an 88.7377% ordinary income distribution ~~a 5.207%~~and an 11.2623% capital gain ~~distribution and a 16.380% return of capital distribution from earnings and profits.~~distribution.

We intend to continue to declare quarterly distributions. However, we cannot provide any assurance as to the amount or timing of future distributions.

Table of Contents

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 October 30, 2019, the Operating Partnership entered into an agreement to acquire a self-storage property located in California for $18.5 million, and agreed to fund a portion of the acquisition price in the form of common units, designated Class B Units. On December 16, 2019, the Operating Partnership closed on the acquisition and funded approximately $3.6 million of the acquisition price through the issuance of 106,738 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 accredited investors unaffiliated with the Company in private placement transactions exempt from the registration requirements of the Securities Act of 1933 pursuant to Section 4(a)(2) of such Act.None.

~~Securities Authorized Under Equity Compensation Plans~~

~~Other information about our equity compensation plans is incorporated herein by reference to Part III, Item 12 of this Annual Report on Form 10-K.~~

~~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, ~~2014~~2017 and ending December 31, ~~2019.~~2022.


	For the year ended December 31,						For the year ended December 31,
Index	2014	2015	2016	2017	2018	2019	2017	2018	2019	2020	2021	2022
CubeSmart	100.00	142.43	128.41	144.74	149.64	168.95	100.00	103.42	118.02	131.79	230.09	169.55
S&P 500 Index	100.00	101.38	113.51	138.29	132.23	173.86	100.00	95.62	125.72	148.85	191.58	156.88
Russell 2000 Index	100.00	95.59	115.95	132.94	118.30	148.49	100.00	88.99	111.70	134.00	153.85	122.41
NAREIT All Equity REIT Index	100.00	102.83	111.70	121.39	116.48	149.86
FTSE NAREIT All Equity REIT Index							100.00	95.96	123.46	117.14	165.51	124.22

ITEM 6. ~~SELECTED FINANCIAL DATA~~[Reserved]

~~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, 2019 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, 2019 and 2018, and for each of the years in the three-year period ended December 31, 2019, 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, 2019, 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~~

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,


2019

2018

2017

2016

2015

(in thousands, except per share data)

REVENUES

Rental income

$
552,404

$
517,535

$
489,043

$
449,601

$
392,476

Other property related income

67,558

60,156

55,001

50,255

45,189

Property management fee income

23,953

20,253

14,899

10,183

6,856

Total revenues

643,915

597,944

558,943

510,039

444,521

OPERATING EXPENSES

Property operating expenses

209,739

196,866

181,508

165,847

153,172

Depreciation and amortization

163,547

143,350

145,681

161,865

151,789

General and administrative

38,560

37,712

34,745

32,823

28,371

Acquisition related costs

—

—

1,294

6,552

3,301

Total operating expenses

411,846

377,928

363,228

367,087

336,633

OTHER (EXPENSE) INCOME

Interest:

Interest expense on loans

(72,525)

(62,132)

(56,952)

(50,399)

(43,736)

Loan procurement amortization expense

(2,819)

(2,313)

(2,638)

(2,577)

(2,324)

Equity in earnings (losses) of real estate ventures

11,122

(865)

(1,386)

(2,662)

(411)

Gains from sale of real estate, net

1,508

10,576

—

—

17,567

Other

1,416

206

872

1,062

(228)

Total other expense

(61,298)

(54,528)

(60,104)

(54,576)

(29,132)

NET INCOME

170,771

165,488

135,611

88,376

78,756

NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS

Noncontrolling interests in the Operating Partnership

(1,708)

(1,820)

(1,593)

(941)

(960)

Noncontrolling interest in subsidiaries

54

221

270

470

(84)

NET INCOME ATTRIBUTABLE TO THE COMPANY

169,117

163,889

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

$
169,117

$
163,889

$
134,288

$
79,923

$
71,704

Basic earnings per share attributable to common shareholders

$
0.89

$
0.89

$
0.74

$
0.45

$
0.43

Diluted earnings per share attributable to common shareholders

$
0.88

$
0.88

$
0.74

$
0.45

$
0.42

Weighted average basic shares outstanding ⁽¹⁾

190,874

184,653

180,525

178,246

168,640

Weighted average diluted shares outstanding ⁽¹⁾

191,576

185,495

181,448

179,533

170,191

~~Table of Contents~~

December 31,


2019

2018

2017

2016

2015

Balance Sheet Data (in thousands):

Storage properties, net

$
3,774,485

$
3,600,968

$
3,408,790

$
3,326,816

$
2,872,983

Total assets

4,029,545

3,752,972

3,545,336

3,475,028

3,104,164

Unsecured senior notes, net

1,835,725

1,143,524

1,142,460

1,039,076

741,904

Revolving credit facility

—

195,525

81,700

43,300

—

Unsecured term loans, net

—

299,799

299,396

398,749

398,183

Mortgage loans and notes payable, net

96,040

108,246

111,434

114,618

111,455

Total liabilities

2,160,121

1,980,704

1,855,646

1,759,384

1,393,183

Noncontrolling interests in the Operating Partnership

62,088

55,819

54,320

54,407

66,128

Total CubeSmart shareholders' equity

1,799,346

1,709,678

1,629,134

1,655,382

1,643,327

Noncontrolling interests in subsidiaries

7,990

6,771

6,236

5,855

1,526

Total liabilities and equity

4,029,545

3,752,972

3,545,336

3,475,028

3,104,164

Other Data:

Number of stores

523

493

484

475

445

Total rentable square feet (in thousands)

36,604

34,619

33,760

32,858

30,361

Occupancy percentage

89.5
%

89.0
%

89.2
%

89.7
%

90.2
%
Cash dividends declared per common share ⁽²⁾

$
1.29

$
1.22

$
1.11

$
0.90

$
0.69

~~(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 of $0.16 and $0.484 per common and preferred share, respectively, on February 24, 2015, May 27, 2015 and August 4, 2015; dividends of $0.21 and $0.484 per common and preferred share, 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; dividends of $0.30 per common share on December 14, 2017, February 13, 2018, May 30, 2018 and August 7, 2018; dividends of $0.32 per common share on December 13, 2018, February 19, 2019, May 14, 2019 and July 23, 2019; and dividends of $0.33 per common share on December 12, 2019.

~~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 five-year period ended December 31, 2019 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, 2019 and 2018, and for each of the years in the three-year period ended December 31, 2019, 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, 2019, 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

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,


2019

2018

2017

2016

2015

(in thousands, except per unit data)

REVENUES

Rental income

$
552,404

$
517,535

$
489,043

$
449,601

$
392,476

Other property related income

67,558

60,156

55,001

50,255

45,189

Property management fee income

23,953

20,253

14,899

10,183

6,856

Total revenues

643,915

597,944

558,943

510,039

444,521

OPERATING EXPENSES

Property operating expenses

209,739

196,866

181,508

165,847

153,172

Depreciation and amortization

163,547

143,350

145,681

161,865

151,789

General and administrative

38,560

37,712

34,745

32,823

28,371

Acquisition related costs

—

—

1,294

6,552

3,301

Total operating expenses

411,846

377,928

363,228

367,087

336,633

OTHER (EXPENSE) INCOME

Interest:

Interest expense on loans

(72,525)

(62,132)

(56,952)

(50,399)

(43,736)

Loan procurement amortization expense

(2,819)

(2,313)

(2,638)

(2,577)

(2,324)

Equity in earnings (losses) of real estate ventures

11,122

(865)

(1,386)

(2,662)

(411)

Gains from sale of real estate, net

1,508

10,576

—

—

17,567

Other

1,416

206

872

1,062

(228)

Total other expense

(61,298)

(54,528)

(60,104)

(54,576)

(29,132)

NET INCOME

170,771

165,488

135,611

88,376

78,756

NET LOSS (INCOME) ATTRIBUTABLE TO NONCONTROLLING INTERESTS

Noncontrolling interest in subsidiaries

54

221

270

470

(84)

NET INCOME ATTRIBUTABLE TO CUBESMART L.P.

170,825

165,709

135,881

88,846

78,672

Operating Partnership interests of third parties

(1,708)

(1,820)

(1,593)

(941)

(960)

NET INCOME ATTRIBUTABLE TO OPERATING PARTNER

169,117

163,889

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

$
169,117

$
163,889

$
134,288

$
79,923

$
71,704

Basic earnings per unit attributable to common unitholders

$
0.89

$
0.89

$
0.74

$
0.45

$
0.43

Diluted earnings per unit attributable to common unitholders

$
0.88

$
0.88

$
0.74

$
0.45

$
0.42

Weighted average basic units outstanding ⁽¹⁾

190,874

184,653

180,525

178,246

168,640

Weighted average diluted units outstanding ⁽¹⁾

191,576

185,495

181,448

179,533

170,191

~~Table of Contents~~

December 31,


2019

2018

2017

2016

2015

Balance Sheet Data (in thousands):

Storage properties, net

$
3,774,485

$
3,600,968

$
3,408,790

$
3,326,816

$
2,872,983

Total assets

4,029,545

3,752,972

3,545,336

3,475,028

3,104,164

Unsecured senior notes, net

1,835,725

1,143,524

1,142,460

1,039,076

741,904

Revolving credit facility

—

195,525

81,700

43,300

—

Unsecured term loans, net

—

299,799

299,396

398,749

398,183

Mortgage loans and notes payable, net

96,040

108,246

111,434

114,618

111,455

Total liabilities

2,160,121

1,980,704

1,855,646

1,759,384

1,393,183

Operating Partnership interests of third parties

62,088

55,819

54,320

54,407

66,128

Total CubeSmart L.P. Capital

1,799,346

1,709,678

1,629,134

1,655,382

1,643,327

Noncontrolling interests in subsidiaries

7,990

6,771

6,236

5,855

1,526

Total liabilities and capital

4,029,545

3,752,972

3,545,336

3,475,028

3,104,164

Other Data:

Number of stores

523

493

484

475

445

Total rentable square feet (in thousands)

36,604

34,619

33,760

32,858

30,361

Occupancy percentage

89.5
%

89.0
%

89.2
%

89.7
%

90.2
%
Cash dividends declared per common unit ⁽²⁾

$
1.29

$
1.22

$
1.11

$
0.90

$
0.69

~~(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 $0.16 and $0.484 per common and preferred unit, respectively, on February 24, 2015, May 27, 2015 and August 4, 2015; dividends of $0.21 and $0.484 per common and preferred unit, 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; dividends of $0.30 per common unit on December 14, 2017, February 13, 2018, May 30, 2018 and August 7, 2018; dividends of $0.32 per common unit on December 13, 2018, February 19, 2019, May 14, 2019 and July 23, 2019; and dividends of $0.33 per common unit on December 12, 2019.

~~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, ~~2019~~2022 and ~~December 31, 2018,~~2021, we owned ~~523~~(or partially owned and consolidated) 611 self-storage properties totaling approximately ~~36.6~~44.1 million rentable square feet and ~~493~~607 self-storage properties totaling approximately ~~34.6~~43.6 million rentable square feet, respectively. As of December 31, ~~2019,~~2022, we owned stores in the District of Columbia and the following 24 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, ~~2019,~~2022, we managed ~~649~~668 stores for third parties (including 9177 stores containing an aggregate of approximately ~~6.3~~5.6 million net rentable square feet as part of ~~four~~six separate unconsolidated real estate ventures), bringing the total number of stores we owned and/or managed to ~~1,172.~~1,279. As of December 31, ~~2019,~~2022, we managed stores for third parties in the District of Columbia and the following 38 states: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, ~~Kansas,~~ Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, ~~Oregon,~~ Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, ~~Utah,~~ Vermont, Virginia, Washington 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 management. We believe this approach allows us to respond quickly and effectively to changes in local market conditions and 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, ~~Texas~~Florida, California and ~~California~~Texas provided approximately 16%, ~~16%~~15%, ~~10%,~~11% and 8%9%, respectively, of total revenues for the year ended December 31, ~~2019.~~2022.

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

Table of Contents

financial statements are particularly important for an understanding of the financial position and results of operations presented in the

~~Table of Contents~~

historical consolidated financial statements included in this Report. A summary of significant accounting policies is also provided in ~~the 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, ~~control~~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.

~~In allocating~~Allocations to land, building and improvements and 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, ~~2019, 2018~~2022, 2021 and ~~2017.~~2020.

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,

Table of Contents

(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~~

as held for sale are reported at the lesser of carrying value or fair value less estimated costs to sell and are not depreciated. The California Yacht Club, which we acquired through our acquisition of LAACO in 2021, has been classified as held for sale as of December 31, 2022. There were no stores classified as held for sale as of December 31, ~~2019.~~2022.

Investments in Unconsolidated Real Estate Ventures

The Company accounts for its investments in unconsolidated real estate ventures under the equity method of 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 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, ~~2019, 2018~~2022, 2021 and ~~2017.~~2020.

Differences between the Company's net investment in unconsolidated real estate ventures and its underlying equity in the net assets of the ventures are primarily a result of the Company acquiring interests in existing unconsolidated real estate ventures. As of December 31, 2022 and 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 $32.7 million and $33.6 million, respectively. These differences are amortized over the 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 operations.

Recent Accounting Pronouncements

For a discussion of recent accounting pronouncements affecting our business, see note 2 to the Company’s consolidated financial 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, ~~2019,~~2022, we owned ~~466~~521 same-store properties and 5790 non same-store properties. All of the non same-store properties were ~~2018~~2021 and ~~2019~~2022 acquisitions, dispositions, developed stores, stores with a significant portion of net rentable square footage taken out of 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~~

The following table summarizes the change in number of owned stores from January 1, ~~2017~~2020 through December 31, ~~2019:~~2022:

Table of Contents

	2022	2021	2020

Balance - January 1	607	543	523
Stores acquired	1	—	1
Stores developed	—	1	—
Stores combined ⁽¹⁾	—	(1)	—
Balance - March 31	608	543	524
Stores acquired ⁽²⁾	1	2	2
Stores developed	1	2	1
Stores combined ⁽¹⁾	(1)	—	—
Balance - June 30	609	547	527
Stores acquired	1	2	—
Stores developed	1	—	—
Stores sold	—	(4)	—
Balance - September 30	611	545	527
Stores acquired	—	62	18
Stores developed	—	1	—
Stores combined ⁽³⁾	—	—	(1)
Stores sold	—	(1)	(1)
Balance - December 31	611	607	543

(1)

(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)

Table of Contents

Comparison of the Year Ended December 31, ~~2019~~2022 to the Year Ended December 31, ~~2018~~2021 (dollars in thousands)


											Non Same-Store						Other/																								Non Same-Store						Other/
	Same-Store Property Portfolio										Properties						Eliminations				Total Portfolio										Same-Store Property Portfolio										Properties						Eliminations				Total Portfolio
							Increase/		%																		Increase/		%										%																				%
	2019			2018			(Decrease)		Change		2019			2018			2019		2018		2019			2018			(Decrease)		Change		2022			2021			Change		Change		2022			2021			2022		2021		2022			2021			Change		Change
REVENUES:
Rental income	$	508,696		$	499,729		$	8,967	1.8	%	$	43,708		$	17,806		$	—	$	—	$	552,404		$	517,535		$	34,869	6.7	%	$	744,094		$	661,989		$	82,105	12.4	%	$	135,195		$	45,762		$	—	$	—	$	879,289		$	707,751		$	171,538	24.2	%
Other property related income		53,130			51,490			1,640	3.2	%		5,139			2,503			9,289		6,163		67,558			60,156			7,402	12.3	%		32,844			27,469			5,375	19.6	%		4,755			1,836			58,567		54,300		96,166			83,605			12,561	15.0	%
Property management fee income		—			—			—	0.0	%		—			—			23,953		20,253		23,953			20,253			3,700	18.3	%		—			—			—	0.0	%		—			—			34,169		31,208		34,169			31,208			2,961	9.5	%
Total revenues		561,826			551,219			10,607	1.9	%		48,847			20,309			33,242		26,416		643,915			597,944			45,971	7.7	%		776,938			689,458			87,480	12.7	%		139,950			47,598			92,736		85,508		1,009,624			822,564			187,060	22.7	%

OPERATING EXPENSES:
Property operating expenses		164,616			158,307			6,309	4.0	%		19,430			9,776			25,693		28,783		209,739			196,866			12,873	6.5	%		207,023			201,070			5,953	3.0	%		42,814			15,331			43,423		35,703		293,260			252,104			41,156	16.3	%
NET OPERATING INCOME (LOSS):		397,210			392,912			4,298	1.1	%		29,417			10,533			7,549		(2,367)		434,176			401,078			33,098	8.3	%
NET OPERATING INCOME:																																569,915			488,388			81,527	16.7	%		97,136			32,267			49,313		49,805		716,364			570,460			145,904	25.6	%

Store count		466			466							57			27							523			493							521			521							90			86							611			607
Total square footage		32,377			32,377							4,227			2,242							36,604			34,619							36,850			36,850							7,257			6,745							44,107			43,595
Period end occupancy ⁽¹⁾		91.2	%		91.1	%						75.8	%		58.9	%						89.5	%		89.0	%						92.1	%		93.3	%						81.0	%		85.1	%						90.3	%		92.0	%
Period average occupancy ⁽²⁾		92.4	%		92.4	%																										94.0	%		94.6	%
Realized annual rent per occupied sq. ft. ⁽³⁾⁽¹⁾	$	17.01		$	16.70																										$	21.49		$	18.99

Depreciation and amortization																						163,547			143,350			20,197	14.1	%																						310,610			232,049			78,561	33.9	%
General and administrative																						38,560			37,712			848	2.2	%																						54,623			47,809			6,814	14.3	%
Subtotal																						202,107			181,062			21,045	11.6	%																						365,233			279,858			85,375	30.5	%

OTHER (EXPENSE) INCOME
Interest:
Interest expense on loans																						(72,525)			(62,132)			(10,393)	(16.7)	%																						(93,284)			(78,448)			(14,836)	(18.9)	%
Loan procurement amortization expense																						(2,819)			(2,313)			(506)	(21.9)	%	Loan procurement amortization expense																					(3,897)			(8,168)			4,271	52.3	%
Equity in earnings (losses) of real estate ventures																						11,122			(865)			11,987	1,385.8	%
Gains from sale of real estate, net																						1,508			10,576			(9,068)	(85.7)	%
Loss on early extinguishment of debt																																																				—			(20,328)			20,328	100.0	%
Equity in earnings of real estate ventures																															Equity in earnings of real estate ventures																					48,877			25,275			23,602	93.4	%
Gains from sales of real estate, net																																																				—			32,698			(32,698)	(100.0)	%
Other																						1,416			206			1,210	587.4	%																						(10,355)			(10,818)			463	4.3	%
Total other expense																						(61,298)			(54,528)			(6,770)	(12.4)	%																						(58,659)			(59,789)			1,130	1.9	%

NET INCOME																						170,771			165,488			5,283	3.2	%																						292,472			230,813			61,659	26.7	%
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS	NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS																														NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
Noncontrolling interests in the Operating Partnership																						(1,708)			(1,820)			112	6.2	%	Noncontrolling interests in the Operating Partnership																					(1,931)			(7,873)			5,942	75.5	%
Noncontrolling interests in subsidiaries																						54			221			(167)	(75.6)	%	Noncontrolling interests in subsidiaries																					722			542			180	33.2	%
NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS	NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS																				$	169,117		$	163,889		$	5,228	3.2	%	NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS																				$	291,263		$	223,482		$	67,781	30.3	%

(1)	~~Represents occupancy as of December 31 of the 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.

~~Table of Contents~~

Revenues

Rental income increased from ~~$517.5~~$707.8 million in ~~2018~~2021 to ~~$552.4~~$879.3 million in ~~2019,~~2022, an increase of ~~$34.9~~$171.5 million, or ~~6.7%~~24.2%. This increase was primarily attributable to $89.4 million of additional rental income from the stores acquired or opened in 2021 and 2022 included in our non-same-store portfolio. The ~~$9.0~~$82.1 million increase in same-store rental income was due primarily to ~~higher~~an increase in rental ~~rates.~~rates for new and existing customers. Realized annual rent per occupied square foot onin our same-store portfolio increased ~~1.9%~~13.2% as a result of higher rental rates for new and existing customers ~~in 2019 as~~for 2022 compared to ~~2018. The remaining increase was primarily attributable to $25.9 million of additional rental income from the stores acquired or opened in 2018 and 2019 included in our non-same store portfolio.~~2021.

Other property related income increased from ~~$60.2~~$83.6 million in ~~2018~~2021 to ~~$67.6~~$96.2 million in ~~2019,~~2022, an increase of ~~$7.4~~$12.6 million, or ~~12.3%~~15.0%. The ~~$1.6~~$5.4 million increase in same-store other property related income was mainly attributable to ~~increased customer insurance participation.~~a $4.4 million increase in fee revenue. The ~~remainder of the~~ increase was ~~attributable~~also due to ~~$2.6~~a $4.2 million ~~of additional other property related income derived from the stores acquired or opened~~increase in ~~2018 and 2019 included in our non-same store portfolio and $3.1 million resulting primarily from increased~~ customer ~~insurance~~storage protection plan participation at our owned and managed stores.

Property management fee income increased from $20.3 million in 2018 to $24.0 million in 2019, an increase of $3.7 million, or 18.3%. This increase was attributable to an increase in management fees related to the third-party management business resulting from more stores under management (649 stores as of December 31, 2019 compared to 593 stores as of December 31, 2018) and higher revenue at these managed stores.

Operating Expenses

Property operating expenses increased from ~~$196.9~~$252.1 million in ~~2018~~2021 to ~~$209.7~~$293.3 million in ~~2019,~~2022, an increase of ~~$12.9~~$41.2 million, or ~~6.5%~~16.3%. This increase was primarily attributable to ~~a $6.3 million increase in property operating expenses on the same-store portfolio primarily due to higher property taxes and personnel expenses. The remainder of the increase was attributable to $9.7~~$27.5 million of increased expenses associated with newly acquired or developed stores. The $6.0 million increase in property operating expenses in the same-store portfolio was primarily due to a $4.7 million increase in property taxes.

Depreciation and amortization increased from ~~$143.4~~$232.0 million in ~~2018~~2021 to ~~$163.5~~$310.6 million in ~~2019,~~2022, an increase of ~~$20.2~~$78.6 million, or ~~14.1%~~33.9%. This increase was primarily attributable to depreciation and amortization ~~expense related~~associated with newly acquired or developed stores.

General and administrative expenses increased from $47.8 million in 2021 to ~~stores acquired and developed during 2018 and 2019.~~$54.6 million in 2022, an increase of $6.8 million, or 14.3%. This increase was primarily attributable to increased personnel expenses.

Other (expense) income

Interest expense on loans increased from ~~$62.1~~$78.4 million in ~~2018~~2021 to ~~$72.5~~$93.3 million in ~~2019,~~2022, an increase of ~~$10.4~~$14.8 million, or ~~16.7%~~18.9%. The increase was attributable to a higher amount of outstanding debt during ~~2019~~2022 compared to ~~2018, and higher interest rates during 2019. The~~ 2021. To fund a portion of our growth, our

Table of Contents

average outstanding debt balance increased ~~$163.5~~by $788.2 million to ~~$1,854.4 million~~$3.14 billion during ~~2019~~2022 as compared to ~~$1,690.9 million~~$2.35 billion during ~~2018 as~~2021, partially offset by lower interest rates during the ~~result of borrowings to fund a portion of the Company’s acquisition activity.~~2022 period. The weighted average effective interest rate on ~~our~~the Company's outstanding debt ~~increased from 3.93% during 2018~~for the years ended December 31, 2022 and 2021 was 2.94% and 3.36%, respectively.

Loss on early extinguishment of debt was $20.3 million for the year ended December 31, 2021. This amount was related to ~~4.06% during 2019.~~the early redemption of $300.0 million of outstanding 4.375% senior notes due 2023 (the “2023 Notes”). There were no such losses for the year ended December 31, 2022.

Equity in earnings ~~(losses)~~ of real estate ventures increased ~~$12.0~~from $25.3 million ~~from 2018~~in 2021 to ~~2019.~~$48.9 million in 2022, an increase of $23.6 million, or 93.4%. The ~~change~~increase was mainly ~~driven by~~due to gains associated with sales of real estate within our ~~share~~unconsolidated real estate ventures. During the year ended December 31, 2022, our portion of the gains ~~attributable~~related to ~~HVP III, a real estate venture in which we previously owned a 10% interest. The gains were recorded in connection with HVP III’s~~HVPSE's sale of ~~50 properties during 2019, prior to the Company’s acquisition~~all 14 of its ~~partner’s 90% interest in~~stores was $45.7 million. During the ~~venture.~~year ended December 31, 2021, our portion of the gains related to HHF’s sale of seven stores was $23.5 million. See note 5 to our consolidated financial statements.

Gains from ~~sale~~sales of real estate, net were ~~$1.5~~$32.7 million ~~in 2019 compared to $10.6 million in 2018, a decrease of $9.1 million.~~for the year ended December 31, 2021. There were no such gains for the year ended December 31, 2022. These gains are determined on a transactional basis and, accordingly, are not comparable across reporting periods.

~~Other~~For the years ended December 31, 2022 and 2021, the component of other (expense) income ~~increased $1.2~~designated as other includes $10.5 million ~~from 2018 to 2019,~~and $15.0 million, respectively, of transaction-related expenses comprised primarily ~~due to fees earned in connection~~of severance costs associated with ~~joint venture property transactions that occurred during 2019.~~the acquisition of LAACO.

Comparison of the Year Ended December 31, ~~2018~~2021 to the Year Ended December 31, ~~2017~~2020

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, ~~2018~~2021 for a comparison of the year ended December 31, ~~2018~~2021 to the year ended December 31, ~~2017.~~2020.

~~Table of Contents~~

Non-GAAP Financial Measures

NOI

We define net operating income, which we refer to as “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): equity in earnings of real estate ventures, gains from ~~sale~~sales of 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;

●

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

●

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.

Table of Contents

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.

~~Table of Contents~~

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~~investors, analysts and other stakeholders consider 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.

Table of Contents

The following table presents a reconciliation of net income to FFO and FFO, as adjusted, for the years ended December 31, ~~2019~~2022 and ~~2018:~~2021:


	For the year ended December 31,				Year Ended December 31,
	2019		2018		2022		2021
	(dollars in thousands)
Net income attributable to the Company’s common shareholders	$	169,117	$	163,889	$	291,263	$	223,482

Add (deduct):
Real estate depreciation and amortization:
Real property		160,485		140,538		305,845		226,599
Company’s share of unconsolidated real estate ventures		7,052		10,286		9,320		8,510
Gains from sale of real estate, net ⁽¹⁾		(12,175)		(10,576)
Gains from sales of real estate, net ⁽¹⁾						(45,705)		(56,181)
Noncontrolling interests in the Operating Partnership		1,708		1,820		1,931		7,873
FFO attributable to common shareholders and OP unitholders	$	326,187	$	305,957
FFO attributable to the Company's common shareholders and OP unitholders					$	562,654	$	410,283

Add:
Loan procurement amortization expense - early repayment of debt		141		—
Loss related to settlement of legal action ⁽²⁾		—		1,828
FFO, as adjusted, attributable to common shareholders and OP unitholders	$	326,328	$	307,785
Add (deduct):
Loss on early repayment of debt ⁽²⁾						—		20,884
Transaction-related expenses ⁽³⁾						10,546		14,986
Loan forgiveness income ⁽⁴⁾						—		(1,546)
Bridge loan fee ⁽⁵⁾						—		4,000
Property damage related to hurricane, net of expected insurance proceeds						1,266		—
FFO, as adjusted, attributable to the Company's common shareholders and OP unitholders					$	574,466	$	448,607

Weighted average diluted shares outstanding		191,576		185,495		225,881		205,009
Weighted average diluted units outstanding		1,886		2,021		1,521		7,117
Weighted average diluted shares and units outstanding		193,462		187,516		227,402		212,126

(1)

The ~~year~~years ended December 31, ~~2019 includes $10.7~~2022 and 2021 included gains of $45.7 million ~~of gains from sale~~and $23.5 million, respectively, related to sales of real estate ~~net that~~within the Company's unconsolidated real estate ventures. These amounts are included in the ~~Company’s~~Company's share of equity in earnings of real estate ventures.

(2)

~~Loss related~~For the year ended December 31, 2021, $20.0 million relates to ~~settlement~~a prepayment premium and $0.3 million relates to a write-off of ~~legal action~~unamortized loan procurement costs associated with the Company’s redemption, in full, of its $300.0 million of outstanding 4.380% senior notes due on December 23, 2021. Additionally, for the year ended December 31, ~~2018, represents a charge related~~2021, $0.6 million relates to ~~a settlement agreement for a class action alleging violations~~debt modification costs that are included in the Company's share of ~~a state specific deceptive and unfair trade practices act.~~equity in earnings of real estate ventures.

(3)

For the year ended December 31, 2022, transaction-related expenses include severance expenses ($10.3 million) and other transaction expenses ($0.2 million). For the year ended December 31, 2021, transaction-related expenses include severance expenses ($14.8 million) and other transaction expenses ($0.2 million). Prior to our acquisition of LAACO on December 9, 2021, the predecessor company entered into severance agreements with certain employees, including members of their executive team. 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. Transaction-related expenses are included in the component of other (expense) income designated as Other.

(4)

The Company assumed a Paycheck Protection Program loan in 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 other (expense) income 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.

Table of Contents

Cash Flows

Comparison of the Year Ended December 31, ~~2019~~2022 to the Year Ended December 31, ~~2018~~2021

A comparison of cash flow related to operating, investing and financing activities for the years ended December 31, ~~2019~~2022 and ~~2018~~2021 is as follows:


	For the year ended December 31,						Year Ended December 31,
Net cash provided by (used in):	2019		2018		Change		2022		2021		Change

	(in thousands)						(in thousands)

Operating activities	$	331,768	$	304,335	$	27,433	$	591,466	$	449,185	$	142,281
Investing activities	$	(375,664)	$	(322,259)	$	(53,405)	$	(48,767)	$	(1,852,668)	$	1,803,901
Financing activities	$	95,855	$	15,248	$	80,607	$	(547,092)	$	1,410,572	$	(1,957,664)

Cash provided by operating activities increased from $449.2 million for the ~~years~~year ended December 31, ~~2019 and 2018 was $331.8~~2021 to $591.5 million ~~and $304.3 million, respectively,~~for the year ended December 31, 2022, reflecting an increase of ~~$27.4~~$142.3 million. Our increased cash flow from operating activities was primarily attributable to stores

~~Table of Contents~~

acquired and developed during ~~2018~~2021 and ~~2019, as well as~~2022 and increased net operating income levels onin the same-store portfolio in ~~2019~~the 2022 period as compared to ~~2018.~~the corresponding 2021 period.

Cash used in investing activities ~~increased~~decreased from ~~$322.3~~$1,852.7 million ~~in 2018~~for the year ended December 31, 2021 to ~~$375.7~~$48.8 million ~~in 2019,~~for the year ended December 31, 2022, reflecting ~~an increase~~a decrease of ~~$53.4~~$1,803.9 million. The change was primarily driven by ~~an increase in~~the $1,679.0 million of cash used for the acquisition of LAACO in 2021. There were no acquisitions of the scale of the LAACO transaction during the 2022 period. Excluding the storage properties ~~and~~acquired through the ~~remaining interest in HVP III, a previously unconsolidated real estate venture. Including the HVP III membership interest~~ acquisition of LAACO, cash used during ~~2019 related to~~the year ended December 31, 2021 included the acquisition of 29nine 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 ~~$238.3 million, inclusive of $3.6 million of OP units issued, while cash~~$152.8 million. Cash used during ~~2018~~the year ended December 31, 2022 related to the acquisition of ~~ten~~three stores and land for an aggregate net purchase price of ~~$227.5 million, inclusive of $7.2 million of assumed debt and $4.8 million of OP units issued. Additionally, there~~$89.3 million. The change was also driven by a ~~$16.7 million increase~~decrease in development costs ~~from the 2018 to 2019 resulting from the payment~~ of ~~put liabilities associated with three previously consolidated development joint ventures during 2019. The remainder of the change was~~$45.5 million due to ~~a $12.5 million decrease in~~fewer development projects under construction. We completed the ~~proceeds from sale~~development of ~~real estate, net from 2018 to 2019 resulting from~~six stores during 2021 and 2022 and began construction on two new stores during the ~~sale of one property for a sales price of $4.1 million in 2019 compared to the sale of two properties for an aggregate sales price of $17.5 million in 2018.~~same time period.

Cash provided by financing activities ~~increased from $15.2~~was $1,410.6 million for the year ended December 31, 2021 compared to cash used in ~~2018 to $95.9~~financing activities of $547.1 million ~~in 2019,~~for the year ended December 31, 2022, reflecting ~~an increase~~a change of ~~$80.6~~$1,957.7 million. ~~This change was primarily~~During the ~~result of $696.4 million of~~year ended December 31, 2021, we received net proceeds from ~~our issuance~~unsecured senior notes of $1,043.4 million while making principal payments of $300.0 million on unsecured senior notes. There were no senior note transactions during the ~~2029 Notes and 2030 Notes (defined below) during 2019 as well as an increase~~2022 period. There was also a decrease of ~~$64.5~~$960.8 million in proceeds received from the issuance of common shares, ~~during 2019 compared~~primarily as a result of our underwritten offering of 15.5 million common shares to ~~2018. These cash inflows were offset by a $200.0 million cash payment made to repay our unsecured term loan~~partially fund the LAACO acquisition in January 2019 and a $413.8 million net increase in revolving credit facility payments from 2018 to 2019. The change was also impacted by the combined $35.8 million cash outflow for the acquisition of the noncontrolling members’ interests in four separate consolidated development joint ventures during 20192021 with no ~~comparable cash outflow~~similar transactions during ~~2018.~~the 2022 period. Additionally, cash distributions paid to common shareholders ~~and noncontrolling interests in the Operating Partnership~~ increased ~~$22.6~~$113.3 million ~~from 2018~~due to ~~2019 resulting from the increase~~increases in the common dividend per share and the number of shares outstanding. These changes were offset by an $84.8 million decrease in principal payments on mortgage loans due to the repayment of two secured loans and the repayment of LAACO's outstanding long-term debt at closing during the 2021 period with no comparable repayments during the 2022 period.

Comparison of the Year Ended December 31, ~~2018~~2021 to the Year Ended December 31, ~~2017~~2020

Refer to the section entitled “Cash Flows” 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, ~~2018~~2021 for a comparison of the year ended December 31, ~~2018~~2021 to the year ended December 31, ~~2017.~~2020.

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 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.

Table of Contents

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 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 and 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 ~~2020~~2023 fiscal year, we expect recurring capital expenditures to be approximately ~~$14.0~~$15.0 million to ~~$19.0~~$20.0 million, planned capital improvements and store upgrades to be approximately ~~$24.0~~$11.0 million to ~~$29.0~~$16.0 million and costs associated with the development of new stores to be approximately ~~$39.0~~$20.0 million to ~~$54.0~~$30.0 million. Our currently scheduled principal payments on debt are approximately ~~$12.8~~$32.6 million in ~~2020.~~2023.

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 equity program and available borrowings under our Revolver (defined below) provide adequate sources of liquidity to enable us to execute our current business plan and remain in compliance with our covenants.

~~Table of Contents~~

Our liquidity needs beyond ~~2020~~2023 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 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, ~~2019,~~2022, we had approximately ~~$54.9~~$6.1 million in available cash and cash equivalents. In addition, we had approximately ~~$749.3~~$788.5 million of availability for borrowings under ~~the revolving portion of~~ our ~~Amended and Restated Credit Facility (defined below).~~Revolver.

Unsecured Senior Notes

On January 30, 2019, we issued $350.0 million in aggregate principal amount of unsecured senior notes due February 15, 2029, which bear interest at a rate of 4.375% per annum (the “2029 Notes”). The 2029 Notes were priced at 99.356% of the principal amount to yield 4.455% to maturity. Net proceeds from the offering were used to repay all of the outstanding indebtedness under our $200.0 million unsecured term loan portion of our credit facility that was scheduled to mature in January 2019. The remaining proceeds from the offering were used to repay a portion of the outstanding indebtedness under the revolving portion of our Credit Facility (defined below).

Additionally, on October 11, 2019, we issued $350.0 million in aggregate principal amount of unsecured senior notes due February 15, 2030, which bear interest at a rate of 3.000% per annum (the “2030 Notes”). The 2030 Notes were priced at 99.623% of the principal amount to yield 3.043% to maturity. Net proceeds from the offering were used to repay all of the outstanding indebtedness under the Revolver and for working capital and other general corporate purposes.

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

December 31,

Effective

Issuance

Maturity

Unsecured Senior Notes

2019

2018

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

300,000

4.33
%

Various ⁽¹⁾

Dec-23

$300M 4.000% Guaranteed Notes due 2025 ⁽²⁾

300,000

300,000

3.99
%

Various ⁽²⁾

Nov-25

$300M 3.125% Guaranteed Notes due 2026

300,000

300,000

3.18
%

Aug-16

Sep-26

$350M 4.375% Guaranteed Notes due 2029

350,000

—

4.46
%

Jan-19

Feb-29

$350M 3.000% Guaranteed Notes due 2030

350,000

—

3.04
%

Oct-19

Feb-30

Principal balance outstanding

1,850,000

1,150,000

Less: Discount on issuance of unsecured senior notes, net

(3,860)

(568)

Less: Loan procurement costs, net

(10,415)

(5,908)

Total unsecured senior notes, net

$
1,835,725

$
1,143,524

~~(1)~~

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 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 effective interest rate of the 2023 notes is 4.330%.


	December 31,				Effective		Issuance	Maturity
Unsecured Senior Notes	2022		2021		Interest Rate		Date	Date

	(in thousands)
$300M 4.000% Guaranteed Notes due 2025 ⁽¹⁾	$	300,000	$	300,000	3.99	%	Various ⁽¹⁾	Nov-25
$300M 3.125% Guaranteed Notes due 2026		300,000		300,000	3.18	%	Aug-16	Sep-26
$550M 2.250% Guaranteed Notes due 2028		550,000		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		500,000	2.59	%	Nov-21	Feb-32
Principal balance outstanding		2,800,000		2,800,000
Less: Discount on issuance of unsecured senior notes, net		(11,801)		(13,455)
Less: Loan procurement costs, net		(15,849)		(18,336)
Total unsecured senior notes, net	$	2,772,350	$	2,768,209

4342

Table of Contents

~~(2)~~(1)

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 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 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 1.5:1.0 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, ~~2019,~~2022, 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”), which was subsequently amended ~~on April 5, 2012, June 18, 2013~~ and ~~April 22, 2015 to provide for, among other things, a $500.0 million unsecured revolving facility with a maturity date of April 22, 2020.~~restated. On ~~June 19, 2019,~~October 26, 2022, we again amended and restated, in its entirety, ~~the~~our Credit Facility (the ~~“Amended~~“Second Amended and Restated Credit Facility”) which, subsequent to the amendment and restatement, is comprised of ~~a $750.0~~an $850.0 million unsecured revolving ~~credit~~ facility (the “Revolver”) maturing on ~~June 19, 2024.~~February 15, 2027. Under the Second Amended and Restated Credit Facility, pricing on the Revolver is dependent upon our unsecured debt credit ~~ratings.~~ratings and leverage levels. At our current ~~Baa2/BBB level,~~unsecured debt credit ratings and leverage levels, amounts drawn under the Revolver are priced ~~at 1.10% over LIBOR, inclusive~~using a margin of 0.775% plus a facility fee of 0.15%~~. We incurred costs of $3.9 million in 2019 in connection with amending~~ over SOFR and ~~restating the Credit Facility and capitalized such costs as~~ a ~~component of Loan procurement costs, net of amortization on the consolidated balance sheets.~~0.10% SOFR adjustment.

As of December 31, ~~2019,~~2022, borrowings under the Revolver had an ~~effective weighted average~~ interest rate of ~~2.86%~~5.33%. Additionally, as of December 31, ~~2019, $749.3~~2022, $788.5 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.

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 seven-year maturity that was repaid on June 19, 2019.

~~Our unsecured term loans under~~Under the ~~Credit Facility and Term Loan Facility are summarized below:~~

Carrying Value as of:

Effective Interest


December 31,

Rate as of

Maturity

Unsecured Term Loans

2019

2018

December 31, 2019

Date

(in thousands)

Credit Facility

Unsecured term loan ⁽¹⁾

$
—

$
200,000

—
%

Jan-19

Term Loan Facility

Unsecured term loan ⁽²⁾

—

100,000

—
%

Jan-20

Principal balance outstanding

—

300,000

Less: Loan procurement costs, net

—

(201)

Total unsecured term loans, net

$
—

$
299,799

~~(1)~~

On January 31, 2019, we used a portion of the net proceeds from the issuance of the 2029 Notes to repay all of the outstanding indebtedness under the unsecured term loan portion of the Credit Facility.

~~(2)~~

On June 19, 2019, we used an initial advance at closing of the Amended and Restated Credit Facility to repay all of the outstanding indebtedness under the unsecured term loan portion of the Term Loan Facility that was scheduled to mature in January 2020. Unamortized loan procurement costs of $0.1 million were written off in conjunction with the repayment.

~~Under the~~Second 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

~~Table of Contents~~

minimum fixed charge coverage ratio of 1.5:1.0. As of and for the year ended December 31, ~~2019,~~2022, the Operating Partnership was in compliance with all of its financial covenants.

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 ~~50.0~~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, ~~2019, 2018~~2022, 2021 and ~~2017~~2020 is summarized below:


	For the year ended December 31,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020

	(dollars and shares in thousands, except per share amounts)						(dollars and shares in thousands, except per share amounts)
Number of shares sold		5,899		4,291		1,036		102		4,982		3,627
Average sales price per share	$	33.64	$	31.09	$	29.13	$	50.64	$	40.57	$	33.69
Net proceeds after deducting offering costs	$	196,304	$	131,835	$	29,642	$	4,936	$	199,977	$	120,727

We used proceeds from sales of common shares under the program during the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020 to fund ~~acquisitions~~the acquisition and development of storage properties and for general corporate purposes. As of December 31, ~~2019, 2018~~2022, 2021 and ~~2017, 4.6~~2020, 5.8 million common shares, ~~10.5~~5.9 million common shares and ~~4.7~~10.9 million common shares, respectively, remained available for issuance under the Equity Distribution Agreements.

Table of Contents

Other Material Changes in Financial Position


	December 31,						December 31,
	2019		2018		Change		2022		2021		Change

			(in thousands)				(in thousands)
Selected Assets
Storage properties, net	$	3,774,485	$	3,600,968	$	173,517	$	6,048,003	$	6,097,670	$	(49,667)
Investment in real estate ventures, at equity								105,993		119,751		(13,758)
Assets held for sale								3,745		49,313		(45,568)
Other assets, net		101,443		48,763		52,680		153,982		265,705		(111,723)

Selected Liabilities
Unsecured senior notes, net	$	1,835,725	$	1,143,524	$	692,201
Revolving credit facility		—		195,525		(195,525)		60,900		209,900		(149,000)
Unsecured term loans, net		—		299,799		(299,799)

Noncontrolling interests in the Operating Partnership							$	57,419	$	108,220	$	(50,801)

Storage properties, net ~~increased $173.5~~decreased $49.7 million from December 31, ~~2018~~2021 to December 31, ~~2019,~~2022, primarily as a result of an increase in accumulated depreciation on existing assets partially offset by the acquisition of 29three storage properties, additions and improvements to storage properties, and development costs incurred during the year.

~~Other assets, net increased $52.7~~Investment in real estate ventures, at equity decreased $13.8 million from December 31, ~~2018~~2021 to December 31, ~~2019~~2022, primarily as the result of the sale by HVPSE of all 14 of its stores during 2022.

Assets held for sale decreased $45.6 million from December 31, 2021 to December 31, 2022 primarily as the result of the sale during 2022 of the Los Angeles Athletic Club, which was acquired in the LAACO acquisition in 2021.

Other assets, net decreased $111.7 million from December 31, 2021 to December 31, 2022, primarily due to the adoption of Accounting Standard Update (“ASU”) No. 2016-02 - Leases (Topic 842) on January 1, 2019, which required the Company to record right-of-use assets associated with leases in which it serves as lessee (see note 13).

~~Unsecured senior notes, net increased $692.2 million from December 31, 2018 to December 31, 2019 as a result~~amortization of the ~~issuance of~~value assigned to the ~~2029 Notes and 2030 Notes on January 31, 2019 and October 11, 2019, respectively.~~in-place leases at the 66 storage properties acquired during 2021.

Revolving credit facility decreased ~~$195.5~~$149.0 million from December 31, ~~2018~~2021 to December 31, ~~2019~~2022 primarily due to an increase in net cash provided by operating activities and a decrease in costs for the acquisition and development of storage properties, which allowed us to use excess cash to pay down the outstanding balance.

Noncontrolling interests in the Operating Partnership decreased $50.8 million from December 31, 2021 to December 31, 2022, primarily due to the decrease in redemption value of the OP units as a result of the ~~Company using a portion~~decrease in the closing price of the ~~net proceeds from~~common shares of CubeSmart on the ~~issuance~~New York Stock Exchange during 2022. In addition, 0.5 million OP units were redeemed for common shares of ~~the 2030 Notes to repay all of the outstanding indebtedness under the Revolver.~~CubeSmart during 2022.

Unsecured term loans, net decreased $299.8 million from December 31, 2018 to December 31, 2019 as a result of the Company using a portion of the net proceeds from the issuance of the 2029 Notes to repay all of the outstanding indebtedness under the unsecured term loan portion of the Credit Facility, and an initial advance at closing of the Amended and Restated Credit Facility to repay all of the outstanding indebtedness under the unsecured term loan portion of the Term Loan Facility.

~~Table of Contents~~

~~Contractual Obligations~~

~~The following table summarizes our known contractual obligations as of December 31, 2019 (in thousands):~~

Payments Due by Period




















2025 and

Total

2020

2021

2022

2023

2024

thereafter

Mortgage loans and notes payable ⁽¹⁾

$
94,494

$
12,791

$
45,057

$
923

$
31,019

$
4,704

$
—

Unsecured senior notes ⁽²⁾

1,850,000

—

—

250,000

300,000

—

1,300,000

Interest payments

472,242

77,071

75,250

68,532

60,829

47,280

143,280

Operating lease payments

103,171

2,273

2,302

2,459

2,523

2,373

91,241

Software and service contracts

1,873

1,735

138

—

—

—

—

Properties under contract to be acquired ⁽³⁾

54,853

54,853

—

—

—

—

—

Development commitments

56,654

46,603

10,051

—

—

—

—

$
2,633,287

$
195,326

$
132,798

$
321,914

$
394,371

$
54,357

$
1,534,521

~~(1)~~

~~Amounts do not include $1.8 million of unamortized fair value adjustments for discounts/premiums and $0.3 million of unamortized loan procurement costs as of December 31, 2019.~~

~~(2)~~

~~Amounts do not include $3.9 million of unamortized discounts on the issuance of unsecured senior notes and $10.4 million of unamortized loan procurement costs as of December 31, 2019.~~

~~(3)~~

Amounts do not include $2.6 million of aggregate deposits made by the Company as of December 31, 2019. The deposits are associated with two properties that were under contract to be acquired as of December 31, 2019 and are to be applied towards the purchase price of each property upon acquisition.

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 debt. The analysis below presents the

Table of Contents

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, ~~2019~~2022 our consolidated debt consisted of ~~$1,944.5 million~~$2.95 billion of outstanding mortgage loans and notes payable and unsecured senior notes that are subject to fixed rates. ~~Borrowings under our Revolver are~~Additionally, as of December 31, 2022, there were $60.9 million of outstanding unsecured credit facility borrowings subject to floating rates. Changes in market interest rates have different impacts on the fixed- and 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.

46If 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 $0.6 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 $0.6 million a year.

~~Table of Contents~~

If market interest rates increase by 100 basis points, the fair value of our outstanding fixed-rate mortgage debt and unsecured senior notes would decrease by approximately ~~$110.2~~$135.2 million. If market interest rates decrease by 100 basis points, the fair value of our outstanding fixed-rate mortgage debt and unsecured senior notes would increase by approximately ~~$122.5~~$139.0 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).

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, ~~2019~~2022 has been audited by KPMG LLP, an independent registered public accounting firm, as stated in its report which is included herein.

Table of Contents

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 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.

~~Table of Contents~~

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, ~~2019~~2022 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

Amendments to Bylaws

On February 22, 2023, upon the recommendation of the Corporate Governance & Nominating Committee of CubeSmart’s Board of Trustees (the “Board”), the Board amended and restated CubeSmart’s Fourth Amended and Restated Bylaws by adopting the Fifth Amended and Restated Bylaws (the “Amended and Restated Bylaws”), effective as of such date, to, among other things, implement a proxy access framework.

Implementation of Proxy Access

Section 17 of Article II of the Amended and Restated Bylaws has been added to permit a shareholder, or a group of up to 20 shareholders, to nominate and include trustee candidates constituting up to the greater of two or 20% of the number of trustees in office as of the last day on which notice of a nomination may be delivered pursuant to Section 17 of Article II of the Amended and Restated Bylaws, provided that (i) such shareholder or shareholder group, as applicable, owns 3% or more of CubeSmart’s outstanding shares that are entitled to vote in the election of trustees continuously for at least three years, and (ii) such shareholder or shareholder group, as applicable, and the nominee(s) satisfy certain procedural, eligibility and disclosure requirements set forth in Article II, Section 17 of the Amended and Restated Bylaws.

The procedural and eligibility requirements set forth in Article II, Section 17 of the Amended and Restated Bylaws include a requirement that, subject to certain exceptions, a notice of proxy access nomination must be received at the principal executive offices of CubeSmart no later than the 120th day, and no earlier than the 150th day, prior to the first anniversary of the date that the preceding year’s proxy statement was first sent to shareholders. Article II, Section 17 of the Amended and Restated Bylaws also includes requirements that the nominating shareholder or shareholder group, as applicable, and the nominee(s) provide certain information, representations and agreements to CubeSmart in order to be eligible for proxy access.

Table of Contents

Additional Bylaw Amendments

In addition to the Board’s implementation of proxy access, the Amended and Restated Bylaws were also updated to reflect certain procedural requirements related to the Securities and Exchange Commission’s recently adopted “universal proxy” rules, as well as certain technical, conforming and clarifying changes in connection therewith. In particular, the Amended and Restated Bylaws provide that, among other things, with respect to shareholder nominees to the Board, (i) the scope of disclosures required by a proposing shareholder seeking to submit a trustee nomination have been expanded to include representations as to whether the shareholder (x) has complied, and will comply, with appliable state law and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), in connection with the solicitation of such proxies, and (y) intends to solicit proxies in support of trustee nominees other than individuals nominated by the Board in compliance with the requirements of Rule 14a-19 under the Exchange Act, (ii) shareholders are not permitted to solicit proxies from other shareholders using a white colored proxy card, which has been reserved for use by the Board, and (iii) certain other updated procedures and information requirements apply to shareholder nominations of trustees.

The foregoing description of the Amended and Restated Bylaws is qualified in its entirety by reference to a copy of the Amended and Restated Bylaws filed as Exhibit 3.12 to this Annual Report on Form 10-K, which is incorporated by reference herein.

ITEM 9C.DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

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 ~~2020~~2023 (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 ~~2020~~2023 Annual Meeting.” The information required by this item regarding compliance with Section 16(a) of the Exchange Act, if any, is hereby incorporated by reference to the material appearing in the Parent Company’s Proxy Statement under the caption “Delinquent Section 16(a) ~~Reports.~~Reports,” if applicable.

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,” “Severance Plan and Potential Payments Upon Termination or Change in Control,” and “Trustee Compensation.”

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, ~~2019.~~2022.

Number of securities remaining

Number of securities to

Weighted average

available for future issuance under

Number of securities to

Weighted average

available for future issuance under

be issued upon exercise

exercise price of

equity compensation plans

be issued upon exercise

exercise price of

equity compensation plans

of outstanding options,

outstanding options,

(excluding securities

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

1,602,353

24.10

⁽¹⁾

4,015,223

2,537,038

33.10

⁽¹⁾

1,941,786

Equity compensation plans not approved by shareholders

—

Total

1,602,353

24.10

4,015,223

2,537,038

33.10

1,941,786

Table of Contents

(1)

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

~~Table of Contents~~

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.”

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.

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.

4948

Table of Contents

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 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.

3.13*3.12		~~First Amendment to Third~~Fifth Amended and Restated Bylaws of CubeSmart, effective ~~June 1, 2017, incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K, filed on June 2, 2017.~~February 22, 2023.

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.

4.8*		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.~~

4.104.6		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.

~~Table of Contents~~

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.

Table of Contents

4.15*		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.

4.164.11		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.

4.184.13		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.

4.194.14		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.

4.204.15		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.

4.214.16		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.

4.224.17		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.

~~4.23~~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.~~1934, incorporated herein by reference to Exhibit 4.23 to the Company’s Annual Report on Form 10-K, filed on February 21, 2020.

~~10.1†~~4.22		~~Indemnification Agreement,~~Ninth Supplemental Indenture, dated of as ~~of October 27, 2004, by and~~November 30, 2021, among ~~U-Store-It Trust, U-Store-It,~~CubeSmart, CubeSmart, L.P. and David J. LaRue (substantially identical agreements have been entered into with Christopher P. Marr, Timothy M. Martin, Jeffrey P. Foster, Joel D. Keaton, Piero Bussani, Dorothy Dowling, John W. Fain, Marianne M. Keler, John F. Remondi, Jeffrey F. Rogatz and Deborah R. Salzberg),U.S. Bank National Association, incorporated herein by reference to Exhibit ~~10.19~~4.4 to the Company’s Current Report on Form 8-K, filed on November ~~2, 2004.~~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.

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.

Table of Contents

10.1*†		Form of Indemnification Agreement for Trustees and Executive Officers, incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on May 17, 2022.

10.2*†		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.

10.3*†		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.

~~Table of Contents~~

10.4*†		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.

10.5*†		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.

10.6*†		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.

10.7*†		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.

10.8*†		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.

10.9*†		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.

10.10*†		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.

10.11*†		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.

10.12*†		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.

10.13*†		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.

10.14*†		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.

10.15*		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.

10.16*		Underwriting Agreement, dated as of January 24, 2019, among CubeSmart, CubeSmart, L.P., Wells Fargo Securities, LLC, Barclays Capital Inc. and Jefferies LLC, as representatives of each of the other underwriters named in Exhibit A thereto, incorporated by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K, filed on January 25, 2019.

10.17*†		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.

Table of Contents

10.1810.17†		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.

10.1910.18†		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.

~~Table of Contents~~

10.2010.19†		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.

10.2110.20†		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.

10.2210.21†		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.

10.2310.22†		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.

10.2410.23†		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.

10.2510.24†		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.

10.2610.25†		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.

10.2710.26†		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.

10.2810.27†		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.

10.2910.28†		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.

10.3010.29†		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.

10.3110.30†		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.

10.3210.31†		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.

10.3310.32†		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.

Table of Contents


10.3410.33†		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.

~~Table of Contents~~

10.3510.34†		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.

10.3610.35†		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.

10.3710.36†		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.

10.38*		Amended and Restated Equity Distribution Agreement, dated July 27, 2018, by and among CubeSmart, CubeSmart, L.P. and Wells Fargo Securities, LLC, incorporated by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K, filed on July 27, 2018.

10.39*		Amended and Restated Equity Distribution Agreement, dated July 27, 2018, by and among CubeSmart, CubeSmart, L.P. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, incorporated by reference to Exhibit 1.2 to the Company’s Current Report on Form 8-K, filed on July 27, 2018.

10.40*		Amended and Restated Equity Distribution Agreement, dated July 27, 2018, 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 July 27, 2018.

10.41*		Amended and Restated Equity Distribution Agreement, dated July 27, 2018, by and among CubeSmart, CubeSmart, L.P. and Jeffries LLC, incorporated by reference to Exhibit 1.4 to the Company’s Current Report on Form 8-K, filed on July 27, 2018.

10.42*		Amended and Restated Equity Distribution Agreement, dated July 27, 2018, by and among CubeSmart, CubeSmart, L.P. and RBC Capital Markets, LLC, incorporated by reference to Exhibit 1.5 to the Company’s Current Report on Form 8-K, filed on July 27, 2018.

10.43*		Amended and Restated Equity Distribution Agreement, dated July 27, 2018, by and among CubeSmart, CubeSmart, L.P. and Barclays Capital Inc., incorporated by reference to Exhibit 1.6 to the Company’s Current Report on Form 8-K, filed on July 27, 2018.

10.4410.37†		Form of 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.

10.4510.38†		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.

10.4610.39†		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.

10.4710.40		Second Amended and Restated Credit Agreement, dated as of ~~June 19, 2019,~~October 26, 2022, 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~~Quarterly Report on Form ~~8-K,~~10-Q, filed on ~~June 21, 2019.~~October 28, 2022.

10.4810.41		~~First Amendment to the~~Second Amended and Restated Equity Distribution Agreement, dated ~~July 29, 2019,~~March 4, 2020, by and among CubeSmart, CubeSmart, L.P. and Wells Fargo Securities, LLC, incorporated by reference to Exhibit ~~10.1~~1.1 to the Company’s ~~Quarterly~~Current Report on Form ~~10-Q for the quarter ended September 30, 2019,~~8-K, filed on ~~October 25, 2019.~~

~~Table of Contents~~

10.49*		First Amendment to the Amended and Restated Equity Distribution Agreement, dated July 29, 2019, by and among CubeSmart, CubeSmart, L.P. and Barclays Capital Inc, incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2019, filed on October 25, 2019.March 4, 2020.

10.5010.42		~~First Amendment to the~~Second Amended and Restated Equity Distribution Agreement, dated ~~July 29, 2019,~~March 4, 2020, by and among CubeSmart, CubeSmart, L.P. and BofA Securities, ~~Inc,~~Inc., incorporated by reference to Exhibit ~~10.3~~1.2 to the Company’s ~~Quarterly~~Current Report on Form ~~10-Q for the quarter ended September 30, 2019,~~8-K, filed on ~~October 25, 2019.~~March 4, 2020.

10.5110.43		~~First Amendment to the~~Second Amended and Restated Equity Distribution Agreement, dated ~~July 29, 2019,~~March 4, 2020, by and among CubeSmart, CubeSmart, L.P. and ~~Jefferies LLC,~~BMO Capital Markets Corp., incorporated by reference to Exhibit ~~10.4~~1.3 to the Company’s ~~Quarterly~~Current Report on Form ~~10-Q for the quarter ended September 30, 2019,~~8-K, filed on ~~October 25, 2019.~~March 4, 2020.

10.5210.44		~~First Amendment to the~~Second Amended and Restated Equity Distribution Agreement, dated ~~July 29, 2019,~~March 4, 2020, by and among CubeSmart, CubeSmart, L.P. and ~~RBC Capital Markets,~~Jefferies LLC, incorporated by reference to Exhibit ~~10.5~~1.4 to the Company’s ~~Quarterly~~Current Report on Form ~~10-Q for the quarter ended September 30, 2019,~~8-K, filed on ~~October 25, 2019.~~March 4, 2020.

10.45*		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.

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.

Table of Contents

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, ~~2019,~~2022, 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.

5554

Table of Contents

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 ~~21, 2020~~24, 2023

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

/s/ ~~Marianne M. Keler~~Deborah Ratner Salzberg	Chair of the Board of Trustees	February ~~21, 2020~~24, 2023
~~Marianne M. Keler~~Deborah Ratner Salzberg

/s/ Christopher P. Marr	Chief Executive Officer and Trustee	February ~~21, 2020~~24, 2023
Christopher P. Marr	(Principal Executive Officer)

/s/ Timothy M. Martin	Chief Financial Officer	February ~~21, 2020~~24, 2023
Timothy M. Martin	(Principal Financial and Accounting Officer)

/s/ Piero Bussani	Trustee	February ~~21, 2020~~24, 2023
Piero Bussani

/s/ Jit Kee Chin	Trustee	February 24, 2023
Jit Kee Chin

/s/ Dorothy Dowling	Trustee	February ~~21, 2020~~24, 2023
Dorothy Dowling

/s/ John W. Fain	Trustee	February ~~21, 2020~~24, 2023
John W. Fain

/s/ Jair K. Lynch	Trustee	February 24, 2023
Jair K. Lynch

/s/ John F. Remondi	Trustee	February ~~21, 2020~~24, 2023
John F. Remondi

/s/ Jeffrey F. Rogatz	Trustee	February ~~21, 2020~~24, 2023
Jeffrey F. Rogatz

~~/s/ Deborah Ratner Salzberg~~	~~Trustee~~	~~February 21, 2020~~
~~Deborah Ratner Salzberg~~

5655

FINANCIAL STATEMENTS
INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS


		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, ~~2019~~2022 and ~~2018~~2021		F-10

CubeSmart and Subsidiaries Consolidated Statements of Operations for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020		F-11

CubeSmart and Subsidiaries Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~201~~20207		F-12

CubeSmart and Subsidiaries Consolidated Statements of Equity for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020		F-13

CubeSmart and Subsidiaries Consolidated Statements of Cash Flows for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020		F-14

CubeSmart, L.P. and Subsidiaries Consolidated Balance Sheets as of December 31, ~~2019~~2022 and ~~2018~~2021		F-15

CubeSmart, L.P. and Subsidiaries Consolidated Statements of Operations for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020		F-16

CubeSmart, L.P. and Subsidiaries Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020		F-17

CubeSmart, L.P. and Subsidiaries Consolidated Statements of Capital for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020		F-18

CubeSmart, L.P. and Subsidiaries Consolidated Statements of Cash Flows for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020		F-19

Notes to Consolidated Financial Statements		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, ~~2019,~~2022, 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, ~~2019,~~2022, 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, ~~2019,~~2022, 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 ~~21, 2020~~24, 2023

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, ~~2019,~~2022, 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, ~~2019,~~2022, the Partnership’s internal control over financial reporting was effective based on the COSO framework.

February ~~21, 2020~~24, 2023

F-3

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Trustees
of CubeSmart:

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of CubeSmart andsubsidiaries (the Company) as of December 31, ~~2019~~2022 and ~~2018,~~2021, 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, ~~2019,~~2022, and the related notes andfinancial statement scheduleIII (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, ~~2019~~2022 and ~~2018,~~2021, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, ~~2019,~~2022, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, ~~2019,~~2022, 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 ~~21, 2020~~24, 2023 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

~~Change in Accounting Principle~~

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting for leases as of January 1, 2019 due to the adoption of Accounting Standards Codification Topic 842, ~~Leases~~.

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 ~~judgment.~~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 ~~self-storage~~storage properties for impairment

As discussed in notes 2 and 3 to the consolidated financial statements, the Company had ~~$3.8~~$6.0 billion of ~~self-storage~~storage properties, net of accumulated depreciation as of December 31, ~~2019.~~2022. 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 ~~self-storage~~storage property.

We identified the evaluation of ~~self-storage~~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 ~~self-storage~~storage property and involved subjective auditor judgement.

The following are the primary procedures we performed to address this critical audit ~~matter included~~matter. We evaluated the ~~following. We~~design and tested the operating effectiveness of certain internal

~~F-4~~

controls over the Company’s ~~self-storage~~storage property impairment process, including controls related to the ~~selection~~use of the revenue and expense growth rates, and terminal value capitalization ~~rate.~~rate assumptions. We assessed the Company’s forecasted growth rates against the Company’s historical growth rates and published reports of industry data. We

F-4

evaluated the 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 ~~self-storage~~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 ~~21, 2020~~24, 2023

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 Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of CubeSmart, L.P. andsubsidiaries (the Partnership) as of December 31, ~~2019~~2022 and ~~2018,~~2021, 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, ~~2019,~~2022, and the related notes andfinancial statement ~~schedule~~schedules III (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Partnership as of December 31, ~~2019~~2022 and ~~2018,~~2021, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, ~~2019,~~2022, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Partnership’s internal control over financial reporting as of December 31, ~~2019,~~2022, 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 ~~21, 2020~~24, 2023 expressed an unqualified opinion on the effectiveness of the Partnership’s internal control over financial reporting.

~~Change in Accounting Principle~~

As discussed in Note 2 to the consolidated financial statements, the Partnership has changed its method of accounting for leases as of January 1, 2019 due to the adoption of Accounting Standards Codification Topic 842, ~~Leases~~.

Basis for Opinion

These consolidated financial statements are the responsibility of the 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 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 ~~self-storage~~storage properties for impairment

As discussed in notes 2 and 3 to the consolidated financial statements, the Partnership had ~~$3.8~~$6.0 billion of ~~self-storage~~storage properties, net of accumulated depreciation as of December 31, ~~2019.~~2022. 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 ~~self-storage~~storage property.

We identified the evaluation of ~~self-storage~~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 ~~self-storage~~storage property and involved subjective auditor judgement.

The following are the primary procedures we performed to address this critical audit ~~matter included~~matter. We evaluated the ~~following.~~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 assumptions. We ~~tested certain internal~~assessed the Company’s forecasted growth rates against the Company’s historical growth rates and published reports of industry data. We

F-6

controls over the Partnership’s self-storage property impairment process, including controls related to the selection 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 ~~Partnership’s~~Company’s expected terminal value capitalization rates by comparing them to published reports of industry data and historical transactions of the ~~Partnership.~~Company. We also identified the threshold rates at which the revenue and expense growth rates and terminal value capitalization rate assumptions would indicate the ~~self-storage~~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 Partnership’s auditor since 2009.

Philadelphia, Pennsylvania

February ~~21, 2020~~24, 2023

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~~CubeSmart and ~~subsidiaries’~~subsidiaries' (the Company) internal control over financial reporting as of December 31, ~~2019,~~2022, 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, ~~2019,~~2022, 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), the consolidated balance sheets of the Company as of December 31, ~~2019~~2022 and ~~2018,~~2021, 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, ~~2019,~~2022, and the related notes and financial statement schedule III (collectively, the consolidated financial statements), and our report dated February ~~21, 2020~~24, 2023 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 ~~21, 2020~~24, 2023

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,~~CubeSmart, L.P. and ~~subsidiaries’~~subsidiaries' (the Partnership) internal control over financial reporting as of December 31, ~~2019,~~2022, 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, ~~2019,~~2022, 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), the consolidated balance sheets of the Partnership as of December 31, ~~2019~~2022 and ~~2018,~~2021, 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, ~~2019,~~2022, and the related notes and financial statement schedule III (collectively, the consolidated financial statements), and our report dated February ~~21, 2020~~24, 2023 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

The 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 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 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 ~~21, 2020~~24, 2023

F-9

CUBESMART AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)


	December 31,
	2019		2018		December 31,
					2022		2021
ASSETS
Storage properties	$	4,699,844	$	4,463,455	$	7,295,778	$	7,183,494
Less: Accumulated depreciation		(925,359)		(862,487)		(1,247,775)		(1,085,824)
Storage properties, net (including VIE assets of $92,612 and $330,986, respectively)		3,774,485		3,600,968
Storage properties, net (including VIE assets of $167,180 and $149,467, respectively)						6,048,003		6,097,670
Cash and cash equivalents		54,857		3,764		6,064		11,140
Restricted cash		3,584		2,718		2,861		2,178
Loan procurement costs, net of amortization		4,059		963		5,182		2,322
Investment in real estate ventures, at equity		91,117		95,796		105,993		119,751
Assets held for sale						3,745		49,313
Other assets, net		101,443		48,763		153,982		265,705
Total assets	$	4,029,545	$	3,752,972	$	6,325,830	$	6,548,079

LIABILITIES AND EQUITY
Unsecured senior notes, net	$	1,835,725	$	1,143,524	$	2,772,350	$	2,768,209
Revolving credit facility		—		195,525		60,900		209,900
Unsecured term loans, net		—		299,799
Mortgage loans and notes payable, net		96,040		108,246		162,918		167,676
Lease liabilities - finance leases						65,758		65,801
Accounts payable, accrued expenses and other liabilities		137,880		149,914		213,297		199,985
Distributions payable		64,688		60,627		111,190		97,417
Deferred revenue		25,313		22,595		38,757		37,144
Security deposits		475		474		1,087		1,065
Liabilities held for sale						1,773		2,502
Total liabilities		2,160,121		1,980,704		3,428,030		3,549,699

Noncontrolling interests in the Operating Partnership		62,088		55,819		57,419		108,220

Commitments and contingencies

Equity
Common shares $.01 par value, 400,000,000 shares authorized, 193,557,024 and 187,145,103 shares issued and outstanding at December 31, 2019 and 2018, respectively		1,936		1,871
Common shares $.01 par value, 400,000,000 shares authorized, 224,603,462 and 223,917,993 shares issued and outstanding at December 31, 2022 and 2021, respectively						2,246		2,239
Additional paid-in capital		2,674,745		2,500,751		4,125,478		4,088,392
Accumulated other comprehensive loss		(729)		(1,029)		(491)		(570)
Accumulated deficit		(876,606)		(791,915)		(1,301,030)		(1,218,498)
Total CubeSmart shareholders’ equity		1,799,346		1,709,678		2,826,203		2,871,563
Noncontrolling interests in subsidiaries		7,990		6,771		14,178		18,597
Total equity		1,807,336		1,716,449		2,840,381		2,890,160
Total liabilities and equity	$	4,029,545	$	3,752,972	$	6,325,830	$	6,548,079

See accompanying notes to the consolidated financial statements.

F-10

CUBESMART AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)


	For the year ended December 31,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020

REVENUES
Rental income	$	552,404	$	517,535	$	489,043	$	879,289	$	707,751	$	581,009
Other property related income		67,558		60,156		55,001		96,166		83,605		70,723
Property management fee income		23,953		20,253		14,899		34,169		31,208		27,445
Total revenues		643,915		597,944		558,943		1,009,624		822,564		679,177
OPERATING EXPENSES
Property operating expenses		209,739		196,866		181,508		293,260		252,104		223,634
Depreciation and amortization		163,547		143,350		145,681		310,610		232,049		156,573
General and administrative		38,560		37,712		34,745		54,623		47,809		41,423
Acquisition related costs		—		—		1,294
Total operating expenses		411,846		377,928		363,228		658,493		531,962		421,630
OTHER (EXPENSE) INCOME
Interest:
Interest expense on loans		(72,525)		(62,132)		(56,952)		(93,284)		(78,448)		(75,890)
Loan procurement amortization expense		(2,819)		(2,313)		(2,638)		(3,897)		(8,168)		(2,674)
Equity in earnings (losses) of real estate ventures		11,122		(865)		(1,386)
Gains from sale of real estate, net		1,508		10,576		—
Loss on early extinguishment of debt								—		(20,328)		(18,020)
Equity in earnings of real estate ventures								48,877		25,275		178
Gains from sales of real estate, net								—		32,698		6,710
Other		1,416		206		872		(10,355)		(10,818)		(240)
Total other expense		(61,298)		(54,528)		(60,104)		(58,659)		(59,789)		(89,936)
NET INCOME		170,771		165,488		135,611		292,472		230,813		167,611
NET (INCOME) LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
Noncontrolling interests in the Operating Partnership		(1,708)		(1,820)		(1,593)		(1,931)		(7,873)		(1,825)
Noncontrolling interest in subsidiaries		54		221		270		722		542		(165)
NET INCOME ATTRIBUTABLE TO THE COMPANY’S COMMON SHAREHOLDERS	$	169,117	$	163,889	$	134,288	$	291,263	$	223,482	$	165,621

Basic earnings per share attributable to common shareholders	$	0.89	$	0.89	$	0.74	$	1.29	$	1.10	$	0.85
Diluted earnings per share attributable to common shareholders	$	0.88	$	0.88	$	0.74	$	1.29	$	1.09	$	0.85

Weighted average basic shares outstanding		190,874		184,653		180,525		224,928		203,832		194,147
Weighted average diluted shares outstanding		191,576		185,495		181,448		225,881		205,009		194,943

See accompanying notes to the consolidated financial statements.

F-11

CUBESMART AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in thousands)


	For the year ended December 31,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020

NET INCOME	$	170,771	$	165,488	$	135,611	$	292,472	$	230,813	$	167,611
Other comprehensive income (loss):
Unrealized gains (losses) on interest rate swaps		232		(979)		195
Reclassification of realized losses (gains) on interest rate swaps		70		(60)		1,680
OTHER COMPREHENSIVE INCOME (LOSS)		302		(1,039)		1,875
Other comprehensive income:
Reclassification of realized losses on interest rate swaps								81		81		81
OTHER COMPREHENSIVE INCOME:								81		81		81
COMPREHENSIVE INCOME		171,073		164,449		137,486		292,553		230,894		167,692
Comprehensive income attributable to noncontrolling interests in the Operating Partnership		(1,710)		(1,814)		(1,615)		(1,933)		(7,892)		(1,809)
Comprehensive loss attributable to noncontrolling interest in subsidiaries		54		221		270
Comprehensive loss (income) attributable to noncontrolling interest in subsidiaries								722		542		(165)
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY	$	169,417	$	162,856	$	136,141	$	291,342	$	223,544	$	165,718

See accompanying notes to the consolidated financial statements.

F-12

CUBESMART AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF EQUITY

(in thousands)


																Noncontrolling																	Noncontrolling
																Interests																	Interests
	Common			Additional		Accumulated Other				Total		Noncontrolling				in the		Common			Additional		Accumulated Other				Total		Noncontrolling				in the
	Shares			Paid-in		Comprehensive		Accumulated		Shareholders’		Interests in		Total		Operating		Shares			Paid-in		Comprehensive		Accumulated		Shareholders’		Interests in		Total		Operating
	Number	Amount		Capital		(Loss) Income		Deficit		Equity		Subsidiaries		Equity		Partnership		Number	Amount		Capital		Income (Loss)		Deficit		Equity		Subsidiaries		Equity		Partnership
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 units																	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 ($1.11 per share)									(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
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													925		925															682		682
Distributions paid to noncontrolling interest in subsidiaries													(169)		(169)															(205)		(205)
Issuance of common shares, net	4,291		43		131,786						131,829				131,829			3,627		37		120,690						120,727				120,727
Issuance of restricted shares	86		1								1				1			60
Issuance of OP units																	6,242																	186,933
Conversion from units to shares	147		1		4,403						4,404				4,404		(4,404)	100		1		2,823						2,824				2,824		(2,824)
Exercise of stock options	405		4		3,831						3,835				3,835			62				961						961				961
Amortization of restricted shares					2,570						2,570				2,570							4,502						4,502				4,502
Share compensation expense					1,541						1,541				1,541							1,952						1,952				1,952
Adjustment for noncontrolling interests in the Operating Partnership									(299)		(299)				(299)		299									(4,230)		(4,230)				(4,230)		4,230
Net income (loss)									163,889		163,889		(221)		163,668		1,820
Other comprehensive (loss) income, net:							(1,032)		405		(627)				(627)		(6)
Common share distributions ($1.22 per share)									(226,599)		(226,599)				(226,599)		(2,452)
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
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													7,376		7,376															11,404		11,404
Distributions paid to noncontrolling interest in subsidiaries													(188)		(188)															(246)		(246)
Acquisition of noncontrolling interest in subsidiary					(34,690)						(34,690)		(5,915)		(40,605)							(2,746)						(2,746)		(651)		(3,397)
Issuance of common shares, net	5,899		60		196,244						196,304				196,304			20,508		205		965,433						965,638				965,638
Issuance of restricted shares	52																	66
Issuance of OP units																	3,576
Conversion from units to shares	80		1		2,485						2,486				2,486		(2,486)	5,519		56		304,959						305,015				305,015		(305,015)
Exercise of stock options	381		4		3,682						3,686				3,686			419		4		7,861						7,865				7,865
Amortization of restricted shares					4,487						4,487				4,487							4,941						4,941				4,941
Share compensation expense					1,786						1,786				1,786							2,271						2,271				2,271
Adjustment for noncontrolling interests in the Operating Partnership									(5,918)		(5,918)				(5,918)		5,918									(164,109)		(164,109)				(164,109)		164,109
Net income (loss)									169,117		169,117		(54)		169,063		1,708									223,482		223,482		(542)		222,940		7,873
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
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
Contributions from noncontrolling interest in subsidiaries																														3,690		3,690
Distributions paid to noncontrolling interest in subsidiaries																														(7,387)		(7,387)
Issuance of common shares, net																		102		1		4,876						4,877				4,877
Issuance of restricted shares																		56		1								1				1
Conversion from units to shares																		475		4		22,944						22,948				22,948		(22,948)
Exercise of stock options																		52		1		1,589						1,590				1,590
Amortization of restricted shares																						5,134						5,134				5,134
Share compensation expense																						2,543						2,543				2,543
Adjustment for noncontrolling interests in the Operating Partnership																										27,203		27,203				27,203		(27,203)
Net income (loss)																										291,263		291,263		(722)		290,541		1,931
Other comprehensive income, net																								79				79				79		2
Common share distributions ($1.78 per share)																										(400,998)		(400,998)				(400,998)		(2,583)
Balance at December 31, 2022																		224,603	$	2,246	$	4,125,478	$	(491)	$	(1,301,030)	$	2,826,203	$	14,178	$	2,840,381	$	57,419

See accompanying notes to the consolidated financial statements.

F-13

CUBESMART AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)


	For the year ended December 31,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020
Operating Activities
Net income	$	170,771	$	165,488	$	135,611	$	292,472	$	230,813	$	167,611
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		166,366		145,663		148,319		314,507		240,217		159,247
Equity in (earnings) losses of real estate ventures		(11,122)		865		1,386
Gains from sale of real estate, net		(1,508)		(10,576)		—
Non-cash portion of interest expense related to finance leases								(43)		202		—
Loss on early extinguishment of debt								—		20,328		18,020
Equity in earnings of real estate ventures								(48,877)		(25,275)		(178)
Gains from sales of real estate, net								—		(32,698)		(6,710)
Equity compensation expense		6,694		5,572		5,586		9,081		8,088		7,140
Accretion of fair market value adjustment of debt		(718)		(735)		(559)		(1,099)		(2,037)		(259)
Changes in other operating accounts:
Other assets		(6,578)		(4,937)		(10,429)		3,498		(9,247)		(9,674)
Accounts payable and accrued expenses		6,042		2,653		10,846		20,395		14,871		13,922
Other liabilities		1,821		342		1,154		1,532		3,923		1,914
Net cash provided by operating activities	$	331,768	$	304,335	$	291,914	$	591,466	$	449,185	$	351,033
Investing Activities
Acquisitions of storage properties		(117,998)		(214,510)		(69,629)		(89,004)		(151,547)		(417,988)
Acquisition of LAACO, Ltd., net of cash acquired								—		(1,678,984)		—
Additions and improvements to storage properties		(37,569)		(27,626)		(27,378)		(41,233)		(34,608)		(49,857)
Development costs		(102,826)		(86,002)		(68,778)		(24,358)		(69,887)		(55,286)
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		(10,264)		(19,216)		(301)		(21)		(28,261)		(7,022)
Cash distributed from real estate ventures		7,096		8,706		15,783		62,656		66,593		6,246
Proceeds from sale of real estate, net		3,856		16,389		—		43,193		44,026		12,466
Net cash used in investing activities	$	(375,664)	$	(322,259)	$	(150,303)	$	(48,767)	$	(1,852,668)	$	(511,441)
Financing Activities
Proceeds from:
Unsecured senior notes		696,426		—		103,192		—		1,043,427		445,833
Revolving credit facility		859,313		679,535		628,400		633,950		906,571		429,085
Principal payments on:
Unsecured senior notes								—		(300,000)		(250,000)
Revolving credit facility		(1,158,776)		(565,710)		(590,000)		(782,950)		(814,471)		(311,285)
Unsecured term loans		(200,000)		—		(100,000)
Mortgage loans and notes payable		(11,652)		(9,816)		(8,666)		(2,426)		(87,263)		(46,093)
Loan procurement costs		(6,023)		—		(953)		(3,885)		(12,548)		(3,764)
Settlement of hedge transactions		(807)		—		—
Debt prepayment costs								—		(20,023)		(17,584)
Acquisition of noncontrolling interest in subsidiary, net		(35,777)		—		(9,033)		—		(3,397)		—
Proceeds from issuance of common shares, net		196,304		131,830		29,643		4,877		965,638		120,727
Cash paid upon vesting of restricted shares		(421)		(1,461)		(2,046)		(1,403)		(876)		(686)
Exercise of stock options		3,686		3,835		2,364		1,590		7,865		961
Contributions from noncontrolling interests in subsidiaries		48		925		1,058		350		8,031		—
Distributions paid to noncontrolling interests in subsidiaries		(188)		(169)		—		(7,387)		(246)		(205)
Distributions paid to common shareholders		(243,859)		(221,328)		(195,006)		(387,106)		(273,839)		(256,253)
Distributions paid to noncontrolling interests in Operating Partnership		(2,419)		(2,393)		(2,272)		(2,702)		(8,297)		(2,540)
Net cash provided by (used in) financing activities	$	95,855	$	15,248	$	(143,319)
Net cash (used in) provided by financing activities							$	(547,092)	$	1,410,572	$	108,196
Change in cash, cash equivalents and restricted cash		51,959		(2,676)		(1,708)		(4,393)		7,089		(52,212)
Cash, cash equivalents and restricted cash at beginning of year		6,482		9,158		10,866
Cash, cash equivalents and restricted cash at end of year	$	58,441	$	6,482	$	9,158
Cash, cash equivalents and restricted cash at beginning of period								13,318		6,229		58,441
Cash, cash equivalents and restricted cash at end of period							$	8,925	$	13,318	$	6,229
Supplemental Cash Flow and Noncash Information
Cash paid for interest, net of interest capitalized	$	69,283	$	66,829	$	63,407	$	92,293	$	79,148	$	80,792
Supplemental disclosure of noncash activities:
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)	$	—	$	—
Acquisitions of storage properties							$	(700)	$	—	$	(2,623)
Right-of-use assets obtained in exchange for lease liabilities							$	—	$	—	$	61,423
Discount on issuance of unsecured senior notes	$	3,574	$	—	$	—	$	—	$	6,573	$	4,167
Noncash drawdown on revolving credit facility	$	103,938	$	—	$	—
Mortgage loan assumptions	$	—	$	7,166	$	6,201	$	—	$	40,880	$	169,056
Repayment of unsecured term loan through noncash drawdown on revolving credit facility	$	(100,000)	$	—	$	—
Accretion of put liability	$	5,895	$	24,747	$	35,122	$	2,444	$	9,777	$	7,917
Derivative valuation adjustment	$	302	$	(633)	$	1,875	$	81	$	81	$	81
Loan procurement costs	$	(3,770)	$	—	$	—
Issuance of OP units	$	3,576	$	6,242	$	12,324
Liability for acquisition of storage property	$	—	$	—	$	1,470
Contribution of storage property to real estate venture	$	—	$	—	$	9,400
Acquisition of noncontrolling interest in subsidiary	$	(4,828)	$	—	$	—
Issuance of OP units (see note 4)							$	—	$	—	$	186,933
Contributions from noncontrolling interests in subsidiaries	$	7,328	$	—	$	—	$	3,340	$	3,373	$	682

See accompanying notes to the consolidated financial statements.

F-14

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands)


	December 31,				December 31,
	2019		2018		2022		2021

ASSETS
Storage properties	$	4,699,844	$	4,463,455	$	7,295,778	$	7,183,494
Less: Accumulated depreciation		(925,359)		(862,487)		(1,247,775)		(1,085,824)
Storage properties, net (including VIE assets of $92,612 and $330,986, respectively)		3,774,485		3,600,968
Storage properties, net (including VIE assets of $167,180 and $149,467, respectively)						6,048,003		6,097,670
Cash and cash equivalents		54,857		3,764		6,064		11,140
Restricted cash		3,584		2,718		2,861		2,178
Loan procurement costs, net of amortization		4,059		963		5,182		2,322
Investment in real estate ventures, at equity		91,117		95,796		105,993		119,751
Assets held for sale						3,745		49,313
Other assets, net		101,443		48,763		153,982		265,705
Total assets	$	4,029,545	$	3,752,972	$	6,325,830	$	6,548,079

LIABILITIES AND CAPITAL
Unsecured senior notes, net	$	1,835,725	$	1,143,524	$	2,772,350	$	2,768,209
Revolving credit facility		—		195,525		60,900		209,900
Unsecured term loans, net		—		299,799
Mortgage loans and notes payable, net		96,040		108,246		162,918		167,676
Lease liabilities - finance leases						65,758		65,801
Accounts payable, accrued expenses and other liabilities		137,880		149,914		213,297		199,985
Distributions payable		64,688		60,627		111,190		97,417
Deferred revenue		25,313		22,595		38,757		37,144
Security deposits		475		474		1,087		1,065
Liabilities held for sale						1,773		2,502
Total liabilities		2,160,121		1,980,704		3,428,030		3,549,699

Limited Partnership interests of third parties		62,088		55,819		57,419		108,220

Commitments and contingencies

Capital
Operating Partner		1,800,075		1,710,707		2,826,694		2,872,133
Accumulated other comprehensive loss		(729)		(1,029)		(491)		(570)
Total CubeSmart, L.P. capital		1,799,346		1,709,678		2,826,203		2,871,563
Noncontrolling interests in subsidiaries		7,990		6,771		14,178		18,597
Total capital		1,807,336		1,716,449		2,840,381		2,890,160
Total liabilities and capital	$	4,029,545	$	3,752,972	$	6,325,830	$	6,548,079

See accompanying notes to the consolidated financial statements.

F-15

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per common unit data)


	For the year ended December 31,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020

REVENUES
Rental income	$	552,404	$	517,535	$	489,043	$	879,289	$	707,751	$	581,009
Other property related income		67,558		60,156		55,001		96,166		83,605		70,723
Property management fee income		23,953		20,253		14,899		34,169		31,208		27,445
Total revenues		643,915		597,944		558,943		1,009,624		822,564		679,177
OPERATING EXPENSES
Property operating expenses		209,739		196,866		181,508		293,260		252,104		223,634
Depreciation and amortization		163,547		143,350		145,681		310,610		232,049		156,573
General and administrative		38,560		37,712		34,745		54,623		47,809		41,423
Acquisition related costs		—		—		1,294
Total operating expenses		411,846		377,928		363,228		658,493		531,962		421,630
OTHER (EXPENSE) INCOME
Interest:
Interest expense on loans		(72,525)		(62,132)		(56,952)		(93,284)		(78,448)		(75,890)
Loan procurement amortization expense		(2,819)		(2,313)		(2,638)		(3,897)		(8,168)		(2,674)
Equity in earnings (losses) of real estate ventures		11,122		(865)		(1,386)
Gains from sale of real estate, net		1,508		10,576		—
Loss on early extinguishment of debt								—		(20,328)		(18,020)
Equity in earnings of real estate ventures								48,877		25,275		178
Gains from sales of real estate, net								—		32,698		6,710
Other		1,416		206		872		(10,355)		(10,818)		(240)
Total other expense		(61,298)		(54,528)		(60,104)		(58,659)		(59,789)		(89,936)
NET INCOME		170,771		165,488		135,611		292,472		230,813		167,611
NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
Noncontrolling interest in subsidiaries		54		221		270		722		542		(165)
NET INCOME ATTRIBUTABLE TO CUBESMART L.P.		170,825		165,709		135,881		293,194		231,355		167,446
Operating Partnership interests of third parties		(1,708)		(1,820)		(1,593)		(1,931)		(7,873)		(1,825)
NET INCOME ATTRIBUTABLE TO COMMON UNITHOLDERS	$	169,117	$	163,889	$	134,288	$	291,263	$	223,482	$	165,621

Basic earnings per unit attributable to common unitholders	$	0.89	$	0.89	$	0.74	$	1.29	$	1.10	$	0.85
Diluted earnings per unit attributable to common unitholders	$	0.88	$	0.88	$	0.74	$	1.29	$	1.09	$	0.85

Weighted average basic units outstanding		190,874		184,653		180,525		224,928		203,832		194,147
Weighted average diluted units outstanding		191,576		185,495		181,448		225,881		205,009		194,943

See accompanying notes to the consolidated financial statements.

F-16

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in thousands)


	For the year ended December 31,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020

NET INCOME	$	170,771	$	165,488	$	135,611	$	292,472	$	230,813	$	167,611
Other comprehensive income (loss):
Unrealized gains (losses) on interest rate swaps		232		(979)		195
Reclassification of realized losses (gains) on interest rate swaps		70		(60)		1,680
OTHER COMPREHENSIVE INCOME (LOSS)		302		(1,039)		1,875
Other comprehensive income:
Reclassification of realized losses on interest rate swaps								81		81		81
OTHER COMPREHENSIVE INCOME:								81		81		81
COMPREHENSIVE INCOME		171,073		164,449		137,486		292,553		230,894		167,692
Comprehensive income attributable to Operating Partnership interests of third parties		(1,710)		(1,814)		(1,615)		(1,933)		(7,892)		(1,809)
Comprehensive loss attributable to noncontrolling interest in subsidiaries		54		221		270
Comprehensive loss (income) attributable to noncontrolling interest in subsidiaries								722		542		(165)
COMPREHENSIVE INCOME ATTRIBUTABLE TO OPERATING PARTNER	$	169,417	$	162,856	$	136,141	$	291,342	$	223,544	$	165,718

See accompanying notes to the consolidated financial statements.

F-17

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CAPITAL

(in thousands)

Number of Common OP

Accumulated Other

Total

Noncontrolling

Operating Partnership

Units

Operating

Comprehensive

CubeSmart L.P.

Interest in

Total

Interests

Outstanding

Partner

(Loss) Income

Capital

Subsidiaries

Capital

of Third Parties

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 units

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 ($1.11 per unit)

(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

Contributions from noncontrolling interest in subsidiaries

925

925

Distributions paid to noncontrolling interest in subsidiaries

(169)

(169)

Issuance of common OP units, net

4,291

131,829

131,829

131,829

Issuance of restricted OP units

86

1

1

1

Issuance of OP units

6,242

Conversion from OP units to shares

147

4,404

4,404

4,404

(4,404)

Exercise of OP unit options

405

3,835

3,835

3,835

Amortization of restricted OP units

2,570

2,570

2,570

OP unit compensation expense

1,541

1,541

1,541

Adjustment for Operating Partnership interests of third parties

(299)

(299)

(299)

299

Net income (loss)

163,889

163,889

(221)

163,668

1,820

Other comprehensive income (loss), net:

405

(1,032)

(627)

(627)

(6)

Common OP unit distributions ($1.22 per unit)

(226,599)

(226,599)

(226,599)

(2,452)

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



	Number of Common OP			Accumulated Other		Total		Noncontrolling				Operating Partnership
	Units		Operating	Comprehensive		CubeSmart L.P.		Interests in		Total		Interests
	Outstanding		Partner	Income (Loss)		Capital		Subsidiaries		Capital		of Third Parties
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)
Acquisition of noncontrolling interest in subsidiary			—				—		—		—
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
Issuance of OP units													—
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
Contributions from noncontrolling interest in subsidiaries									3,690		3,690
Distributions paid to noncontrolling interest in subsidiaries									(7,387)		(7,387)
Issuance of common OP units, net	102		4,877				4,877				4,877
Issuance of restricted OP units	56		1				1				1
Conversion from OP units to shares	475		22,948				22,948				22,948		(22,948)
Exercise of OP unit options	52		1,590				1,590				1,590
Amortization of restricted OP units			5,134				5,134				5,134
OP unit compensation expense			2,543				2,543				2,543
Adjustment for Operating Partnership interests of third parties			27,203				27,203				27,203		(27,203)
Net income (loss)			291,263				291,263		(722)		290,541		1,931
Other comprehensive income, net					79		79				79		2
Common OP unit distributions ($1.78 per unit)			(400,998)				(400,998)				(400,998)		(2,583)
Balance at December 31, 2022	224,603	$	2,826,694	$	(491)	$	2,826,203	$	14,178	$	2,840,381	$	57,419

See accompanying notes to the consolidated financial statements.

F-18

CUBESMART, L.P. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)


	For the year ended December 31,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020
Operating Activities
Net income	$	170,771	$	165,488	$	135,611	$	292,472	$	230,813	$	167,611
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		166,366		145,663		148,319		314,507		240,217		159,247
Equity in (earnings) losses of real estate ventures		(11,122)		865		1,386
Gains from sale of real estate, net		(1,508)		(10,576)		—
Non-cash portion of interest expense related to finance leases								(43)		202		—
Loss on early extinguishment of debt								—		20,328		18,020
Equity in earnings of real estate ventures								(48,877)		(25,275)		(178)
Gains from sales of real estate, net								—		(32,698)		(6,710)
Equity compensation expense		6,694		5,572		5,586		9,081		8,088		7,140
Accretion of fair market value adjustment of debt		(718)		(735)		(559)		(1,099)		(2,037)		(259)
Changes in other operating accounts:
Other assets		(6,578)		(4,937)		(10,429)		3,498		(9,247)		(9,674)
Accounts payable and accrued expenses		6,042		2,653		10,846		20,395		14,871		13,922
Other liabilities		1,821		342		1,154		1,532		3,923		1,914
Net cash provided by operating activities	$	331,768	$	304,335	$	291,914	$	591,466	$	449,185	$	351,033
Investing Activities
Acquisitions of storage properties		(117,998)		(214,510)		(69,629)		(89,004)		(151,547)		(417,988)
Acquisition of LAACO, Ltd., net of cash acquired								—		(1,678,984)		—
Additions and improvements to storage properties		(37,569)		(27,626)		(27,378)		(41,233)		(34,608)		(49,857)
Development costs		(102,826)		(86,002)		(68,778)		(24,358)		(69,887)		(55,286)
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		(10,264)		(19,216)		(301)		(21)		(28,261)		(7,022)
Cash distributed from real estate ventures		7,096		8,706		15,783		62,656		66,593		6,246
Deposit of escrows
Proceeds from sale of real estate, net		3,856		16,389		—		43,193		44,026		12,466
Net cash used in investing activities	$	(375,664)	$	(322,259)	$	(150,303)	$	(48,767)	$	(1,852,668)	$	(511,441)
Financing Activities
Proceeds from:
Unsecured senior notes		696,426		—		103,192		—		1,043,427		445,833
Revolving credit facility		859,313		679,535		628,400		633,950		906,571		429,085
Principal payments on:
Unsecured senior notes								—		(300,000)		(250,000)
Revolving credit facility		(1,158,776)		(565,710)		(590,000)		(782,950)		(814,471)		(311,285)
Unsecured term loans		(200,000)		—		(100,000)
Mortgage loans and notes payable		(11,652)		(9,816)		(8,666)		(2,426)		(87,263)		(46,093)
Loan procurement costs		(6,023)		—		(953)		(3,885)		(12,548)		(3,764)
Settlement of hedge transactions		(807)		—		—
Debt prepayment costs								—		(20,023)		(17,584)
Acquisition of noncontrolling interest in subsidiary, net		(35,777)		—		(9,033)		—		(3,397)		—
Proceeds from issuance of common OP units		196,304		131,830		29,643		4,877		965,638		120,727
Cash paid upon vesting of restricted OP units		(421)		(1,461)		(2,046)		(1,403)		(876)		(686)
Exercise of OP unit options		3,686		3,835		2,364		1,590		7,865		961
Contributions from noncontrolling interests in subsidiaries		48		925		1,058		350		8,031		—
Distributions paid to noncontrolling interests in subsidiaries		(188)		(169)		—		(7,387)		(246)		(205)
Distributions paid to common OP unitholders		(246,278)		(223,721)		(197,278)		(389,808)		(282,136)		(258,793)
Net cash provided by (used in) financing activities	$	95,855	$	15,248	$	(143,319)
Net cash (used in) provided by financing activities							$	(547,092)	$	1,410,572	$	108,196
Change in cash, cash equivalents and restricted cash		51,959		(2,676)		(1,708)		(4,393)		7,089		(52,212)
Cash, cash equivalents and restricted cash at beginning of year		6,482		9,158		10,866
Cash, cash equivalents and restricted cash at end of year	$	58,441	$	6,482	$	9,158
Cash, cash equivalents and restricted cash at beginning of period								13,318		6,229		58,441
Cash, cash equivalents and restricted cash at end of period							$	8,925	$	13,318	$	6,229
Supplemental Cash Flow and Noncash Information
Cash paid for interest, net of interest capitalized	$	69,283	$	66,829	$	63,407	$	92,293	$	79,148	$	80,792
Supplemental disclosure of noncash activities:
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)	$	—	$	—
Acquisitions of storage properties							$	(700)	$	—	$	(2,623)
Right-of-use assets obtained in exchange for lease liabilities							$	—	$	—	$	61,423
Discount on issuance of unsecured senior notes	$	3,574	$	—	$	—	$	—	$	6,573	$	4,167
Noncash drawdown on revolving credit facility	$	103,938	$	—	$	—
Mortgage loan assumptions	$	—	$	7,166	$	6,201	$	—	$	40,880	$	169,056
Repayment of unsecured term loan through noncash drawdown on revolving credit facility	$	(100,000)	$	—	$	—
Accretion of put liability	$	5,895	$	24,747	$	35,122	$	2,444	$	9,777	$	7,917
Derivative valuation adjustment	$	302	$	(633)	$	1,875	$	81	$	81	$	81
Loan procurement costs	$	(3,770)	$	—	$	—
Issuance of OP units	$	3,576	$	6,242	$	12,324
Liability for acquisition of storage property	$	—	$	—	$	1,470
Contribution of storage property to real estate venture	$	—	$	—	$	9,400
Acquisition of noncontrolling interest in subsidiary	$	(4,828)	$	—	$	—
Issuance of OP units (see note 4)							$	—	$	—	$	186,933
Contributions from noncontrolling interests in subsidiaries	$	7,328	$	—	$	—	$	3,340	$	3,373	$	682

See accompanying notes to the consolidated financial statements.

F-19

CUBESMART AND CUBESMART L.P.

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, ~~2019,~~2022, the Company owned (or partially owned and consolidated) self-storage properties located in the District of Columbia and 24 states throughout the United States which are presented under 1one reportable segment: the Company owns, operates, develops, manages and acquires self-storage properties.

As of December 31, ~~2019,~~2022, the Parent Company owned approximately ~~99.0%~~99.4% 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 the 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 following a specified restricted period for cash equal to the fair value of an equivalent number of common shares of the Parent 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 ~~1-for-one~~one-for-one basis. This one-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”.~~“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 Operating Partnership 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 (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

~~F-20~~

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, ~~2019,~~2022, 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 $5.9 million as of December 31, 2019.~~ 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 management believes the assumptions and estimates made are reasonable and appropriate, as discussed in the applicable sections throughout these consolidated financial statements, different assumptions and estimates could materially impact 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 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. 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. Allocations to land, building and improvements and equipment are recorded based upon their respective fair values as estimated by management. If appropriate, 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 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

~~F-21~~

contracts. Accordingly, to date, 0no portion of the purchase price has been allocated to above- or below-market lease ~~intangibles.~~intangibles

F-21

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 $32.3 million and $121.6 million, respectively, for the year ended December 31, 2022, and $52.7 million and $59.9 million, respectively, for the year ended December 31, 2021.

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~~asset’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 0no impairment losses recognized during the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017.~~2020.

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~~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.

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~~Assets classified as held for sale are reported at the lesser of carrying value or fair value less estimated costs to sell and are not depreciated. The California Yacht Club acquired through our acquisition of LAACO (defined below) has been classified as held for sale as of December 31, 2022. There were 0no stores classified as held for sale as of December 31, ~~2019.~~2022.

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 ~~$31.5~~$53.9 million and ~~$21.5~~$50.1 million as of December 31, ~~2019~~2022 and ~~2018,~~2021, respectively, and are reported net of accumulated amortization of ~~$12.9~~$19.8 million and ~~$13.4~~$14.3 million as of December 31, ~~2019~~2022 and ~~2018,~~2021, respectively. In 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

F-22

asset net of accumulated amortization. Loan procurement costs associated with the Company’s revolving credit facility remain in Loan 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.

~~F-22~~

Other Assets

Other assets are comprised of the following as of December 31, ~~2019~~2022 and ~~2018:~~2021:

December 31,

2019

2018

(in thousands)

Intangible assets, net of accumulated amortization of $10,170 and $3,124

$
10,283

$
8,145

Accounts receivable, net

6,386

5,672

Prepaid property taxes

4,706

4,406

Prepaid insurance

2,191

1,479

Amounts due from affiliates (see note 14)

10,450

10,584

Assets held in trust related to deferred compensation arrangements

13,280

9,645

Right-of-use assets (see note 13)

41,698

—

Equity investment recorded at cost ⁽¹⁾

5,000

5,000

Other

7,449

3,832

Total other assets, net

$
101,443

$
48,763

~~(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 newly formed venture that acquired 22 self-storage properties located in Florida (4), Oklahoma (5) and Texas (13). The Class A preferred units earn an 11% cumulative dividend prior to any other distributions. The Company’s investment in Capital Storage and the related dividends are 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.


	December 31,
	2022		2021

	(in thousands)
Intangible assets, net of accumulated amortization of $2,263 and $12,760, respectively	$	1,181	$	108,794
Accounts receivable, net		7,932		8,145
Prepaid property taxes		8,033		6,938
Prepaid property and casualty insurance		2,129		3,352
Amounts due from affiliates (see note 14)		15,947		15,417
Assets related to deferred compensation arrangements		55,572		60,297
Right-of-use assets - operating leases		49,491		54,741
Ground lease receivable		6,138		—
Other		7,559		8,021
Total other assets, net	$	153,982	$	265,705

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 the Company’s stores indicates that a store is impacted by soil or groundwater contamination from prior owners/operators or other sources, the Company will work with 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 substantially 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.

The Company recognizes gains from ~~sale~~sales of real estate in accordance with the guidance on transfer of nonfinancial assets. Payments received from purchasers prior to closing are recorded as deposits. Profit on real estate sold is recognized when a valid contract exists, the collectability of the sales price is reasonably assured and the control of the property has transferred.

Advertising and Marketing Costs

The Company incurs advertising and marketing costs primarily attributable to internet marketing and other media advertisements. These costs are expensed as incurred. The Company incurred ~~$11.5~~$22.4 million, ~~$10.3~~$21.0 million and ~~$9.7~~$16.9 million in advertising and marketing expenses for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017,~~2020, respectively, which are included in Property operating expenses on the Company’s consolidated statements of operations.

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, ~~2019, 2018~~2022, 2021 and ~~2017,~~2020, the Company recognized ~~$2.1~~$0.2 million, ~~$1.6~~$28.3 million and ~~$0.6~~$1.5 million, respectively, of equity offering costs related to the issuance of common shares.

~~F-23~~

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.

F-23

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 asset(s) using the weighted average rate of the Company’s outstanding debt. For the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017,~~2020, the Company capitalized $~~3.0~~1.3 million, ~~$4.4~~$1.9 million and ~~$5.6~~$2.7 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~~ $150.0 million as of December 31, 2018, the fair values of which are included in Accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets. The Company had 0no outstanding derivatives as of December 31, ~~2019.~~2022 or 2021.

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 approximately ~~$3,909.1~~$6,145.8 million and ~~$3,645.7~~$6,113.5 million as of December 31, ~~2019~~2022 and ~~2018,~~2021, 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 ~~2019~~2022 consisted of ~~a 78.413%~~an 88.7377% ordinary income distribution ~~a 5.207%~~and an 11.2623% capital gain ~~distribution and a 16.380% 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. ~~NaN~~No excise tax was incurred in ~~2019, 2018~~2022, 2021 or ~~2017.~~2020.

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 ~~$0.7~~$1.0 million and ~~$1.4~~$0.7 million as of December 31, ~~2019~~2022 and ~~2018,~~2021, respectively.

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 options, unvested restricted shares and contingently issuable shares outstanding during the period using the treasury stock method. Potentially dilutive securities calculated under the treasury stock method were ~~702,000; 842,000~~953,000, 1,177,000 and ~~923,000 in 2019, 2018~~796,000 for the years ended December 31, 2022, 2021 and ~~2017,~~2020, respectively.

~~F-24~~

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. The Company recognizes forfeitures on share-based payments as they occur.

F-24

Investments in Unconsolidated Real Estate Ventures

The Company accounts for its investments in unconsolidated real estate ventures under the equity method of 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 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 and impairments. On a periodic basis, management 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. The determination as to whether impairment exists requires significant management judgment about the fair value of the Company’s ownership interest. Fair value is determined through various valuation techniques, including but not limited to, discounted cash flow models, quoted market values and third-party appraisals. There were 0no impairment losses related to the Company’s investments in unconsolidated real estate ventures recognized during the years ended December 31, ~~2019~~2022 and ~~2018.~~2021.

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~~certain settlement provisions. In addition, the new guidance ~~is to better align a company’s financial reporting for hedging activities with~~modifies how particular convertible instruments and certain contracts that may be settled in cash or shares impact the ~~economic objectives of those activities.~~diluted earnings per share computation. The standard ~~became~~was effective on January 1, ~~2020 and is~~2022. The adoption of this guidance did not ~~expected to~~ have a material impact on the Company’s consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13 – Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. The new guidance changes how entities measure credit losses for most financial assets. This standard requires an entity to estimate its lifetime expected credit loss and record an allowance that, when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. In November 2018, the FASB issued ASU No. 2018-19 – Codification Improvements to Topic 326, Financial Instruments - Credit Losses, which clarifies that receivables arising from operating leases are within the scope of the leasing standard (ASU No. 2016-02), and not within the scope of ASU No. 2016-13. The standard became effective on January 1, 2020 and is not expected to have a material impact on the Company’s consolidated financial statements.

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 determines whether lease expense is recognized based on an effective interest method or on a straight line basis over the term of the lease. 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 are accounted for similar to previous guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to previous guidance for sales-type leases, direct financing leases and operating leases. The Company adopted the standard on January 1, 2019, the date it became effective for public companies, using the modified retrospective approach whereby the cumulative effect of adoption was recognized on the adoption date and prior periods were not restated. There was 0 net cumulative effect adjustment to retained earnings as of January 1, 2019 as a result of this adoption. Upon adoption, the Company elected the package of practical expedients permitted within the standard, which among other things, allows for the carryforward of historical lease classification. The Company also elected the practical expedient provided to lessors in a subsequent amendment to the standard that removed the requirement to separate lease and nonlease components, provided certain conditions were met. Refer to note 13 for the impact of the adoption of ASU No. 2016-02 – Leases (Topic 842) on the Company’s consolidated financial statements.

~~F-25~~

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, California and Texas provided approximately 16%, 15%, 11% and 9%, respectively, of the Company’s total revenues for the year ended December 31, 2022. The stores in New York, Florida, Texas and California provided approximately ~~16%~~19%, ~~16%~~15%, ~~10%~~9% and 8%, respectively, of the Company’s total revenues for the year ended December 31, ~~2019.~~2021. The stores in ~~Florida,~~ New York, Florida, Texas and California provided approximately ~~17%,~~ 16%, ~~10%~~15%, 9% and 8%, respectively, of the Company’s total revenues for ~~each of~~ the ~~years~~year ended December 31, ~~2018 and 2017.~~2020.

3. STORAGE PROPERTIES

The book value of the Company’s real estate assets is summarized as follows:


	December 31,				December 31,
	2019		2018		2022		2021

	(in thousands)				(in thousands)
Land	$	858,541	$	806,916	$	1,588,138	$	1,565,463
Buildings and improvements		3,619,594		3,343,173		5,483,506		5,368,383
Equipment		128,111		176,583		144,605		129,531
Construction in progress		93,598		136,783		37,584		78,221
Right-of-use assets - finance leases						41,945		41,896
Storage properties		4,699,844		4,463,455		7,295,778		7,183,494
Less: Accumulated depreciation		(925,359)		(862,487)		(1,247,775)		(1,085,824)
Storage properties, net	$	3,774,485	$	3,600,968	$	6,048,003	$	6,097,670

~~F-26~~F-25

The following table summarizes the Company’s acquisition and disposition activity for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017:~~2020:


			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)

2019 Acquisitions:
2022 Acquisitions:

Maryland Asset	Baltimore / DC	March 2019	1	$	22,000		Washington-Arlington-Alexandria, DC-VA-MD-WV	February 2022	1	$	32,000
Florida Assets	Florida Markets - Other	April 2019	2		19,000
Arizona Asset	Phoenix	May 2019	1		1,550
HVP III Assets	Various (see note 4)	June 2019	18		128,250	⁽¹⁾
Texas Asset							San Antonio, TX	June 2022	1		23,000
Georgia Asset	Atlanta	August 2019	1		14,600		Atlanta, GA	July 2022	1		20,700
South Carolina Asset	Charleston	August 2019	1		3,300
Texas Asset	Texas Markets - Major	October 2019	1		7,300
Florida Assets	Florida Markets - Other	November 2019	3		32,100
California Asset	Los Angeles	December 2019	1		18,500
			29	$	246,600				3	$	75,700

2019 Disposition:
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	Texas Markets - Major	October 2019	1	$	4,146		Houston-Sugar Land-Baytown, TX	November 2021	1		5,200
			1	$	4,146				5	$	43,800

2018 Acquisitions:
2020 Acquisitions:

Texas Asset	Texas Markets - Major	January 2018	1	$	12,200		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	Texas Markets - Major	May 2018	1		19,000		Austin-Round Rock, TX	November 2020	1		10,750
Metro DC Asset	Baltimore / DC	July 2018	1		34,200
Texas Asset							Dallas-Fort Worth-Arlington, TX	November 2020	1		10,150
Nevada Asset	Las Vegas	September 2018	1		14,350		Las Vegas-Paradise, NV	December 2020	1		16,800
North Carolina Asset	Charlotte	September 2018	1		11,000
California Asset	Los Angeles	October 2018	1		53,250
Texas Asset	Texas Markets - Major	October 2018	1		23,150
California Asset	San Diego	November 2018	1		19,118
New York Asset	New York / Northern NJ	November 2018	1		37,000		New York-Northern New Jersey-Long Island, NY-NJ-PA	December 2020	1		6,750
Illinois Asset	Chicago	December 2018	1		4,250
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
			10	$	227,518				21	$	735,875

2018 Dispositions:
2020 Disposition:

Arizona Assets	Phoenix	November 2018	2	$	17,502
New York Asset							New York-Northern New Jersey-Long Island, NY-NJ-PA	December 2020	1	$	12,750
			2	$	17,502				1	$	12,750

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

(1)

~~Amount~~Acquired by a consolidated joint venture in which the Company holds a 50% interest.

(2)

Purchase price represents the ~~purchase price~~acquisition of all 167,557 outstanding partnership units of LAACO, Ltd. (“LAACO”) for ~~90% of the ownership interest in 191 III CUBE LLC (“HVP III”), which at~~$9,838 per unit. At the time of the acquisition, LAACO owned 1857 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”). The Los Angeles Athletic Club was sold by the Company during the year ended December 31, 2022. The California Yacht Club is classified as held for sale on the Company’s consolidated balance sheets as of December 31, 2022 (see note 4).

4. INVESTMENT ACTIVITY

2022 Acquisitions

During the year ended December 31, 2022, the Company acquired three stores located in Georgia (1), Maryland (1) and Texas (1) for an aggregate purchase price of $75.7 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 $3.4 million at the time of the acquisition and prior to amortization of

F-26

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, 2022 was approximately $2.3 million.

Additionally, on February 2, 2022, the Company acquired land underlying a wholly-owned store located in Bronx, New York for $7.5 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 $4.1 million and $5.0 million, respectively, were removed from the Company’s consolidated balance sheets.

Also, on April 28, 2022, the Company acquired land underlying a store owned by 191 IV CUBE LLC, an unconsolidated joint venture in which the Company holds a 20% ownership interest (see note 5). The purchase price for the land was $6.1 million, and the Company now serves as the lessor in a ground lease of the land to 191 IV CUBE LLC.

2022 Dispositions

During the year December 31, 2022, the Company sold the Los Angeles Athletic Club, which it purchased in December 2021 as part of the LAACO acquisition, for $44.0 million. No gain or loss was recognized in conjunction with the sale.

Assets Held for Sale

As of December 31, 2022, the Company determined that the California Yacht Club (the "CYC") met the criteria to be classified as held for sale. Accordingly, the assets and liabilities associated with the CYC have been categorized as held for sale within the Company’s consolidated balance sheets. As of December 31, 2022, the estimated fair value less selling costs of the CYC was greater than the carrying value of the CYC, and therefore no loss has been recorded in the current period.

Development Activity

As of December 31, 2022, the Company had invested in joint ventures to develop two self-storage properties located in New Jersey (1) and New York (1). Construction for these projects is expected to be completed by the second quarter of 2024. As of December 31, 2022, development costs incurred to date for these projects totaled $27.6 million. Total construction costs for these projects are expected to be $64.0 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.

The Company has completed the construction of and opened for operation the following stores since January 1, 2020. 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)

Valley Stream, NY	1	Q3 2022	51%	$	39,000
Vienna, VA ⁽¹⁾	1	Q2 2022	80%		21,800
Newton, MA ⁽²⁾	1	Q4 2021	100%		20,800
East Meadow, NY ⁽³⁾	1	Q2 2021	100%		25,900
King of Prussia, PA	1	Q2 2021	70%		22,800
Arlington, VA ⁽¹⁾	1	Q1 2021	90%		26,400
Brooklyn, NY ⁽³⁾	1	Q2 2020	100%		45,900
	7			$	202,600

(1)

Each of these stores are located adjacent to an existing consolidated joint venture store. Given this proximity, each of these stores has been combined with the adjacent existing store in our store count upon opening, as well as for operational and reporting purposes.

(2)

During the fourth quarter of 2021, the Company, through a joint venture in which it owned a 90% interest that was previously consolidated, completed the construction of this store and it was opened for operation. On December 14, 2021, the Company acquired the 10% interest of the noncontrolling member in the venture that owned the store for $3.4 million. Prior to this transaction, the noncontrolling member’s interest in this venture was reported in Noncontrolling interests in subsidiaries on the

F-27

consolidated balance sheets. Since the Company retained its controlling interest in the venture and the store is now wholly owned, this transaction was accounted for as an equity transaction. The carrying amount of the noncontrolling interest was reduced to zero to reflect the purchase and the difference between the purchase price paid by the Company and the carrying amount of the noncontrolling interest of $2.7 million was recorded as an adjustment to equity attributable to the Company, with no gain or loss recorded. The $13.2 million related party loan extended by the Company to the venture that owned the store was repaid in conjunction with the Company’s acquisition of the noncontrolling member’s ownership interest.

~~4. INVESTMENT ACTIVITY~~

(3)

These stores were previously owned by two separate consolidated joint ventures, of which the Company held a 51% ownership interest in each. 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.

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 two separate unconsolidated joint ventures, each of which own one 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 CYC (consisting of sports facilities, food and beverage operations and a marina). During the year ended December 31, 2022, the Company sold the Los Angeles Athletic Club (see above). As of December 31, 2022, the CYC is 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, $10.3 million and $14.8 million were included in the component of other (expense) income designated as Other for the years ended December 31, 2022 and 2021, respectively.

(3)

Includes consulting fees, legal fees, and other costs.

~~2019~~

F-28

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

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 years ended December 31, 2022 and 2021 was approximately $100.6 million and $9.1 million, respectively.

Other 2021 Acquisitions

During the year ended December 31, ~~2019,~~2021, the Company acquired 11eight additional stores located in ~~Arizona~~Florida (1), ~~California~~Georgia (1), ~~Florida (5), Georgia~~Illinois (1), Maryland (1), ~~South Carolina~~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 the Company holds a 50% interest, acquired a store in Minnesota for a purchase price of $12.0 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 $11.9 million at the time of the acquisitions 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 years ended December 31, 2022 and 2021 was approximately $8.3 million and $3.6 million, respectively.

2021 Dispositions

During the year ended December 31, 2021, the Company sold five stores located in Colorado (1), Nevada (1), North Carolina (2) and Texas (1) for an aggregate sales price of $43.8 million. In conjunction with the sales, the Company recorded gains that totaled $32.7 million.

2020 Acquisitions

The Company acquired a portfolio of eight stores located in the outer boroughs of New York City (the “Storage Deluxe Assets”), in two separate tranches during December 2020, for an aggregate purchase price of $540.0 million. In connection with the acquisition of the Storage Deluxe Assets, the Company assumed six 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 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 $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. There was no amortization expense recognized for these in-place leases during the year ended December 31, 2022. Additionally, as part of the transaction, the Company assumed three existing ground leases as lessee, two of which have been classified as finance leases and one of which has been classified as an operating lease (see note 13).

F-29

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 ~~$118.3~~$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 ~~$6.2~~$11.4 million at the time of the acquisitions 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 ~~2019~~the years ended December 31, 2021 and 2020 was approximately ~~$1.9 million. In connection with one of~~$9.3 million and $2.1 million, respectively. There was no amortization expense recognized for these in-place leases during 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).~~year ended December 31, 2022.

Additionally, on ~~June 6, 2019,~~July 20, 2020, the Company acquired ~~its partner’s 90% ownership interest~~land underlying a wholly-owned store located in ~~HVP III, an unconsolidated real estate venture~~the Bronx, New York for $9.5 million. The land was previously subject to a ground lease 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.served as lessee. As a result of the transaction, which was accounted for as an asset acquisition, the ~~HVP III Assets became wholly-owned by~~Company was released from its obligations under the Company and are now consolidated within its financial statements. NaN gain or loss was recognized as a result of the transaction. In connection with the transaction, the Company allocated the value of the HVP III Assets 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 $14.3 million at the time of the acquisition and prior to amortization of such amounts. The estimated life of these in-place leases was 12 monthsground lease, and the ~~amortization expense that was recognized during 2019 was approximately $8.3 million.~~

~~The following table summarizes the Company’s revenue~~right-of-use asset and ~~earnings associated with the 2019 acquisitions~~lease liability totaling $5.1 million and $5.0 million, respectively, were removed from ~~the respective acquisition dates, that are included in the consolidated statements of operations for the year ended December 31, 2019:~~

For the year ended
December 31, 2019

(in thousands)

Total revenue

$
11,130

Net loss

(6,020)

As of December 31, 2019, the Company had made aggregate deposits of $2.6 million associated with 2 stores that were under contract to be acquired for an aggregate acquisition price of $57.5 million. The deposits are reflected in Other assets, net on the Company’s consolidated balance sheets.

~~2019~~2020 Disposition

On ~~October 7, 2019,~~December 22, 2020, the Company sold a self-storage property located in ~~Texas~~New York for a sales price of ~~$4.1~~$12.8 million. The Company recorded a ~~$1.5~~$6.7 million gain in connection with the sale.

~~Development Activity~~

As of December 31, 2019, the Company had invested in joint ventures to develop 5 self-storage properties located in Massachusetts (1), New York (2), Pennsylvania (1) and Virginia (1). Construction for all projects is expected to be completed by the second quarter of 2021 (see note 12). As of December 31, 2019, development costs incurred to date for these projects totaled $77.7 million. Total construction costs for these projects are expected to be $137.6 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.

The Company has completed the construction and opened for operation the following stores since January 1, 2017. 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.

~~F-28~~

CubeSmart

Number of

Ownership

Total
Store Location

Stores

Date Opened

Interest

Construction Costs

(in thousands)

Waltham, MA ⁽¹⁾

1

Q3 2019

100%

$
18,000
Queens, NY ⁽²⁾

1

Q2 2019

100%

47,500
Bayonne, NJ ^{(2) (3)}

1

Q2 2019

100%

25,100
Bronx, NY ⁽²⁾

1

Q3 2018

100%

92,100
Brooklyn, NY ⁽²⁾

1

Q4 2017

100%

49,300
Washington, D.C.

1

Q3 2017

100%

27,800
New York, NY ⁽¹⁾

1

Q3 2017

100%

81,200
North Palm Beach, FL

1

Q1 2017

100%

9,700

8

$
350,700

~~(1)~~

On September 18, 2017 and August 8, 2019, the Company, through 2 separate joint ventures in which the Company owned a 90% interest in each and that were previously consolidated, completed the construction and opened for operation a store located in New York, NY and a store located in Waltham, MA, respectively. On June 25, 2019, the Company acquired the noncontrolling member’s 10% interest in the venture that owned the New York, NY store for $18.5 million, and on September 6, 2019, the Company acquired the noncontrolling member’s 10% interest in the venture that owned the Waltham, MA store for $2.6 million. Prior to these transactions, the noncontrolling member’s interest in each venture was reported in Noncontrolling interests in subsidiaries on the consolidated balance sheets. Since the Company retained its controlling interest in each venture and the stores are now wholly owned, these transactions were accounted for as equity transactions. The carrying amount of the noncontrolling interest was reduced to 0 to reflect the purchase and the difference between the purchase price paid by the Company and the carrying amount of the noncontrolling interest, which aggregated to $16.1 million, was recorded as an adjustment to equity attributable to the Company, with 0 gain or loss recorded. In conjunction with the Company’s acquisition of the noncontrolling interest in the venture that owns the Waltham, MA store, the $10.5 million related party loan extended by the Company to the venture during the construction period was repaid in full.

~~(2)~~

These stores were previously owned by 4 separate consolidated joint ventures, in which the Company held a 51% ownership interest in each. On March 28, 2018, the noncontrolling member in the venture that owned the Brooklyn, NY store put its 49% interest in the venture to the Company for $20.4 million. On February 15, 2019, the noncontrolling member in the venture that owned the Bronx, NY store put its 49% interest in the venture to the Company for $37.8 million. 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. These amounts are included in Development costs in the consolidated statements of cash flows.

~~(3)~~

~~This store is subject to a ground lease.~~

During the fourth quarter of 2015, the Company, through 2 separate joint ventures in which the Company owned a 90% interest in each and that were previously consolidated, completed the construction and opened for operation a store located in Brooklyn, NY and a store located in Queens, NY. On June 2, 2017, the Company acquired the noncontrolling member’s 10% interest in the venture that owed the Brooklyn, NY store, and on ~~June 28, 2019~~, the Company acquired the noncontrolling member’s 10% interest in the venture that owned the Queens, NY store, each for $9.0 million. Prior to these transactions, the noncontrolling member’s interest in each venture was reported in Noncontrolling interests in subsidiaries on the consolidated balance sheets. Since the Company retained its controlling interest in each venture and the stores are now wholly owned, these transactions were accounted for as equity transactions. The carrying amount of the noncontrolling interest was reduced to 0 to reflect the purchase and the difference between the purchase price paid by the Company and the carrying amount of the noncontrolling interest which aggregated to $17.1 million, was recorded as an adjustment to equity attributable to the Company, with 0 gain or loss recorded. In conjunction with the Company’s acquisition of the noncontrolling interest in each venture, the $9.8 million and $12.4 million related party loans extended by the Company to the ventures during the construction period for the Brooklyn, NY store and the Queens, NY store, respectively, were repaid in full.

~~F-29~~

~~2018 Acquisitions~~

During the year ended December 31, 2018, the Company acquired 10 stores located throughout the United States, including 1 store upon completion of construction and the issuance of a certificate of occupancy, for an aggregate purchase price of approximately $227.5 million. 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 of in-place leases, which aggregated $11.3 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, 2019 and 2018 was approximately $8.2 million and $3.1 million, respectively. In connection with 1 of the acquired stores, the Company assumed a $7.2 million mortgage loan that was immediately repaid by the Company. The remainder of the purchase price was funded with $0.2 million of cash and $4.8 million through the issuance of 168,011 OP Units (see note 12). Following a ~~13-month~~ lock-up period, the holder may tender the OP Units for redemption by the Operating Partnership for a cash amount per OP 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 1 common share in exchange for each OP Unit tendered for redemption.

~~2018 Dispositions~~

On November 28, 2018, the Company sold 2 stores in Arizona for an aggregate sales price of approximately $17.5 million. In connection with these sales, the Company recorded gains that totaled approximately $10.6 million.

~~2017 Acquisitions~~

During the year ended December 31, 2017, the Company acquired 6 stores located throughout the United States, including 2 stores upon completion of construction and the issuance of a certificate of occupancy, for an aggregate purchase price of approximately $69.5 million. In connection with these acquisitions, which were accounted for as business combinations prior to the adoption of ASU No. 2017-01, 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 $3.2 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, 2018 and 2017 was approximately $1.7 and $1.5 million, respectively. In connection with 1 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 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 had a stated value of $25 and an annual distribution rate of 3% of the stated value. On July 23, 2018, all of the Class C OP Units were exchanged for an aggregate of 46,322 common units of the Operating Partnership. Because the Class C OP Units represented an unconditional obligation that the Company settled by issuing a variable number of its common shares with a monetary value that was known at inception, the Class C OP Units were classified as a liability in Accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets prior to redemption.

~~F-30~~

5. INVESTMENT IN UNCONSOLIDATED REAL ESTATE VENTURES

The Company’s investments in unconsolidated real estate ventures ~~in which it holds a common ownership interest,~~ are summarized as follows ~~(in~~(dollars in thousands):


	CubeSmart	Number of Stores as of:		Carrying Value of Investment as of:				CubeSmart	Number of Stores as of		Carrying Value of Investment as of
	Ownership	December 31,		December 31,				Ownership	December 31,		December 31,
Unconsolidated Real Estate Ventures	Interest	2019	2018	2019		2018		Interest	2022	2021	2022		2021
191 IV CUBE LLC ("HVP IV") ⁽¹⁾	20%	21	13	$	23,112	$	14,791
CUBE HHF Northeast Venture LLC ("HHFNE") ⁽²⁾	10%	13	13		1,998		2,411
191 III CUBE LLC ("HVP III") ⁽³⁾	10%	—	68		—		9,183
CUBE HHF Limited Partnership ("HHF") ⁽⁴⁾	50%	35	35		66,007		69,411
Fontana Self Storage, LLC ("Fontana") ⁽¹⁾								50%	1	1	$	13,789	$	14,225
Rancho Cucamonga Self Storage, LLC ("RCSS") ⁽¹⁾								50%	1	1		20,994		21,536
191 V CUBE LLC ("HVP V") ⁽²⁾								20%	6	5		14,318		16,080
191 IV CUBE Southeast LLC ("HVPSE") ⁽³⁾								10%	-	14		—		4,541
191 IV CUBE LLC ("HVP IV")								20%	28	28		19,853		23,223
CUBE HHF Northeast Venture LLC ("HHFNE")								10%	13	13		1,101		1,291
CUBE HHF Limited Partnership ("HHF")								50%	28	28		35,938		38,855
		69	129	$	91,117	$	95,796		77	90	$	105,993	$	119,751

(1)

~~The stores owned by HVP IV are located~~On December 9, 2021, the Company completed the acquisition of LAACO, which included a 50% interest in ~~Arizona (2)~~Fontana and RCSS, ~~Connecticut (2), Florida (4), Georgia (2), Maryland (1), Minnesota (1) Pennsylvania (1)~~each of which owns one self-storage property in California. As of the date of acquisition, the Company recognized differences between the Company’s equity investment in Fontana and ~~Texas (8). The Company’s total contribution to HVP IV in connection with these store acquisitions was $26.3 million.~~RCSS and the underlying equity reflected at the venture level. As of December 31, ~~2019, HVP IV had $82.2~~2022, this difference was $13.1 million ~~outstanding on its $107.0~~for Fontana and $19.6 million ~~loan facility, which bears interest at LIBOR plus 1.70% per annum, and matures on May 16, 2021 with options to extend~~for RCSS. These differences are being amortized over the ~~maturity date through May 16, 2023, subject to satisfaction of certain conditions and payment~~expected useful life of the ~~extension fees as stipulated in~~self-storage properties owned by the loan agreement. As of December 31, 2019, HVP IV also had $55.5 million outstanding under a separate loan that bears interest at LIBOR plus 2.75% per annum, and matures on June 9, 2022 with options to extend the maturity date through June 9, 2024, subject to satisfaction of certain conditions and payment of the extension fees as stipulated in the loan agreement.ventures.

(2)

~~The stores owned by HHFNE are~~During the year ended December 31, 2022, HVP V acquired one store located in ~~Connecticut (3), Massachusetts (6), Rhode Island (2) and Vermont (2).~~New Jersey for a purchase price of $33.2 million. The ~~Company’s total contribution to HHFNE in connection with these store acquisitions~~Company contributed $0.1 million towards this purchase, which was ~~$3.8 million. As of December 31, 2019, HHFNE had an outstanding $45.0 million loan facility, which bears interest at LIBOR plus 1.20% per annum and matures on December 16, 2024.~~primarily funded by HVP V's secured term loan.

(3)

On ~~June 5, 2019, HVP III~~August 30, 2022, HVPSE sold 50all 14 of its stores ~~located in Florida (3), Georgia (4), Michigan (17), North Carolina (3), South Carolina (15) and Tennessee (8),~~ to an unaffiliated ~~third party~~third-party buyer for an aggregate sales price of ~~$293.5~~$235.0 million. The stores owned by HVPSE were located in Florida (2), Georgia (8) and South Carolina (4). As of the transaction date, ~~HVP III~~HVPSE had ~~5 mortgage loans with~~ an ~~aggregate outstanding balance of $22.9~~$81.6 million ~~as well as $179.5 million outstanding on its $185.5 million~~secured term loan, ~~facility, all of~~ which ~~were defeased or~~was repaid in full at the time of the sale. Net proceeds to the venture from the transaction totaled ~~$82.9 million.~~$150.1 million, of which $49.9 million were distributed to the Company. The venture recorded gains which aggregated to approximately ~~$106.7~~$114.1 million in connection with the sale. ~~Subsequent to the sale, the Company acquired its partner’s 90% ownership interest in HVP III, which at the time of the acquisition owned the remaining 18 storage properties (see note 4).~~

~~(4)~~

~~The stores owned by HHF are located in North Carolina (1) and Texas (34).~~ As of December 31, ~~2019, HHF had an outstanding $100.0~~2022, the venture retained cash of $3.5 million ~~secured loan, which bears interest at 3.59%~~to pay venture-level expenses. After such expenses are paid, any remaining proceeds will be distributed to the venture’s partners per ~~annum and matures on April 30, 2021.~~the terms of the operating agreement.

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 (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 earnings (losses) of real estate ventures on the Company’s consolidated statements of operations.

~~F-31~~F-30

method of accounting. 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 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, ~~2019~~2022 and ~~2018:~~2021:

December 31,

2019 ⁽¹⁾

2018
Assets

(in thousands)
Storage properties, net

$
552,791

$
741,209
Other assets

11,997

16,042
Total assets

$
564,788

$
757,251

Liabilities and equity

Other liabilities

$
10,064

$
7,911
Debt

280,392

413,848
Equity

CubeSmart

91,117

95,796
Joint venture partners

183,215

239,696
Total liabilities and equity

$
564,788

$
757,251

~~(1) Excludes HVP III as it was consolidated by the Company on June 6, 2019.~~


	December 31,
	2022		2021

Assets	(in thousands)
Storage properties, net	$	741,563	$	850,250
Other assets		11,708		34,760
Total assets	$	753,271	$	885,010

Liabilities and equity
Debt	$	468,783	$	526,972
Other liabilities		16,626		14,500
Equity
CubeSmart		73,289		86,083
Joint venture partners		194,573		257,455
Total liabilities and equity	$	753,271	$	885,010

The following is a summary of results of operations of the Ventures for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017:~~2020:


	For the year ended December 31,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020

	(in thousands)						(in thousands)
Total revenues	$	72,582	$	90,111	$	81,058	$	102,910	$	88,449	$	67,239
Operating expenses		(32,134)		(37,899)		(33,922)		(42,408)		(37,967)		(30,755)
Other expenses		(3,227)		(938)		(783)		(484)		(1,138)		(430)
Interest expense, net		(14,927)		(13,311)		(11,703)		(15,568)		(12,031)		(11,585)
Depreciation and amortization		(30,107)		(41,972)		(45,086)		(36,866)		(37,805)		(33,086)
Gains from sale of real estate, net		106,667		—		—		114,107		46,966		—
Net income (loss)	$	98,854	$	(4,009)	$	(10,436)	$	121,691	$	46,474	$	(8,617)
Company’s share of net income (loss)	$	11,122	$	(865)	$	(1,386)	$	48,877	$	25,275	$	178

The results of operations above include the periods from January 1, 2017 through June 6, 2019 (date of consolidation) for HVP III and November 1, 2017 (date of initial store acquisition) through December 31, 2019 for HVP IV.

6. UNSECURED SENIOR NOTES

The Company’s unsecured senior notes are summarized as follows (collectively referred to as the “Senior Notes”):

~~F-32~~

~~(1)~~


	December 31,				Effective		Issuance	Maturity
Unsecured Senior Notes	2022		2021		Interest Rate		Date	Date

	(in thousands)
$300M 4.000% Guaranteed Notes due 2025 ⁽¹⁾	$	300,000	$	300,000	3.99	%	Various ⁽¹⁾	Nov-25
$300M 3.125% Guaranteed Notes due 2026		300,000		300,000	3.18	%	Aug-16	Sep-26
$550M 2.250% Guaranteed Notes due 2028		550,000		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		500,000	2.59	%	Nov-21	Feb-32
Principal balance outstanding		2,800,000		2,800,000
Less: Discount on issuance of unsecured senior notes, net		(11,801)		(13,455)
Less: Loan procurement costs, net		(15,849)		(18,336)
Total unsecured senior notes, net	$	2,772,350	$	2,768,209

~~(2)~~(1)

F-31

principal amount to yield 3.811% and 4.032%, respectively, to maturity. The combined weighted average effective interest rate of the 2025 notes is 3.994%.

7. REVOLVING CREDIT FACILITY ~~AND UNSECURED TERM LOANS~~

On December 9, 2011, the Company entered into a credit agreement (the “Credit Facility”), which was subsequently amended ~~on April 5, 2012, June 18, 2013~~ and ~~April 22, 2015 to provide for, among other things, a $500.0 million unsecured revolving facility with a maturity date of April 22, 2020.~~restated. On ~~June 19, 2019,~~October 26, 2022, the Company again amended and restated, in its entirety, the Credit Facility (the ~~“Amended~~“Second Amended and Restated Credit Facility”) which, subsequent to the amendment and restatement, is comprised of ~~a $750.0~~an $850.0 million unsecured revolving credit facility (the “Revolver”) maturing on ~~June 19, 2024.~~February 15, 2027. Under the Second Amended and Restated Credit Facility, pricing on the Revolver is dependent upon the Company’s unsecured debt credit ~~ratings.~~ratings and leverage levels. At the Company’s current ~~Baa2/BBB level,~~unsecured debt credit ratings and leverage levels, amounts drawn under the Revolver are priced ~~at 1.10% over LIBOR, inclusive~~using a margin of 0.775% plus a facility fee of 0.15%~~. The Company incurred costs of $3.9 million in 2019 in connection with amending~~ over SOFR and ~~restating the Credit Facility and capitalized such costs as~~ a ~~component of Loan procurement costs, net of amortization on the consolidated balance sheets.~~0.10% SOFR adjustment.

~~On June 20, 2011,~~Under 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 seven-year maturity that was repaid on June 19, 2019.

~~The Company’s unsecured term loans under the Credit Facility and Term Loan Facility are summarized below:~~

~~(1)~~

On January 31, 2019, the Company used a portion of the net proceeds from the issuance of $350.0 million of 4.375% Senior Notes due 2029 (the “2029 Notes”) to repay all of the outstanding indebtedness under the unsecured term loan portion of the Credit Facility.

~~F-33~~

~~(2)~~

On June 19, 2019, the Company used an initial advance at closing of the Amended and Restated Credit Facility to repay all of the outstanding indebtedness under the unsecured term loan portion of the Term Loan Facility that was scheduled to mature in January 2020. Unamortized loan procurement costs of $0.1 million were written off in conjunction with the repayment.

~~Under the~~Second 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, ~~2019,~~2022, the Operating Partnership was in compliance with all of its financial covenants.

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

2019

2018

Interest Rate

Date

(in thousands)

YSI 33 ⁽¹⁾

$
—

$
9,214

6.42
%

Jul-19

YSI 26

7,805

8,022

4.56
%

Nov-20

YSI 57

2,740

2,816

4.61
%

Nov-20

YSI 55

21,547

22,041

4.85
%

Jun-21

YSI 24

24,042

24,893

4.64
%

Jun-21

YSI 65

2,313

2,363

3.85
%

Jun-23

YSI 66

30,588

31,171

3.51
%

Jun-23

YSI 68

5,459

5,626

3.78
%

May-24

Principal balance outstanding

94,494

106,146

Plus: Unamortized fair value adjustment

1,833

2,551

Less: Loan procurement costs, net

(287)

(451)

Total mortgage loans and notes payable, net

$
96,040

$
108,246

~~(1)~~

~~YSI 33 was repaid in full on July 1, 2019.~~


	Carrying Value as of
	December 31,				Effective		Maturity
Mortgage Loans and Notes Payable	2022		2021		Interest Rate		Date

	(in thousands)
Nashville V, TN	$	2,148	$	2,206	3.85	%	Jun-23
New York, NY		28,669		29,340	3.51	%	Jun-23
Annapolis I, MD		4,906		5,099	3.78	%	May-24
Brooklyn XV, NY		15,093		15,423	2.15	%	May-24
Long Island City IV, NY		12,270		12,580	2.15	%	May-24
Long Island City II, NY		18,283		18,714	2.25	%	Jul-26
Long Island City III, NY		18,290		18,723	2.25	%	Aug-26
Flushing II, NY		54,300		54,300	2.15	%	Jul-29
Principal balance outstanding		153,959		156,385
Plus: Unamortized fair value adjustment		10,228		12,981
Less: Loan procurement costs, net		(1,269)		(1,690)
Total mortgage loans and notes payable, net	$	162,918	$	167,676

F-32

As of December 31, ~~2019~~2022 and ~~2018,~~2021, the Company’s mortgage loans and notes payable were secured by certain of its self-storage properties with net book values of approximately ~~$206.3~~$442.9 million and ~~$231.0~~$450.7 million, respectively. The following table represents the future principal payment requirements on the outstanding mortgage loans and notes payable as of December 31, ~~2019~~2022 (in thousands):


2020	$	12,791
2021		45,057
2022		923
2023		31,019	$	32,591
2024		4,704		32,329
2025 and thereafter		—
2025				979
2026				33,760
2027				—
2028 and thereafter				54,300
Total mortgage payments		94,494		153,959
Plus: Unamortized fair value adjustment		1,833		10,228
Less: Loan procurement costs, net		(287)		(1,269)
Total mortgage loans and notes payable, net	$	96,040	$	162,918

~~F-34~~

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, ~~2019:~~2022 and 2021.

Unrealized Gains (Losses)

on Interest Rate Swaps

(in thousands)

Other comprehensive gain before reclassifications

$
230

Amounts reclassified from accumulated other comprehensive loss

70
⁽¹⁾
Net current-period other comprehensive income

300

Balance at December 31, 2018

(1,029)

Balance at December 31, 2019

$
(729)


	December 31,
	2022		2021

		(in thousands)
Beginning balance	$	(575)	$	(656)
Reclassification of realized losses on interest rate swaps ⁽¹⁾		81		81
Ending balance		(494)		(575)
Less: portion included in noncontrolling interests in the Operating Partnership		3		5
Total accumulated other comprehensive loss included in equity	$	(491)	$	(570)

(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.

~~During~~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 the 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 the derivative is not highly-effective as a hedge or if a derivative ceases to be a highly-effective hedge, the Company discontinues hedge accounting prospectively and reflects in its consolidated statement of operations realized and unrealized gains and losses with respect to the derivative. As of December 31, 2022 and 2021, 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 designed to reduce~~hedges. Accordingly, the ~~impact of interest rate changes on a forecasted issuance of long-term debt. Therefore, the interest rate swaps~~Interest Rate Swaps were recorded on the consolidated balance ~~sheets~~sheet at fair value and the related gains or losses were deferred in shareholders’ equity as accumulated other comprehensive income or loss. These deferred gains and losses ~~are~~were amortized into interest expense during the period or periods in which the related interest payments ~~affect~~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”), the Company settled the Interest Rate Swaps for $0.8 million. The $0.8 million termination premium will be reclassified from accumulated

F-33

The Company formally assessed, both at inception of the hedge and on an on-going basis, whether each derivative was highly-effective in offsetting changes in cash flows of the hedged item. If management determined that the derivative was highly-effective as a hedge, then the Company accounted for the derivative using hedge accounting, pursuant to which gains or losses inherent in the derivative did not impact the Company’s results of operations. If management determined that the derivative was not highly-effective as a hedge or if a derivative ceased to be a highly-effective hedge, the Company discontinued hedge accounting prospectively and reflected in its statement of operations realized and unrealized gains and losses with respect to the derivative.

~~The following table summarizes the terms and fair values of the Company’s derivative financial instruments as of December 31, 2019 and 2018 (in thousands):~~

Hedge

Hedge

Notional Amount

Effective

Fair Value

Product

Type

December 31, 2019

December 31, 2018

Strike

Date

Maturity

December 31, 2019

December 31, 2018

Swap

Cash flow ⁽¹⁾

$
—

$
75,000

2.8015
%

6/28/2019

6/28/2029

$
—

$
(516)

Swap

Cash flow ⁽¹⁾

—

50,000

2.8030
%

6/28/2019

6/28/2029

—

(350)

Swap

Cash flow ⁽¹⁾

—

25,000

2.8020
%

6/28/2019

6/28/2029

—

(173)

$
—

$
150,000

$
—

$
(1,039)

~~(1)~~

These interest rate swaps were entered into on December 24, 2018 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. On January 24, 2019, in conjunction with the issuance of the 2029 Notes, the Company settled these interest rate swaps for $0.8 million. The termination premium will be reclassified from accumulated other comprehensive loss as an increase to interest expense over the life of the 2029 Notes, which mature on February 15, 2029.

The Company measured its derivative instruments at fair value and recorded them in the balance sheet as a liability. As of December 31, 2019, all derivative instruments had been settled. As of December 31, 2018, all derivative instruments were included in Accounts payable,

~~F-35~~

accrued expenses and other liabilities on the accompanying consolidated balance sheets. The effective portions of changes in the fair value of the derivatives are reported in accumulated other comprehensive loss. Amounts reported in accumulated other comprehensive loss related to derivatives are reclassified to interest expense as interest payments are made on the Company’s 2029 Notes. The change in unrealized losses on interest rate swaps reflects a reclassification of ~~$0.1~~$0.1 million of unrealized losses from accumulated other comprehensive loss as an increase to interest expense during ~~2019.~~2022. The Company estimates that $0.1 million will be reclassified as an increase to interest expense in ~~2020.~~2023.

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.

~~There were 0 financial assets or~~ ~~liabilities~~ carried at fair value as of December 31, 2019. Financial assets and liabilities carried at fair value as of December 31, 2018 are classified in the table below in one of the three categories described above (dollars in thousands):

Level 1

Level 2

Level 3

(in thousands)

Interest rate swap derivative liabilities

$
—

$
1,039

$
—

Total liabilities at fair value

$
—

$
1,039

$
—

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, NaN of which experienced any significant downgrades 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 the reporting dates, the Company has assessed the significance of the effect 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, restricted cash, accounts receivable, ~~and~~other financial instruments included in other assets, accounts payable, accrued expenses and other liabilities approximate their respective carrying values ~~as of~~at December 31, ~~2019~~2022 and ~~2018.~~ 2021.

The ~~aggregate~~following table summarizes the carrying value ~~of the Company’s debt was $1,931.8 million~~ and ~~$1,747.1 million as of December 31, 2019 and 2018, respectively. The~~ estimated fair value of the Company’s debt ~~was $2,037.6 million and $1,731.9 million~~ as of December 31, ~~2019~~2022 and ~~2018, respectively. These~~2021:


	December 31, 2022		December 31, 2021

		(in thousands)
Carrying value	$	2,996,168	$	3,145,785
Fair value		2,568,103		3,256,128

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, ~~2019~~2022 and ~~2018.~~2021. The Company estimates the fair value of its fixed-rate debt and the credit spreads over variable market rates on its 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

~~F-36~~

policies, which is classified within level 2 of the fair value hierarchy. Rates and credit spreads take into consideration general market conditions and maturity.

F-34

12. NONCONTROLLING INTERESTS

Interests in Consolidated Joint Ventures

Noncontrolling interests in subsidiaries represent the ownership interests of third parties in the Company’s consolidated joint ventures. The Company has determined that these ventures are variable interest entities, and that the Company is the primary beneficiary. Accordingly, the Company consolidates the assets, liabilities and results of operations of theAll consolidated joint ventures inwere formed to develop, own and operate new stores with the exception of Anoka, which was formed to acquire an existing store that had commenced operations. The following table ~~below:~~summarizes the Company’s consolidated joint ventures, each of which are accounted for as VIEs:


			Date Opened /	CubeSmart						CubeSmart
	Number		Estimated	Ownership	December 31, 2019				Number	Ownership	December 31, 2022
Consolidated Joint Ventures	of Stores	Location	Opening	Interest	Total Assets		Total Liabilities		of Stores	Interest	Total Assets		Total Liabilities		Related Party Loans ⁽¹⁾

					(in thousands)						(in thousands)
CS Valley Forge Village Storage, LLC ("VFV") ⁽¹⁾	1	King of Prussia, PA	Q2 2021 (est.)	70%	$	4,279	$	856
Shirlington Rd II, LLC ("SH2") ⁽²⁾	1	Arlington, VA	Q1 2021 (est.)	90%		8,965		339
CS 2087 Hempstead Tpk, LLC ("Hempstead") ⁽³⁾	1	East Meadow, NY	Q4 2020 (est.)	51%		12,538		3,289
CS SDP Newtonville, LLC ("Newton") ⁽¹⁾	1	Newton, MA	Q3 2020 (est.)	90%		10,351		3,827
CS 1158 McDonald Ave, LLC ("McDonald Ave") ⁽³⁾	1	Brooklyn, NY	Q1 2020 (est.)	51%		41,995		10,713
Shirlington Rd, LLC ("SH1") ⁽²⁾	1	Arlington, VA	Q2 2015	90%		14,905		162
1074 Raritan Road, LLC ("Clark")									1	90%	$	3,500	$	5	$	—
Astoria Investors, LLC ("Astoria")									1	70%		24,763		10,161		9,238
CS 750 W Merrick Rd, LLC ("Merrick")									1	51%		37,140		17,142		—
CS Lock Up Anoka, LLC ("Anoka")									1	50%		10,934		5,581		5,540
CS Valley Forge Village Storage, LLC ("VFV")									1	70%		20,576		14,863		14,792
CS Vienna, LLC ("Vienna")									1	80%		32,400		35,085		34,875
SH3, LLC ("SH3")									1	90%		38,165		274		—
	6				$	93,033	$	19,186	7		$	167,478	$	83,111	$	64,445

(1)

~~The Company has a related~~Related party ~~commitment~~loans represent amounts payable from the joint venture to ~~VFV and Newton to fund all or a portion of the construction costs. As of December 31, 2019,~~ the Company ~~has funded $3.1 million of a total $12.1 million loan commitment to Newton, which is~~and are included in ~~the~~ total ~~liability amount~~liabilities within the table above. ~~This loan~~The loans and ~~the~~ related party interest ~~were~~have been eliminated for consolidation purposes. ~~As of December 31, 2019, the Company had not funded any of its $12.4 million loan commitment to VFV.~~

~~(2)~~

On March 7, 2019, the Company acquired the noncontrolling member’s ownership interest in SH1, inclusive of its promoted interest in the venture, for $10.0 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 venture, this transaction was accounted for as an equity transaction. The carrying amount of the noncontrolling interest was reduced to 0 to reflect the purchase and the $9.7 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 with the Company’s acquisition of the noncontrolling interest in SH1, the $12.2 million related party loan extended by the Company to the venture during the construction period was repaid in full. Subsequently, the noncontrolling member re-acquired a 10% interest in SH1 and a 10% interest in SH2 for a combined $4.8 million, which is included in Noncontrolling interests in subsidiaries on the consolidated balance sheets.

~~(3)~~

The noncontrolling members of Hempstead and McDonald Ave have the option to put their ownership interest in the ventures to the Company for $6.6 million and $10.0 million, respectively, within the one-year period after construction of each store is substantially complete. Additionally, the Company has a one-year option to call the ownership interest of the noncontrolling members of Hempstead and McDonald Ave for $6.6 million and $10.0 million, respectively, beginning on the second anniversary of the respective store’s construction being substantially complete. The Company, at its sole discretion, may pay cash and/or issue OP Units in exchange for the noncontrolling member’s interest in Hempstead and McDonald. The Company is accreting the respective liabilities during the development periods and, as of December 31, 2019, has accrued $2.8 million and $9.7 million related to Hempstead and McDonald Ave, respectively, which are included in Accounts payable, accrued expenses and other liabilities on the Company’s consolidated balance sheets.

On May 30, 2019, the Company sold its 90% ownership interest in CS SJM E 92nd Street, LLC, a previously consolidated development joint venture, for $3.7 million. In conjunction with the sale, $0.7 million of the $1.7 million related party loan extended by the Company to the venture was repaid. The remaining $1.0 million was recorded as a note receivable and was repaid during the third quarter of 2019. Additionally, as a result of the transaction, the Company was released from its obligations under the venture’s ground lease, and right-of-use assets and lease liabilities totaling $13.4 million and $14.6 million, respectively, were removed from the Company’s consolidated balance sheets.

~~F-37~~

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%~~0.6% and 0.8% of the outstanding OP Units as of December 31, ~~2019~~2022 and ~~2018,~~2021, 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 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.

OnIn two separate tranches during December ~~16, 2019,~~2020, the Company acquired the Storage Deluxe Assets for an aggregate purchase price of $540.0 million. In connection with the acquisition of the Storage Deluxe Assets, the Company issued 5,272,023 OP Units valued at approximately $175.1 million to fund a portion of the purchase price.

On September 29, 2020, the Company acquired the noncontrolling interest in a previously consolidated joint venture that owned a store in ~~California~~New York for ~~$18.5~~$10.0 million. In conjunction with the closing, the Company paid ~~$14.9~~$1.0 million in cash and issued ~~106,738~~276,497 OP Units, valued at approximately ~~$3.6~~$9.0 million, to pay the remaining consideration.

~~On January~~F-35

During the years ended December 31, ~~2018,~~2022, 2021 and 2020, 475,046, 5,519,233 and 100,000 OP units, respectively, were redeemed for common shares of the Company acquired a store in Texas for $12.2 million and assumed an existing mortgage loan with an outstanding balance of approximately $7.2 million and immediately repaid the loan. In conjunction with the closing, the Company paid $0.2 million in cash and issued 168,011 OP Units, valued at approximately $4.8 million, to pay the remaining consideration.Company.

On April 12, 2017, the Company acquired a store in Illinois for $11.2 million. In conjunction with the closing, the Company paid $9.7 million and issued 58,400 Class C OP Units to pay the remaining consideration. On July 23, 2018, all of the 58,400 Class C OP Units were exchanged for an aggregate of 46,322 common units of the Operating Partnership.

On May 9, 2017, the Company acquired a store in Maryland 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.

As of December 31, ~~2019~~2022 and ~~2018, 1,972,308~~2021, 1,426,549 and ~~1,945,570~~1,901,595 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, ~~2019~~2022 and ~~2018. As~~2021. The aggregate redemption value of the 1,426,549 OP Units as of December 31, ~~2019 and 2018, the Operating Partnership recorded an increase to OP Units owned by third parties and a corresponding decrease to capital of $5.9 million and $0.3~~ ~~million, respectively.~~2022 was $57.4 million.

~~F-38~~

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 ~~year~~years ended December 31, ~~2019,~~2022, 2021 and 2020, administrative and late fees totaled ~~$22.6~~$27.8 million, $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 ~~ranging from one year~~of up to 4542 years. Certain of the Company’s leases ~~contain provisions that~~ (1) provide for one or more options to renew, with renewal options that can extend the lease ~~term from one year~~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 residual value guarantees or material restrictive covenants. ~~As a result of~~Lease expense for payments related to the Company’s ~~election of~~finance leases is recognized as interest expense using the ~~package of practical expedients permitted within ASC 842, which among other things, allows for~~interest method over the ~~carryforward of historical~~related lease ~~classification, all of the Company’s lease agreements have been classified as operating leases.~~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. ~~Upon adoption of ASC 842 on January 1, 2019, the Company had right-of-use assets and lease liabilities related to its operating leases of $55.7 million and $60.7 million,~~ ~~respectively. As of December 31, 2019, the Company had right-of-use assets and lease liabilities related to its operating leases of $41.7 million and $46.4 million, which are included in~~ ~~Other assets, net and~~ ~~Accounts payable, accrued expenses~~ and other liabilities on the Company’s consolidated balance sheets, respectively. As of December 31, 2019, the Company’s weighted average remaining lease term and weighted average discount rate related to its operating leases were 35.9 years and 4.74%, respectively.

For the year ended December 31, 2019, the Company’s lease cost consists of the following components, each of which is included in Property operating expenses within the Company’s consolidated statements of operations:

For the year ended

December 31, 2019

(in thousands)

Operating lease cost

$
3,304

Short-term lease cost ⁽¹⁾

1,227

Total lease cost

$
4,531

~~F-39~~F-36

For the years ended December 31, 2022, 2021 and 2020, the Company’s lease cost consists of the following components:


	Year Ended December 31,
	2022		2021		2020

Finance lease cost:
Amortization of finance lease right-of-use assets	$	964	$	964	$	49
Interest expense related to finance lease liabilities		2,140		2,139		64
Operating lease cost		2,980		3,278		2,856
Short-term lease cost ⁽¹⁾		868		1,173		1,114
Total lease costs	$	6,952	$	7,554	$	4,083

Cash paid for amounts included in measurement of lease liabilities:
Operating cash outflows for finance leases	$	2,183	$	1,938	$	—
Operating cash outflows for operating leases		2,453		2,513		2,186
Total cash outflows for lease liability measurement	$	4,636	$	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, 2022 and 2021:


	December 31,
	2022			2021

	(dollars in thousands)
Finance Leases
Right-of-use assets included in Storage properties, net	$	41,945		$	40,932
Lease liabilities included in Lease liabilities - finance leases	$	65,758		$	65,801

Operating Leases
Right-of-use assets included in Other assets, net	$	49,491		$	54,741
Lease liabilities included in Accounts payable, accrued expenses and other liabilities	$	48,664		$	54,018

Weighted Average Lease Term (in years)
Finance leases		41.5			42.5
Operating leases		33.3			34.0

Weighted Average Discount Rate
Finance leases		3.25	%		3.25	%
Operating leases		4.44	%		4.46	%

The following table represents the future ~~operating~~ lease liability maturities as of December 31, ~~2019~~2022 (in thousands):

2020

$
2,273

2021

2,302

2022

2,459

2023

2,523

2024

2,373

2025 and thereafter

91,241

Total operating lease payments

103,171

Less: Imputed interest

(56,780)

Present value of operating lease liabilities

$
46,391


	Finance		Operating
2023	$	2,183	$	2,484
2024		2,183		2,334
2025		2,224		2,322
2026		2,334		2,386
2027		2,371		2,416
2028 and thereafter		118,227		86,094
Total lease payments		129,522		98,036
Less: Imputed interest		(63,764)		(49,372)
Present value of lease liabilities	$	65,758	$	48,664

During the year ended December 31, 2019, the cash paid for amounts included in the measurement of lease liabilities related to the Company’s operating leases was approximately $2.5 million, which is included as an operating cash outflow within the consolidated statements of cash flows. As of December 31, ~~2019,~~2022, the Company has not entered into any lease agreements that are set to commence in the future.

F-37

14. RELATED PARTY TRANSACTIONS

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 revenues at the managed stores. Total management fees for unconsolidated real estate ventures or other entities in which the Company held an ownership interest for the years ending December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020 were ~~$4.0~~$5.1 million, ~~$4.5~~$4.9 million and $3.8 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 reimbursements consist of amounts due for management fees, payroll and other store expenses. The amounts due to the Company were ~~$10.5~~$15.9 million and ~~$10.6~~$15.4 million as of December 31, ~~2019~~2022 and ~~2018,~~2021, respectively, and are included in Other Assets, net on the Company’s consolidated balance sheets. Additionally, ~~as discussed in note 12,~~ the Company had outstanding mortgage loans receivable from consolidated joint ventures of ~~$3.1~~$64.4 million and ~~$33.2~~$32.4 million as of December 31, ~~2019~~2022 and ~~2018,~~2021, 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 upon the closing of a property transaction by HVP ~~III,~~V, HVPSE, HVP IV and HHFNE, or any of their subsidiaries and completion of certain measures as defined in the operating agreements. ~~The~~During the years ended December 31, 2022, 2021 and 2020, the Company recognized ~~$2.1 million,~~ $0.6 million, $1.3 million and ~~$0.5~~$0.7 million, respectively, in fees associated with property ~~transactions during~~transactions. Property transaction fees are included in the ~~years~~component of other (expense) income designated as Other on the consolidated statements of operations.

In April 2022, the Company began serving as lessor in a ground lease related to land underlying an HVP IV property located in Texas (see note 4). During the year ended December 31, ~~2019, 2018 and 2017, respectively, which are~~2022, the Company recognized income associated with this ground lease of $0.2 million. This income is included in the component of other (expense) income designated as Other ~~income~~ on the consolidated statements of operations.

15. COMMITMENTS AND CONTINGENCIES

Development Commitments

The Company has agreements with developers for the construction of 5two new self-storage properties (see note 4), which will require payments of approximately ~~$56.7~~$34.6 million, due in installments upon completion of certain construction milestones, during ~~2020~~2023 and ~~2021.~~2024.

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 unknown uncertainties. In the opinion of management, the Company has made adequate

~~F-40~~

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.

On January 11, 2019, a settlement agreement was entered into for a class action alleging violation of a state specific deceptive and unfair trade practices act. During the year ended December 31, 2018, the Company recorded a $1.8 million charge related to this legal action, which is included in General and administrative on the Company’s consolidated statements of operations. On August 2, 2019, the court granted final approval of the settlement for the class action.

16. 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,~~The Company has 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 on 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, 2019: (i) 4,015,223 common shares remained available for future awards under the 2007 Plan; (ii) 547,266 unvested restricted share awards were outstanding under the 2007 Plan; and (iii) 1,602,353 common shares were subject to outstanding options under the 2007 Plan (with the outstanding options having a weighted average exercise price of $24.10 per share and a weighted average term to maturity of 6.26 years).

Prior to the June 1, 2016 amendment, 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 on June 1, 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 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 5 percent of the shares subject to the Aggregate Share Reserve may be subject to awards that are not subject to such

~~F-41~~F-38

December 31, 2022: (i) 1,941,786 common shares remained available for future awards under the Plan; (ii) 340,952 unvested restricted share awards were outstanding under the Plan; and (iii) 2,537,038 common shares were subject to outstanding options under the Plan.

The 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 Plan and, subject to its right to delegate authority to grant awards, determines the terms and provisions of option grants and share awards.

Under the Plan, the Compensation Committee determines the vesting schedule of each award, subject to a one-year minimum vesting requirement for share options, share appreciation rights, and certain restricted share and restricted share unit awards, 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 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.

Share Options

The fair values for options granted in ~~2019, 2018~~2022, 2021 and ~~2017~~2020 were estimated at the time the options were granted using the Black-Scholes option-pricing model applying the following weighted average assumptions:


Assumptions:	2019			2018			2017			2022			2021			2020
Risk-free interest rate		2.7	%		2.5	%		2.2	%		1.5	%		0.6	%		1.9	%
Expected dividend yield		3.9	%		3.7	%		3.5	%		3.7	%		3.8	%		3.9	%
Volatility ⁽¹⁾		32.00	%		32.00	%		33.00	%		25.00	%		25.00	%		20.00	%
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	$	6.35		$	6.24		$	6.12		$	8.83		$	4.62		$	3.66
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 2019, 2018 and 2017 grants was based on the trading history of the Company’s shares.

In ~~2019, 2018~~2022, 2021 and ~~2017,~~2020 the Company recognized compensation expense related to options issued to employees and executives of approximately ~~$1.8~~$2.5 million, ~~$1.5~~$2.3 million and ~~$1.5~~$2.0 million, respectively, which is included in General and administrative expense on the Company’s consolidated statements of operations. ~~During 2019, 324,409 share options were issued for which the fair value of the options at their respective grant dates was approximately $2.1 million.~~ The share options vest ratably over three years. As of December 31, ~~2019,~~2022, the Company had approximately ~~$2.0~~$2.8 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.

The table below summarizes the option activity under the ~~2004~~ Plan for the year ended December 31, 2022:


	Options	Weighted Average Strike Price		Weighted Average Remaining Contractual Term (Years)
Balance at December 31, 2021	2,263,804	$	29.63	6.82
Options granted	324,840		56.91	9.01
Options exercised	(51,606)		30.80	7.29
Balance at December 31, 2022	2,537,038	$	33.10	6.21

Vested or expected to vest at December 31, 2022	2,537,038	$	33.10	6.21
Exercisable at December 31, 2022	1,636,544	$	28.42	5.14

As of December 31, 2022, the aggregate intrinsic value of options that were exercisable was approximately $19.4 million. As of that date, the aggregate intrinsic value of options that had vested or were expected to vest was approximately $23.6 million. The aggregate intrinsic value of options exercised was approximately $1.0 million, $10.6 million and ~~the 2007 Plan~~$0.9 million for the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017:~~2020, respectively.

Weighted Average

Number of Shares

Weighted Average

Remaining

Under Option

Strike Price

Contractual Term

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

Options granted

305,805

27.85

9.08

Options canceled

(74,748)

26.95

—

Options exercised

(405,227)

9.47

1.98

Balance at December 31, 2018

1,659,003

$
19.89

5.52

Options granted

324,409

28.69

9.01

Options exercised

(381,059)

9.67

1.00

Balance at December 31, 2019

1,602,353

$
24.10

6.26

Vested or expected to vest at December 31, 2019

1,602,353

$
24.10

6.26

Exercisable at December 31, 2019

1,015,950

$
21.81

5.00

~~F-42~~F-39

As of December 31, 2019, the aggregate intrinsic value of options outstanding, of options that vested or are expected to vest, and of options that were exercisable was approximately $11.8 million. The aggregate intrinsic value of options exercised was approximately $9.1 million for the year ended December 31, 2019.Restricted Shares & Performance Units

~~Restricted Shares~~During 2022, 2021 and 2020 the Company granted restricted shares to employees and trustees and also granted performance units to certain executives.

The ~~Company applies~~fair values for restricted share awards made under the Plan were valued at the grant date fair value, ~~method~~which is the market price of ~~accounting for contingently issued~~the underlying common shares. ~~As such, each grant is recognized ratably~~The shares vest over either a 3-year or 5-year period beginning with the ~~related vesting period. There~~first anniversary of the grant.

Performance units represent the right to earn common shares. The performance units were ~~180,607 restricted shares and~~granted in the form of deferred share units ~~issued during~~with a market condition, entitling the ~~year ended December 31, 2019, which~~holders thereof to receive common shares at a future date. The performance units 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 performance units cliff vest ~~over~~ ~~three~~ ~~to five years. The fair value~~upon the third anniversary of the restricted shares and share units issued during the year ended December 31, 2019 was approximately $5.8 million at their respective grant dates. There were 165,551 restricted shares and share units issued during the year ended December 31, 2018 for whicheffective date. The Company used a Monte Carlo simulation analysis to estimate the fair value of the ~~restricted shares and share units at their respective grant dates was approximately $4.9 million. As~~awards, the key assumptions of December 31, 2019 the Company had approximately $5.7 million of remaining unrecognized restricted share and share unit compensation costs that will be recognized over the next five years. Restricted share awardswhich 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.as follows:


Assumptions:	2022			2021			2020
Risk-free interest rate		1.0	%		0.2	%		1.7	%
Volatility ⁽¹⁾		28.00	%		28.00	%		19.00	%

~~In 2019, 2018~~

(1)

Expected volatility is based upon the Company’s historical daily share prices.

During the years ended December 31, 2022, 2021 and ~~2017,~~2020, the Company recognized compensation expense related to restricted shares and ~~share~~performance units ~~issued to employees and Trustees~~ of approximately ~~$4.9~~$6.5 million, ~~$4.0~~$5.8 million and ~~$4.1~~$5.2 million, ~~respectively; these amounts were recorded~~respectively, which is included in ~~general~~General and administrative ~~expense.~~expense on the Company’s consolidated statements of operations. The following table presents non-vested restricted share and ~~share~~performance unit activity ~~during 2019:~~under the Plan for the year ended December 31, 2022:


		Number of Non-
		Vested Restricted
		Shares and ~~Share~~Performance Units
Non-Vested at January 1, ~~2019~~2022		~~382,600~~387,701
Granted		~~180,607~~126,304
Vested		~~(66,392)~~(164,228)
Forfeited		~~(6,851)~~(8,825)
Non-Vested at December 31, ~~2019~~2022		~~489,964~~340,952

~~On January 1, 2019, 55,168 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 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. Theweighted average fair value of restricted shares and performance units granted during the ~~restricted share units on the grant date~~years ended December 31, 2022, 2021 and 2020 was ~~approximately $2.1 million.~~$61.41, $39.37 and $32.39, 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, 2022, 2021 and 2020 was $5.6 million, $4.8 million and $6.0 million, respectively. As of December 31, 2022 the Company had approximately $7.6 million of remaining unrecognized restricted share ~~units will cliff vest upon the third anniversary of the effective date, or December 31, 2021. 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, 2018, 66,872 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 $1.9 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, 2020. The compensation expense recognized related to these awards and remaining unrecognized compensation costs are included in the amounts disclosed above.

On January 23, 2017, 52,426 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 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 of the restricted share units on the grant date was approximately $1.8 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, 2019. The compensation expense recognized related to these awards and remaining unrecognized compensation costs are included in the amounts disclosed above.

2.0 years.

~~F-43~~F-40

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,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020
	(dollars and shares in thousands, except per share amounts)

							(dollars and shares in thousands, except per share amounts)
Net income	$	170,771	$	165,488	$	135,611	$	292,472	$	230,813	$	167,611
Noncontrolling interests in the Operating Partnership		(1,708)		(1,820)		(1,593)		(1,931)		(7,873)		(1,825)
Noncontrolling interest in subsidiaries		54		221		270		722		542		(165)
Net income attributable to the Company’s common shareholders	$	169,117	$	163,889	$	134,288	$	291,263	$	223,482	$	165,621

Weighted average basic shares outstanding		190,874		184,653		180,525		224,928		203,832		194,147
Share options and restricted share units		702		842		923		953		1,177		796
Weighted average diluted shares outstanding ⁽¹⁾		191,576		185,495		181,448		225,881		205,009		194,943

Basic earnings per share attributable to common shareholders	$	0.89	$	0.89	$	0.74	$	1.29	$	1.10	$	0.85
Diluted earnings per share attributable to common shareholders(2)	$	0.88	$	0.88	$	0.74	$	1.29	$	1.09	$	0.85

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,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020
	(dollars and units in thousands, except per unit amounts)

							(dollars and units in thousands, except per unit amounts)
Net income	$	170,771	$	165,488	$	135,611	$	292,472	$	230,813	$	167,611
Operating Partnership interests of third parties		(1,708)		(1,820)		(1,593)		(1,931)		(7,873)		(1,825)
Noncontrolling interest in subsidiaries		54		221		270		722		542		(165)
Net income attributable to common unitholders	$	169,117	$	163,889	$	134,288	$	291,263	$	223,482	$	165,621

Weighted average basic units outstanding		190,874		184,653		180,525		224,928		203,832		194,147
Unit options and restricted share units		702		842		923		953		1,177		796
Weighted average diluted units outstanding ⁽¹⁾		191,576		185,495		181,448		225,881		205,009		194,943

Basic earnings per unit attributable to common unitholders	$	0.89	$	0.89	$	0.74	$	1.29	$	1.10	$	0.85
Diluted earnings per unit attributable to common unitholders(2)	$	0.88	$	0.88	$	0.74	$	1.29	$	1.09	$	0.85

(1)

For the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017,~~2020, the Company declared cash dividends per common share/unit of ~~$1.29, $1.22,~~$1.78, $1.45 and ~~$1.11,~~$1.33, 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, 2022 and 2020 were 0.3 million and 0.8 million, respectively. There were no anti-dilutive options for the year ended December 31, 2021.

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~~OP 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 1,972,308; 1,945,570~~The following is a summary of OP and ~~1,878,253 as of December 31, 2019, 2018 and 2017, respectively. There were 193,557,024; 187,145,103 and 182,215,735~~ common units ~~outstanding as of December 31, 2019, 2018 and 2017, respectively.~~outstanding:


	As of December 31,
	2022	2021	2020
Outstanding OP units	1,426,549	1,901,595	7,420,828
Outstanding common units	224,603,462	223,917,993	197,405,989

F-41

Common Shares

On November 19, 2021, the Company 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.

The Company maintains an at-the-market equity program that enables it to offer and sell up to ~~50.0~~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, ~~2019, 2018~~2022, 2021 and ~~2017~~2020 is summarized below:

~~F-44~~


	For the year ended December 31,						For the year ended December 31,
	2019		2018		2017		2022		2021		2020

	(dollars and shares in thousands, except per share amounts)						(dollars and shares in thousands, except per share amounts)
Number of shares sold		5,899		4,291		1,036		102		4,982		3,627
Average sales price per share	$	33.64	$	31.09	$	29.13	$	50.64	$	40.57	$	33.69
Net proceeds after deducting offering costs	$	196,304	$	131,835	$	29,642	$	4,936	$	199,977	$	120,727

The proceeds from the sales of common shares under the program during the years ended December 31, ~~2019, 2018~~2022, 2021 and ~~2017~~2020 were used to fund ~~acquisitions~~the acquisition and development of ~~storage~~self-storage properties and for general corporate purposes. As of December 31, ~~2019, 2018~~2022, 2021 and ~~2017, 4.6~~2020, 5.8 million common shares, ~~10.5~~5.9 million common shares and ~~4.7~~10.9 million common shares, respectively, remained available for issuance under the Equity Distribution Agreements.

~~18. INCOME TAXES~~

Deferred income taxes are established for temporary differences between the 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. NaN valuation allowance was recorded as of December 31, 2019 or 2018. As of December 31, 2019 and 2018, the Company had net deferred tax assets of $0.8 million and $1.4 million, respectively, which are included in Other assets, net on the Company’s consolidated balance sheets. The Company believes it is more likely than not the deferred tax assets will be realized.

~~19. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)~~

~~The following is a summary of quarterly financial information for the years ended December 31, 2019 and 2018:~~

Three months ended


March 31,

June 30,

September 30,

December 31,

2019

2019

2019

2019

(in thousands, except per share amounts)

Total revenues

$
152,845

$
159,017

$
166,547

$
165,506

Total operating expenses

99,014

100,583

106,855

105,394

Net income

35,786

49,878

42,597

42,510

Net income attributable to the Company's common shareholders

35,498

49,420

42,154

42,045

Basic earnings per share attributable to common shareholders

0.19

0.26

0.22

0.22

Diluted earnings per share attributable to common shareholders

0.19

0.26

0.22

0.22

Three months ended


March 31,

June 30,

September 30,

December 31,

2018

2018

2018

2018

(in thousands, except per share amounts)

Total revenues

$
142,877

$
147,815

$
153,370

$
153,882

Total operating expenses

92,464

92,915

93,774

98,775

Net income

34,799

38,751

43,302

48,636

Net income attributable to the Company's common shareholders

34,423

38,410

42,900

48,156

Basic earnings per share attributable to common shareholders

0.19

0.21

0.23

0.26

Diluted earnings per share attributable to common shareholders

0.19

0.21

0.23

0.26

~~The sum of quarterly earnings per share amounts do not necessarily equal the full year amounts.~~

~~F-45~~F-42

Table of Contents

CUBESMART

SCHEDULE III

REAL ESTATE AND RELATED DEPRECIATION

December 31, ~~2019~~2022

(dollars in thousands)

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2019






Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(A)

Developed

Chandler I, AZ

47,880

327

1,257

551

327

1,631

1,958

752

2005

Chandler II, AZ

82,915

1,518

7,485

229

1,518

7,713

9,231

1,544

2013

Gilbert I, AZ

57,100

951

4,688

205

951

4,893

5,844

1,048

2013

Gilbert II, AZ

115,430

1,199

11,846

171

1,199

12,017

13,216

1,098

2016

Glendale, AZ

56,807

201

2,265

1,301

418

3,002

3,420

1,555

1998

Green Valley, AZ

25,050

298

1,153

259

298

1,201

1,499

520

2005

Mesa I, AZ

52,575

920

2,739

403

921

2,696

3,617

1,241

2006

Mesa II, AZ

45,511

731

2,176

311

731

2,158

2,889

1,022

2006

Mesa III, AZ

59,209

706

2,101

505

706

2,222

2,928

979

2006

Peoria, AZ

110,810

1,436

7,082

255

1,436

7,337

8,773

1,087

2015

Phoenix III, AZ

121,880

2,115

10,429

336

2,115

10,765

12,880

1,999

2014

Phoenix IV, AZ

69,710

930

12,277

111

930

12,388

13,318

1,141

2016

Queen Creek, AZ

94,462

1,159

5,716

94

1,159

5,810

6,969

892

2015

Scottsdale, AZ

67,575

443

4,879

1,793

883

5,555

6,438

2,949

1998

Surprise , AZ

72,475

584

3,761

128

584

3,889

4,473

511

2015

Tempe I, AZ

77,330

941

3,283

784

941

3,757

4,698

1,063

2005 / 2019

Tempe II, AZ

68,409

588

2,898

2,162

588

5,060

5,648

1,237

2013

Tucson I, AZ

59,800

188

2,078

1,157

384

2,731

3,115

1,435

1998

Tucson II, AZ

43,950

188

2,078

1,150

391

2,743

3,134

1,412

1998

Tucson III, AZ

49,820

532

2,048

391

533

2,078

2,611

914

2005

Tucson IV, AZ

48,040

674

2,595

411

675

2,586

3,261

1,169

2005

Tucson V, AZ

45,184

515

1,980

420

515

2,043

2,558

935

2005

Tucson VI, AZ

40,766

440

1,692

291

430

1,685

2,115

767

2005

Tucson VII, AZ

52,663

670

2,576

406

670

2,567

3,237

1,176

2005

Tucson VIII, AZ

46,650

589

2,265

448

589

2,361

2,950

1,063

2005

Tucson IX, AZ

67,496

724

2,786

516

725

2,780

3,505

1,269

2005

Tucson X, AZ

46,350

424

1,633

387

425

1,710

2,135

754

2005

Tucson XI, AZ

42,700

439

1,689

444

439

1,840

2,279

908

2005

Tucson XII, AZ

42,275

671

2,582

415

672

2,567

3,239

1,145

2005

Tucson XIII, AZ

45,800

587

2,258

365

587

2,253

2,840

1,056

2005

Tucson XIV, AZ

48,995

707

2,721

502

708

2,670

3,378

1,247

2005

Benicia, CA

74,770

2,392

7,028

499

2,392

6,433

8,825

2,856

2005

Citrus Heights, CA

75,620

1,633

4,793

277

1,634

4,292

5,926

2,007

2005

Corona, CA

95,124

2,107

10,385

224

2,107

10,608

12,715

1,736

2014

Diamond Bar, CA

103,528

2,522

7,404

341

2,524

6,634

9,158

3,074

2005

Escondido, CA

143,645

3,040

11,804

319

3,040

9,763

12,803

3,765

2007

Fallbrook, CA

45,926

133

1,492

1,896

432

2,845

3,277

1,503

1997

Fremont, CA

51,189

1,158

5,711

188

1,158

5,899

7,057

1,134

2014

Lancaster, CA

60,475

390

2,247

1,135

556

2,646

3,202

1,192

2001

Long Beach I, CA

124,541

3,138

14,368

1,104

3,138

13,536

16,674

5,917

2006

Long Beach II, CA

70,630

3,424

13,987

1

3,424

13,988

17,412

—

2019

Los Angeles, CA

76,818

23,289

25,867

137

23,289

26,004

49,293

868

2018

Murrieta, CA

49,775

1,883

5,532

325

1,903

4,991

6,894

2,256

2005

North Highlands, CA

57,094

868

2,546

591

868

2,676

3,544

1,217

2005

Ontario, CA

93,540

1,705

8,401

470

1,705

8,870

10,575

1,486

2014

Orangevale, CA

50,542

1,423

4,175

380

1,423

3,877

5,300

1,814

2005

Pleasanton, CA

83,600

2,799

8,222

481

2,799

7,460

10,259

3,288

2005

Rancho Cordova, CA

53,978

1,094

3,212

433

1,095

3,101

4,196

1,421

2005

Rialto I, CA

57,391

899

4,118

304

899

3,849

4,748

1,690

2006

Rialto II, CA

99,783

277

3,098

1,855

672

4,156

4,828

2,279

1997

Riverside I, CA

67,320

1,351

6,183

645

1,351

5,996

7,347

2,655

2006

Riverside II, CA

85,101

1,170

5,359

547

1,170

5,102

6,272

2,233

2006

Roseville, CA

59,944

1,284

3,767

478

1,284

3,647

4,931

1,722

2005

Sacramento I, CA

50,764

1,152

3,380

486

1,152

3,300

4,452

1,493

2005

Sacramento II, CA

111,565

2,085

6,750

638

2,086

6,721

8,807

1,999

2005/2017

San Bernardino I, CA

31,070

51

572

1,201

182

1,441

1,623

748

1997

San Bernardino II, CA

41,426

112

1,251

1,393

306

2,101

2,407

1,092

1997

San Bernardino III, CA

35,416

98

1,093

1,350

242

1,945

2,187

1,032

1997

San Bernardino IV, CA

83,352

1,872

5,391

245

1,872

4,421

6,293

1,694

2005

San Bernardino V, CA

56,803

783

3,583

680

783

3,731

4,514

1,658

2006

San Bernardino VII, CA

78,695

1,475

6,753

482

1,290

6,487

7,777

2,889

2006

San Bernardino VIII, CA

111,833

1,691

7,741

721

1,692

6,510

8,202

2,951

2006

San Diego, CA

87,412

1,185

16,740

18

1,186

16,757

17,943

595

2018

San Marcos, CA

37,425

775

2,288

218

776

2,135

2,911

981

2005

Santa Ana, CA

63,831

1,223

5,600

493

1,223

5,315

6,538

2,354

2006

South Sacramento, CA

52,390

790

2,319

482

791

2,381

3,172

1,062

2005

Spring Valley, CA

55,085

1,178

5,394

947

1,178

5,597

6,775

2,484

2006

Temecula I, CA

81,340

660

4,735

1,088

899

4,977

5,876

2,328

1998

Temecula II, CA

84,520

3,080

5,839

887

3,080

5,790

8,870

2,144

2007

Vista I, CA

74,238

711

4,076

2,363

1,118

5,105

6,223

2,347

2001

Vista II, CA

147,723

4,629

13,599

219

4,629

11,755

16,384

5,363

2005

Walnut, CA

50,664

1,578

4,635

486

1,595

4,382

5,977

1,957

2005

West Sacramento, CA

39,765

1,222

3,590

237

1,222

3,259

4,481

1,505

2005

Westminster, CA

68,393

1,740

5,142

396

1,743

4,651

6,394

2,204

2005

Aurora, CO

75,717

1,343

2,986

611

1,343

3,047

4,390

1,321

2005

Centennial, CO

62,400

1,281

8,958

111

1,281

9,069

10,350

978

2016

Colorado Springs I, CO

47,975

771

1,717

456

771

1,827

2,598

813

2005

Colorado Springs II, CO

62,400

657

2,674

287

656

2,453

3,109

1,110

2006

Denver I, CO

59,200

673

2,741

501

646

2,763

3,409

1,202

2006

Denver II, CO

74,420

1,430

7,053

183

1,430

7,235

8,665

1,688

2012

Denver III, CO

76,025

1,828

12,109

92

1,828

12,201

14,029

1,245

2016

Federal Heights, CO

54,770

878

1,953

347

879

1,901

2,780

835

2005

Golden, CO

87,800

1,683

3,744

591

1,684

3,663

5,347

1,624

2005

Littleton, CO

53,490

1,268

2,820

404

1,268

2,714

3,982

1,165

2005

Northglenn, CO

43,102

862

1,917

589

662

2,290

2,952

925

2005


											Gross Carrying Amount at
		Total				Initial Cost			Costs		December 31, 2022
		Rentable					Buildings		Subsequent				Buildings				Accumulated
	Number of	Square Feet					&		to				&				Depreciation
State	Stores	(unaudited)	Encumbrances		Land		Improvements		Acquisition		Land		Improvements		Total		(A)
Arizona	48	3,089,826	$	—	$	98,442	$	389,514	$	26,017	$	99,495	$	399,753	$	499,248	$	49,843
California	63	4,765,486		—		371,460		683,683		33,592		373,301		660,593		1,033,894		98,929
Colorado	10	654,252		—		11,812		46,755		4,386		11,787		45,056		56,843		13,740
Connecticut	22	1,200,002		—		22,023		82,375		20,316		23,568		86,984		110,552		34,873
Florida	90	6,796,098		—		104,987		531,360		91,455		112,652		548,011		660,663		174,952
Georgia	22	1,657,378		—		20,015		117,825		10,212		19,825		115,798		135,623		30,589
Illinois	43	2,760,969		—		54,493		221,022		30,106		54,358		226,591		280,949		71,326
Indiana	1	70,386		—		1,134		5,589		250		1,134		5,833		6,967		1,565
Maryland	20	1,683,821		4,906		40,467		214,985		13,729		41,324		216,272		257,596		50,456
Massachusetts	20	1,252,577		—		31,948		159,000		10,742		32,203		163,982		196,185		32,521
Minnesota	2	176,296		—		2,621		21,655		408		2,621		22,063		24,684		2,740
Nevada	22	1,702,416		—		69,956		394,023		6,198		71,703		398,249		469,952		22,383
New Jersey	28	1,983,356		—		45,864		188,139		37,639		49,372		206,349		255,721		65,269
New Mexico	3	182,261		—		2,866		9,367		1,826		2,867		7,977		10,844		3,433
New York	59	4,742,378		146,905		427,921		1,331,857		50,817		440,133		1,354,122		1,794,255		290,358
North Carolina	9	611,792		—		10,349		44,680		6,534		10,788		47,530		58,318		13,397
Ohio	20	1,294,303		—		13,529		51,265		18,083		14,938		54,639		69,577		21,590
Pennsylvania	12	890,385		—		18,769		99,199		10,731		18,723		104,496		123,219		21,935
Rhode Island	4	247,305		—		3,480		17,156		1,633		3,480		18,732		22,212		4,839
South Carolina	8	432,389		—		6,117		31,039		1,363		6,117		32,402		38,519		3,362
Tennessee	9	755,655		2,148		9,117		54,403		5,781		8,992		52,924		61,916		14,483
Texas	76	5,446,871		—		110,252		476,749		34,511		110,569		485,325		595,894		103,599
Utah	4	239,388		—		10,763		2,844		2,831		10,622		4,208		14,830		1,944
Virginia	11	1,060,480		—		37,282		138,668		4,355		37,283		135,792		173,075		29,041
Washington D.C.	5	410,676		—		28,759		80,996		2,369		28,803		78,847		107,650		18,078
Other Corporate Assets	—	—		—		1,480		9,654		1,367		1,480		10,978		12,458		2,847
	611	44,106,746	$	153,959	$	1,555,906	$	5,403,802	$	427,251	$	1,588,138	$	5,483,506	$	7,071,644	$	1,178,092

(A)	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~~F-43

Table of Contents

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2019








Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(A)

Developed

Bloomfield, CT

48,700

78

880

2,422

360

2,691

3,051

1,344

1997

Branford, CT

50,629

217

2,433

1,727

504

3,447

3,951

1,833

1995

Bristol, CT

50,925

1,819

3,161

431

1,819

3,127

4,946

1,421

2005

East Windsor, CT

45,816

744

1,294

568

744

1,591

2,335

811

2005

Enfield, CT

52,875

424

2,424

477

473

2,120

2,593

1,009

2001

Gales Ferry, CT

54,905

240

2,697

1,686

489

3,661

4,150

2,069

1995

Manchester I, CT

46,925

540

3,096

552

563

2,651

3,214

1,174

2002

Manchester II, CT

52,725

996

1,730

410

996

1,832

2,828

879

2005

Manchester III, CT

60,113

671

3,308

175

671

3,483

4,154

677

2014

Milford, CT

44,885

87

1,050

1,364

274

1,920

2,194

975

1996

Monroe, CT

63,700

2,004

3,483

942

2,004

3,741

5,745

1,833

2005

Mystic, CT

50,850

136

1,645

2,171

410

3,048

3,458

1,601

1996

Newington I, CT

42,270

1,059

1,840

294

1,059

1,838

2,897

902

2005

Newington II, CT

35,640

911

1,584

361

911

1,672

2,583

812

2005

Norwalk I, CT

30,181

646

3,187

66

646

3,253

3,899

782

2012

Norwalk II, CT

82,225

1,171

15,422

462

1,171

15,884

17,055

1,649

2016

Old Saybrook I, CT

87,000

3,092

5,374

713

3,092

5,233

8,325

2,642

2005

Old Saybrook II, CT

26,425

1,135

1,973

288

1,135

1,934

3,069

993

2005

Shelton, CT

78,405

1,613

9,032

546

1,613

8,494

10,107

2,173

2011

South Windsor, CT

72,075

90

1,127

1,555

272

2,284

2,556

1,183

1996

Stamford, CT

28,907

1,941

3,374

195

1,941

3,029

4,970

1,487

2005

Wilton, CT

84,515

2,409

12,261

798

2,421

13,121

15,542

3,219

2012

Washington I, DC

62,685

871

12,759

1,025

894

11,059

11,953

4,050

2008

Washington II, DC

82,452

3,152

13,612

463

3,154

12,299

15,453

3,094

2011

Washington III, DC

78,215

4,469

15,438

107

4,469

15,545

20,014

1,795

2016

Washington IV, DC

72,298

6,359

20,417

160

6,359

20,577

26,936

1,209

2017

Washington V, DC

114,200

13,908

18,770

170

13,917

18,931

32,848

843

2018

Boca Raton, FL

37,968

529

3,054

1,662

813

3,607

4,420

1,665

2001

Boynton Beach I, FL

61,725

667

3,796

1,957

958

4,420

5,378

2,058

2001

Boynton Beach II, FL

61,514

1,030

2,968

469

1,030

3,000

4,030

1,358

2005

Boynton Beach III, FL

67,368

1,225

6,037

266

1,225

6,304

7,529

1,141

2014

Boynton Beach IV, FL

76,514

1,455

7,171

162

1,455

7,333

8,788

1,047

2015

Bradenton I, FL

68,389

1,180

3,324

434

1,180

2,929

4,109

1,107

2004

Bradenton II, FL

88,063

1,931

5,561

1,191

1,931

5,125

7,056

2,077

2004

Cape Coral I, FL

76,857

472

2,769

2,595

830

4,031

4,861

2,236

2000

Cape Coral II, FL

67,955

1,093

5,387

108

1,093

5,494

6,587

905

2014

Coconut Creek I, FL

78,846

1,189

5,863

201

1,189

6,061

7,250

1,431

2012

Coconut Creek II, FL

90,147

1,937

9,549

210

1,937

9,760

11,697

1,856

2014

Dania Beach, FL

180,888

3,584

10,324

1,804

3,584

9,650

13,234

3,890

2004

Dania, FL

58,315

205

2,068

1,768

481

3,137

3,618

1,648

1996

Davie, FL

80,985

1,268

7,183

1,357

1,373

6,266

7,639

2,741

2001

Deerfield Beach, FL

57,280

946

2,999

2,041

1,311

4,528

5,839

2,317

1998

Delray Beach I, FL

67,563

798

4,539

847

883

4,098

4,981

1,941

2001

Delray Beach II, FL

75,770

957

4,718

278

957

4,996

5,953

1,076

2013

Delray Beach III, FL

94,257

2,086

10,286

182

2,086

10,469

12,555

1,856

2014

Delray Beach IV, FL

97,208

2,208

14,384

23

2,208

14,407

16,615

908

2017

Ft. Lauderdale I, FL

70,343

937

3,646

2,522

1,384

5,482

6,866

2,802

1999

Ft. Lauderdale II, FL

49,662

862

4,250

105

862

4,356

5,218

842

2013

Ft. Myers I, FL

67,504

303

3,329

993

328

3,318

3,646

1,726

1999

Ft. Myers II, FL

83,325

1,030

5,080

182

1,030

5,262

6,292

941

2014

Ft. Myers III, FL

81,554

1,148

5,658

181

1,148

5,839

6,987

1,041

2014

Ft. Myers IV, FL

69,682

992

8,287

164

992

8,451

9,443

155

2019

Ft. Myers V, FL

62,370

950

7,763

124

950

7,887

8,837

145

2019

Jacksonville I, FL

79,735

1,862

5,362

199

1,862

4,878

6,740

2,045

2005

Jacksonville II, FL

64,970

950

7,004

218

950

5,674

6,624

2,193

2007

Jacksonville III, FL

65,840

860

7,409

1,058

1,670

6,055

7,725

2,341

2007

Jacksonville IV, FL

95,525

870

8,049

1,218

1,651

7,184

8,835

2,758

2007

Jacksonville V, FL

82,573

1,220

8,210

450

1,220

6,916

8,136

2,673

2007

Jacksonville VI, FL

67,375

755

3,725

152

755

3,876

4,631

644

2014

Kendall, FL

75,495

2,350

8,106

493

2,350

6,826

9,176

2,619

2007

Lake Worth I, FL

158,778

183

6,597

7,795

354

11,148

11,502

5,618

1998

Lake Worth II, FL

86,920

1,552

7,654

203

1,552

7,857

9,409

1,435

2014

Lake Worth III, FL

92,510

957

4,716

243

957

4,959

5,916

759

2015

Lakeland, FL

49,079

81

896

1,300

256

1,604

1,860

854

1994

Leisure City, FL

56,185

409

2,018

198

409

2,213

2,622

537

2012

Lutz I, FL

71,595

901

2,478

438

901

2,299

3,200

862

2004

Lutz II, FL

69,232

992

2,868

416

992

2,524

3,516

995

2004

Margate I, FL

53,660

161

1,763

2,345

399

3,427

3,826

1,862

1996

Margate II, FL

65,380

132

1,473

2,188

383

3,031

3,414

1,466

1996

Merritt Island, FL

50,171

716

2,983

711

796

2,781

3,577

1,200

2002

Miami I, FL

46,500

179

1,999

1,889

484

2,889

3,373

1,554

1996

Miami II, FL

67,160

253

2,544

1,864

561

3,569

4,130

1,873

1996

Miami III, FL

151,620

4,577

13,185

898

4,577

12,257

16,834

5,324

2005

Miami IV, FL

76,695

1,852

10,494

1,047

1,963

9,980

11,943

2,773

2011

Miramar, FL

80,080

1,206

5,944

151

1,206

6,096

7,302

1,277

2013

Naples I, FL

48,100

90

1,010

2,759

270

3,225

3,495

1,673

1996

Naples II, FL

65,850

148

1,652

4,387

558

5,342

5,900

2,845

1997

Naples III, FL

80,205

139

1,561

4,302

598

4,224

4,822

2,255

1997

Naples IV, FL

40,625

262

2,980

693

407

3,076

3,483

1,655

1998

New Smyrna Beach, FL

81,454

1,261

6,215

203

1,261

6,417

7,678

1,073

2014

North Palm Beach, FL

45,825

1,374

7,649

57

1,374

7,706

9,080

751

2017

Oakland Park, FL

63,706

3,007

10,145

43

3,007

10,188

13,195

615

2017

Ocoee, FL

76,150

1,286

3,705

238

1,286

3,425

4,711

1,499

2005

Orange City, FL

59,580

1,191

3,209

362

1,191

2,788

3,979

1,086

2004

Orlando II, FL

63,184

1,589

4,576

259

1,589

4,195

5,784

1,830

2005

Orlando III, FL

101,190

1,209

7,768

811

1,209

7,191

8,400

2,882

2006

Orlando IV, FL

76,801

633

3,587

203

633

3,286

3,919

953

2010

Orlando V, FL

75,377

950

4,685

143

950

4,828

5,778

1,128

2012

Orlando VI, FL

67,275

640

3,154

158

640

3,312

3,952

560

2014

Orlando VII, FL

78,705

896

9,142

1

896

9,143

10,039

21

2019

Oviedo, FL

49,276

440

2,824

637

440

2,784

3,224

1,151

2006

Palm Coast I, FL

47,400

555

2,735

123

555

2,859

3,414

561

2014

Palm Coast II, FL

122,490

1,511

7,450

432

1,511

7,883

9,394

1,529

2014

~~F-47~~

~~Table of Contents~~

Gross Carrying��Amount at

Initial Cost

Costs

December 31, 2019








Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(A)

Developed

Palm Harbor, FL

82,685

2,457

16,178

71

2,387

16,319

18,706

1,686

2016

Pembroke Pines, FL

67,321

337

3,772

2,905

953

5,530

6,483

2,966

1997

Royal Palm Beach II, FL

81,178

1,640

8,607

340

1,640

7,284

8,924

2,834

2007

Sanford I, FL

61,810

453

2,911

241

453

2,584

3,037

1,010

2006

Sanford II, FL

69,875

1,003

4,944

251

1,003

5,194

6,197

877

2014

Sarasota, FL

71,142

333

3,656

1,516

529

3,955

4,484

1,979

1999

St. Augustine, FL

59,725

135

1,515

3,497

383

4,404

4,787

2,393

1996

St. Petersburg, FL

66,025

2,721

10,173

436

2,721

10,609

13,330

1,113

2016

Stuart, FL

87,486

324

3,625

3,272

685

5,904

6,589

3,169

1997

SW Ranches, FL

65,060

1,390

7,598

305

1,390

6,039

7,429

2,333

2007

Tampa I, FL

83,938

2,670

6,249

307

2,670

5,203

7,873

2,003

2007

Tampa II, FL

74,790

2,291

10,262

140

2,291

10,402

12,693

1,067

2016

West Palm Beach I, FL

66,831

719

3,420

1,864

835

4,034

4,869

1,835

2001

West Palm Beach II, FL

94,113

2,129

8,671

555

2,129

7,114

9,243

2,843

2004

West Palm Beach III, FL

77,410

804

3,962

138

804

4,100

4,904

921

2012

West Palm Beach IV, FL

102,722

1,499

7,392

333

1,499

7,724

9,223

1,402

2014

Winter Park I, FL

54,416

866

4,268

127

866

4,394

5,260

738

2014

Winter Park II, FL

71,363

1,897

9,286

1

1,897

9,287

11,184

22

2019

Winter Springs, FL

61,965

1,248

7,259

—

1,248

7,259

8,507

17

2019

Alpharetta, GA

90,501

806

4,720

1,032

917

4,045

4,962

1,843

2001

Atlanta I, GA

66,600

822

4,053

137

822

4,191

5,013

980

2012

Atlanta II, GA

81,665

1,890

11,579

4

1,890

11,583

13,473

145

2019

Austell, GA

83,655

1,635

4,711

447

1,643

4,502

6,145

1,788

2006

Decatur, GA

145,320

616

6,776

457

616

6,224

6,840

3,499

1998

Duluth, GA

70,885

373

2,044

258

373

1,976

2,349

533

2011

Lawrenceville, GA

73,890

546

2,903

472

546

2,945

3,491

807

2011

Lithia Springs, GA

73,200

748

5,552

425

719

6,006

6,725

759

2015

Norcross I, GA

85,320

514

2,930

1,082

632

3,087

3,719

1,355

2001

Norcross II, GA

52,595

366

2,025

241

366

1,979

2,345

552

2011

Norcross III, GA

46,955

938

4,625

94

938

4,719

5,657

1,181

2012

Norcross IV, GA

57,475

576

2,839

134

576

2,973

3,549

703

2012

Norcross V, GA

50,030

881

3,083

38

881

3,121

4,002

55

2019

Peachtree City I, GA

49,875

435

2,532

811

529

2,558

3,087

1,152

2001

Peachtree City II, GA

59,950

398

1,963

157

398

2,119

2,517

499

2012

Smyrna, GA

57,015

750

4,271

334

750

3,480

4,230

1,602

2001

Snellville, GA

80,000

1,660

4,781

392

1,660

4,510

6,170

1,773

2007

Suwanee I, GA

85,125

1,737

5,010

365

1,737

4,658

6,395

1,821

2007

Suwanee II, GA

79,590

800

6,942

152

622

5,877

6,499

2,267

2007

Villa Rica, GA

65,281

757

5,616

177

757

5,793

6,550

768

2015

Addison, IL

31,574

428

3,531

605

428

3,308

3,736

1,283

2004

Aurora, IL

73,985

644

3,652

264

644

3,058

3,702

1,189

2004

Bartlett, IL

51,395

931

2,493

356

931

2,215

3,146

874

2004

Bellwood, IL

86,500

1,012

5,768

1,186

1,012

5,216

6,228

2,315

2001

Blue Island, IL

55,125

633

3,120

92

633

3,212

3,845

493

2015

Bolingbrook, IL

82,575

1,675

8,254

209

1,675

8,463

10,138

1,415

2014

Chicago I, IL

95,792

2,667

13,118

1,044

2,667

14,161

16,828

2,430

2014

Chicago II, IL

78,835

833

4,035

98

833

4,134

4,967

685

2014

Chicago III, IL

84,890

2,427

11,962

834

2,427

12,796

15,223

2,206

2014

Chicago IV, IL

60,420

1,296

6,385

153

1,296

6,538

7,834

989

2015

Chicago V, IL

51,775

1,044

5,144

121

1,044

5,265

6,309

794

2015

Chicago VI, IL

71,748

1,596

9,535

76

1,596

9,611

11,207

1,067

2016

Chicago VII, IL

90,947

—

11,191

332

—

11,523

11,523

753

2017

Countryside, IL

97,658

2,607

12,684

265

2,607

12,951

15,558

2,147

2014

Des Plaines, IL

69,450

1,564

4,327

871

1,564

4,158

5,722

1,624

2004

Downers Grove, IL

71,625

1,498

13,153

60

1,498

13,213

14,711

1,497

2016

Elk Grove Village, IL

64,104

1,446

3,535

321

1,446

2,999

4,445

1,233

2004

Evanston, IL

57,715

1,103

5,440

290

1,103

5,729

6,832

1,234

2013

Glenview I, IL

100,085

3,740

10,367

599

3,740

8,539

12,279

3,349

2004

Glenview II, IL

30,844

725

3,144

73

725

3,217

3,942

113

2018

Gurnee, IL

80,300

1,521

5,440

440

1,521

4,606

6,127

1,818

2004

Hanover, IL

41,190

1,126

2,197

406

1,126

2,062

3,188

813

2004

Harvey, IL

60,090

869

3,635

502

869

3,255

4,124

1,229

2004

Joliet, IL

72,865

547

4,704

325

547

3,934

4,481

1,538

2004

Kildeer, IL

74,438

2,102

2,187

4,603

1,997

6,385

8,382

1,254

2004

Lombard, IL

58,728

1,305

3,938

1,055

1,305

4,021

5,326

1,622

2004

Maywood, IL

60,225

749

3,689

80

749

3,769

4,518

568

2015

Mount Prospect, IL

65,000

1,701

3,114

672

1,701

3,041

4,742

1,197

2004

Mundelein, IL

44,700

1,498

2,782

493

1,498

2,602

4,100

989

2004

North Chicago, IL

53,500

1,073

3,006

629

1,073

2,873

3,946

1,119

2004

Plainfield I, IL

53,900

1,770

1,715

373

1,740

1,636

3,376

630

2004

Plainfield II, IL

51,900

694

2,000

345

694

2,013

2,707

835

2005

Riverwoods, IL

73,883

1,585

7,826

93

1,585

7,919

9,504

747

2017

Schaumburg, IL

31,160

538

645

270

538

718

1,256

287

2004

Streamwood, IL

64,305

1,447

1,662

601

1,447

1,798

3,245

694

2004

Warrenville, IL

48,796

1,066

3,072

544

1,066

3,184

4,250

1,335

2005

Waukegan, IL

79,500

1,198

4,363

686

1,198

3,992

5,190

1,566

2004

West Chicago, IL

48,175

1,071

2,249

547

1,071

2,229

3,300

876

2004

Westmont, IL

53,400

1,155

3,873

341

1,155

3,315

4,470

1,287

2004

Wheeling I, IL

54,210

857

3,213

558

857

3,002

3,859

1,182

2004

Wheeling II, IL

67,825

793

3,816

626

793

3,537

4,330

1,418

2004

Woodridge, IL

50,257

943

3,397

373

943

2,980

3,923

1,146

2004

Schererville, IN

67,600

1,134

5,589

78

1,134

5,667

6,801

1,010

2014

Boston I, MA

33,286

538

3,048

291

538

2,908

3,446

846

2010

Boston II, MA

60,470

1,516

8,628

884

1,516

7,051

8,567

3,002

2002

Boston III, MA

108,205

3,211

15,829

765

3,211

16,594

19,805

2,788

2014

Brockton I, MA

59,993

577

4,394

1,225

577

5,619

6,196

718

2015

Brockton II, MA

69,375

1,900

3,520

3

1,900

3,523

5,423

65

2019

East Bridgewater, MA

35,905

1,039

4,748

2

1,039

4,750

5,789

76

2019

Fall River, MA

75,950

1,794

11,684

33

1,794

11,717

13,511

186

2019

Franklin, MA

63,405

2,034

5,704

3

2,034

5,707

7,741

100

2019

Haverhill, MA

60,589

669

6,610

227

669

6,837

7,506

887

2015

Holbrook, MA

56,100

1,688

8,033

2

1,688

8,035

9,723

137

2019

Lawrence, MA

34,672

585

4,737

275

585

5,012

5,597

672

2015

~~F-48~~

~~Table of Contents~~

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2019








Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(A)

Developed

Leominster, MA

54,048

90

1,519

2,669

338

3,546

3,884

1,787

1998

Medford, MA

58,675

1,330

7,165

344

1,330

6,016

7,346

2,183

2007

Milford, MA

44,950

1,222

6,638

3

1,222

6,641

7,863

109

2019

New Bedford, MA

69,775

1,653

9,950

2

1,653

9,952

11,605

156

2019

Stoneham, MA

62,200

1,558

7,679

308

1,558

7,987

9,545

1,684

2013

Tewksbury, MA

62,402

1,537

7,579

283

1,537

7,861

9,398

1,425

2014

Walpole, MA

74,980

634

13,069

569

634

13,638

14,272

1,365

2016

Waltham, MA

87,840

2,683

14,491

—

2,683

14,491

17,174

218

2019

Annapolis I, MD

92,302

5,459

2,643

13,938

84

2,643

14,022

16,665

1,091

2017

Annapolis II, MD

76,765

2,425

17,890

50

2,425

17,940

20,365

427

2019

Baltimore, MD

93,750

1,050

5,997

1,711

1,173

5,543

6,716

2,422

2001

Beltsville, MD

63,657

1,277

6,295

139

1,268

6,442

7,710

1,354

2013

California, MD

77,840

1,486

4,280

365

1,486

3,634

5,120

1,400

2004

Capitol Heights, MD

79,600

2,704

13,332

62

2,704

13,394

16,098

1,883

2015

Clinton, MD

84,225

2,182

10,757

156

2,182

10,913

13,095

2,122

2013

District Heights, MD

80,365

1,527

8,313

656

1,527

7,844

9,371

2,099

2011

Elkridge, MD

63,475

1,155

5,695

251

1,120

5,982

7,102

1,192

2013

Gaithersburg I, MD

87,045

3,124

9,000

598

3,124

7,503

10,627

2,909

2005

Gaithersburg II, MD

74,100

2,383

11,750

90

2,383

11,840

14,223

1,675

2015

Hyattsville, MD

52,830

1,113

5,485

115

1,113

5,600

6,713

1,186

2013

Laurel, MD

162,896

1,409

8,035

4,001

1,928

9,163

11,091

4,154

2001

Temple Hills I, MD

97,270

1,541

8,788

2,669

1,800

8,908

10,708

4,038

2001

Temple Hills II, MD

84,325

2,229

10,988

81

2,229

11,069

13,298

2,087

2014

Timonium, MD

66,717

2,269

11,184

247

2,269

11,430

13,699

2,168

2014

Upper Marlboro, MD

62,240

1,309

6,455

112

1,309

6,565

7,874

1,397

2013

Bloomington, MN

100,928

1,598

12,298

351

1,598

12,649

14,247

1,164

2016

Belmont, NC

81,850

385

2,196

986

451

2,364

2,815

1,095

2001

Burlington I, NC

109,300

498

2,837

911

498

2,930

3,428

1,433

2001

Burlington II, NC

42,165

320

1,829

542

340

1,829

2,169

825

2001

Cary, NC

111,750

543

3,097

982

543

3,378

3,921

1,581

2001

Charlotte I, NC

69,000

782

4,429

1,779

1,068

4,753

5,821

1,987

2002

Charlotte II, NC

53,683

821

8,764

67

821

8,831

9,652

772

2016

Charlotte III, NC

69,037

1,974

8,211

86

1,974

8,297

10,271

340

2018

Charlotte IV, NC

37,700

721

1,425

2

721

1,427

2,148

29

2019

Cornelius, NC

59,270

2,424

4,991

1,113

2,424

6,104

8,528

790

2015

Pineville, NC

77,747

2,490

9,169

160

2,490

9,329

11,819

1,231

2015

Raleigh, NC

48,675

209

2,398

477

296

2,399

2,695

1,256

1998

Bayonne, NJ

96,867

—

23,007

—

—

23,007

23,007

670

2019

Bordentown, NJ

50,550

457

2,255

177

457

2,431

2,888

567

2012

Brick, NJ

54,910

234

2,762

1,765

485

3,677

4,162

1,940

1996

Cherry Hill I, NJ

51,700

222

1,260

240

222

1,279

1,501

356

2010

Cherry Hill II, NJ

65,450

471

2,323

330

471

2,653

3,124

616

2012

Clifton, NJ

105,550

4,346

12,520

815

4,340

11,654

15,994

4,877

2005

Cranford, NJ

91,280

290

3,493

2,928

779

5,226

6,005

2,725

1996

East Hanover, NJ

105,704

504

5,763

4,650

1,315

8,431

9,746

4,471

1996

Egg Harbor I, NJ

36,025

104

510

196

104

696

800

170

2010

Egg Harbor II, NJ

70,400

284

1,608

430

284

1,817

2,101

529

2010

Elizabeth, NJ

38,684

751

2,164

742

751

2,583

3,334

1,120

2005

Fairview, NJ

27,896

246

2,759

799

246

2,948

3,194

1,512

1997

Freehold, NJ

84,070

1,086

5,355

361

1,086

5,711

6,797

1,319

2012

Hamilton, NJ

70,550

1,885

5,430

527

1,893

5,188

7,081

2,063

2006

Hoboken, NJ

38,484

1,370

3,947

995

1,370

4,309

5,679

1,936

2005

Linden, NJ

100,425

517

6,008

2,741

1,043

7,201

8,244

3,814

1996

Lumberton, NJ

96,025

987

4,864

327

987

5,191

6,178

1,231

2012

Morris Township, NJ

76,026

500

5,602

3,404

1,072

7,358

8,430

3,732

1997

Parsippany, NJ

84,705

475

5,322

6,242

844

10,219

11,063

3,760

1997

Rahway, NJ

83,121

1,486

7,326

710

1,486

8,036

9,522

1,683

2013

Randolph, NJ

52,565

855

4,872

1,602

1,108

4,784

5,892

2,077

2002

Ridgefield, NJ

67,803

1,810

8,925

480

1,810

9,405

11,215

1,321

2015

Roseland, NJ

53,569

1,844

9,759

449

1,844

10,208

12,052

1,324

2015

Sewell, NJ

57,826

484

2,766

1,460

706

3,148

3,854

1,459

2001

Somerset, NJ

57,485

1,243

6,129

608

1,243

6,737

7,980

1,521

2012

Whippany, NJ

92,070

2,153

10,615

661

2,153

11,276

13,429

2,330

2013

Albuquerque I, NM

65,927

1,039

3,395

392

1,039

3,203

4,242

1,518

2005

Albuquerque II, NM

58,798

1,163

3,801

437

1,163

3,614

4,777

1,680

2005

Albuquerque III, NM

57,536

664

2,171

406

664

2,187

2,851

1,049

2005

Henderson, NV

75,150

1,246

6,143

124

1,246

6,266

7,512

1,043

2014

Las Vegas I, NV

48,732

1,851

2,986

604

1,851

3,177

5,028

1,615

2006

Las Vegas II, NV

49,570

3,354

5,411

623

3,355

5,452

8,807

2,694

2006

Las Vegas III, NV

84,600

1,171

10,034

133

1,171

10,167

11,338

962

2016

Las Vegas IV, NV

90,527

1,116

8,575

384

1,116

8,959

10,075

903

2016

Las Vegas V, NV

107,226

1,460

9,560

190

1,460

9,750

11,210

888

2016

Las Vegas VI, NV

92,732

1,386

12,299

175

1,386

12,474

13,860

1,039

2016

Las Vegas VII, NV

94,525

1,575

11,483

194

1,575

11,677

13,252

431

2018

Baldwin, NY

61,380

1,559

7,685

672

1,559

8,357

9,916

1,206

2015

Bronx I, NY

67,864

2,014

11,411

1,259

2,014

11,076

13,090

3,301

2010

Bronx II, NY

99,028

—

28,289

1,773

—

29,527

29,527

7,651

2011

Bronx III, NY

105,850

6,459

36,180

278

6,460

32,111

38,571

8,312

2011

Bronx IV, NY

74,415

—

22,074

163

—

19,582

19,582

5,088

2011

Bronx V, NY

54,704

—

17,556

261

—

15,706

15,706

4,087

2011

Bronx VI, NY

45,970

—

16,803

381

—

15,152

15,152

3,946

2011

Bronx VII, NY

78,700

7,805

—

22,512

235

—

22,856

22,856

5,692

2012

Bronx VIII, NY

30,550

2,740

1,245

6,137

353

1,251

6,520

7,771

1,607

2012

Bronx IX, NY

147,800

21,547

7,967

39,279

1,555

7,967

40,829

48,796

10,059

2012

Bronx X, NY

159,805

24,042

9,090

44,816

621

9,090

45,419

54,509

10,744

2012

Bronx XI, NY

46,425

—

17,130

384

—

17,516

17,516

2,696

2014

Bronx XII, NY

100,983

—

31,603

105

—

31,708

31,708

3,664

2016

Bronx XIII, NY

201,195

19,622

68,378

305

19,684

68,621

88,305

3,327

2018

Brooklyn I, NY

64,656

1,795

10,172

458

1,795

9,212

11,007

2,700

2010

Brooklyn II, NY

60,845

1,601

9,073

533

1,601

8,286

9,887

2,472

2010

Brooklyn III, NY

41,610

2,772

13,570

190

2,772

13,842

16,614

3,598

2011

Brooklyn IV, NY

37,560

2,283

11,184

219

2,284

11,465

13,749

2,990

2011

Brooklyn V, NY

47,070

2,374

11,636

149

2,374

11,838

14,212

3,065

2011

~~F-49~~

~~Table of Contents~~

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2019








Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(A)

Developed

Brooklyn VI, NY

74,180

4,210

20,638

170

4,211

20,915

25,126

5,410

2011

Brooklyn VII, NY

72,725

5,604

27,452

460

5,604

28,077

33,681

7,242

2011

Brooklyn VIII, NY

61,525

4,982

24,561

147

4,982

24,708

29,690

4,462

2014

Brooklyn IX, NY

46,980

2,966

14,620

168

2,966

14,789

17,755

2,672

2014

Brooklyn X, NY

55,913

3,739

7,703

3,133

4,885

9,690

14,575

1,336

2015

Brooklyn XI, NY

110,050

10,093

35,385

250

10,093

35,635

45,728

4,163

2016

Brooklyn XII, NY

131,813

7,249

40,230

29

7,250

40,258

47,508

2,697

2017

Flushing, NY

64,995

17,177

17,356

85

17,177

17,441

34,618

527

2018

Holbrook, NY

60,372

2,029

10,737

81

2,029

10,818

12,847

1,414

2015

Jamaica I, NY

89,735

2,043

11,658

2,776

2,043

11,698

13,741

5,133

2001

Jamaica II, NY

92,780

5,391

26,413

445

5,391

27,001

32,392

7,007

2011

Long Island City, NY

88,800

5,700

28,101

284

5,700

28,385

34,085

4,554

2014

New Rochelle I, NY

44,076

1,673

4,827

1,227

1,673

5,394

7,067

2,288

2005

New Rochelle II, NY

63,385

3,167

2,713

470

3,762

18,944

22,706

4,696

2012

New York, NY

94,944

30,588

42,022

38,753

148

42,022

38,901

80,923

2,661

2017

North Babylon, NY

78,350

225

2,514

4,237

568

5,598

6,166

2,938

1998

Patchogue, NY

47,759

1,141

5,624

90

1,141

5,714

6,855

941

2014

Queens I, NY

82,875

5,158

12,339

1,203

5,160

13,540

18,700

1,916

2015

Queens II, NY

90,578

6,208

25,815

508

6,208

26,323

32,531

3,538

2016

Queens III, NY

80,566

13,663

32,025

—

13,663

32,025

45,688

1,002

2019

Riverhead, NY

38,490

1,068

1,149

234

1,068

1,104

2,172

569

2005

Southold, NY

59,945

2,079

2,238

355

2,079

2,189

4,268

1,120

2005

Staten Island, NY

96,573

1,919

9,463

938

1,919

10,401

12,320

2,153

2013

Tuckahoe, NY

51,358

2,363

17,411

349

2,363

11,989

14,352

3,103

2011

West Hempstead, NY

83,395

2,237

11,030

276

2,237

11,304

13,541

2,625

2012

White Plains, NY

85,924

3,295

18,049

1,043

3,295

16,595

19,890

4,594

2011

Woodhaven, NY

50,455

2,015

11,219

236

2,015

10,158

12,173

2,610

2011

Wyckoff, NY

60,440

1,961

11,113

408

1,961

10,036

11,997

2,875

2010

Yorktown, NY

78,879

2,382

11,720

230

2,382

11,963

14,345

3,115

2011

Cleveland I, OH

46,000

525

2,592

365

524

2,607

3,131

1,191

2005

Cleveland II, OH

58,325

290

1,427

263

289

1,437

1,726

672

2005

Columbus I, OH

71,905

1,234

3,151

165

1,239

2,841

4,080

1,291

2006

Columbus II, OH

36,659

769

3,788

387

769

4,175

4,944

693

2014

Columbus III, OH

51,200

326

1,607

138

326

1,746

2,072

301

2014

Columbus IV, OH

60,950

443

2,182

158

443

2,339

2,782

394

2014

Columbus V, OH

73,325

838

4,128

161

838

4,289

5,127

713

2014

Columbus VI, OH

63,525

701

3,454

155

701

3,609

4,310

601

2014

Grove City, OH

89,290

1,756

4,485

330

1,761

4,194

5,955

1,846

2006

Hilliard, OH

89,290

1,361

3,476

365

1,366

3,354

4,720

1,469

2006

Lakewood, OH

39,332

405

854

701

405

1,397

1,802

1,098

1989

Lewis Center, OH

76,224

1,056

5,206

159

1,056

5,364

6,420

898

2014

Middleburg Heights, OH

93,200

63

704

2,449

332

2,482

2,814

1,245

1980

North Olmsted I, OH

48,672

63

704

1,607

214

1,809

2,023

945

1979

North Olmsted II, OH

47,850

290

1,129

1,294

469

2,096

2,565

1,815

1988

North Randall, OH

80,297

515

2,323

3,282

898

3,994

4,892

1,933

1998

Reynoldsburg, OH

67,245

1,290

3,295

392

1,295

3,233

4,528

1,450

2006

Strongsville, OH

43,683

570

3,486

438

570

3,089

3,659

1,234

2007

Warrensville Heights, OH

90,281

525

766

3,312

935

3,463

4,398

1,732

1980

Westlake, OH

62,750

509

2,508

336

508

2,453

2,961

1,152

2005

Conshohocken, PA

81,285

1,726

8,508

350

1,726

8,851

10,577

2,054

2012

Exton, PA

57,750

541

2,668

259

519

2,949

3,468

676

2012

Langhorne, PA

64,838

1,019

5,023

615

1,019

5,638

6,657

1,276

2012

Levittown, PA

77,730

926

5,296

1,403

926

4,978

5,904

2,250

2001

Malvern, PA

18,820

2,959

18,198

1,753

2,959

19,949

22,908

3,289

2013

Montgomeryville, PA

84,145

975

4,809

469

975

5,272

6,247

1,223

2012

Norristown, PA

61,521

662

3,142

1,100

638

4,372

5,010

1,168

2011

Philadelphia I, PA

96,639

1,461

8,334

2,980

1,461

7,967

9,428

3,290

2001

Philadelphia II, PA

68,279

1,012

4,990

318

1,012

5,308

6,320

990

2014

Exeter, RI

41,275

547

2,697

167

547

2,864

3,411

486

2014

Johnston, RI

77,275

1,061

5,229

132

1,061

5,362

6,423

890

2014

Wakefield, RI

47,895

823

4,058

204

823

4,263

5,086

684

2014

Charleston I, SC

58,840

606

1,763

30

606

1,793

2,399

34

2019

Charleston II, SC

40,950

570

1,986

4

570

1,990

2,560

34

2019

Goose Creek I, SC

52,475

771

5,307

3

771

5,310

6,081

84

2019

Goose Creek II, SC

41,419

409

2,641

134

409

2,775

3,184

27

2019

Mount Pleasant, SC

72,671

1,434

9,826

46

1,434

9,872

11,306

159

2019

North Charleston I, SC

54,755

755

5,349

2

755

5,351

6,106

85

2019

North Charleston II, SC

56,885

809

2,129

9

809

2,138

2,947

39

2019

North Charleston III, SC

54,424

763

2,038

54

763

2,092

2,855

37

2019

Woonsocket, RI

79,100

1,049

5,172

517

1,049

5,688

6,737

900

2014

Antioch, TN

75,985

588

4,906

395

588

4,533

5,121

2,043

2005

Nashville I, TN

108,490

405

3,379

1,148

405

3,939

4,344

1,654

2005

Nashville II, TN

83,174

593

4,950

365

593

4,621

5,214

2,068

2005

Nashville III, TN

101,525

416

3,469

458

416

3,590

4,006

1,596

2006

Nashville IV, TN

102,450

992

8,274

545

992

7,574

8,566

3,357

2006

Nashville V, TN

74,560

2,313

895

4,311

892

895

5,203

6,098

901

2015

Nashville VI, TN

72,416

2,749

8,443

174

2,749

8,617

11,366

1,128

2015

Nashville VII, TN

65,681

1,116

8,592

3

1,116

8,595

9,711

139

2019

Nashville VIII, TN

71,234

1,363

8,820

5

1,363

8,825

10,188

144

2019

Allen, TX

62,170

714

3,519

140

714

3,660

4,374

877

2012

Austin I, TX

59,645

2,239

2,038

324

2,239

2,013

4,252

877

2005

Austin II, TX

64,310

734

3,894

489

738

3,819

4,557

1,570

2006

Austin III, TX

70,585

1,030

5,468

365

1,035

5,170

6,205

2,130

2006

Austin IV, TX

65,258

862

4,250

473

862

4,723

5,585

884

2014

Austin V, TX

67,850

1,050

5,175

332

1,050

5,507

6,557

946

2014

Austin VI, TX

63,150

1,150

5,669

337

1,150

6,007

7,157

1,014

2014

Austin VII, TX

71,023

1,429

6,263

363

1,429

6,626

8,055

857

2015

Austin VIII, TX

61,038

2,935

7,007

76

2,935

7,083

10,018

944

2016

Austin IX, TX

78,498

1,321

9,643

48

1,321

9,691

11,012

646

2018

Carrollton, TX

77,380

661

3,261

152

661

3,413

4,074

775

2012

Cedar Park, TX

86,725

3,350

7,950

439

3,350

8,389

11,739

1,068

2016

College Station, TX

26,550

812

740

224

813

777

1,590

332

2005

Cypress, TX

58,161

360

1,773

213

360

1,986

2,346

478

2012

~~F-50~~

~~Table of Contents~~

Gross Carrying Amount at

Initial Cost

Costs

December 31, 2019








Buildings

Subsequent



Buildings



Accumulated

Year

Square

&

to

&

Depreciation

Acquired/

Description

Footage

Encumbrances

Land

Improvements

Acquisition

Land

Improvements

Total

(A)

Developed

Dallas I, TX

58,582

2,475

2,253

510

2,475

2,284

4,759

1,006

2005

Dallas II, TX

76,673

940

4,635

258

940

4,894

5,834

980

2013

Dallas III, TX

83,020

2,608

12,857

341

2,608

13,198

15,806

2,148

2014

Dallas IV, TX

114,300

2,369

11,850

97

2,369

11,947

14,316

1,838

2015

Dallas V, TX

54,430

—

11,604

102

—

11,706

11,706

1,665

2015

Denton, TX

61,446

553

2,936

538

569

2,978

3,547

1,121

2006

Fort Worth I, TX

50,066

1,253

1,141

378

1,253

1,280

2,533

546

2005

Fort Worth II, TX

72,900

868

4,607

419

874

4,355

5,229

1,829

2006

Fort Worth III, TX

80,645

1,000

4,928

205

1,000

5,133

6,133

799

2015

Fort Worth IV, TX

77,329

1,274

7,693

39

1,274

7,732

9,006

934

2016

Fort Worth V, TX

79,322

1,271

5,485

73

1,271

5,558

6,829

27

2019

Frisco I, TX

52,594

1,093

3,148

221

1,093

2,911

4,004

1,269

2005

Frisco II, TX

71,039

1,564

4,507

277

1,564

4,168

5,732

1,799

2005

Frisco III, TX

74,265

1,147

6,088

690

1,154

5,967

7,121

2,453

2006

Frisco IV, TX

74,635

719

4,072

345

719

3,821

4,540

1,115

2010

Frisco V, TX

74,215

1,159

5,714

157

1,159

5,871

7,030

1,099

2014

Frisco VI, TX

69,176

1,064

5,247

178

1,064

5,425

6,489

920

2014

Garland I, TX

70,100

751

3,984

687

767

4,077

4,844

1,683

2006

Garland II, TX

68,425

862

4,578

328

862

4,309

5,171

1,727

2006

Grapevine, TX

77,019

1,211

8,559

134

1,211

8,693

9,904

1,042

2016

Houston III, TX

61,590

575

524

495

576

906

1,482

400

2005

Houston IV, TX

43,750

960

875

740

961

1,414

2,375

572

2005

Houston V, TX

121,189

1,153

6,122

1,825

991

7,197

8,188

2,707

2006

Houston VI, TX

54,690

575

524

5,863

983

5,064

6,047

1,380

2011

Houston VII, TX

46,991

681

3,355

194

681

3,548

4,229

905

2012

Houston VIII, TX

54,203

1,294

6,377

394

1,294

6,772

8,066

1,630

2012

Houston IX, TX

51,208

296

1,459

210

296

1,668

1,964

401

2012

Houston X, TX

95,789

5,267

12,667

14

5,267

12,681

17,948

605

2018

Houston XI, TX

80,930

5,616

15,330

105

5,616

15,435

21,051

528

2018

Humble, TX

70,700

706

5,727

134

706

5,861

6,567

772

2015

Katy, TX

71,118

1,329

6,552

94

1,329

6,648

7,977

1,290

2013

Keller, TX

88,685

1,330

7,960

351

1,331

7,696

9,027

2,079

2006/2017

Lewisville I, TX

67,340

476

2,525

543

492

2,630

3,122

1,052

2006

Lewisville II, TX

127,659

1,464

7,217

520

1,464

7,736

9,200

1,580

2013

Lewisville III, TX

93,855

1,307

15,025

245

1,307

15,270

16,577

1,662

2016

Little Elm I, TX

60,015

892

5,529

142

892

5,671

6,563

647

2016

Little Elm II, TX

95,096

1,219

9,864

147

1,219

10,011

11,230

1,120

2016

Mansfield I, TX

63,000

837

4,443

343

843

4,203

5,046

1,752

2006

Mansfield II, TX

57,375

662

3,261

169

662

3,430

4,092

841

2012

Mansfield III, TX

71,000

947

4,703

206

947

4,909

5,856

494

2016

McKinney I, TX

46,770

1,632

1,486

290

1,634

1,534

3,168

659

2005

McKinney II, TX

70,050

855

5,076

349

857

4,800

5,657

1,990

2006

McKinney III, TX

53,650

652

3,213

77

652

3,289

3,941

532

2014

North Richland Hills, TX

57,200

2,252

2,049

266

2,252

1,935

4,187

852

2005

Pearland, TX

72,050

450

2,216

621

450

2,838

3,288

630

2012

Richmond, TX

102,275

1,437

7,083

264

1,437

7,348

8,785

1,413

2013

Roanoke, TX

59,240

1,337

1,217

288

1,337

1,279

2,616

524

2005

San Antonio I, TX

73,325

2,895

2,635

396

2,895

2,499

5,394

1,095

2005

San Antonio II, TX

73,005

1,047

5,558

326

1,052

5,191

6,243

2,058

2006

San Antonio III, TX

71,555

996

5,286

345

996

4,908

5,904

1,935

2007

San Antonio IV, TX

61,500

829

3,891

178

829

4,069

4,898

392

2016

Spring, TX

72,745

580

3,081

330

580

2,919

3,499

1,223

2006

Murray I, UT

60,280

3,847

1,017

576

3,848

1,376

5,224

663

2005

Murray II, UT

70,796

2,147

567

712

2,147

1,106

3,253

469

2005

Salt Lake City I, UT

56,446

2,695

712

587

2,696

1,113

3,809

535

2005

Salt Lake City II, UT

51,676

2,074

548

440

1,937

822

2,759

408

2005

Alexandria, VA

114,100

2,812

13,865

276

2,812

14,138

16,950

3,397

2012

Arlington, VA

95,993

6,836

9,843

103

6,836

9,946

16,782

1,706

2015

Burke Lake, VA

91,237

2,093

10,940

1,230

2,093

10,570

12,663

2,995

2011

Fairfax, VA

73,265

2,276

11,220

322

2,276

11,544

13,820

2,707

2012

Fredericksburg I, VA

69,475

1,680

4,840

435

1,680

4,601

6,281

1,884

2005

Fredericksburg II, VA

61,057

1,757

5,062

448

1,757

4,819

6,576

2,012

2005

Leesburg, VA

85,503

1,746

9,894

208

1,746

8,813

10,559

2,274

2011

Manassas, VA

72,745

860

4,872

371

860

4,571

5,431

1,315

2010

McLearen, VA

68,960

1,482

8,400

267

1,482

7,511

8,993

2,149

2010

Vienna, VA

55,260

2,300

11,340

182

2,300

11,522

13,822

2,696

2012

Divisional Offices

956

956

956

182

36,603,609

837,399

3,530,854

336,395

858,541

3,619,594

4,478,135

853,935

~~(A)~~

~~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-51~~

~~Table of Contents~~

Activity in storage properties during the period from January 1, ~~2017~~2020 through December 31, ~~2019~~2022 was as follows (in thousands):


	2019			2018		2017		2022		2021		2020
Storage properties*
Balance at beginning of year	$	4,463,455		$	4,161,715	$	3,998,180	$	7,183,494	$	5,489,754	$	4,699,844
Acquisitions & improvements		364,324			381,182		247,546		191,495		1,795,965		825,247
Fully depreciated assets		(81,717)			(26,125)		(53,903)		(32,344)		(52,722)		(83,418)
Dispositions and other		(3,033)			(8,735)		(9,179)		(6,230)		(19,408)		(8,533)
Construction in progress, net		(43,185)			(44,582)		(20,929)		(40,637)		(30,095)		14,718
Right-of-use assets - finance leases									—		—		41,896
Balance at end of year	$	4,699,844		$	4,463,455	$	4,161,715	$	7,295,778	$	7,183,494	$	5,489,754
			��
Accumulated depreciation*
Balance at beginning of year	$	862,487		$	752,925	$	671,364	$	1,085,824	$	983,940	$	925,359
Depreciation expense		145,233			138,510		135,732		195,522		160,933		143,952
Fully depreciated assets		(81,717)			(26,125)		(53,903)		(32,344)		(52,722)		(83,418)
Dispositions and other		(644)			(2,823)		(268)		(1,227)		(6,327)		(1,953)
Balance at end of year	$	925,359		$	862,487	$	752,925	$	1,247,775	$	1,085,824	$	983,940
Storage properties, net	$	3,774,485		$	3,600,968	$	3,408,790	$	6,048,003	$	6,097,670	$	4,505,814

*These amounts include equipment that is housed at the Company’s stores which is excluded from Schedule III above.

As of December 31, ~~2019,~~2022, the aggregate cost of Storage properties for federal income tax purposes was approximately ~~$4,945.3~~$7,643.8 million.

~~F-52~~F-44


		Rentable	Average Occupancy
Year Acquired ⁽¹⁾	# of Stores	Square Feet	2019		2018		2017

2016 and earlier	472	32,856,176	92.1	%	92.0	%	91.7	%
2017	9	762,926	68.3	%	45.9	%	39.1	%
2018	11	994,243	66.1	%	56.7	%	—
2019	31	1,990,264	74.2	%	—		—
All stores owned as of December 31, 2019	523	36,603,609	90.4	%	90.6	%	91.3	%


		Rent per Square Foot
Year Acquired ⁽¹⁾	# of Stores	2019		2018		2017

2016 and earlier	472	$	17.76	$	17.44	$	16.83
2017	9		21.14		19.99		19.11
2018	11		22.69		24.76		—
2019	31		15.18		—		—
All stores owned as of December 31, 2019	523	$	17.80	$	17.59	$	16.85


	Carrying Value as of:				Effective Interest
	December 31,				Rate as of		Maturity
Unsecured Term Loans	2019		2018		December 31, 2019		Date
	(in thousands)
Credit Facility
Unsecured term loan ⁽¹⁾	$	—	$	200,000	—	%	Jan-19
Term Loan Facility
Unsecured term loan ⁽²⁾		—		100,000	—	%	Jan-20
Principal balance outstanding		—		300,000
Less: Loan procurement costs, net		—		(201)
Total unsecured term loans, net	$	—	$	299,799


	Payments Due by Period
													2025 and
	Total		2020		2021		2022		2023		2024		thereafter
Mortgage loans and notes payable ⁽¹⁾	$	94,494	$	12,791	$	45,057	$	923	$	31,019	$	4,704	$	—
Unsecured senior notes ⁽²⁾		1,850,000		—		—		250,000		300,000		—		1,300,000
Interest payments		472,242		77,071		75,250		68,532		60,829		47,280		143,280
Operating lease payments		103,171		2,273		2,302		2,459		2,523		2,373		91,241
Software and service contracts		1,873		1,735		138		—		—		—		—
Properties under contract to be acquired ⁽³⁾		54,853		54,853		—		—		—		—		—
Development commitments		56,654		46,603		10,051		—		—		—		—
	$	2,633,287	$	195,326	$	132,798	$	321,914	$	394,371	$	54,357	$	1,534,521


	For the year ended December 31, 2019
	(in thousands)
Total revenue	$	11,130
Net loss		(6,020)


	December 31,
	2019 ⁽¹⁾		2018
Assets	(in thousands)
Storage properties, net	$	552,791	$	741,209
Other assets		11,997		16,042
Total assets	$	564,788	$	757,251

Liabilities and equity
Other liabilities	$	10,064	$	7,911
Debt		280,392		413,848
Equity
CubeSmart		91,117		95,796
Joint venture partners		183,215		239,696
Total liabilities and equity	$	564,788	$	757,251


	Unrealized Gains (Losses)
	on Interest Rate Swaps
		(in thousands)
Other comprehensive gain before reclassifications	$	230
Amounts reclassified from accumulated other comprehensive loss		70	⁽¹⁾
Net current-period other comprehensive income		300
Balance at December 31, 2018		(1,029)
Balance at December 31, 2019	$	(729)


Hedge	Hedge	Notional Amount						Effective		Fair Value
Product	Type	December 31, 2019		December 31, 2018		Strike		Date	Maturity	December 31, 2019		December 31, 2018

Swap	Cash flow ⁽¹⁾	$	—	$	75,000	2.8015	%	6/28/2019	6/28/2029	$	—	$	(516)
Swap	Cash flow ⁽¹⁾		—		50,000	2.8030	%	6/28/2019	6/28/2029		—		(350)
Swap	Cash flow ⁽¹⁾		—		25,000	2.8020	%	6/28/2019	6/28/2029		—		(173)
		$	—	$	150,000					$	—	$	(1,039)


	Level 1		Level 2		Level 3
	(in thousands)
Interest rate swap derivative liabilities	$	—	$	1,039	$	—

Total liabilities at fair value	$	—	$	1,039	$	—


	For the year ended
	December 31, 2019
	(in thousands)
Operating lease cost	$	3,304
Short-term lease cost ⁽¹⁾		1,227
Total lease cost	$	4,531


				Weighted Average
	Number of Shares	Weighted Average		Remaining
	Under Option	Strike Price		Contractual Term
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
Options granted	305,805		27.85	9.08
Options canceled	(74,748)		26.95	—
Options exercised	(405,227)		9.47	1.98
Balance at December 31, 2018	1,659,003	$	19.89	5.52
Options granted	324,409		28.69	9.01
Options exercised	(381,059)		9.67	1.00
Balance at December 31, 2019	1,602,353	$	24.10	6.26

Vested or expected to vest at December 31, 2019	1,602,353	$	24.10	6.26
Exercisable at December 31, 2019	1,015,950	$	21.81	5.00


	Three months ended
	March 31,		June 30,		September 30,		December 31,
	2019		2019		2019		2019
	(in thousands, except per share amounts)
Total revenues	$	152,845	$	159,017	$	166,547	$	165,506
Total operating expenses		99,014		100,583		106,855		105,394
Net income		35,786		49,878		42,597		42,510
Net income attributable to the Company's common shareholders		35,498		49,420		42,154		42,045
Basic earnings per share attributable to common shareholders		0.19		0.26		0.22		0.22
Diluted earnings per share attributable to common shareholders		0.19		0.26		0.22		0.22


						Gross Carrying��Amount at
			Initial Cost		Costs	December 31, 2019
				Buildings	Subsequent		Buildings		Accumulated	Year
	Square			&	to		&		Depreciation	Acquired/
Description	Footage	Encumbrances	Land	Improvements	Acquisition	Land	Improvements	Total	(A)	Developed
Palm Harbor, FL	82,685		2,457	16,178	71	2,387	16,319	18,706	1,686	2016
Pembroke Pines, FL	67,321		337	3,772	2,905	953	5,530	6,483	2,966	1997
Royal Palm Beach II, FL	81,178		1,640	8,607	340	1,640	7,284	8,924	2,834	2007
Sanford I, FL	61,810		453	2,911	241	453	2,584	3,037	1,010	2006
Sanford II, FL	69,875		1,003	4,944	251	1,003	5,194	6,197	877	2014
Sarasota, FL	71,142		333	3,656	1,516	529	3,955	4,484	1,979	1999
St. Augustine, FL	59,725		135	1,515	3,497	383	4,404	4,787	2,393	1996
St. Petersburg, FL	66,025		2,721	10,173	436	2,721	10,609	13,330	1,113	2016
Stuart, FL	87,486		324	3,625	3,272	685	5,904	6,589	3,169	1997
SW Ranches, FL	65,060		1,390	7,598	305	1,390	6,039	7,429	2,333	2007
Tampa I, FL	83,938		2,670	6,249	307	2,670	5,203	7,873	2,003	2007
Tampa II, FL	74,790		2,291	10,262	140	2,291	10,402	12,693	1,067	2016
West Palm Beach I, FL	66,831		719	3,420	1,864	835	4,034	4,869	1,835	2001
West Palm Beach II, FL	94,113		2,129	8,671	555	2,129	7,114	9,243	2,843	2004
West Palm Beach III, FL	77,410		804	3,962	138	804	4,100	4,904	921	2012
West Palm Beach IV, FL	102,722		1,499	7,392	333	1,499	7,724	9,223	1,402	2014
Winter Park I, FL	54,416		866	4,268	127	866	4,394	5,260	738	2014
Winter Park II, FL	71,363		1,897	9,286	1	1,897	9,287	11,184	22	2019
Winter Springs, FL	61,965		1,248	7,259	—	1,248	7,259	8,507	17	2019
Alpharetta, GA	90,501		806	4,720	1,032	917	4,045	4,962	1,843	2001
Atlanta I, GA	66,600		822	4,053	137	822	4,191	5,013	980	2012
Atlanta II, GA	81,665		1,890	11,579	4	1,890	11,583	13,473	145	2019
Austell, GA	83,655		1,635	4,711	447	1,643	4,502	6,145	1,788	2006
Decatur, GA	145,320		616	6,776	457	616	6,224	6,840	3,499	1998
Duluth, GA	70,885		373	2,044	258	373	1,976	2,349	533	2011
Lawrenceville, GA	73,890		546	2,903	472	546	2,945	3,491	807	2011
Lithia Springs, GA	73,200		748	5,552	425	719	6,006	6,725	759	2015
Norcross I, GA	85,320		514	2,930	1,082	632	3,087	3,719	1,355	2001
Norcross II, GA	52,595		366	2,025	241	366	1,979	2,345	552	2011
Norcross III, GA	46,955		938	4,625	94	938	4,719	5,657	1,181	2012
Norcross IV, GA	57,475		576	2,839	134	576	2,973	3,549	703	2012
Norcross V, GA	50,030		881	3,083	38	881	3,121	4,002	55	2019
Peachtree City I, GA	49,875		435	2,532	811	529	2,558	3,087	1,152	2001
Peachtree City II, GA	59,950		398	1,963	157	398	2,119	2,517	499	2012
Smyrna, GA	57,015		750	4,271	334	750	3,480	4,230	1,602	2001
Snellville, GA	80,000		1,660	4,781	392	1,660	4,510	6,170	1,773	2007
Suwanee I, GA	85,125		1,737	5,010	365	1,737	4,658	6,395	1,821	2007
Suwanee II, GA	79,590		800	6,942	152	622	5,877	6,499	2,267	2007
Villa Rica, GA	65,281		757	5,616	177	757	5,793	6,550	768	2015
Addison, IL	31,574		428	3,531	605	428	3,308	3,736	1,283	2004
Aurora, IL	73,985		644	3,652	264	644	3,058	3,702	1,189	2004
Bartlett, IL	51,395		931	2,493	356	931	2,215	3,146	874	2004
Bellwood, IL	86,500		1,012	5,768	1,186	1,012	5,216	6,228	2,315	2001
Blue Island, IL	55,125		633	3,120	92	633	3,212	3,845	493	2015
Bolingbrook, IL	82,575		1,675	8,254	209	1,675	8,463	10,138	1,415	2014
Chicago I, IL	95,792		2,667	13,118	1,044	2,667	14,161	16,828	2,430	2014
Chicago II, IL	78,835		833	4,035	98	833	4,134	4,967	685	2014
Chicago III, IL	84,890		2,427	11,962	834	2,427	12,796	15,223	2,206	2014
Chicago IV, IL	60,420		1,296	6,385	153	1,296	6,538	7,834	989	2015
Chicago V, IL	51,775		1,044	5,144	121	1,044	5,265	6,309	794	2015
Chicago VI, IL	71,748		1,596	9,535	76	1,596	9,611	11,207	1,067	2016
Chicago VII, IL	90,947		—	11,191	332	—	11,523	11,523	753	2017
Countryside, IL	97,658		2,607	12,684	265	2,607	12,951	15,558	2,147	2014
Des Plaines, IL	69,450		1,564	4,327	871	1,564	4,158	5,722	1,624	2004
Downers Grove, IL	71,625		1,498	13,153	60	1,498	13,213	14,711	1,497	2016
Elk Grove Village, IL	64,104		1,446	3,535	321	1,446	2,999	4,445	1,233	2004
Evanston, IL	57,715		1,103	5,440	290	1,103	5,729	6,832	1,234	2013
Glenview I, IL	100,085		3,740	10,367	599	3,740	8,539	12,279	3,349	2004
Glenview II, IL	30,844		725	3,144	73	725	3,217	3,942	113	2018
Gurnee, IL	80,300		1,521	5,440	440	1,521	4,606	6,127	1,818	2004
Hanover, IL	41,190		1,126	2,197	406	1,126	2,062	3,188	813	2004
Harvey, IL	60,090		869	3,635	502	869	3,255	4,124	1,229	2004
Joliet, IL	72,865		547	4,704	325	547	3,934	4,481	1,538	2004
Kildeer, IL	74,438		2,102	2,187	4,603	1,997	6,385	8,382	1,254	2004
Lombard, IL	58,728		1,305	3,938	1,055	1,305	4,021	5,326	1,622	2004
Maywood, IL	60,225		749	3,689	80	749	3,769	4,518	568	2015
Mount Prospect, IL	65,000		1,701	3,114	672	1,701	3,041	4,742	1,197	2004
Mundelein, IL	44,700		1,498	2,782	493	1,498	2,602	4,100	989	2004
North Chicago, IL	53,500		1,073	3,006	629	1,073	2,873	3,946	1,119	2004
Plainfield I, IL	53,900		1,770	1,715	373	1,740	1,636	3,376	630	2004
Plainfield II, IL	51,900		694	2,000	345	694	2,013	2,707	835	2005
Riverwoods, IL	73,883		1,585	7,826	93	1,585	7,919	9,504	747	2017
Schaumburg, IL	31,160		538	645	270	538	718	1,256	287	2004
Streamwood, IL	64,305		1,447	1,662	601	1,447	1,798	3,245	694	2004
Warrenville, IL	48,796		1,066	3,072	544	1,066	3,184	4,250	1,335	2005
Waukegan, IL	79,500		1,198	4,363	686	1,198	3,992	5,190	1,566	2004
West Chicago, IL	48,175		1,071	2,249	547	1,071	2,229	3,300	876	2004
Westmont, IL	53,400		1,155	3,873	341	1,155	3,315	4,470	1,287	2004
Wheeling I, IL	54,210		857	3,213	558	857	3,002	3,859	1,182	2004
Wheeling II, IL	67,825		793	3,816	626	793	3,537	4,330	1,418	2004
Woodridge, IL	50,257		943	3,397	373	943	2,980	3,923	1,146	2004
Schererville, IN	67,600		1,134	5,589	78	1,134	5,667	6,801	1,010	2014
Boston I, MA	33,286		538	3,048	291	538	2,908	3,446	846	2010
Boston II, MA	60,470		1,516	8,628	884	1,516	7,051	8,567	3,002	2002
Boston III, MA	108,205		3,211	15,829	765	3,211	16,594	19,805	2,788	2014
Brockton I, MA	59,993		577	4,394	1,225	577	5,619	6,196	718	2015
Brockton II, MA	69,375		1,900	3,520	3	1,900	3,523	5,423	65	2019
East Bridgewater, MA	35,905		1,039	4,748	2	1,039	4,750	5,789	76	2019
Fall River, MA	75,950		1,794	11,684	33	1,794	11,717	13,511	186	2019
Franklin, MA	63,405		2,034	5,704	3	2,034	5,707	7,741	100	2019
Haverhill, MA	60,589		669	6,610	227	669	6,837	7,506	887	2015
Holbrook, MA	56,100		1,688	8,033	2	1,688	8,035	9,723	137	2019
Lawrence, MA	34,672		585	4,737	275	585	5,012	5,597	672	2015